Although some RV manufacturers have struggled, smaller dealers are enjoying sharply higher net profits in 2001, according to data gathered by the Spader Companies consultant firm.
The average smaller dealership saw its net earnings increase 65.5% during the first 10 months of this year, to $149,175, the Spader firm reports.
The Spader firm defines smaller dealerships as having less than $5 million in annual sales revenue.
Profits increased despite slightly lower new-unit sales revenue and slightly smaller new-unit inventories.
The average smaller dealer’s new-unit sales revenue was down 1.8% after the first 10 months of this year to $1,953,020, the Spader firm reports.
However, total dealership sales revenue increased 1% during the first 10 months of this year to $3,330,002.
Meanwhile, the value of the new-unit inventory at the average smaller dealership was down 2.1% as of Oct. 31 to $934,568, the Spader firm reports. The combined new and used RV unit inventory at the average smaller dealership was down 3.5% as of Oct. 31 to $1,137,867.
Two reasons for the bigger profits were lower interest and advertising expenses. Interest expenses at the average smaller dealer declined 5% during the first 10 months of this year to $68,476, and advertising costs were lowered 7% to $44,481.