My dealer is closing and I'm really bummed!

Drew · Post by **Drew** » Sun Jul 22, 2012 10:50 pm

This was posted on MPG Motors Facebook page. Pat is a great guy and I wish him the best.

Breaking News

Folks, we've decided to close MPG Motors after seven years. Until we close sometime in August, we will be offering the best deals on our remaining inventory.

Going forward, we are looking for a buyer, or we plan to work with other local dealerships to take on our brands if a buyer doesn't emerge. For both scenarios, we are working with our bike brands to facilitate the transition. Please remember that existing Hyosung, Genuine and SYM dealers are already available. As you all know, I am very proud of our brands and recommend them to dealers just as I did to you.

As this is "real-time," if you have, or know someone that has, a burning desire to be a scooter/motorcycle/used-car dealer - give us a call. Nothing has been set in stone just yet. This would be a fine time to let me know.

We thank you for your support and most of all your friendship since we have opened. Please stop by or drop us a note if you get a chance. For the next few weeks until we firm up a closing date, we will be open from 2-6 T-F and 10-5 on Saturday.

Pat Yearick, MPG Motors

chub1965 · Post by **chub1965** » Sun Jul 22, 2012 11:16 pm

so sad to hear

. please scooterist support your local shops. you may get cheaper gloves,helmets etc online but you will kick yourself if the local guy closes.

MGM · Post by **MGM** » Mon Jul 23, 2012 1:18 am

Pat was a great guy. Unfortunately, he was located in a suburb of philadelphia where there is a SRONG Genuine, Sym Kymco, Royal Enfield dealer. That meant he had to depend on his local area for his market. I bought a total of three scooters from him and tried to get any needed parts from him as well. He's tried many creatve things to stay afloat in a still difficult s.cooter market. He was truly one of the good guys and will be missed.

We still have Philly Scooter for support. Sean and the guys there are also top shelf.

kmrcstintn · Post by **kmrcstintn** » Mon Jul 23, 2012 2:43 am

that sucks!!! it's hard for smaller mom-n-pop shops to compete with larger dealers and I do my best to throw as much practical business at my Genuine dealer...they do alot of maintenance, repairs, and inspections of scooters, motorcycles, atv's, etc and the senior owner dabbles in classic British vehicle restoration...well rounded shop

agrogod · Post by **agrogod** » Mon Jul 23, 2012 9:14 am

I think part of his trouble came from not doing state required inspection like alot of the other dealer's in the area. I finally got my RH50 down to Montgomeryville Cycle for its inspect., and ended up buying some Motul 2T oil while I was there. Having customer's come in for required state service is one potential way to make sales.

That being said, Pat was always good natured and friendly, seemed to love what he was doing, and yes he and MPG will be sorely missed.

So is their any one in the Sellersville area that want's to go into the scooter business with me? (PM me if interested)

hardd1 · Post by **hardd1** » Mon Jul 23, 2012 11:54 am

MPG is just another victim of the dismal state of the economy.....

mqracing · Post by **mqracing** » Mon Jul 23, 2012 2:13 pm

My post probably isn't going to go over too well...

I live in Philly and have an interest especially in the Stellas. I've seen MPG advertise on craigslist quite a bit and I'm also aware of Philly Scooters.

The problem for me is that many of the local dealers go for full markup sales and then tag on freight, prep, and "doc" fees. These "extras" add hundreds of dollars to the MSRP of the product.

I know a lot of people will say about low margins and the need for the dealer to make more on each sale to stay in business. But, I would argue the the practices of charging above and beyond might well scare more business away than the extra charges actually put into the business's cash register.

Just the other day I saw on Philly Scooters splash page that the had a "sale on 2009 Stella's" .... so I was pshched and called the shop and spoke to the owner. His sale price on the 09 stella's was $3900.

That's more than what the MSRP was in 2009. It was NOT sale priced at all. I told Sean that there was a business in a neighboring state who had leftover 09's for like $2800 and $2900. From there he just got defensive and started talking about "supporting a local dealer" to which my reply is that we should "support local buyers" --- it's my dollars and other consumers purchases that will keep you in business.

I don't need to buy a brand new scooter--- if I wait it out I'll be able to find a used Stella with very low miles for at least a grand or two less. And I have muiltiple motorcycles and a scooter already--- so this is a "luxury" purchase not a necessity.

I don't mind paying up to list on a current model year if I really want the bike. But I am not going to pay over list for any bike. And I'm not going to pay documentatin fees, shipping fees, setup fees and all the add ons.

Every time I would look at MPG's website I would see prices above the MSRP and that was enough to keep me from making a purchase.

How many other consumers like myself see these inflated prices and just say NO?

Then later you read about so many of these dealers going out of business. If you don't sell enough products you won't survive. If you mark up your product too high your going to decrease your sales.

I'd rather sell more bikes---at a fair price (say MSRP) and then try to build up the service and parts departments on ater the intial sale business with my new customers.

Service and parts have greater markups (as I understand it) than sales of new bikes--- so that should be even more incentive to sell the bikes and many of them at a fair price---- so that you have a larger customer base to tap for the service and parts segments of the business. IF you don't sell me a Stella then I'm not going to be buying spare parts or have my scooter serviced at your shop will I?

MSL

hardd1 · Post by **hardd1** » Mon Jul 23, 2012 2:43 pm

in order to stabilize the msrp prices, the powersport industry would have to adopt the method used in the new automobile msrp's.....same destination charges would be included within the distibutors msrp whether you purchase in Bangor, Maine or Tucson, Arizona.....just my 2 cents

pinthea · Post by **pinthea** » Mon Jul 23, 2012 2:52 pm

The dealer here in Portland, OR does the same thing, full MSRP plus freight.

Really, who goes into a car dealership and pays full retail for a car?

It is the fact they are the only game in town that allows them to get away with this.

Competition is healthy for the consumer...

MGM · Post by **MGM** » Mon Jul 23, 2012 5:04 pm

I never saw any ad or blog for MPG with inflated prices. Here's a history of my experience. Buddy 50 for my son. List with no additional delivery, freight or setup charge. Scoot was derestricted at no charge. Buddy 50 for me-$150 off list no extras. Black jack-$200 off list, no extras and $100 less than I paid as trade in allowance on my 50. I know what the margin is on scooters and he probably bought lunch with what he made on me.

Alexbv200 · Post by **Alexbv200** » Mon Jul 23, 2012 5:55 pm

Some people still pay over M.S.R.P for a car.... true, for a hard car to get.

We ALL pay destination charge when we buy a new car.
Yup...
When you see the price advertised whether on TV or in print, it always says in very small print at the bottom, destination charge excluded.
Dealers are invoiced that charge; it's flat. Dealers don't mark it up, at least we don't.
Sure a dealer can eat it, but, when the cost of the freight is equal to the total margin of a bike, how do you expect him to stay open.

Pre-Delivery Inspection. Ok.....
How about we give you the bike in the crate and let you deal with it.
I am sure you would prefer having a bike that is ready to go; the Stella is a "bitch" to get ready properly. You even have to put the front wheel on the bike when you open the crate.
That's the difference between the dealers that sell the chinese bike for $1,000 and a dealer that sells reputable brands.
I don't know how many times we have people coming to our store looking, then buy a chinese bike, to see them come a week later wanting us to fix it for them.

You need quite a bit of time for a Stella to be ready, between the front wheel, the mirrors, clean the white wall tires (remove the blue), check every cable, fluids, test drive and more it's at least an hour and a half!
Yes, it is an internal cost, but some one has to get paid to do it; service does not work for free.
I have been on both sides of the story, and I understand now why these charges. I don't mean you have to gauge clients, of course not, that is just bad business, but I always make a point for my clients to understand why there are these charges. We must be doing something right as we will be in business for 10 years!!!
And our clients keep coming back to us.

BuddyLicious · Post by **BuddyLicious** » Mon Jul 23, 2012 10:26 pm

Correct me if I'm wrong on this but isnt location and the job market very important too? I mean I have heard from several people as of late Texas is one of the leading States for jobs and I would think if a Dealer just so happens to be located in a prime job location,they will do well.

A place such as Detroit as big as it is,I would think would be a Dealer killer right off the bat.

Everything above said is assuming the Dealer is doing everything fair and honest.

agrogod · Post by **agrogod** » Mon Jul 23, 2012 11:02 pm

As a direct comment to ^ mqracing above, I bought my 2009 RH50 in 2010, its listed floor price was $1,999.00 plus sales tax. That's what I paid, no over inflated prep charges, no dealer fee's, no hidden charges. MPG wasn't like that, Pat really loved what he did and he showed that by keeping cost's down for the customer. Unfortunately with the sagging economy and his refusal to offer state mandated services are IMO the culprits in this scenario.

mqracing · Post by **mqracing** » Tue Jul 24, 2012 12:22 am

Alexbv200 wrote:
Yes, it is an internal cost, but some one has to get paid to do it; service does not work for free.

I ordered a Big Mac today. The sign said the sandwhich cost $4.25. The girl at the register told me I owed her $5.10. I asked her how. Told her the price was listed at $4.25.

She told me that the price on the sign did not include pre-delivery inspection and transportation costs to get the raw materials to the McDonalds store, nor the labor to cook, assemble and package the sandwhich. She did offer to throw the raw patties, buns, and condiments in a bag for me at the original listed price. Said they could not do all that work for free. I said no thanks.

Then I shook my head, turned around and walked out the door.

MSL

mqracing · Post by **mqracing** » Tue Jul 24, 2012 12:32 am

To all the posters who have had good experiences with Pat at MPG. I was relying a bit on memory from looking at some of his craigslist posts and going to his website--- I thought that the prices I was seeing were in excess of MSRP.

But my memory could bee (or is) shot. And Pat sure has seemed to have treated people well enough that they speak well of him. I'll try to give him a call and see if he has any scoots that I might have an interest in and see what kind of pricing hes's willing to sell at.

But overall I think the industry needs to do better in how prices are established and what they really mean or are.

MSL

pdxrita · Post by **pdxrita** » Tue Jul 24, 2012 2:33 am

mqracing wrote:
Alexbv200 wrote:
Yes, it is an internal cost, but some one has to get paid to do it; service does not work for free.

I ordered a Big Mac today. The sign said the sandwhich cost $4.25. The girl at the register told me I owed her $5.10. I asked her how. Told her the price was listed at $4.25.

She told me that the price on the sign did not include pre-delivery inspection and transportation costs to get the raw materials to the McDonalds store, nor the labor to cook, assemble and package the sandwhich. She did offer to throw the raw patties, buns, and condiments in a bag for me at the original listed price. Said they could not do all that work for free. I said no thanks.

Then I shook my head, turned around and walked out the door.

MSL

That's a really ridiculous analogy. It would be more correct if McDonald's corp posted $4.25 as the MSRP and then charged the stores $4.20 for the makings of each burger. The stores would then need to recoup the cost of labor, the building, etc and they would mark the burgers up beyond the corporate stated MSRP. Really, this is more a fault with the system than a fault with the dealers. If the manufacturers would include the realistic extra costs in that price, then you would have a leg to stand on. As it is, you don't and that's why a good dealer, who apparently tried to adhere to your unrealistic standards, is going out of business.

pdxrita · Post by **pdxrita** » Tue Jul 24, 2012 2:42 am

pinthea wrote:The dealer here in Portland, OR does the same thing, full MSRP plus freight.

Really, who goes into a car dealership and pays full retail for a car?

It is the fact they are the only game in town that allows them to get away with this.

Competition is healthy for the consumer...

This is really a systemic issue caused at the manufacturer's, or in the case of Genuine, distributor's level. Of the two brands I'm most familiar with, Kymco and Genuine, I know that they award dealerships exclusively for a certain amount of area. For instance, Beaverton Honda was selling Kymco scooters for a brief period of time, but apparently, they were told by Kymco that Columbia has exclusive rights to the area, so they had to clear them out. They do still sell other Kymcos, like 4 wheelers, because Columbia doesn't have them. Same, I believe, with Genuine. Classic Scooters (or whatever they're calling themselves this week) has exclusive rights for the area. Personally, I'm not a fan of Classic/Vespa/ScooterKing<insertnewnamehere> and I take mine to Columbia when I need dealer support. I'm pretty sure that Genuine would be scooped up, hopefully by Columbia, if the current dealer went under. So the two issues I see here are both at the manufacturer/distributer level. One is that the stated MSRP's leave the dealers looking greedy when they mark up to recoup cost and make a profit and the other is that exclusive territories inhibit competition.

mqracing · Post by **mqracing** » Tue Jul 24, 2012 3:28 am

[/quote]

That's a really ridiculous analogy. It would be more correct if McDonald's corp posted $4.25 as the MSRP and then charged the stores $4.20 [/quote]

Are you trying to say that Genuine dealers have only an approx 1 percent markup from their distributor? Now, who's being ridiculous?

And for the reported one to one and a half hour "assembly" time to get the scooter on the showroom floor --- is that worth $200 to $300 and in some cases even higher upcharge on top of MSRP?

The analogy stands--- or consider as another example a bicycle shop and a consumer purchasing a bicycle. Bicycles actually probably require even more set up time--- checking and truing wheels, adjuisting front and rear derailleurs, installing handle bars and cables (in many cases) as well as seat posts and perhaps saddles? And often when the consumer does make a purchase the dealer will make adjustments to "fit" the bike to the customer before actually delivering the bike. How many bicycle shops charge above the listed MSRP and then also add on freight charges and\or setup\delivery charges?

MSL

hardd1 · Post by **hardd1** » Tue Jul 24, 2012 12:02 pm

consumers would benefit if all dealers were working from the same invoice(shipping included)...shops in prosperous economy areas could still extract additional benefits with an addendum to the msrp

Alexbv200 · Post by **Alexbv200** » Tue Jul 24, 2012 7:32 pm

You want a Big Mac for $4.25 than go to Europe.. shown prices over there already include taxes.

The M.S.R.P is the Manufacturer Suggested Retail Price.. Suggested....
Dealers don't mark up that price.. they have an addendum that shows Freight and Pre-delivery inspection.
A mark up is when a dealer shows like $3,000 and says Market Adjustment Value.. THAT's a markup and just to make additional profit.
Freight is invoiced by the Manufacturer to the dealer; yup... we pay it. It's not something that dealer pull out of their hat.
When your total profit on a bike is about 9%, if you eat freight, that can be 7% of your profit gone. Then, your service technicians have to get paid to put the bike together, and get it ready for DELIVERY because the manufacturer will not do that. That means assemble the bike, check everything per the check list provided by the manufacturer, put 5 miles on the bike to make sure everything is like it is supposed to be (per the manufacturer), full tank of gas, clean the bike and so on.
That's 3% of your profit.

Oh and if a client pays by credit card, that's another 3% that we get charged.

What is left of your profit margin?
And then there is the over head.......

redhandmoto · Post by **redhandmoto** » Tue Jul 24, 2012 8:19 pm

Alexbv200 wrote:You want a Big Mac for $4.25 than go to Europe.. shown prices over there already include taxes.

The M.S.R.P is the Manufacturer Suggested Retail Price.. Suggested....
Dealers don't mark up that price.. they have an addendum that shows Freight and Pre-delivery inspection.
A mark up is when a dealer shows like $3,000 and says Market Adjustment Value.. THAT's a markup and just to make additional profit.
Freight is invoiced by the Manufacturer to the dealer; yup... we pay it. It's not something that dealer pull out of their hat.
When your total profit on a bike is about 9%, if you eat freight, that can be 7% of your profit gone. Then, your service technicians have to get paid to put the bike together, and get it ready for DELIVERY because the manufacturer will not do that. That means assemble the bike, check everything per the check list provided by the manufacturer, put 5 miles on the bike to make sure everything is like it is supposed to be (per the manufacturer), full tank of gas, clean the bike and so on.
That's 3% of your profit.

Oh and if a client pays by credit card, that's another 3% that we get charged.

What is left of your profit margin?
And then there is the over head.......

absolutely, positively spot-on. Overhead: keep the lights turned on and the water running, pay the business and liability insurance, pay the bookkeeper, accountant, and DMV clerk; get the place cleaned and the windows washed; make quarterly payments on your business taxes, pony-up for your share of co-op advertising, pay the website maintenance guy, pay the phone bill, pay the rent (which is horrendous), pay the ...

Mousenut · Post by **Mousenut** » Tue Jul 24, 2012 8:19 pm

Alexbv200 wrote:Oh and if a client pays by credit card, that's another 3% that we get charged.

Mine charges me the CC cost on top of the transaction up front. We wrote a check

strambley · Post by **strambley** » Tue Jul 24, 2012 9:33 pm

Mousenut wrote:
Alexbv200 wrote:Oh and if a client pays by credit card, that's another 3% that we get charged.
Mine charges me the CC cost on top of the transaction up front.

I'm pretty sure that violates the terms of the contract with the credit card companies. technically, a vendor can't even put a minimum transaction cost for purchases with a card, but I understand why they do that. The terms are ridiculous and kill small businesses.

Charging the CC cost up front is great way to get Visa/MC to revoke privileges fast though. They do not like that.

jprestonian · Post by **jprestonian** » Wed Jul 25, 2012 12:16 am

strambley wrote:
Mousenut wrote:
Alexbv200 wrote:Oh and if a client pays by credit card, that's another 3% that we get charged.
Mine charges me the CC cost on top of the transaction up front.

I'm pretty sure that violates the terms of the contract with the credit card companies. technically, a vendor can't even put a minimum transaction cost for purchases with a card, but I understand why they do that. The terms are ridiculous and kill small businesses.

Charging the CC cost up front is great way to get Visa/MC to revoke privileges fast though. They do not like that.

That does look to be changing very soon, though, in the U.S. I think there's a recent or upcoming SCOTUS case about this, and the court seems predisposed to favor the pass-along to consumers.
.

strambley · Post by **strambley** » Wed Jul 25, 2012 12:48 am

jprestonian wrote:
strambley wrote:
Mousenut wrote: Mine charges me the CC cost on top of the transaction up front.

I'm pretty sure that violates the terms of the contract with the credit card companies. technically, a vendor can't even put a minimum transaction cost for purchases with a card, but I understand why they do that. The terms are ridiculous and kill small businesses.

Charging the CC cost up front is great way to get Visa/MC to revoke privileges fast though. They do not like that.
That does look to be changing very soon, though, in the U.S. I think there's a recent or upcoming SCOTUS case about this, and the court seems predisposed to favor the pass-along to consumers.
.

No way they would let that go to court. They settled instead for much more favorable terms.

http://www.litle.com/blog/headlines/the ... whats-next

hardd1 · Post by **hardd1** » Wed Jul 25, 2012 11:44 am

Alexbv200 wrote:You want a Big Mac for $4.25 than go to Europe.. shown prices over there already include taxes.

The M.S.R.P is the Manufacturer Suggested Retail Price.. Suggested....

Freight is invoiced by the Manufacturer to the dealer; yup... we pay it. It's not something that dealer pull out of their hat........

oh well, maybe one day freight will be included in the M.S.R.P.......theoretically the manufacturer would be essentially invoicing the buyers at a consistent price. Customer suspicion of extorsion charges would be eliminated. ....no more pulling inconsistent charges out of the hat added to the salesorder. ...sure the MSRP is going to go up. Let the manufacturer analyze the additionalcost to msrp ..It could be a win-win proposal. Dealers are happy knowing true cost of scooter(s) shipped from the manufacturer to them....customers are happy knowing they won't be getting any "suprise" charges added to their scooter purchase

Alexbv200 · Post by **Alexbv200** » Wed Jul 25, 2012 3:33 pm

hardd1 wrote:
Alexbv200 wrote:You want a Big Mac for $4.25 than go to Europe.. shown prices over there already include taxes.

The M.S.R.P is the Manufacturer Suggested Retail Price.. Suggested....

Freight is invoiced by the Manufacturer to the dealer; yup... we pay it. It's not something that dealer pull out of their hat........
yes, freight should be included in the M.S.R.P.......therefore the manufacturer is essentially invoicing the buyers at a consistent price. Customer suspicion of extorsion charges would be eliminated. ....no more pulling inconsistent charges out of the hat to add to sale. ...sure the MSRP is going to go up. Let the manufacturer analyze the additional cost to suggest to the USA consumers. It is a win-win proposal. Dealer is happy knowing true cost of scooter(s) shipped from the manufacturer....customer is happy knowing they won't be getting any "suprise" charges added to their scooter purchase

I agree this is the way it should be done, however.. it's all about perception..
Adding freight to the M.S.R.P would drstically increase the price of a bike and might turn some people away. It's all about first impressions. It's the same for cars.
When they advertise a car starting at $19,999... it NEVER includes the destination of $600+. Yup $19,999 sounds more attractive than $20,599.
I hate it, but we are all guilty of that, and marketing knows it!!

hardd1 · Post by **hardd1** » Wed Jul 25, 2012 3:41 pm

I agree....just a pleasant thought

Alexbv200 · Post by **Alexbv200** » Wed Jul 25, 2012 3:41 pm

hardd1 wrote:I agree....just a pleasant thought

Oh absolutely!!!

Edwub · Post by **Edwub** » Wed Jul 25, 2012 4:03 pm

Alexbv200 wrote:
hardd1 wrote:
Alexbv200 wrote:You want a Big Mac for $4.25 than go to Europe.. shown prices over there already include taxes.

The M.S.R.P is the Manufacturer Suggested Retail Price.. Suggested....

Freight is invoiced by the Manufacturer to the dealer; yup... we pay it. It's not something that dealer pull out of their hat........
yes, freight should be included in the M.S.R.P.......therefore the manufacturer is essentially invoicing the buyers at a consistent price. Customer suspicion of extorsion charges would be eliminated. ....no more pulling inconsistent charges out of the hat to add to sale. ...sure the MSRP is going to go up. Let the manufacturer analyze the additional cost to suggest to the USA consumers. It is a win-win proposal. Dealer is happy knowing true cost of scooter(s) shipped from the manufacturer....customer is happy knowing they won't be getting any "suprise" charges added to their scooter purchase
I agree this is the way it should be done, however.. it's all about perception..
Adding freight to the M.S.R.P would drstically increase the price of a bike and might turn some people away. It's all about first impressions. It's the same for cars.
When they advertise a car starting at $19,999... it NEVER includes the destination of $600+. Yup $19,999 sounds more attractive than $20,599.
I hate it, but we are all guilty of that, and marketing knows it!!

I don't know... That's a huge % difference, isn't it? $600 on 20,000 versus $300 on 3,000.

People might get into the shop due to a lower perceived price, but I think I've seen countless threads here lamenting the sticker shock. People go in expecting around MRSP, and the out the door is 20 to 30% higher than what they came in expecting. Perception comes into play there too. Dealer then mentions gear and accessories, and the total cost shoots up - and I think that's tough for a lot of people to swallow.

I know you tossed out a quick analogy, so sorry for picking in on it, but that freight charge (even $1,000) on a 20k car is a lot less of an addition than a $300 freight charge on a 3K scooter. People go in expecting to spend a lot of money on a car, and negotiate - and most of us know, there's not as much wiggle room on scooter negotiation, so when the out the door cost is % much, much higher than MSRP (especially compared to a car purchase), I think there's definitely a bit of shock. (Hence, the many threads I've seen lamenting it here, and heard about from people in person).

No idea what the "best" solution or scenario is - it's not my business or field. Merely an observation/comment from me.

Lambrettaman · Post by **Lambrettaman** » Wed Jul 25, 2012 11:47 pm

Even though scooters have engines and wheels and get you from point A to point B like a car, the car business is not the scooter business. Most of us are small small potatoes compared to the car dealers. They are high volume very low margin businesses. Scooter dealerships are much lower volume and therefore need higher margins. We (my wife and I) did not get into this business for the money, folks. Very few, if any, of our peers did either. I can't think of one and I know dealers from coast to coast. How many scooter dealers do you know who drive late model European sports cars and send their children to private schools? In other words, those mark ups you are noting are keeping the lights on at the shops, not going into offshore bank accounts. We got into the business because we love scooterists, and to-be-scooterists and scooters. And because we get to do business and develop friendships with people like Philip McCaleb who travel around and sponsor big rides with Genuine customers.