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“The challenge is people are coming more prepared. They’re coming with more knowledge, or they think they know more than we do.” — Fun Bike Center Motorsports Finance Manager Samer Fidy
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Johnnie Martinez 13:49:11
On this week's episode of The Roadmap, I'm joined by Samer Fide from Fun Bike Center Motorsports, and I will let him introduce himself further.
Samer Fidy 13:49:21
I'm Samer Fidy from Fun Bike Center Motorsports in Lakeland, Florida. I've been in the power sports industry for 15 years, but I was a lender, a subprime lender for this dealership for 10 years prior. So, I've been involved in the industry about 25 years.
Johnnie Martinez 13:49:42
Fantastic. Well, great to have you this week, and you know, get into some of what is happening in the power sports industry, and with your background, you know, have the insight.
Samer Fidy 13:49:52
Perfect.
Johnnie Martinez 13:49:53
Okay, so to start, in this time of year, we're getting into the summer months, very busy time for power sports dealers. How would you describe the market right now, heading into sort of the peak riding season.
Samer Fidy 13:50:06
Well, Florida is in our area, it's unique. Well, across the whole United States is power sports is something that we can do all the time, right? But May is a special time because you know we're coming off winter and spring into the summer months, so you'll have a great month of writing, and then it ties into watercraft, and here in Florida, watercraft is huge for us in the summertime, so May, June, July, we start focusing on marketing on watercraft sales, and then towards the end of May into June we start focusing on hunting season for the off-road vehicles,
Johnnie Martinez 13:50:47
fantastic. And I'm curious, are you guys seeing anything unique about customer behavior in the space, especially given the summer? And we've heard so much about the economic uncertainty, but in a place like Florida, you know, there's so many people who are in the retiree space or in the space where they may be able to do a little more. What are you seeing as far as the customer base that you interact with?
Samer Fidy 13:51:07
I mean, the customer base varies, honestly. It's you're right, it's a lot of retirees, it's a lot of snowbirds, but we do get a lot of the younger crowd, a lot of young crowds are starting to get into the motorcycle, so especially on the mini bikes and the and the low cc motorcycles that a lot of the manufacturers, like Honda Trina, Kawasaki, are releasing the 400 cc 500 class, so we're getting a lot of influx of the younger generation coming into it, and the difference that I've, that we've been seeing with shoppers is they're more prepared, you know, they, they're when they come into our dealership, it's more like they're coming to confirm the research that they've done online, and they want to check the pricing that they've gotten from other dealerships, so it's like when they come here, it's more of like a confirmation time for them, and then they, you know, they either buy because we got them the right price, or they need to go back and do more research, but they, I would say, consumers, no matter what age they are coming here more prepared, and they, they know a lot about promos and rates, because it's being marketed more, you know.
Johnnie Martinez 13:52:29
Gotcha, that makes a lot of sense. And you mentioned the promo and rate side of it, and I think one of the talking points really in every industry right now is the affordability aspect to it. When you're talking with these consumer bases, especially the young writers coming in, are they being very much influenced by the monthly payments, the in their purchasing decisions, or is there something more that they're coming to you with?
Samer Fidy 13:52:54
It's, I would say 80% of the customers are payment focused, they're, you know, everything's, you know, gas is expensive, you know, buying exit yogurt is over $15 now, so I think everybody is definitely tighter on their budget. So the monthly payment is key into us closing the deal, you know, and it's trying to get them away from the, you know, the out the door price, which is like your MSRP plus all the fees, which, you know, let's say, if it's a general number, 20 grand, and try to help them not focus on that, but like to focus on what, what the important thing is to them, is their payment, you know, and trying to work out payments. I don't, you know, like I tell customers, like, I want to get your payment, because every month you get the bill, I don't want you to be like, oh man, freaking hate this thing, but I love it. I just want you to like get the bill and be happy to pay it, because we got you the payment that you could afford, you know. Because when I, when they come into finance, I want it to be.. I don't want to be the stress of being in finance department. It's like, oh, hey, here's the payment that we discussed, I got you there, you know, sign, sign, sign, and go ride and have fun. You know,
Johnnie Martinez 13:54:06
right? No, that makes sense, especially is with an industry like Power Sports, where it's so driven on the experience side of it. You don't want the experience to be within the walls of a room trying to put the deal together for the customer side of it.
Samer Fidy 13:54:19
Yeah, because it gets stressful, especially for younger kids, or even, like, you know, people that are retired that are also on a budget, when you're buying something you know expensive or something that's, I mean, none of the stuff that we sell is a necessity, it's not essential to the quality of your life, it may help the quality of life, but you don't need it to live right, so it's it's something like a lot of customers are like, do I do I really need to spend the extra $500 a month? Do I really need to buy this side by side for 30 grand? And it's our job and our partners' jobs to put the customer at ease and to get them the best out the door that we can. And
Johnnie Martinez 13:54:58
to your point, we miss our touch on this, right? The first time buyers, how they're coming in, for some of them, you know, if they were people who, you know, their parents or their grandparents helped get them their first car, their power sports purchase might actually be their first financing process they go through on their own. Do you see some of that coming in, and is maybe unique, just as far as talking with customer base, that maybe going to you is their first financing experience?
Samer Fidy 13:55:22
Some, I would say a lot of times it's the first, and it's, you know, the people that got a car when they were younger with their grandparents or parents, they understand, but we also have to kind of like train, you know, not train them, but educate them on how our industry, the rates are higher than the automobile industry, and explain to them why, and explain to them that you know the process in detail. You can do the application. We're going to send to the lender, and then you know we'll talk to you about the payments, and then set their expectation of a rate, because you know if they, if they cosign with their grandparents or mom on a car, and their rate is let's say five to 8% and then with us, you know, they're they're a first time buyer, the rate may be, you know, 10 to 15% so kind of like I like to always let them know the, the into, you know, like what, what's going to happen, you know, where they may be, so this way they they're not like fully surprised when I actually get the answer, and then there's the people that have never financed anything, and you know, you teach them about credit, and you teach them, you know, you ask them the pre-screening questions, but it's great, because I have customers that I worked with 15 years ago, you know, when they were, you know, younger, 18 years old, and I taught them, and I got them their first dirt bike, or first small spec 250 motorcycle, and they always come in and remember, like, that's the guy that got me my bike 15 years ago, and then they keep, you know, they keep buying from us, and that's what I love about our community, is that, you know, people have been shopping here for going on 34 years, and that's it's just beautiful
Johnnie Martinez 13:57:07
as far as the the customers as they're coming in. How are maybe longer loan terms of promotional financing becoming a part of the process? Are you hearing them demanding that, or is that more of a, you know, as you're going through the process, just saying, hey, here's where you're going to need to be from just a financial situation.
Samer Fidy 13:57:22
No, a lot of customers are asking for the longer terms, the 84 months, 72 months, and sometimes on watercraft you can go 96 months, and the beautiful thing is, is most of our loans are simple interest, so they can just get the longer term and just pay it off whenever they want, and I think a lot of times they want that lower payment, but their goal is to pay it off, you know, within, if they do an eight year loan, they, their goal is paid off within four years, but yeah, we do, we do let them know that as well, and, and I offered them, I say, hey, you know, like you're at 72 months, we're at your budgeted payment, but there's an 84 month option, or it's even a lower payment, and I kind of explain it to them and let them make that decision for themselves, but yeah, people do ask for the longer terms, especially on the larger units, like the watercraft, the side by sides, and the high, you know, the more expensive motorcycles.
Johnnie Martinez 13:58:18
Gotcha. No, that makes a lot of sense. And you were in touch on this one, but to came up again, I do want to bring it up, as far as you know, maybe what types of units you're seeing the most demand for in the current market. Obviously, you talked about how the new riders are looking to the small vehicles. You talked about how on the financing side they're looking toward some of the longer terms for some of those bigger units. Really, where's the kind of the demand in the space right now?
Samer Fidy 13:58:43
The demand right now, midsize cruisers is pretty, pretty big, so you're, you're 500 to 900 cc cruisers, motorcycles, because you know they're easier to handle, you're getting, you know, you're saving a. Lot of money on gas, because you're like, you know, you fill up your bike once a month, right, but that's that's kind of been our bread and butter, is the midsize cruisers, and now we've been pumping our marketing towards watercraft, so it'll shift from midsize cruisers to watercraft, but I would say across the board year round is the midsize, midsize cruisers is always our consistent sales in that bracket. There
Johnnie Martinez 13:59:39
gotcha. Okay. Well, with that in mind, I want to get into a few wrap-up style questions, and then we'll call it a day, and really to start, you know, what are maybe some of the biggest challenges that dealers are facing right now during the selling season, or really even just over the course of this year,
Samer Fidy 14:00:01
you know, I'll give you an example, last week we lost a deal because a customer put in the numbers we sent him into AI, and then he sent screenshots, and he's like, 'Here, I have it, like I'm not even playing around. Then he said, 'I'm going to read, I'll read you verbatim what he said, and it's, uh, it says, uh we sent him the numbers, as you can see, and he and the answers from AI. Short answer, no. Cameron, this is not a good deal. It's overpriced by 3500 to 6000 compared to what Florida dealers normally charge for two skis. And then, and then AI made basically what the price should be, and I had to explain to him, like, at that price we're, we're negative, like, we're not making any money, we can't sell two skis in a trailer that's worth 45 grand for $27,000 like, if there was that much markup in there, you know, I wouldn't be in a Toyota Highlander, you know, and I said, "You know what, that's fine. I was like, "Well, can your AI platform build the skis, pull them up with gas, prep them, put them on the trailers, and deliver them to your house? Because if they can, I'll match the props, and he didn't like that response. So it's the challenges is that with the internet, with AI consumers have this unrealistic expectation of the right answer, so like they do, they go on Google, they use their AI platforms because they want to side by side, and they go to multiple dealerships, they go online and they put best side by side, and then you'll have Can Am or Polaris and Honda and Kawasaki pop up, and they'll see a difference in, like, they'll see random rates, 1.99 2.9 3.9 and 4.99 and they're not, they're not seeing which rates apply to which brands when they come in here, and we're like, oh, this is the Kawasaki that you wanted, like, oh yeah, the rate is 1.99 I saw online, it's like, no, that is for a different brand that we don't carry. So, I think the challenge is to try to, like, setting an expectation right off the bat for the customer that we love that you did your research, we love that you think you know the right pricing, but this is the reality. Let's explain it to you, and let's come together to work out a deal. That's at the end of the day, we're a dealership, right? We want to make deals, we want to sell, that's how we make money, that's how we live. But the challenge is, people are coming more prepared, they're coming with more knowledge, or they think they know more than we do, and it's just trying to, like, just trying to, like, educate them without being rude, trying to show them the reality of the pricing and how we have to build the units, and that not all brands have the same promos and rates, you know, so the internet has really given them, it's a good tool for them to do research, but when it comes to the expectation of pricing and promos and rates and terms, it's, it's really not good. And for me, I like it. It's challenging, and 99% of the time the customers do understand us, you know. And that's the difference between us and other places is that I am so transparent with my customers, I sit and take my time explaining it to them, and and then I also tell them, like, you know, when we work with lender like Synchrony, choose your option, you know, like, here's the, here's the rates and terms that Synchrony is offering you, it may not be as low as what you're getting on AI, but your AI app is, you know, completely wrong, and you know, like, you know, I'll show them the cost, and then they'll realize it. Hopefully, we'll get this guy back. We lowered it a little bit more for him, but yeah, that's the kind of the challenges is that we're getting is that people are just. And there's so much information out there, and just helping them bring in all the information they got into like a small bomb, like this is where this is what you should be studying and researching.
Samer Fidy 14:04:14
Yeah, I would say the internet and AI is probably the biggest challenge. If I've developed anything over the last few years, it's patience, you know, and the ability to, you know, tell myself, you know, it's not their fault, it's there's just so much information out there, and that just slow it down, explain it to them, don't get defensive, and we'll combat the internet world with real life information in person, hopefully. Gotcha. Well, I
Johnnie Martinez 14:04:53
good.
Samer Fidy 14:04:53
No, go ahead.
Johnnie Martinez 14:04:54
I was gonna say, yeah, with that in mind, obviously we'll this technology continue to develop, but really, when you start looking at where the market is, and where it's headed. Do you feel like this is going to be kind of the new normal for you guys on the dealership side and on the financing side, as far as what the purchasing and financing process looks like, or are you seeing maybe some some shifts as far as you know how the technology is being used, as the technology is improving, maybe being a little easier, a little harder.
Samer Fidy 14:05:23
I think this will be the new norm, is that people coming in and having an abundance amount of information, you know, knowing so much, not only about the product, like if they're coming to look at a calisak subside, but they'll know the, you know, the competitors' brands as well. So I think the new norm for consumers is to do a lot of their research. It's not like back in the day, we're like, ah, I want a motorcycle, let's go to fun bike and buy one. They don't care about rate or term because they're, they didn't, they didn't research it online, they didn't confirm things with their AI apps, they just like, let's just go buy a motorcycle for all, and they just come by. Now it's like, should I buy a motorcycle? Is it safe to buy a motorcycle? What's the best motorcycle to buy? What's the best rates to buy? It's like, it's like it takes the joy out of just going and buying something and having fun with it, because, like, you feel like you have to do all this research first. But yeah, I think it's the new norm, and that's why it's, it's important to educate your team on the importance of the dealership, you know, most dealerships are family owned. Talk about how much we've done for the community, talk about our partners and lenders, and really let the customers know that, you know, when you buy from us, you know you're part of a family, and you're part of a very strong community, and a business that's been here 30 years, serving you guys, serving the community, and you know we only work with great partners, you know, like Synchrony and other lenders. So, yeah,
Johnnie Martinez 14:07:05
okay, fantastic. Well, thank you so much for your time today, and for your insights. And it was great chatting with you, and hope the listeners gain a lot from our conversation.
Samer Fidy 14:07:14
Yeah, I hope so. I appreciate you.
Johnnie Martinez 14:07:17
Thank you so much.
Transcribed by https://otter.ai