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[skreminegul07]

Rossmeyer bought Boston HD last year for $9mil cash.

[RJ749]

Rossmeyer bought Boston HD last year for $9mil cash.

Near as I can tell the price of a store has worked off of a multiplier of the number of bikes in the allocation.

From that and current sales a buyer with the knowledge of a Rossmeyer can put in the numbers he makes on Parts, service and sales to come up with the value of a store.

I would imagine it also equates to 3 to 5 times the annual net profit depending on the location etc.

It wouldn't be a stretch to think that the Boston store would net $1-2m annually so the $9m number would make sense for the "blue sky" then add the inventory, fixtures and property on top of that.

[skreminegul07]

Near as I can tell the price of a store has worked off of a multiplier of the number of bikes in the allocation.

From that and current sales a buyer with the knowledge of a Rossmeyer can put in the numbers he makes on Parts, service and sales to come up with the value of a store.
I would imagine it also equates to 3 to 5 times the annual net profit depending on the location etc.

It wouldn't be a stretch to think that the Boston store would net $1-2m annually so the $9m number would make sense for the "blue sky" then add the inventory, fixtures and property on top of that.

I've asked the GM at my dealer point blank of sales service parts and clothes, where is the most profit.  The answer is Sales, although I was a bit surprised.  I assume profit as a % of revenue.

[RJ749]

I've asked the GM at my dealer point blank of sales service parts and clothes, where is the most profit.  The answer is Sales, although I was a bit surprised.  I assume profit as a % of revenue.

Hard to imagine it isn't parts and service, I had a friend that ran a shop in a very "touristy" location, the T-shirt operation netted $100k a month.  Now I know this is no the norm but the gross profit in a T-shirt is well in excess of 100%, a bike is maybe 20% (now) and parts are normally around 35%.

Another acquaintance is looking to buy a shop where there is a "huge" and growing rally just to get the T-shirt business from a twice a year rally.............they project they can grow what is now a $3m sales operation to $9m in a matter of a couple of years.

Dealers have had a great run and it may continue, but with the economy being sluggish at best I imagine the great times are gone for awhile and it may become more of a challenge to produce the sales and profits that came so easily for the past 10 years.