Schwartz, Hollinger, and Hackett zeroed in on the sales department, which had dwindled to one full-time salesperson, one part-timer, a full-time finance manager, and Schwartz. Getting Schwartz off the sales floor--and putting the right people with the right tools in place--was a top priority. To help lead the charge, Schwartz hired two new sales managers, both from nearby automobile dealerships, and then he turned Hackett loose.
On the day Hackett began evaluating the dealership, he sat at the front door and counted customers. "I've never seen so much traffic," he told Schwartz. But what happened next shocked him. The customers weren't greeted when they walked through the door, and those lucky enough to strike up a conversation with a salesperson were often interrupted when the main office sent telephone calls down to the floor. To Hackett, that was double trouble. The conversation on the retail floor was being interrupted, and the customer on the phone was given short shrift because the salespeople were too distracted to get their names and numbers. "It was a waste of a Yellow Pages ad," grouses Hackett.
Schwartz worked with Hackett for 30 days, "from bell to bell," analyzing what was happening on the sales floor and devising a system to fix it. "We started to look at our customers as an opportunity, talking to them about why they were there and what their needs were. And when we did that, we went from selling clothes and parts and service and motorcycles along the way to really selling motorcycles."
They started with the phones. Schwartz created a business development center, staffed with employees whose sole responsibility was to take calls from prospective customers. "My job is to set up appointments and get them in the building," says Jane Spoerl, one of five operators in the center. She has an inventory of every bike in the store and can rattle off information on warranties, insurance, and financing. She can even promise callers a free lunch at the restaurant if they come in--but she never, ever, transfers calls to the retail floor. "Most months, 80% of the people who set up appointments showed up at the dealership and 50% bought bikes," she says. Everyone--even those who don't make an appointment--goes into Mike's database along with Spoerl's notes. If they do wander in at some point, salespeople can pull up their information right on the sales floor.
Next, Schwartz and his team created a sales training program, which starts with an ad in the local newspaper inviting prospective hires to apply for a free three-day course. Acceptance into the program doesn't guarantee a job, and neither does being an avid rider. Typically, nine of 10 participants stay the full three days and Schwartz hires a third of them. He runs the class four or five times a year, usually in the winter, so he can hire approximately 10 new salespeople for the spring season.
The delivery department--previously called "finance and insurance"--where customers go to fill out the paperwork that finalizes their motorcycle purchase, was completely overhauled to shorten the process to just 45 minutes. "Before, it took up to two hours," says Hollinger. "And it just wasn't consistent." Now, customers are treated to a meal at Mike's Warehouse Grill if there's a wait. Hollinger also standardized the department's selling process and moved it from the noisy show room up to the second floor of the museum, where customers are surrounded by eye-catching memorabilia. "After we improved the process, bike sales increased from 800 to more than 1,700," says Hollinger. And Harley-Davidson filmed Mike's delivery process for use as a training tool.
Hollinger also introduced a program called Famous for Service, a group comprising six employees from different departments. They meet once a week to hash out problems and brainstorm new ideas. "You get a service person sitting there with a salesperson and the barriers start breaking down," says Hollinger, who was promoted to general manager in April 2001. Employees in the group might also shadow one another for a day so that, say, a parts department employee gets a taste of what it might be like to work as a service technician or as a salesperson.
Schwartz's changes yielded quick and impressive rewards. Revenue grew to $22 million in 2001, $33 million in 2002, and $38 million in 2003. Schwartz has grown so confident of his systems that he opened a satellite dealership 40 miles away in Smyrna, Del., last spring; he also bought a Harley dealership in Groton, Conn. He's bringing his Mike's Famous brand to both new facilities and projecting 2005 revenue of $53 million for the three dealerships. The flagship will step back to $36 million, but only because some business is moving up the road.
"I always set my sights on being the best Harley dealership in the world," he says. It's a quest for perfection that's never quite over. Like a road trip on a Harley, it's not the destination that's appealing. It's the journey.
