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ATKINSON, Ill. -- After more than a year in development, Family Tree RV is set to rock the RV industry by organizing mom-and-pop RV dealers across the country into one national franchise.
The concept is the brainchild of Tom Enyeart, owner of Shabbona Creek RV. An RV dealer for 21 years, Enyeart wants to accomplish two things with his new group. First, he wants to put an end to pricing shenanigans in the RV industry. Second, he wants to give smaller RV dealers a fighting chance at competing with Camping World, he told RV Daily Report.
"The RV industry is in such a state of flux right now," he explained. "During the recession, a lot of dealers lost or gave up product line, they had difficulty getting financing and many dealers went out of business. I thought the time was right to step up and reorganize smaller dealers in order to stop some of the frustrating games that are being played in our industry."
One of the biggest frustrations is the warranty game that has been played out for decades, he explained. "It is a daily problem to get paid an adequate amount to service a manufacturer's customer -- and to get that payment in a reasonable amount of time."
The second frustration is the lack of pricing consistency by RV manufacturers.
"After the recession, we started losing deals to Internet sellers who are charging prices that are less than we paid for our units," said Enyeart. "I know they are not doing it for fun, or to lose money. That means they are getting a better deal than we are from the manufacturers."
Dealers who sell 30 to 40 travel trailers a year for a particular manufacturer are not in a position to truly negotiate the best deal because they lack weight behind their purchasing power, he explained, noting that change can happen with a national franchise of independent dealers.
"We want to stop RV manufacturers from giving deep discounts to Internet retailers, organized dealer groups, and big box retailers, like Camping World," said Enyeart. "We want manufacturers to give us the best deal that the company offers - the same deal they offer to anyone else."
"Those type of companies assemble a group of retailers or dealers, then beat up the manufacturers to lower their prices even more than the OEM's 'best possible price," said Enyeart. "We aren't going to beat up anyone. We just want to know that our dealers got the best deal that the company has to offer -- a deal that won't be sold at a lower rate to a bigger competitor down the street."
It may make it easier for manufacturers to avoid bullying by larger dealer networks, he explained, because whatever price they negotiate with a manufacturer will have to be applied to units sold to Family Tree RV dealers.
As he is looking for more dealers to join his cause, Enyeart has already put his plan into action at his own dealership. He has started dropping manufacturers due to the discounts they are offering other dealers that makes it impossible for his dealership to compete.
"My salespeople spend hours educating people on the product to the point the buyer is fully devoted to the product," he added. "But because not everyone is willing to make a major purchasing decision on the dealer lot, naturally they go home to think about it.
"When they do, the buyers start looking online to evaluate the price we offered, and then our name looks like mud because it appears that we are charging $3,000 more than a dealer in Ohio, who was simply able to buy the same unit at $3,000 discount that we didn't receive."
A lot of products may be commodity priced, but that can't apply to recreation vehicles, said Enyeart.
"Shoes and clothing don't require a lot of service after the sale, so commodity pricing fits for those types of products," he explained. "But every single RV that is sold from a dealer will need service at some point.
"So, what are we supposed to do when a consumer goes to Ohio to purchase a unit from a dealer capable of buying the same RVs at a cheaper price, then brings the RV to us for service only to have the RV's manufacturer pay us less than it cost to fix the problem -- and keep us waiting months for payment?" he asked.
If the manufacturers would level the playing field on pricing to begin with, then customers don't need to drive out of state to save money, Enyeart argued.
"With a level playing field, the customer can have his cake and eat it, too," he explained. "They can buy their units locally and get them serviced locally."
Enyeart said it was ironic that a manufacturer's sales representative demonstrated the extent of the problem when describing his own experience buying a snowmobile. The sales rep traveled three hours to save $1,000.
"He was living proof that the system is screwed up," said Enyeart.
Not a buying group
Family Tree RV is not a buying group, Enyeart explained. It is a group of dealers who plan to use their collective numbers to ensure they are getting treated fairly by manufacturers and suppliers.
Riverside RV has already stepped up to the plate, he added. "Mark Gerber has made a commitment that he will sell travel trailers to us at the best price -- guaranteed," said Enyeart. "That's good for him and its good for our group."
Enyeart has spent the last year talking to dealers, manufacturers and lawyers to set up the best type of system he can that protects everyone involved. In fact, the legal documentation just became available.
"Due to the complexity of various state laws, we can't set up as a national co-op like we were originally planning to do," said Enyeart. "So, our legal team recommended that we set up franchises because franchise law clearly dictates how businesses are supposed to operate within each state."
Ultimately, Family Tree RV plans to become the largest group of independent dealers in the nation -- all operating under the same brand name. Enyeart noted there are already far more mom-and-pop dealerships than mega dealers in America.
Some dealers may be skeptical about changing the name of their family business, but Enyeart said doing so is essential if they hope to compete with Internet retailers and Camping World.
"I know some people like seeing their name on the marquee outside their store, but that is not nearly as important as seeing money in their pocket," he explained. "If a dealer can't make adequate money running the business the way they are now, then they need to change their business model to do so. And, that's where Family Tree RV comes in."
The franchise is planning to do national advertising to drive traffic into the stores. Money to do so comes from the annual fee that dealers will pay to be part of the franchise.
Enyeart said he sees no problem in having 50 dealers on board by June 1. "A lot of dealers have been thinking about it for a long time. Now that we are ready to go, so are they," he added.
Family Tree RV dealers will be committed to taking care of their customers by taking care of the business that supports them. The franchise is not a Wall Street company with big money behind it. It's a small organization of small, mom-and-pop RV dealers being built from the ground up.
"Many dealers started 20 to 30 years ago and they lack the organization to take on a competitor like Camping World," said Enyeart. "Once we reach 150 to 200 dealers, then Camping World no longer carries the weight they have with manufacturers that allows them to demand this or that. We won't even care what price Camping World pays if we know we are getting the manufacturer's best deal."
The true benefactor in his whole arrangement is the consumer, said Enyeart. "Consumers who are dissatisfied with poorly constructed products that can't be adequately serviced cause more harm to our industry's reputation than anything else," he added. "We can't change how manufacturers build their RVs, but we can ensure that they are being fair and honest in how they work with dealers. That will allow us to alleviate some of the frustration consumers are experiencing as well."
For more information, dealers can download an introductory packet by visiting www.familytreerv.com or by calling Enyeart at 309-936-7878 to request a one-hour video