New Products can Add More Profit

VAR - A Computer Term for the RV Industry

by Bob Zagami
Associate Editor

Many of you may be familiar with the acronym VAR, it's very popular in the computer and information management industries and stands for Value Added Reseller.

In its most simplistic definition, it means to add value to that which we sell. In our company it means that we add value to the products we sell by offering our clients a full range of document conversion services to augment their hardware purchases.

I think of an RV dealer as a value added reseller. Adding value to the sale of the product has some unique advantages that may set you apart from the competition and allow you to retain the customer longer, improve the profit on each sale, and be a solutions provider rather than just another salesperson.

How can an RV dealer become a VAR? Well you actually are, or certainly could be, but it's just not a term that is currently used in the RV industry today.

There were a few interesting suppliers at the Louisville show that had some very unique products that could present some exciting opportunities. Let's take a look at some of them and see how they can add value to you RV sales and profit to your dealership.

The worst thing about RVing is ..

I'm sure you ask every prospect or customer what it is that they like most about the RV lifestyle.

You will get many different answers to this question. Some like the quality of life it brings back to their family, others enjoy their RV in conjunction with a hobby or sporting event such as NASCAR, fishing, hunting, or tailgate parties at the Saturday football game. Others have retired and want to spend their leisure time seeing the wonderful sites offered by touring this great country of ours.

Now it may seem strange to ask them what they don't like about the RV lifestyle but perhaps you should also ask them that question.

Think about it -- have you ever asked a customer what the one thing was that they absolutely detest about their RVing experiences?

How about emptying the holding tanks!

Let's look at it another way. When you have asked prospects and customers what they do like about RVing -- did anyone ever say that they actually do enjoy the ritual of emptying the holding tank?

I don't think so !

I'm an active RVer and I don't like emptying the holding tanks. Here's one place where the women have really outsmarted us guys. How many women do you see down there on bended-knee, hands extended, wearing thick heavy gloves and trying to maneuver those cheap plastic T-valves.

Cheap, plastic valves -- the only thing between you and an instant shower of the best Mother Nature has to offer if you screw up.

Every challenge brings with it an opportunity -- if you know what to do with it.

When was the last time you talked to your customers about their RV evacuation system? The system that evacuates the black and gray water holding tanks is probably the least talked about item in anyone's RV experience.

What could possibly make you want to talk about this stuff with a prospect or customer who also doesn't particularly care to engage one in a conversation about emptying human waste and dirty water from their RV?

This nasty task actually provides you with an exciting opportunity to enhance and automate something that the customer doesn't want to really be involved with. They do it now because in the RV industry, that's the way it always been done.

I did find a company at the show that actually likes to talk about this stuff. In fact, it's the only thing they do discuss because all of their products deal directly with the evacuation systems for RVs.

Phase Four Industries (www.phasefourindustries.com) makes a product called the DrainMaster RV Evacuation System. Now that's a clever and descriptive product name isn't it? In terms we can all understand, and discuss around the dinner table tonight, they completely automate the process of emptying the holding tanks. Imagine emptying the holding tanks by flipping a switch inside the RV. Now that's convenience.

This is where you come in as a VAR.

This is the opportunity for you to add value above and beyond just selling a product. This product allows you to improve the quality of life for the RVer and removes a negative task that we have been saddled with for years.

You can relate this to the many stories that have been published by the industry's trade press about the baby boomer customer and their desire to have it all, and have it all right now.

This next generation RVer wants convenience, ease of use, and quick results. You have an opportunity to add value to their RV. Baby boomers pay for value, they pay for luxury, and they pay for anything that will make their life less stressful and give them back that one thing we all want more of -- time.

Did you ever hear anyone brag about how fast they can empty their tanks? They don't. They'd don't because they simply can't empty them fast.

Have you ever wondered why a manufacturer would design a 3" drain on the black water tank but then only provide a 1.5" drain on the gray water tank? It really doesn't make sense. Why not have 3" drains on both tanks so they will empty faster. If they empty faster, you get done with this ugly task sooner. The design of the DrainMaster system allows an RVer to empty their holding tanks 2.5X faster!

I'm sure many of them enter into the RV experience and don't have a clue about how the holding tanks must be emptied.

Phase Four has caught the eye of many RV manufacturers who see an opportunity to add value during the manufacturing process by installing the system at the factory. I think you will see a lot of the 2002 models rolling down the assembly line with this new system. Manufacturers will begin to offer this system because it is truly new and revolutionary and can set their products apart from the competition.

This may be the most exciting thing to happen to RVs since slide-outs were introduced.

You can share in the success of this revolutionary new product that very few people know about and one that can easily be sold as an aftermarket product when you are closing the deal for that new RV prospect. They have an aftermarket version of the DrainMaster that can be added by your service department before or after you deliver the new RV.

Will customers actually pay to have an automated evacuation system? Ten years ago they probably wouldn't. Today -- they will. You see that everyday with the toys that they now add to their RVs and demand that the manufacturers add to their products. The difference here is that this option removes a negative task that nobody wants to do when it comes to RVing.

Replacing a 25" TV with a 42" plasma TV simply gives them a better picture and sound. They already like television.

Replacing an audio tape player with a CD player simply provides them another media to work with. They already like the music.

Replacing the laminate countertop with a solid surface material simply provides a more attractive and easier to clean work surface. They already like the kitchen.

Replacing a gas engine with a diesel simply puts them up there with the big boys. They already like their RV.

Well guess what, replacing the manual plastic t-valve system that leaks, sticks, clogs and sometimes freezes up with an automated system is different. They don't like anything about emptying holding tanks. This is an option the RV consumer will pay for if they know it is out there.

You introduce it to them. You add the value. You make the profit.

Bikes for the boomers ...

One of my business heroes is Lee Iacocca. Here's a man who made a career out of understanding the consumer and bringing products to the market that met a demand that was not yet understood by the majority of our population.

His introduction of the Ford Mustang is still one of the best-read business stories of all time. Who among us -- in a certain age group -- didn't long for a Ford Mustang convertible in our youth. It was the coolest car in town and you would do just about anything to get one. That same age group today is buying up classic Mustangs even though Ford is introducing new Mustangs. They don't want the new ones -- they want the real thing, the Lee Iacocca Mustang.

He pulled Chrysler Corporation out of the grave and revolutionized the company. Sure, there are some who will say he couldn't do it without government loans. However, he paid every penny of it back and paid it back early. He was able to do this by introducing products that met the needs of the consumer. If they didn't reinvent Chrysler under his leadership, the government would still be looking for its money.

He knew what the consumer wanted before the consumer knew what he wanted -- now that's creative marketing.

He's done it again with a unique hybrid bicycle called the E-Bike. If you looked carefully in the halls of Louisville you may have seen these unique vehicles being road tested right there on the exhibit floor.

The E-Bike is being manufactured by EV Global Industries.

This is a bike for the boomers. This is a bike that should be sold by RV dealers. Baby boomers will buy this bike -- this is a toy that again provides convenience, ease of use, and enhances their lifestyle for something they enjoy doing.

They will take this bike with them. Many will forgo towing a car and simply bring their E-Bikes in tow for local transportation when out on the open road.

Another entry into the bikes for baby boomers is the TH!NK® bike - www.thinkmobility.com.

The TH!NK bike - fun and travel power assisted electric bicycles are a new approach to recreational cycling, bringing together human power and electronic technology to create a totally new cycling experience!

TH!NK bike's exclusive Electric Power Assist system and throttle enhance the enjoyment of riding an ordinary adult bicycle by giving you an extra boost for climbing hills or riding into a headwind - all automatically, efficiently and instantly. TH!NK bikes are available in red, blue or silver.

TH!NK bikes come with a quiet electric motor that easily engages for go-anywhere bicycling and up to 22 power-assisted miles on a six-hour charge.

These two bikes add value to the RVing experience.

These bikes are not cheap, and shouldn't be. People will pay for options, features and accessories that add value. This is a value added product if I've ever seen one.

As kids we would walk through the junk yard looking for abandoned bikes that we would then take home and wash up, paint, put new tires on and be damn proud of the bike we just put together for $10.00 and pocket change.

Kids don't do that anymore.

Baby boomers never did it. Baby boomer kids wouldn't think about doing it because their parents are going to provide it for them.

Well they might as well buy it from you. This is not a $10.00 bicycle -- these bikes range from about $1,000 to $2,000 -- the more popular one running in the $1500 to $2000 range. You can ride it like a regular bike or switch to a quiet, efficient electric motor to propel you around the campground or tourist attraction.

Did you ever think people would pay over a thousand dollars for a bicycle? I didn't, but I do now.

We just had the Massachusetts Association of Campground Owners RV show in Marlboro, MA. It's a small show, but well attended by people who refuse to drive into Boston for the big show. As I turned the corner into the Adventure World RV display, there were four E-Bikes right along side a large selection of travel trailers. They were getting a lot of attention from their customers.

Convenience sells. E-Bikes and TH!NK are convenient and fun, and profitable.

Bikes add value to your RV sale.

Adding value at your dealership..

These are just two interesting products that can add significant value to your RV sales opportunities. Adding value sets you apart from the wholesale price discounters. Adding value allows you to build relationships that will bring the customers back to your dealership.

Look for other many exciting opportunities that will allow you to add value and increase profits by providing solutions that customers want and will pay for.

The market is changing. The consumer is changing. Buying habits are changing.

If I told you ten years ago that people would pay for automated evacuation systems in their RVs you wouldn't believe me.

If I told you ten years ago that people would pay $2,000 for a bicycle you wouldn't believe me.

If I told you ten years ago that the top golfer would be black and the most popular rap singer would be white, you wouldn't believe me.

All the rules are changing. Changing for the better. Now is an excellent opportunity for you to take advantage of the changing patterns. The next generation RVer is going to demand more innovative and convenient products such as the two described in this article. Go find them.

RVN