DEALERS REGRET FUTURE LOSSES AFTER SELLING STOCK OVERSEAS
April 2 2009.

Feedback gathered by Glass's from the used motorcycle trade indicates that an increasing number of retailers regret having sold large volumes of stocks to overseas buyers during the quiet winter months just passed.

The strength of the Euro against Sterling has put foreign customers in a position to pay near retail prices for second-hand units in the UK before transporting them across the continent to sell on at substantial margins.

Doing business with this growing customer group may have provided a short-term sales boost during an otherwise bleak trading time, but dealers are now concerned that it has been at the cost of future business.

"Some within the trade have pointed out that each machine retailed to a UK resident can generate as many as five subsequent transactions for the dealer," explains Randal Thomas, Editor of Glass's Guide to Motorcycle Values. "This might be in the form of part-exchange, or even the return of the original machine. If it does come back to the dealership, it can be turned over several times at different price points to suit different customers. On the other hand, once a bike has gone abroad then that is the end of the trading chain."

Thomas adds, "It is a brave, even a foolish businessman who turns down a good deal in the hope of a better one - a bird in the hand being worth two in the bush. However, the farmer is also counselled not to eat his seed-corn, and that is what some motorcycle retailers realise they may have done."

"This activity does serve to illustrate the degree of passion that European motorcyclists have for their hobby. It also underlines the value for money that UK riders have been enjoying in the past, but perhaps not fully appreciating," he says.


Retail demand picks up
In the auction halls, competition for the best quality lots at recent motorcycle sales has become more intense as retail demand gains strength and good-quality machines become more difficult to source.

Feedback from the market indicates that second-hand stocks are too low to satisfy this rise in consumer demand. Responses to Glass's latest trade survey confirm that the intake of part-exchanges over recent weeks has been below the volume seen in previous years, limiting the quantity of machines entering the market.

"It appears that there are a number of retail buyers attending auctions to try and lay their hands on a bargain," comments Thomas. "This is adding fuel to an already competitive environment, with all parties out to secure the very best examples that are coming up for sale."