Machine Racing is closing down in September.
A long-running motorcycle dealership in the Newmarket, Ontario, region, Machine Racing was well-known by generations of off-roaders after being in business for 39 years. In other words, they were around since the beginning.
As a result of the impending closure (they’re shutting it down in September), management now has a blowout clearance sale on. As you can see on racer Kyle Keast’s Facebook page here, the announcement is really hitting a lot of locals hard, as the dealership was the start of many riders’ careers.
We assume any further announcements of sales or other details will come at Machine Racing’s Facebook page or website.
In the past few months, there has been a pattern of turmoil in long-running dealerships in the GTA, whether it’s Dual Sport Plus’s sale (and near-miss with closure), Kahuna Powersports’ closure, or Parker Bros. Powersports’ closure, or others. The most likely culprit? Cross-border shopping when the Canadian dollar was close to par with the US dollar – not a problem dealerships have to deal with at the moment!
I believe Joel is a hundred percent correct in his assumption.
Why would I buy an existing business for 1.5 million and have to be the owner operator. All for $80 k a year and work 50 hours a week? 1.5 million should earn 80k in investment income.
No thanks .
All the best to John.
Cheers
It may not be a case of the business not being able to compete or not being profitable (enough) as an entity. They had a large and pretty loyal customer base.
It could be that after 39 years the owner wants to retire and the value of the property exceeds that of the business. When my father and I sold our garden center it was very profitable, but in relation to the value of the land it was on and what that sum of money could generate by being invested we’d have been idiots not to sell.
Either way I wish John (I think) well. I only met him once at a 2 day trail ride in Lake St. Peter, but he was a nice fellow and contributed a lot to the off road riding/racing community both personally and through Machine Racing .
” It’s only going to get worse, I expect. They’re only going to protect their empires, as you would expect.”
True that…. 🙁
Market agreements and the importers is where I’ve seen the source of evil on this. Parts Canada, owned by Parts Unlimited in the US, sets the prices. Parts coming out of the same Ohio warehouse. Said part goes from $141 cad (after exchange rate, if bought at a US retailer), to $242 cad, then add the tax to that amount, not the lower one.
And the Canadian shop has no chance of coming close to that price. Importer still gets paid for the same tire, so what do they care? I’m still buying it from them.
When the exchange rate hit close to par was when Joe Public became aware of this profiteering at their expense, so as anyone would, they spent a hundred bucks less for the tire. Cannot fault them for that.
It’s only going to get worse, I expect. They’re only going to protect their empires, as you would expect.
Yep, the dealers here are between a rock and a hard place. They’re stuck buying from the exclusive Canadian distributors – often paying more for things wholesale than one can buy them for at retail from a US online retailer. Us buyers naturally wonder why the tire (for example) that we can buy from an online retailer for $180 (even from a Canadian online seller) suddenly costs $300 when ordered (and they pretty much never have any stuff like this, even common sizes of sportbike tires) through the local dealer. Somebody’s making a lot of extra money in the deal. Probably not the dealer, but that’s a big difference in price for the buyer. Same for other hard parts and accessories.
Clothing and gear like boots, gloves, etc? Try and find a dealer that even carries a decent stock (especially now, since so many people apparently used dealers as fitting rooms and than bought online, something I personally wouldn’t do) of helmets, jackets, gloves, etc. If I have to order the stuff I want sight unseen anyway, why wouldn’t I go with an online retailer and save myself a lot of $$$?
I’d like to support my local dealer(s), but there’s a limit to how much extra I’m willing to pay for that.
“Somebody’s making a lot of extra money in the deal. Probably not the dealer, but that’s a big difference in price for the buyer. Same for other hard parts and accessories.”
Definitely not the dealer.
“I’d like to support my local dealer(s), but there’s a limit to how much extra I’m willing to pay for that.”
Then unfortunately be prepared for fewer and fewer of them. It sucks, but that’s likely the way its going to be…
” In the past few months, there has been a pattern of turmoil in long-running dealerships in the GTA, whether it’s Dual Sport Plus’s sale (and near-miss with closure), Kahuna Powersports’ closure, or Parker Bros. Powersports’ closure, or others. The most likely culprit? Cross-border shopping when the Canadian dollar was close to par with the US dollar – not a problem dealerships have to deal with at the moment! ”
The major problem is the fixed costs of doing business – rents, property values, taxes, salaries and the proliferation of online e-tailers cutting profit margins.
It also seems (to me) like the distributors, with maybe the exception of BMW and H-D have given up the fight.
Sad….
But, see, that’s all part of the deal. The reason people shop online (cross-border online shopping is the biggest foe, from what I see) is that those retailers can offer lower prices because they can work around rents, property values, etc …
Precisely, but when it comes time to repair, try on, fit accessories and the like there’s no one left- then what….?
All that to save, in lots of instances minimal $ per item.
As you say, with the Canadian dollar in the dumper maybe that will help.