St. Paul Harley Sues Harley-Davidson Over Prohibition Of Online International Sales

A few months ago, you remember that I reported that Harley-Davidson was informing and reminding its dealers that online sales were forbidden outside their dealership territories. Main targets were those dealers selling parts and accessories through 3rd party independent dealers (brick & mortar and online shops usually reselling Harley genuine parts at a discount) and those, because of their proximity to our country borders, doing a lot of international sales. Problem is that many Harley dealers would have not have survived our US economic recessions without these “outlawed sales.”

And to lead the revolt, 72-year old Tom Gianetti, owner of Harley-Davidson St. Paul Motorsports Inc, who has decided to sue the Milwaukee manufacturer for trying to prevent his dealership to continue these 3rd party and international sales. Tom states that without them, and because new motorcycles sales dwindled since 2006, his business would not have survived and that it is also the case of several other dealers. The dealer said it earned $8 million a year in revenue from those sales from 2008 through 2010.

According to the lawsuit, the motorcycle maker said that starting Aug. 1, U.S. dealers may not sell Harley-Davidson parts and accessories to any customer outside the United States. The lawsuit said that starting Jan. 1, 2012, U.S. dealers may not sell new parts or accessories on third-party websites.The policy revisions illegally alter the company’s franchise agreement with dealers, the lawsuit claims.

Years ago,it may have been difficult for the Milwaukee manufacturer to anticipate the explosion of online sales and the danger they could represent both in terms of loss of income and of price competition. The issue of this lawsuit is going to be watched very closely by all Harley-Davidson dealers. To foliow…

52 Responses to “St. Paul Harley Sues Harley-Davidson Over Prohibition Of Online International Sales”

  1. 1 Bago Nov 12th, 2011 at 9:04 am

    Interesting…………..This dealer is right next door to Twin Cities Indian. St. Paul HD made many cuts including layoffs over the last few years to survive and being creative with online sales was another thing done to keep the lights on and their MVP parties going.

    The interesting part is the Indian dealer just in the last couple months created their own Ebay store and have been selling Indian goods pretty well this way. Polaris needs to get the word out and sell Indian “stuff” any way they can. HD on the other hand bitching about online sales is just looking out for their own P&L spreadsheets as they are missing out on income via international sales by their own dealers. It’s like the music recording industry and the post office going crazy because they lost millions in sales due to online resources.

    Huge companies including HD have to evolve with the times or experiance a slow but sure death! The hog is old, fat, and ripe for slaughter. Remember that when you’re pigging out on ham during the holidays.

  2. 2 Sasha Nov 12th, 2011 at 9:08 am

    We need to be true brothers and sisters to one another and help one another survive. Isn’t that what the motorcycle lifestyle was once based upon? Family? H-D corporate let’s pull together, keep the love alive, help your dealers to survive anyway possible because keeping the dealers alive saves much needed jobs.

  3. 3 Kirk Perry Nov 12th, 2011 at 9:27 am

    I bought my H-D® s/s steel, insulated, sippy cup and official “potato potato” wall clock from St. Pauli H-D via Amazon.
    Don’t cut me off cold turkey! 🙁

  4. 4 Tom Hodkin Nov 12th, 2011 at 10:00 am

    This is just another way that HD is trying to shore up their overpriced unbelivable merchandice. They are getting desperate.

  5. 5 Woody Nov 12th, 2011 at 10:20 am

    If US dealers can sell retail to Canadians and make enough of a profit to justify the extra hassles of customs paperwork & shipping it seems there is a problem with the Factory distribution system to Canada and subsequent domestic pricing once there. Should be an interesting case, as you DO have to jump through hoops when you are a franchisee and “fairness” seldom trumps a license aggreement.

  6. 6 Rider2 Nov 12th, 2011 at 10:50 am

    Totally supporting this…. this is about time, HD dealers go after the boys in Milwaukee. “Gray” dealers have been helping A LOT of those dealers survive with parts, used bikes and motorclothes for years. Having an online presence does not violate anything and hopefully Tom will kick their butts in court.
    Depending on the franchise agreement, one can argue that all parts, bikes, accessories and motorclothes purchased from HD are the sole property of the dealership, meaning they are free to resell to whoever they want.

    The bigger issue here is not online sale, it’s the way some of these dealers were set up. Most of them were under the Wholesale Category within the parts department, meaning they were getting between 15% and 25% off, which wasn’t too bad. Considering the price of certain parts in Canada, Europe and Japan (usually about 2.5 times higher than the US), having a non-franchised dealer get 20% off on parts and being able to resell overseas made a huge dent in the European/Japanese/Canadian HD dealers. Even with shipping and taxes, it was still over 40% cheaper to buy from a wholeseller in the USA.

    HD knows about it and got complaints from their international dealers and therefore put that policy in place.

    It will be very interesting to watch the development of this as probably some other dealers will follow. Glad to see there is finally a dealer with balls….

  7. 7 Kirk Perry Nov 12th, 2011 at 11:45 am

    Here’s what Harley-Davidson and all brick & mortar are up against:
    Me and my trusty coffee mug, at the desktop, ordering gobs of $1.00 tools from Harbor Freight’s online “Dollar Store”, instead of firing up the ol’ carbon-nator – and roaming the isles at Home Depot not knowing what I’m looking for, and burning calories and valuable daily mental ram allotment.

  8. 8 Pierre Nov 12th, 2011 at 1:57 pm

    As rider2 said, in France (and in the rest of Europe), we pay 2.5 times higher than in the US for all HD products. And, including shipping and local taxes, we still save 40 to 50% (depending of the exchange rate).
    Sometimes it’s more: I got a HD leather jacket from St Paul for 260 euros, wich one was sold for 750 euros at my dealership…
    Additionaly, we also pay our bikes a lot more than in the states.
    I bought a 2011 FLHX a few month ago: that’s $33000 here for the stock bike and I paid it $37000 with some extra parts! I believe the CVO is much cheaper in USA!
    If the Moco wins against St paul HD at the court, Harley Davidson will loose a lot of money. Because most of us will stop buying HD clothes, parts and accessories.
    And there’s plenty of choice in aftermarket: they should think about it!

  9. 9 Napoleon Nov 12th, 2011 at 7:34 pm

    I totally agree with Rider2 and Pierre. This kind of policy is inacceptable as the prices in our dealerships.
    I hope there will be more HD dealers like St Paul, dealers with guts instead of being obedient and coward.

  10. 10 Montparnasse Nov 13th, 2011 at 6:11 am

    Pierre, if The H-D company is logical with these new rules it is not allowed to sell a jacket or motorcycle parts at all the Europeans and French people who come at Destination Daytona during the Daytona bike week because they do not pay the French and European taxes on these parts, because they will not buy these parts at the European dealers. Bad news for the US dealers, ridiculous.

  11. 11 Bill Nov 13th, 2011 at 9:30 am

    I, own an independent shop in the Harrisburg, Pa area. I don’t buy from the H-D dealer closest to me, as we don’t see eye to eye. Instead I was buying my parts wholesale from the dealer 10 miles away. I was informed that this new rule forbids them to sell to me. Now in order for me to buy Harley parts, I must pay full retail. This is taking all the insurance repairs that I would do out of my shop. The last time I checked most Harley shops hate insurance jobs. I don’t like internet sale sites much either, cause its very hard for me to make a penny when I hear ” Dude E-Bay has that for _ price”. But for all of us to survive in this god forsaken economy, we have to do what we can. Harley-Davidson is just like the big banks in the world, all the money is there’s and screw the little guy.

  12. 12 bigalyts Nov 13th, 2011 at 1:36 pm

    I don’t feel the Love towards HD? Why just think of all that they have given us! We should be grateful to have the ability to Pay Retail for Motorcycles and to pay 11% for financing with a 760 Beacon score,and 23% with a 600 Beacon score ! We should be obliged that we should pay $3, 000 for Dealer Fees and Delivery and disposing of a Crate and putting some fuel in the gas tank and hooking up a battery, and calling it Dealer Prep Now we should be happy to have the Factory…………….F_ _ K YOU Harley, I am buying a Used Harley from Craigs List for 25% under Book. NOW Harley tell everyone how strong your RESALE Is @#$%^&^%^&*(?>

  13. 13 Chop Nov 13th, 2011 at 1:38 pm

    Isn’t it all about service, I live DownUnder and feel at ease purchasing online through a safe and reputable H-D dealership like St Paul. Point proven a little time back, purchase a used Harley via an online listing, flew from Australia to MN to collect it, purchased a new motor for a friend and other goodies then rode to California and had the Bike & parts containered to Oz and still saved $$$’s compared to a local purchase including my airfares. Only downside was I had to wait 5 weeks for it to get here by ship BUT parts by air I can have in 5-10 days to my door not bad to get exactly what you want or need………GO for it TOM !

  14. 14 Gary Bang Nov 13th, 2011 at 2:07 pm

    AS a Harley-Davidson Dealer your business is selling Motorcycles, Parts, Accesories and parts to the retail trade in the USA. Not Canada or the rest of the World. The Rest of the World has a Delaler network that supplies parts, Accessories and Motorcycles to their Deales.

    This is an aggreement that the Factorys have set up all over the World. This is not just Harley this includes all Motorcycle Manufactures.

    Lets look at another thing about Saint-Paul Harley-Davidson how would you like to be a Dealer in California and have him sell to your customer items, and way below retail price and not have to pay California or any other states sales Tax. I know who cares as long as you are buying retail and you are getting a reduced price. MY Opinion Only

    The Retail Motorcycle business can not survive unless their is a level playing field all over the world. I take my hat off to the Motor company for taking a stand. My Opinion Only

    When we do not have a strong Dealer network, gee I am sorry they also have to make a living this little fun thing called Motorcycles will vanish. My Opinion Only

    Some one said gee he is just trying to make a living, every Motorcycle Dealer in the world is trying to do the same. Some of us are trying to do it the old fashion way Making a little Money and working very hard. My Opinion Only

    I have been making my living in the Motorcycle business for the past 48-Years the last 4-have been the worst I have ever seen. Man up Mister Saint Paul be like the rest of us hang in their and do the best “Good” thing you can do to stay in business. Business is Business I know, but what about Good Business some still practice this. My Opinion Only.

    Gary Bang

  15. 15 Rider2 Nov 13th, 2011 at 2:24 pm

    Bill…your story is the story of probably about 1000 stores in the country having to suffer from this new rule. One of the issues with HD is that if you purchase a set of screamin’ eagle heads for a Twin Cam and screw the installation and their customer dies, HD doesn’t want to be responsible because they sold you the part, even if they don’t have anything to do with the work.
    It’s also creating a dealer-only demand to protect territories. They want the HD stuff to go to HD dealer, just like they don’t want you to work on HD with HD OEM parts.

    @ Montparnasse… that doesn’t affect the new policy… HD doesn’t care if you buy a jacket at Destination Daytona during Bike Week, because it’s retail sale, full price + taxes. Doesn’t matter where the jacket goes once it’s paid. HD can’t control this. They care if the week after you’re back from Daytona, you purchase 10 of them for your buddies, ask Destination Daytona a discount and then have them ship it to your country.

  16. 16 Gary Bang Nov 13th, 2011 at 3:11 pm

    Cyril: This is a very interesting Post we have at least 4-things or Opinions going on.

    1 The Motorcompany trying to Protect the World Wide Dealer Networks Integrity.

    2 Legitimate USA Harley-Dealers Trying to survive and Doing The correct type of Retail Business.

    3 Other Harley-Dealers who choose to do a different type of Retail, Wholsale or any kind of Business

    4 The World Wide customers that benifit no matter what the price is.

    Not every one can win. My opinion Only Gary Bang.

  17. 17 Richard Nov 13th, 2011 at 5:05 pm

    bigalyts…Get you loan somwhere other than HD and pay cash. $3000. for set up fees? I think the set up fees range between $500. and $750. where I’ve bought my last three bikes. Oh yeah, I’ve negotiated those fees (as well as $250 shipping fees) with my dealer and have paid 0.$ on those last three bikes in shipping and set up. Also, I do not trade in bikes…sell them outright. As a consequence, I have not paid list price for these bikes either. I suggest you find a new dealer…

  18. 18 Olive Oil Nov 13th, 2011 at 5:31 pm

    Having bought many accessories and clothing from St. Pauls, I can say I buy where the best price is found. If that changes buying HD accessories and clothing will be a thing of the past at their prices. Time to get out the tents and have a Occupy HD tent city !! I’ll bring the Jack. Or perhaps an Occupy Sturgis rally, the tents are their already anyway.

  19. 19 izadore007 Nov 13th, 2011 at 10:23 pm

    I will tell you something Rider @ and Gary Bang, THIS WORLD AIENT ABOUT PAYING RETAIL ANYMORE!!!!!!!!!!!!!! Enter the “INTERNET” ! Gary BAng hire a Geek that does Web Sites and get a Better Web Site. The Internet has changed all the Rules. The Internet is about “Google” ! Type in the words “Best Price”or “Cheapest Price” and you get the best price or 100 Best prices! Dealer Network, what a crock of BullShit! Get me the Best price and the Cheapest Price and If I need your help Mr. Harley Dealer, I will come and see you if you are close and conveinent.. The only way the Dealer Network thing will ever work and be effective is to Control the Factory !

  20. 20 bigalyts Nov 13th, 2011 at 10:59 pm

    “Richard” I understand and know what to do! I just said that this was the HD and their Dealer Network had it! Those days are over! Enter the “Internet”! Here is the magic words ” Google, Cheapest part or Service or whatever”. This is what the problem is . So now Mr. Dealer hire the best Web designer and become the Better Mouse Trap. Mr. Gary Bang you and the other Dealership Friends that you have are Puppets, with HD as the Master.The Suckiest part is that you have Big Millions invested and there are no buyers

  21. 21 Napoleon Nov 14th, 2011 at 6:25 am

    Yes, that’s it and ONLY it : MONEY ! The MoCo and all other big companies don’t care anymore about customer. No, they just care about dividends and how much their shareholders are gonna earn.
    Should we let this happen and happen again ? Should we let shareholders and finance rule our lifes, tell us what and where to buy, eat … ?
    If HD hadn’t wanted to make easy big money in the rest of the world, they would have set prices and margins at a reasonnable level within their dealer network and the sales overseas wouldn’t have increased in that proportion.
    This is only the result of a bad overseas price policy and a strategy only driven by shareholders expectations !

  22. 22 Napoleon Nov 14th, 2011 at 6:27 am

    Sorry for my bad english.

  23. 23 Grayhawk Nov 14th, 2011 at 8:18 am

    The mindset of the affected and non-affected, your liberal when not affected but concervative when impacted.

    You want cheaper but want help locally and instantly when its a problem.

    The internet; the worlds lifesaver but local deathwarrant.

    I love the internet and what it affords from an accessible knowledge database never before afforded us and love the ability to find a specialty item or rare bird I would never have found locally. But wait there seems to be/could be a downside that is creeping across the countryside here and abroad that one doesn’t seemingly think bad till your gasping for breath from an unscented gas that overcomes you overtime.

    Local downtowns and long of tooth personalized business’s with storekeepers that know their products good and bad points in and out and will work with you to come to a workable solution that will be there when you need them again and in a rush are boarding up to the wholesale and mega store fronts with saleshands that can point you to a row and a book/electronic pad to look up the parts you think you know you need or an internet jockey that put a picture on the web with a price and will ship. But may not answer your emails of concern.

    Its not HD, Bang has a point whether its his business model or your local hardware store, St Paul’s numbers are down because of the economy so they look to other markets to keep volume sales up albeit in the long run it will/may affect their margins locally as well when and if times pickup.

    Consumers have long memorys once you become a wholesaler you are a wholesaler and better be able to maintain your business model overall at the lower margin because your local walk-in business sees your internet sales also.

    They/many dealers probably do not sell their parts to independent shops near their dealership but may like a lot of dealerships sell to independent shops in other dealers areas, noting that was the outrage/maybe norm way of increasing out of area sales and the screaming outrage before the internet.

    Again some look the otherway when its affects someone else’s business but not theirs, go figure but who is the first to fein outrage when another dealer sells parts to a shop in their area and it affects their local sells and heaven forbid labor sales/work. Ouch.

    If we as a whole do not support local communities and their/your local business to the extent they can survive then all you will have left is internet buys, non-support of sales after the sale, only picture visual product decision making before purchase, etc., etc.

    What a world that would be, its a fine line no perfect answer but we cannot expect local business to invest/stay open and employ knowledgeable product and service people and that pay local taxes/burdens to support your everyday way of life and securitiy, schools, parks, upkeep in your community.

    Last but not least the governments/worldwide governments will always find ways to tax, burden, internet taxation is and has been trying to grab a handhold and will overtime.

  24. 24 Mick Chadwick- Custom Nov 14th, 2011 at 8:47 am

    Looks like we should all consider dealing with St Pauls_ got real balls- good luck- you wanna see the prices in UK! Mike

  25. 25 The Engineer Nov 14th, 2011 at 8:58 am

    I think that this move on Harley’s part is stupid. I have an aftermarket shop, our local Dealer does not sell parts wholesale so I have been buying parts from an out of district HD Dealer for 5 years. I have hade a great repore with that Dealer and would like to continue to buy the $10-12k in parts from them that I have been buying. As of this time I cannot buy from them, and the local Dealer still won’t sell wholesale.

  26. 26 Jason Hallman Nov 14th, 2011 at 9:05 am

    Well it is about damn time! Harley is only pissed that their license to print money has finally been revoked due to the economy…screw them. They are Hippocrates! It is “Yay capitalism” when things are good but as soon as things get tight and the general riding public is tired of buying the “unfinished” motorcycles Harley sells they have decided to mess with the dealers. You cant shit where you eat and vice versa. There isn’t a long line of millionares looking to become dealers anymore. I don’t think there is any way in the world HD can win this one. This is going to be another “be careful what you ask for you just might get it” situation like Harley created by complaining to the EPA lobby aver Jesse James and others, building “pollution machines”.

  27. 27 simonnormandin Nov 14th, 2011 at 9:46 am

    last friday the closest rip off harley dealer from me told me the same shit it apply to canadian dealers also. i would have to buy one oil filter at the time and no harley parts on the wall of my after market shop. after over 30 years of helping and promoting harley davidson thats what i get . it would be great if after market parts manufacturing co. would decide not to sell anything to genuine harley dealers . anyways i tell everyone to keep their bike not to buy a new one its all made out of plastic shit days.

  28. 28 Rider2 Nov 14th, 2011 at 9:53 am

    This is not solely about the money but about SERVICE, reliability, business relationships and the customer at heart. We have purchased HD parts for many years and probably 2% of them were from our own state. Why? because we have better relationships with some dealers in other states. Some of them call us to see how we are doing, send us promo emails based on what we have purchased, we receive a Christmas card, etc… others take 3 months to get a t-shirt, or screw up our orders on a regular basis because they keep changing parts managers.

    It’s not necessarily about the price because wholesale accounts used to have the same price. It’s then up to the store to figure out its margin. It’s certainly not about devaluating the brand by going the cheapest, it’s about providing products at a reasonable price so people keep coming back to you because they know you are not screwing them. It goes for everything you buy in life.

    Also, not everybody used to get wholesale pricing… you had to buy a certain amount per year. It wasn’t that easy to get the special treatment. In any case, it’s a sale for a dealer, HD and the store. Everybody should be happy.

    The internet has provided tools to find products cheaper or faster. You don’t like it, don’t use it but 90% of us do so if you don’t know how to play the game, stay away. Certainly don’t bitch about it.

    HD is not gold you know… they think they are but they’re not. Everybody knows who makes their parts, where and some of us that have been here long enough know the margins, even at wholesale. I am 100% for protecting the dealer network. However, when the dealer doesn’t do its job, doesn’t want to work with you, suck at customer service and communicate with you only when he wants to know if your credit card will work, there shouldn’t be a rule that we still have to purchase from him because he is the closest to our zip code. If you don’t like you local Best Buy, you are welcome to buy for the next one or online…..

    The fact that HD is restricting this means they are trying to didcate where you buy and whom you’re buying from. This is where I have a problem with.

  29. 29 Craig Nov 14th, 2011 at 10:32 am

    For many of you outside the US, the “elevated” prices you pay are the result of taxes your governments charge on the products being imported, HD is not setting your final price. It is your government you should complain to.

    It is human nature to look for the lowest price, no one wants to overpay. However, there is more to value than the price. When the part you ordered over the internet turns out to be wrong, or the leather jacket does not fit or has a deffect, dealing with an on-line store to get this corrected is a major frustration. Many take that part or jacket to their local dealer and attempt to exchange it there to avoid that frustration. Yes, to the dealer that won’t be there without retail customers.

  30. 30 Tom Hodkin Nov 14th, 2011 at 10:43 am

    Any buisness that thinks they can stop the internett is doomed. HD has been riding the nastalgia train since the 80s. as their customers are dying literaly, selling 70 year old technolagy is not going to work much longer. They had the ( made in the USA ) deal going for them but now we have choices. Victory is who they need to be worring about, not thier own dealers.

  31. 31 Andy @ Thundercity Nov 14th, 2011 at 11:04 am

    I’m conflicted over this one. On one hand I can understand The Factory responding to pressure from international dealers who are trying to protect their market from cheap internet sales from the US. On the other hand, why the hell can’t St Pauls profit from the opportunities offered by favourable exchange rates?

    I would just ask respondents to consider this. No-one in this industry is currently making a shed load of money selling anything to anybody! In this economic climate the name of the game is SURVIVAL. Some businesses will survive this Recession, other won’t. The ones that survive are the ones who give an excellent service to their loyal customers, year after year. Exploiting vagaries in exchange rates for short term gain is not a long term plan.

  32. 32 Ted Nov 14th, 2011 at 11:20 am

    I too have purchased thousands of $ in parts from St Paul, usually at a 15% discount. They have the best stock of parts in the nation and ship quickly. I get the parts faster and cheaper than my local dealer can.
    Now here is what really pis*ed me off about Harley’s new rule; as of November 1st dealers can not sell HD merchandise on Ebay or Amazon. What right do they have to tell St Pauls that they can not sell an overstock tee shirt on Amazon?
    Another thing that is confusing to me is that St Paul’s is contributing to the bottom line profit of HD. Without innovative dealers who have the business sense to move product, HD’s retail sales numbers would be in the trash.
    May the strong survive and the law be on our side.

  33. 33 XH-D Rider Nov 14th, 2011 at 12:17 pm

    If I’m wrong say so. But if HD doesn’t put a stop to foreign country sales then the foreign sales will not grow.
    Its all most like HD is spreading there wings to wide and now the local dealers are dieing off cause they can’t survive with local sales. St Paul has another store 30 miles away from the home store.
    There is six HD stores in just a small radius. St Paul was one of the first to sell to local aftermarket shops at 10% above dealer and now with them dieing off times are getting tuff.
    HD created there misery and now they want the dealers to suffer for it.
    Motorcycle shops are the only place you go into and demand a better price cause you know they have a 50% mark up on there HD parts. You don’t go into any other store like Target or Walmart and demand a better price,
    I could see HD getting pissed at St Paul and pull there dealer ship. I remember back in the day if you called your aftermarket shop Hog something HD would sue you.
    By the way Gary Bang has been in the industry longer then any of you have been riding.

  34. 34 LENNY SINNET MC ADVANTAGES Nov 14th, 2011 at 1:00 pm

    Gary Bang has been in this Forever and is a great person in our industry a true legend.
    Also great is Mary Bang there everyday with Gary simply the Best of the Best.
    Keep up the good work.

  35. 35 Toby Nov 14th, 2011 at 4:35 pm

    There are multiple issues at stake here. The first is simply overseas or out of district sales. Even at MSRP overseas internet sales can be profitable. It is unlikely that HD can stop this. Most dealers will simply find a way to sell to a third party (owned by their cousin) that makes the international sale.

    The idea that a manufacturer can tell a dealer what to do depends 100% on the state. Dealer franchise laws vary considerably. Internet sales are mail order sales, and most of these older dealer agreements said nothing about mail order, so like the St. Paul suit it depends on the state laws governing dealer franchises and whether HD can unilaterally modify it. The outcome will likely only affect dealers in MN.

    For my own purposes, other than required parts for my bike, I usually buy after market. They are usually of better quality and often made in the USA or in a fair trade country.

  36. 36 Brett Nov 14th, 2011 at 6:56 pm

    well the St. Paul dealer is huge. I doubt HD wants to lose them…however with all the forcing dealers to make these ridiculous palaces…you should see the monsterous building Vandervest is putting up now that they were awarded the Green bay dealership from McCoy’s….it is only a matter of time until you see MANY dealerships shutting their doors. There is not a need for a dealership every 30 minutes anymore.

    The clothing boutique may be closing.

    A good friend of mine who used to work at an HD dealership told me the other day, the Harley – Davidson he knew, died 30 years ago.

  37. 37 fuji Nov 14th, 2011 at 8:01 pm

    Gary Bang.

    I will agree with you whole heartedly. There’s a first Gary. LOL

    You are point on with your comments. Except one sentence.

    The Motor Company and “Integrity ” in the same sentence. Oil and water. LOL

    Its the HD Show my friends if one doesnt Like it buy another brand.

    Now ! The option is there.

    Bultacos forever Gary.


  38. 38 MC Nov 15th, 2011 at 11:43 am

    This is a little off subject but still involves how HD Corporate controls their dealer network.

    After enjoying a great relationship with our local dealership for the past 25 years I was informed that they can no longer sell to us. I was told that the factory can monitor their sales and look for red flags like tax exempt and bulk sales.

    I should mention that all of the parts and accessories we purchased were sold at MSRP and installed at our shop. No internet sales. We just preferred some OEM parts as opposed to their aftermarket counterpart because the fit and function was correct. Also, there will always be customers that prefer shops like ours as opposed to going to the dealer.

    We will still buy the occasional part as we need it. I will even send my customer to the dealer to buy at retail and bring it to the shop. But there is no way we will ever buy at the volume we bought before.
    Most parts have been cross referenced in our system and replaced with aftermarket parts.

    The dealership did not seem very happy having to stop our business.

    Maybe someone can give their opinion as to how this will or will not help HD and their dealer.

  39. 39 just my opinion Nov 15th, 2011 at 12:51 pm

    I can see that both sides have a valid point here, the dealers that are losing sales to ST. Paul cannot afford that loss in business but the same can be said for St. Paul if he does not do what he can to sell any part possible he may be forced to close and even if HD wins this fight and St. Paul cannot sell to anyone out side of their area what will stop them from just adding one link to the chain and selling to a locally based store that sells to all their existing clients out of state and out of country? I personally don’t understand why every dealer does not do what St Paul is doing. If every dealer had wholesale pricing for the mom and pop shops that a lot of riders prefer to use in their area, and if the HD dealer gave a small discount to the guy that does his own work on his own bike then the dealer still makes money so who is hurt? I remember being told that if I became a member of HOG “Harley Owners Group” I would be getting a discount but most dealers will not honor that so now what? If the HD dealer sells to a customer that does his own work or sells to a small shop in their area Sure the HD dealer loses the labor end of the sale but if the dealer did not over charge every one on labor they would not be losing that sale to start with, HD dealers use a fixed number of time on ever job done, for example if you have a head gasket go bad the dealer charges X amount of time to change it even though a experienced mechanic can do the job in half the allotted time so who gets hurt? “the customer” The other side of that issue is that the local mom and pop shop will do the job and only charge for the time spent doing the job not twice the amount because the HD service guide says to screw the customer for double the time And the truth is most HD dealers think they must have full retail on all sales which by the way is more than 100% marked up on most items and even more on a lot of items on top of the inflated labor rates and that is why a dealer like St. Paul can sell to someone out of the country and the guy in Canada can pay duties and taxes and still get it cheaper than his local HD dealer in Canada will sell him the same part for and that customers local mom and pop shop will charge him half the cost for the labor using an HD certified mechanic that went to the same schools as the guy that works for the HD dealer, so why would he want to use the greedy HD dealer? Harley does not need to stop any of their dealers from selling where ever they want to sell those parts, all they have to do is tell all dealers that they are allowed to do the same, and encourage all dealers to use good business practices to get those sales even if it means charging less money on some sales and as for those dealers that are greedy and refuse to discount the customer that is smart enough to ask for a discount they will simply go out of business and those buildings will be filled with a new dealer that understands that it is better to make 10 dollars on a million parts than to try and make 1,000 dollars on 1000 parts. Walmart did not get to be the largest retailer in the world by charging more than people are willing to pay. The days of over charging the customer is gone and if those dealers that still charge full retail don’t change they will have to close their doors. Any good business person knows that you charge as much as you can and still make the sale. If you are losing sales lower your prices for those few customers that insist on discounts and get those customers back and remember treat all your customers like you need them “even those that want a discount” because you do need them. MORE THEN THEY NEED YOU. That is my opinion

  40. 40 Local Independent Shop Nov 15th, 2011 at 2:17 pm

    First off, thank you to Cyril for getting some discussion going on this point and Mr Bang, thank you for giving us the Dealer perspective.

    I own an Independent shop not to far from Gary Bang, I have been in business for 6 years and have been buying closeout from Harley for about 8 years. I began buying parts strictly for resale about 4 years ago.

    I find many flaws in how HD decided to unilaterally forbid sales. The largest is disallowing one dealer from wholesale customers and forcing them to a dealer just because of proximity. In a free market, competition drives business, with the decision from HD, they did not intend to create competition, but deny sales. What I mean here is this: I shopped dealers to get the best price for my volume, I could negotiate a discount with my existing dealer/supplier based on other dealer/suppliers offering more competitive rates to earn my business. In the end, everyone wins. No matter which dealer the parts stem from, the Motor company and myself get paid, and the customer is happy. Now, the local dealer has full advantage of me and my customer, therefore the free market is closed. I do agree that the best business practice is to keep things in the neighborhood, but the dealer has to be willing. In my case, my 2 neighboring dealers (both 7 miles away) refused to compete in the free market, and now that HD came down and forced me to go to them, one offers no discount and the other 10% off, both of which prohibit me from selling OEM parts.

    Further, I feel that if HD would model itself after the local Chevy/Ford or Honda/Kawasaki for wholesale purposes, everyone would be happy. But they do not, HD says no sales outside your radius and then no rules within. So a guy that was getting 20 or 25% off, goes to 0 or 10% and both OEM and Aftermarket shops are upset.

    The biggest insult is restrictions on quantities, HD has insisted that supplies for more than 2 bikes must be substantiated. Perhaps this is over extreme. Im sure some people take advantage of oil.plugs and such and resell overseas, but an honest shop will have a difficult time buying 10 quarts of oil at a time 3 times a day, that puts stress on the shop and the dealer/supplier and adds to labor cost etc that would have otherwise been discounted because of volume.

    In the end, In my opinion, HD will need to loosen the reins and allow sales (seems crazy, that you must “allow” sales to happen when its a retail store), They either need to place an across the board discount for categories and volume and force dealers to sell to Independents in proximity or open the market back up for competition. It would make sense for the local shop and local dealer to do business or giants like St Paul or other dealers will create “satellite” operations and infringe on sales that could have been from the local dealer.

    Gary, I respect your opinions and appreciate your input. Without dealers like you, opinions would fester and not be open for discussion, thank you.

  41. 41 Tamara Smith, James Gaskets, Inc. Nov 15th, 2011 at 6:58 pm

    This seems like an opportune time to mention that there are many aftermarket manufacturers producing comparable products that are at least equivalent in quality to the factory counter-part along with many that have been improved upon. Most of these manufacturers, many well known throughout the industry, some having been in business for 30 to 40 years, are happy to sell Dealer-direct to aftermarket repair shops in addition to making our product available through Distributors world-wide. Seems to me that H-D has left the door wide open for reputable service parts and other manufacturers to step in.

  42. 42 X Harley Dealer Nov 16th, 2011 at 7:27 pm

    I started in the motorcycle business in 1970 with a small chopper shop. What a blast! I actually made decent money, along with meeting fellow bikers who are friends today all over the World. My dream was to be a Harley dealer so I could get genuine Harley parts cheaper to build my custom bikes. In 1978 I started Harley-Davidson of Winnipeg and ran it for 26 years. I was very sucessfull, had top notch knowlegebale wrenchs (the top in Canada), built motors, big inch and high performance ( I’m currently building a John Harmen dual carb 120 inch Shovelhead in a Wayne Engineering single dowwn tube frame). We had a in house paint spray booth with a full time painter. We did everything, and did it good, and at a fair price. We had one of the largest parts inventory in Canada, because the Canadian distributor for Harley, Fred Deeley Imports never had any dept or coverage of Harley parts, so we had to stock almost everything including tons of aftermarket parts. Our stock was so inclusive that we sold to other Canadian dealers as Deeley never had much and had to order from Harley! In 2004 Deeley Harley-Davidson did not renew my contract and gave it to my brother! What a joke! My life’s work gone, including my retirement funds. It was a blessing in discuise as I got out when Harley dealers had their customers respect. Harley-Davidson had a good thing going for them, but they got greedy and all of sudden these dealers who supported them for years were out of business along with losing their life savings as it was all tied up in their shops! These Taj Mahals are cookie cutter boutiques! They’r not motorcycle shops anymore! Both H-D shops here couldn’t rebuild a motor if their live’s dependded on it! My brothers shop is one of the worst in Canada. No knowlegebale staff! No intergety! No parts! Poor unreliable service! Its a gong show! I used to buy H-D parts from the states and I dicounted them 25% to my customers and still made my full margin! Parts in Canada are 2 to 2 1/2 more than in the US. All parts are duty free! makes a guy wonder!! I said my piece and I’m sticking to it. I’m going out yo my garage with more Harley tools and tooling than all the H-D dealers in Manitoba combined (I kept everything) and work on my 120 Harman motor. Life is good!

  43. 43 Tim Nov 17th, 2011 at 4:01 am

    You go Tom!

  44. 44 Big Nov 17th, 2011 at 10:47 am

    I love the stories about dealers selling parts wholesale to independents outside their own market but not to shops in their market who compete for local repair business. It’s OK for the indy shop to eat another dealer’s lunch, but not their own. Until another dealer is doing it to them! Does anybody else see the comedy in this?

  45. 45 Jim C Nov 17th, 2011 at 2:07 pm

    My local dealer never had part ‘xyz’ in stock for my Dyna, so I got it from SPHD via ebay. Who’s fault is that?

  46. 46 Bob Yezek Nov 21st, 2011 at 12:03 pm

    Gary what about the crappy parts I have purchased from you in the past, You know the fake Harley copy cat ones. I happen to know St Paul Harley backs all their sales 100%. Also the dealership has been around since the 1940’s. So before you rip on someone when you don’t know the full story-Do the research on the real issue, Can we say anti trust or monaploy. Yes there are laws against those as well. Every dealer has the right to do business with whomever seeks them out. If a dealer has the smarts to be current with the 2000’s way of doing comerance so be it. Props to ST PAul Harley Davidson, and all the other online dealers like Chicago HD

  47. 47 stacey Nov 22nd, 2011 at 4:01 pm

    alot of crap being said here. HD took away this gus right to sell over internet to Canadians. Im calling BS!!!! I own a Harley and I have been buying from St. Paul for months and had read the disclaimer about it being Jan 1 they were going to cut off from selling on ebay. Apparently they were cut off as of August 1. An example for everyone is for me to buy a dealer shirt here it is anywhere from 65-100$ per t shirt………thats right T-SHIRT!!!!!!!!! I can purchase one through St. Paul for half the price, exact same shirt I may add. Why is this such an issue? \As long as SPHD forwards HD HQ their cut what is the big issue???

  48. 48 Darrell Nov 25th, 2011 at 1:45 pm

    This is in response to Craig’s assertion that the price of Canadian parts is higher because of our taxes. We stiil have to pay taxes on parts order from the US. Last week I priced out the parts to add the rear fascia from a Street Glide to my Road Glide Ultra, the price was $297.00 plus tax. The price in the States was $193.00. I would still have to pay GST (taxes) when I picked it up at the post office. The biggest additon to Canadian prices is what we unaffectionately call the Deeley tax which is the markup that Deeley Motorcycles(Canadian HD distributor) sees fit to add to the price. If I would have known about HD’s decision to suspend internet sales to Canada before the purchase of my new bike this past year I would have seriously reconsidered the purchase. I have beeb riding for over 40 yrs and have pretty much reached the end of my rope when it comes to Harley and their mistreatment of customers.

  49. 49 Bueller Nov 27th, 2011 at 11:02 pm

    “Without innovative dealers who have the business sense to move product, HD’s retail sales numbers would be in the trash.”

    What happens to innovators at H-D? Ask Erik Buell.

  50. 50 OLDAUSSIE Feb 12th, 2012 at 1:15 am

    When you limit sales out the door,,doesn’t that have a negative impact back up the food chain? Dealership itself and it’s employees. How about the suppliers of all those parts. Not to mention STOCKHOLDERS/Shareholders!.. I know in Australia the H-D article is grossly overpriced compared with USA prices. Too many years of total greed. More people SAVVY with online ‘shopping’. There are realistic alternatives to H-D now. The H-D company MUST face some basic, live or die,decisions. When ypu have your head in the sand,,,,something else is exposed !!!! .

  51. 51 Dan O'Keefe Jr. Feb 19th, 2012 at 6:41 pm

    To Gary Bang:

    Just for fun I went and found that you are selling parts on-line and turns out I was able to go through the whole buying process from another state. Everything you said in your post is very hypocritical and I also found you on a third party web site as well – J&P Cycles.

    Good for you Tom, a true business man that will do what it takes to provide great service and parts.

    If anyone hasn’t been to St. Paul Harley, they should go, it’s the best dealership i have been to.

  52. 52 ROD Mar 6th, 2012 at 8:57 pm

    In the 90’s when new bikes were hard to get Decker HD, Madison,Wi,sold bikes across the ocean,he is dead now,but what else goes on?I was in his shop when this was done.What does go on?Who comes out of these deals with the most cash.Internet sales can span the world,I sit back and collect bits and pieces,my computer has been hacked into many times,

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Cyril Huze