How To Become an RV Dealer: Start Your Own Successful RV Dealership Business

Living the RV lifestyle and owning an RV dealership may sound like a dream come true for RV enthusiasts. With the RV industry projected to continue its upward growth trajectory, now is an opportune time for entrepreneurs and existing business owners to consider opening an RV dealership.

As an avid RVer myself, I understand the fulfillment that comes from helping fellow outdoor adventure seekers find the perfect recreational vehicle to create lasting memories. However, starting an RV dealership requires careful planning, significant upfront investment, and the ability to adapt to industry changes down the road. In this comprehensive guide, I’ll walk you through the key steps and potential challenges involved in launching your own successful RV dealership business.

Capitalizing on the Booming RV Industry

The RV industry has thrived in recent years, with 2021 setting a new shipment record of over 600,000 RVs to dealers. This demand has been fueled by the COVID-19 pandemic driving more consumers to domestic outdoor vacations. With RV ownership rates highest among younger generations like millennials, the industry is poised for continued growth. Whether you’re an entrepreneur looking to tap into this expanding market or an existing RV business owner seeking to upgrade your dealership, this in-depth guide will equip you with the knowledge to succeed.

Let’s begin this journey together by first understanding the different facets of the RV industry.

Source: togorv

Diverse RV Industry Landscape

Before launching an RV dealership, it’s crucial to comprehend the different RV categories, geographic variations, industry operations, competitive forces, and regulations that make up the RV ecosystem. This market intelligence will help inform your business model and inventory decisions down the road.

A Thorough Market Analysis Provides Key Insights

As an RV dealer, keeping your finger on the pulse of broader industry trends and growth projections is imperative for success. Key market analysis insights include –

Industry revenue is estimated to reach $60 billion by 2026, exhibiting a compound annual growth rate of 7% from 2021-2026. This steady growth presents a profitable opportunity.

RV unit shipments increased 22% from 2020 to 2021. Towable RVs like travel trailers accounted for 88% of units shipped, while motorhomes made up the remaining 12%.

The most popular towable RV categories by market share are conventional travel trailers (61%), fifth-wheel trailers (17%), and folding camping trailers (10%).

For motorhomes, Class A motorhomes hold 24% of the market share, while less expensive Class C motorhomes lead with 43% market share.

Demographics show the bulk of RV demand comes from younger generations. 60% of RV owners are under age 45, while 50% are 35-54 years old. Target marketing accordingly.

Clearly understanding current RV industry trends and growth projections will help you make accurate business plans and set realistic financial goals for your future dealership.

Diverse Options: RV Categories and Features

RVs range widely in size, design, features, and price point. As a dealer, you’ll need deep knowledge of the unique aspects of each RV category you sell.

The main types of towable RVs are –

Travel trailers: Hard-sided trailers ranging from small, lightweight models to luxurious 40+ foot homes on wheels. Can be towed by many vehicles.

Fifth-wheel trailers: Require a pickup truck to tow due to hitch mounting in a truck bed. Feature spacious living with high ceilings. Popular for full-timers.

Folding camping trailers: Also known as pop-up campers. Canvas-sided trailers that collapse for towing and expand on-site. Affordable option.

Truck campers: Slide into truck beds for compact, go-anywhere RVing. Capable off-roaders.

Motorhomes also vary significantly –

Class A: Luxury homes on wheels built on bus chassis. Most expensive.

Class B: Converted full-size vans. Great for maneuverability and MPG.

Class C: Built on truck or van frames. More budget-friendly. Sleeps up to 8.

Beyond RV type, aspects like several slide-outs, towing capacity, kitchen and bathroom amenities, sleeping arrangements, and interior finishes will impact prices for consumers. Cater your inventory to your local market’s preferences.

Regional Differences Shape the Market

While RVing has become more popular nationwide, market demand differs by region. Consider geographic trends as you plan your ideal dealership location –

The highest per capita RV ownership rates are seen in Michigan, Utah, Minnesota, and Alaska.

Texas, Florida, and California have the largest total RV ownership numbers due to population size.

Proximity to campgrounds boosts local demand. RV hot spots include areas near National Parks and lakeside recreational areas.

Temperate climates like the Southeast and Southwest can support year-round selling seasons.

Northern locations may require winterizing maintenance services.

No matter your location, emphasize the accessibility of RV getaways and the community your dealership provides.

RV Industry Dynamics Impact Dealerships

In addition to market forces of supply and demand, the way RV manufacturers, dealerships, and industry groups operate influences individual dealer success. Key dynamics include –

Most dealers sell brands from major manufacturers like Thor, Forest River, Winnebago, and REV Group, which together account for over 80% of units shipped.

Independent dealerships not aligned with a manufacturer account for 42% of all dealers. Brand-exclusive dealers make up the other 58%.

RV dealers may partner with rental agencies to capture the lucrative rental market without using inventory risk.

Industry groups like the RV Dealers Association provide valuable training, advocacy, and networking.

Regulations impacting RV dealers include licensure, zoning, taxation, and environmental compliance. Know your regional requirements.

Understanding these operational factors will help you craft your optimal business model and set your dealership up for success.

Sizing Up the Competition

Existing RV dealers in your area will be your main competitors. Thoroughly research your local market by –

Identifying all current dealers and their brands, sizes, models, and prices. Look for gaps or saturation.

Calling anonymously to audit their sales approach and buying experience. Look for strengths or weaknesses.

Searching online reviews to gauge customer satisfaction levels. Poorly reviewed dealers present an opportunity.

Considering the proximity to your planned location. Aim for physical separation to reduce direct competition.

Determining if competitors focus on new sales, used sales, rentals, or services. Consider your niche.

Also recognize that larger dealers will compete on price with higher volumes, while smaller operations focus more on service. With in-depth competitive analysis, you can strategically differentiate your dealership.

Laying the Groundwork with Meticulous Planning

After thoroughly analyzing the RV industry from multiple angles, it’s time to dive into the planning phase of opening your dealership. Careful research and number crunching now will pay dividends down the road.

Choosing the Optimal Business Model

The RV sales spectrum ranges from small used inventory lots to expansive dealerships offering new models, used trade-ins, rentals, services, and accessories. Consider your goals, budget, and local demand to determine the ideal model, such as –

New RV sales: Requires manufacturer partnerships but nets higher profit margins. Allows you to compete for local sales among brands.

Used RV sales: Lower barriers to entry and inventory cost, but thinner profit margins. Great for targeting budget-conscious buyers.

New and used combo: Balances the benefits of both models. Makes it easy for buyers to trade up to new models. Requires ample lot space.

Expanded offerings: Adding rentals, services, parts, or on-site camping can boost revenue streams.

While ambitious offerings have higher startup costs, they also increase customer convenience and grow brand loyalty. Weigh your options carefully in the planning phase to build a sustainable business model.

Conduct In-Depth Market Research

Meticulous market research is crucial for determining ideal inventory selection, facility requirements, and sales strategies. Key areas to analyze –

Local demand for specific RV types, categories, brands, price ranges, and features based on demographics. Gauge preferences through customer surveys.

Regional sales cycles including peak seasons, average turn times, and seasonal inventory needs.

Optimal location based on customer proximity, lot size, zoning laws, road access, and visibility. Research commercial property costs.

Facility and parking requirements to comfortably showcase inventory, facilitate test drives, and enable service access.

Customer demographics like age, household income, family size, lifestyle, and buying motivations to tailor your marketing approach.

Potential partnerships with campgrounds, tourism bureaus, and rental agencies for cross-promotions.

Thorough market research and analysis will provide the foundational data needed to build a high-demand dealership in your area.

Crafting a Comprehensive Business Plan

With deep industry knowledge and market research in hand, you’re ready to craft a detailed business plan. This living document will guide your startup budget, location and layout, inventory management, marketing, staffing, and beyond. Key components include:

Executive summary: High-level overview of your dealership goals and competitive advantages.

Financial plan: Projected startup costs, operating expenses, sales forecasts, capital requirements, and profit/loss projections.

Funding plan: Whether through loans, investors, business grants, or personal savings.

Location: Proposed site, lot size, and facility requirements with photos, maps, and details.

Facility layout: Floor plan maximizing showroom, inventory parking, customer flow, and service access.

Inventory plan: Mix of new/used units to stock by category, volume, and profit margins.

Marketing strategy: Brand positioning, advertising channels, partnerships, digital presence, and promotions.

Staffing: Organizational chart outlining roles like sales, finance, service, cleaning, and support staff.

With every business plan detail meticulously researched, you’ll be prepared to bring your dealership vision to life.

Becoming an Authorized RV Dealer

Once your business plan is complete, it’s time for the complex tasks of securing manufacturer partnerships, acquiring licensing, and transferring inventory. Follow these steps to check all the boxes required for authorized RV sales.

Building Relationships with RV Manufacturers

Becoming an exclusive authorized dealer for one or more RV brands is key for reliable inventory access. Typical steps include –

Researching RV builders and selecting those aligning with your business plan in terms of size, models, quality, consumer appeal, geographic regions, etc.

Completing dealer applications outlining your business plan, market analysis, facility plans, ownership structure, training ability, and financials.

Qualifying for authorization based on industry experience, business longevity, Dun & Bradstreet credit score, service capabilities, marketing strategy, and inventory commitments. Requirements vary by manufacturer.

Negotiating business terms like unit order minimums, wholesale pricing, holdbacks, floor plan financing, cooperative advertising support, staff training, grand opening support, and territory limitations.

Signing your dealership agreement after carefully reviewing all terms with your legal counsel to ensure the partnership will be profitable.

Take time to foster strong relationships with manufacturer reps during this process, as their support can make or break your ongoing success.

Navigating Licensing, Bonding, and Regulations

Legally selling RVs requires obtaining proper business licenses, permits, and insurance –

Business licenses and tax IDs are required at both state and local levels. Some locations have special RV dealer categories.

Sales tax permits are necessary wherever you collect and remit RV sales tax. Understand exemptions.

Zoning approvals must be secured to use your commercial property as an RV dealership selling to the public.

Building permits will be required for any renovation or new construction on your property before work begins.

Dealer bond protects customers if your business fails before completing RV warranty work. Typically $50k minimum and held for 5 years after closing.

Liability insurance protects against property damage, bodily injury, and inventory loss from theft, vandalism, or natural disasters. Workers’ comp is also mandatory.

Dealer license plate tags simplify moving inventory between storage and your lot for display.

Don’t let regulatory requirements overwhelm you. Hire qualified legal counsel to ensure every box is checked before opening your doors.

Stocking Inventory for Your Grand Opening

With the paperwork complete, it’s time to put your inventory plan into action. As opening day approaches –

Begin placing wholesale orders with your manufacturer partners according to your inventory plan. Order early to avoid production backlogs.

Shop the used RV market through auctions, dealership trade-ins, and private sellers to hand-pick quality used stock per your plan.

Shuttle inventory from off-site holding lots to your dealership display spaces using your shiny new dealer plates.

Merchandise your lot for high visual impact, grouping similar models. Maximize signage and feature hot-selling units up front.

Train staff thoroughly on every RV in inventory using online materials and in-person walkthroughs from manufacturers. Product expertise is critical.

Stock parts and accessories to profit from customization requests. Offer starter kits with essentials.

With appealing, salable inventory ready on opening day, you’ll be off to a profitable start. Now focus on spreading the word.

Hitting the Ground Running with Your Dealership

From securing the perfect location to hiring a skilled team, meticulous planning and preparation will allow your dealership to hit the ground running from day one. Let’s explore key steps to open smoothly and successfully.

Choosing an Accessible, Zoned Location

Selecting the right property for your RV dealership showroom and lot will impact visibility, convenience, and sales. Ideal locations –

Are close to the main thoroughfares with traffic lights for safe exit/entry. Avoid windy rural roads.

Have acreage to comfortably showcase inventory, offer test drives, and expand later.

Are properly zoned for commercial retail/wholesale with any necessary variances approved upfront.

Are situated near affluent recreational areas for local buyer convenience.

Are not obstructed by other buildings or tree lines which block visibility.

Will accommodate service bays, customer parking, and inventory delivery logistics.

Are competitively priced within your commercial real estate budget.

Finding the perfect RV dealership property may take time, but the long-term benefits are invaluable.

Designing a Customer-Focused Dealership Layout

Your facility’s flow and layout directly impact the buying experience. Maximize sales by –

Leading customers through visually appealing showrooms before exposing them to pricing.

Grouping similar models on your lot.

Offering clear signage and educational materials for self-guided browsing.

Maintaining accessibility clearances around RVs so all units can be viewed up close.

Providing well-lit spaces for evening browsing.

Incorporating lounges and refreshments to relax customers.

Setting up a professionally designed sales center for deal paperwork.

Installing service bays out of customer view to avoid detracting from the sales floor.

Take time to map out how customers will move through your space, visualizing hassle-free flow.

Stocking Inventory Aligned with Local Demand

Carefully curating your inventory mix is among the most crucial elements of RV sales success. Tactics include –

Ordering the floorplans, categories, features, and price points proven most popular through your market research. Local preferences vary.

Factoring in regional climate considerations like extra A/C capacity for hot climates or improved insulation for colder ones.

Balancing inventory levels across entry-level, mid-range, and high-end motorhomes and towables based on area income demographics.

Limiting competing overlap across the models you carry while offering a good selection within each brand.

Leaving room for high-turnover hot sellers like lightweight travel trailers which attract first-time buyers.

Rotating used inventory quickly to balance acquisition costs with selling periods.

By consistently fine-tuning your offerings to match local buyers, your inventory will fly off the lot.

Leveraging Cutting-Edge Dealership Technology

Modern RV dealership management software centralizes inventory tracking, sales workflow, and back-office tasks for simplified operations. Look for solutions offering –

Real-time inventory visibility with details, photos, and prices synced across your website and sales portals.

Lead management and CRM tools with integrated marketing and customer support.

Sales deal flow processing from quote through financing, titling paperwork, and closing.

Service schedule, parts catalogs, maintenance records, and technician workflows.

Accounting integration, reporting analytics, and custom report builders.

Mobile accessibility to empower your team with data access on the go.

While technology requires an upfront investment, the long-term efficiencies, organization, and insights are invaluable at scale.

Marketing Your Dealership Strategically

Opening day arrives, and inventory is ready – now it’s time to spread awareness and attract buyers. An omnichannel marketing strategy is key for steady sales.

Establishing Your Unique Brand Identity

In a crowded marketplace, making a memorable first impression is critical. Be sure your branding –

Communicate your dealership’s unique personality, strengths, and value proposition.

Resonates with your target customer demographic on an emotional level through messaging and imagery.

Is conveyed consistently across all platforms – website, signage, print ads, swag, email, and more.

Leverages logo, tagline, colors, fonts, and styles that are simple, recognizable, and evoke your desired brand image.

Sets you apart from local competitor branding. Unique is memorable.

Invest time upfront in thoughtful branding that translates your vision into a compelling identity. This will pay dividends through enhanced visibility and customer connection.

Launching a User-Friendly Website and Strong Social Presence

Your website and social channels are the digital face of your brand. Ensure they –

Spotlight inventory through search tools, photo galleries, 360 tours, customization visualizers, and extensive unit details.

Offer educational RV buying guides, blog content, FAQs, and resources to build trust with prospective buyers.

Provide seamless lead capture forms and live chat for sales follow-up.

Share customer stories, dealership news, and promotions on social media while interacting with followers.

Utilize SEO keywords, tags, and backlinks to improve search visibility and direct website traffic.

Provide contact info, hours, directions, and facility details for location transparency.

The right digital presence will seamlessly guide online customers into your showroom. Leverage professional web designers and marketers as needed.

Cultivating Partnerships and Local Relationships

While digital reach is important, connecting locally establishes your dealership within the community. Ideas include –

Joining local tourism boards, business groups, and recreational associations. Look for partnership and cross-promotion opportunities.

Sponsoring charity events, fundraisers, and festivals to increase visibility while giving back.

Partnering with campgrounds and RV parks that can refer buyers in exchange for service discounts to their customers.

Building relationships with banks and credit unions to steer buyers your way for RV financing.

Networking at county fairs, sporting events, community centers, and any venue frequented by potential RV owners.

The more your dealership brand penetrates the local landscape, the higher your visibility and trust will become.

Training Your Sales Team for Success

Your sales associates are the face of your business. Be sure staff –

Possess extensive product knowledge on features, construction, options, and operations for every RV on your lot. Encourage ongoing training.

Understand legal compliance for advertising, documentation procedures, and disclosures.

Embrace friendly yet professional personality traits that build customer trust and likeability.

Utilize sound discovery tactics to profile customer needs before suggesting well-matched inventory.

Are skilled negotiators able to communicate value persuasively while overcoming objections?

Remain patient, transparent, and focused on customer satisfaction from sale through delivery and beyond.

With extensive product and selling skills training, your team will gain the confidence to seal deals and build loyalty.

Maintaining Profitability and Growth

Grand openings generate initial excitement, but consistent performance over the long haul ultimately determines RV dealership success. Ongoing priorities should include –

Monitoring Financial Health

Proactively tracking metrics helps identify issues early before they become profitability threats. Watch key indicators like –

Sales revenue across new, used, parts/service, and finance streams. Set targets by month and model seasonal fluctuations.

Gross profit margins on inventory sales. Narrowing margins signal issues like overstock or pricing gaps.

Cost of goods sold to confirm favorable manufacturer terms and transportation costs.

Operating expenses include payroll, marketing, utilities, loan payments, and more. Control overhead.

Number of sales and close rates by salesperson to maintain accountability.

Regular financial analysis provides critical insights to inform strategic decisions and safeguard stability.

Supporting and Developing Staff

Your team’s skills and company culture greatly impact your dealership’s performance. Make it a priority to –

Continually train sales and technical staff on new offerings and industry shifts. Ongoing education builds expertise.

Provide opportunities for staff to learn different roles and strengthen weak areas through job rotation programs. Boost experience levels.

Offer incentives and recognition for top performers. Friendly competitions, bonuses, and perks help motivate.

Check-in regularly via meetings or surveys to identify issues impacting staff satisfaction or performance.

Promote respectful, ethical conduct and implement clear policies against discrimination, harassment, dishonesty, and negligence.

Satisfied, dedicated employees will provide top-notch experiences that turn customers into raving fans.

Adapting to Shifts in the Market

Regular strategic analyses help you recognize areas for adaptation, improvement, or expansion. Re-evaluate –

Sourcing advantages like manufacturer terms, inventory pipeline reliability, or availability of affordable used stock. Adjust accordingly.

Inventory selection based on current demand trends, changing RVer demographics, or new product releases.

Competitor market activities like new local dealers, acquisitions, or shifts in brand offerings. React strategically.

Physical expansion needs as inventory and staff levels grow. Also, assess reductions if demand contracts.

Staff training topics according to frequent customer questions or service issues. Close knowledge gaps proactively.

Marketing messaging and channels as preferences change. Leverage manufacturer co-op support.

The RV market evolves constantly. Stay agile and keep growth momentum high.

Accessing Ongoing Guidance and Inspiration

In the challenging RV industry, every bit of knowledge and support helps. Some helpful resources include –

Joining the RV Dealers Association for access to training, mentorship programs, conferences, profitability benchmarks, legal help, and more.

Attending RV trade shows to discover new products, innovations, and industry connections. The annual Open House event is particularly beneficial.

Developing a peer advisory group, mastermind, or informal network of other dealers for advice sharing and problem-solving.

Reading industry publications and blogs to stay atop trends. RV Executive Today and RV Pro are trusted sources.

Completing manufacturers’ recommended training on the latest offerings plus sales, marketing, technology, and compliance topics.

Leveraging insights from seasoned professionals will equip you to continually evolve and thrive, regardless of outside conditions.

Realize Your Dream of RV Dealership Ownership

Starting an RV dealership entails significant effort and risk, but the substantial benefits for outdoor enthusiasts make success deeply rewarding. I hope this detailed guide provided you with clarity on the process, requirements, costs, and strategies involved so you can make an informed decision.

With thorough planning, capitalization, vendor relationships, inventory analysis, marketing foresight, customer focus, business acumen, and passion for the RV lifestyle, realizing your goal of dealership ownership is attainable. I wish you prosperity on the exciting journey ahead, and look forward to seeing you embrace life on the road!