Choosing to start a motorcycle aftermarket parts business is an exciting opportunity that can yield substantial rewards.
It may not have seemed like that at the start of the COVID-19 pandemic – with production facilities and dealerships shut down across the world, the motorcycle industry has experienced a low like never before.
However, when COVID-19 restrictions started lifting, it became apparent that motorcycle riders decided to spend their vacation money on new rides and motorcycle components instead. In 2021, motorcycle parts and accessories are simply flying off the shelves, especially in online sales.
In this post, we will discuss the benefits of online parts stores and provide actionable advice on what to consider when starting this type of business. We’ll talk about finding your niche, choosing suppliers, managing inventory (or dropshipping), obtaining all the essential licenses, and even marketing techniques!
Find a Gap in the Market
Before you even start considering what to sell, you need to find a gap in the market. The best motorcycle parts and accessories online stores are those that fill an unmet demand.
Research is crucial here. You need to dive deep into the platforms and markets you want to break into. Find out what motorcycle parts and accessories are in high demand but generally not available. If you feel comfortable selling those components, then you’ve found your niche.
Additionally – it is essential to research which popular brands sell the best online (i.e., Harley Davidson motorcycle parts) along with competitors’ customer service processes. How do these stores present themselves? How do they communicate with their customers? What are their aftermarket product images and descriptions like? Are they based only on one eCommerce platform or across several different ones?
Pinpoint the most successful competitors you will have in your niche (or in the aftermarket motorcycle parts game overall) and strive to become better than them.
Determine a Budget
It’s not a secret that starting a business requires a financial investment. You will need to determine a budget for your motorcycle accessories or parts business, which can be as low as $500 or high enough to buy an entire store.
Are your customers primarily online shoppers? This is where the eCommerce aspect of selling aftermarket parts comes into play – it provides the convenience and potential profit margins that brick and mortar stores cannot match, especially not in these uncertain times.
Of course, if you want to join an established marketplace such as Amazon or eBay, you need to consider the fees that these platforms charge.
You can always sell on your own website as well, which will allow you to have complete control over pricing and margins. However, this will likely require hiring a website developer and/or a designer to create an eCommerce shop for you at an additional cost.
Locate Reliable Suppliers
Just as you need to research your competitors, you also need to research your suppliers.If you want to do business with a motorcycle aftermarket parts distributor in the US, they must be reputable and have a national (or better yet, international) presence.
Look at their lead time on orders and, if possible, get specific information about how long it will take for them to deliver one of your desired items. It’s also crucial that they have a good return policy in place, so you can feel confident about trying out new products and not being stuck with leftover stock if it doesn’t sell well.
Once you find a wholesale distributor that seems promising, work hard to build a good relationship with them. This will ensure you get good quality products at a fair price. Furthermore, they will be more willing to work with you if a problem arises.
Most manufacturers have distributor showrooms, so it should be relatively easy to visit their facilities in person and get a firsthand look at the products they carry.
When it comes to inventory, you have two primary options – build your inventory and actually have items in stock in a storage facility, or dropshipping.
Dropshipping consists of placing an order with a supplier for a certain number of items, and then they drop-ship the products directly to your customer. You don’t need any storage space, and you can offer a wide range of products because the supplier is filling your orders.
The advantage of dropshipping is that you don’t have to invest in inventory up front. The downside is that you have no control over delivery times. It is all up to the supplier.
Dropshipping should be considered if you are starting out and don’t have much money to invest right off the bat for inventory space.
If, on the other hand, your company has been around for a while and can afford it, building an actual warehouse with physical goods is ideal.
“Build-your-own inventory” means stocking all or most of what’s for sale on your website (or eCommerce platform store) from your warehouse. The benefits of this include improved customer service, increased sales by keeping inventory fresh and in stock, and complete control over delivery times and customer satisfaction.
Having an actual inventory also comes with some disadvantages – it costs more money to maintain an inventory, purchase items in bulk, and store goods. This type of inventory is best if you already have an established business with some profits to invest in stocking up your products.
Licensing and Insurance
It goes without saying that you need all the proper permits and licenses for running a motorcycle aftermarket parts dealership. Some of the necessary licenses for this type of business include:
- Federal Tax ID Number
- State Business License (or Permit)
- Motor Vehicle Dealer Licenses or Certificates
All states require a different set of licenses, so you’ll need to make sure you have the right ones. This step is vital for the success of your business – you don’t want to be shut down before you’ve even started because you don’t have the proper documentation.
If you’re handling motor oil or similar substances, inquire whether you need any special permits for that. These can be considered hazardous materials and could fall under special regulations.
Finally, consult with an insurance representative over what type of insurance or a business liability policy would suit your store. What happens if parts you sold fail? What if they cause damage to motorcycles, or perhaps even endangers the customers’ lives? You need to be protected from these situations.
The “build it and they will come” world is long over. Without spreading the word about your business, you cannot hope to draw in many customers. Investing in a marketing plan as early as possible is a crucial step for any company, and it doesn’t have to be a significant expense.
A marketing campaign can include social media posts about your products or services. Find the social media platforms your target audience frequents. Is it Facebook? Twitter? Instagram? Reddit? A combination of those?
Another helpful marketing channel is web-based content, such as guest blog posts or videos on YouTube. Offer your customers value – teach bike owners how to install the parts they buy from your store, how to maintain their bikes, or how to stay safe while riding.
Don’t neglect the power of paid marketing as well. The most popular way to advertise your motorcycle parts business is through Facebook ads that target your specific demographic. This ad will allow you to specify what types of people are allowed to see your post, as well as the maximum amount of money you are willing to spend on the ad.
A well-thought-out marketing strategy can be the difference between a successful business and one that struggles to break even. The sooner you start marketing your store, the better!
Starting a small business, no matter what kind, takes a lot of work and perseverance. There is plenty to be researched and determined before you start putting up product listings on your online platform.
Decide what your niche will be – find a gap in the market that you can fill. Determine your budget and how much you can spend on setting everything up. Search for suppliers that are reliable and offer reasonable prices.
Are you going to build your inventory or dropship? How are you going to manage it? How much time will each aspect of the business take up in your day-to-day life? Determine how and when you’ll have time for everything, as that can be an important factor.
Figure out what marketing strategies work best for your product and industry (paid ads vs. word of mouth, etc.). It is never too early to start marketing.
Once you have everything ready, it’s time to get started and take the leap! There might be a few hiccups along the way (and some sleepless nights), but with enough resilience and hard work, nothing is stopping you from becoming successful in this industry.
Contact MyFitment if you’d like some help in putting together a motorcycle part catalog that will keep motorcycle enthusiasts coming back for more.