The Beginning of Dealer Networks
The motorcycle marketplace in the first decade of the 20th century was a crowded one. In 1907, more than 40 manufacturers in the United States were producing and selling motorcycles. Among these was Indian motorcycle maker Hendee Manufacturing, which was well on its way to establishing itself as an industry superpower. The founders of Harley-Davidson and their thirteen employees knew what they were up against.
1907 was a critical year for Harley-Davidson. William A. Davidson came on board to help his brothers Arthur and Walter along with William S. Harley. The Company incorporated on September 17th, and sold its first stock to employees and board members. But a far more pivotal decision was made to begin recruitment of dealers on a large scale. Harley-Davidson enjoyed dealer support since Charles Lang set up the very first operation in 1904 in Chicago. And certainly, the wiser and more successful manufacturers recognized that visible and accessible dealerships operated by trained and dedicated people could make the difference between small and large sales figures. The years following 1907 would prove that in many cases, the size and strength of a company's dealer network could mean the difference between survival and bankruptcy.
The Board of Directors voted to rent space at the Chicago Auto Show in November of 1907 in order to recruit dealers. To entice potential dealers, price breaks were offered at a rate that increased with each motorcycle purchased. (At the 5th machine bought, the dealer earned a $30 rebate.)
A Foundation of Dealers
Company founder and now Sales Manager Arthur Davidson departed on a single cylinder Harley-Davidson® motorcycle for New England to begin more formal and aggressive dealer recruitment. By the end of 1908, dealerships were established in New York, Chicago, Philadelphia, Atlanta, Newark among many other cities.
At the end of 1912, over 200 Harley-Davidson® dealers were in operation in the United States, and the first overseas distributorship was established in Japan. European sales were established with the London office in 1914, which was commonly referred to as the Foreign Branch. London eventually took over all sales outside of North and South America.
A Customer-Centric Philosophy
By 1916, Arthur already had to divide the nation into districts, with a factory representative as liaison to each district, later known as district managers. It was also the years 1912 to 1916 that the Company published the magazine The Harley-Davidson Dealer, whose articles ranged from the basics of store layout to the intricacies of piston wear. Most importantly, the Harley-Davidson Dealer stressed that customer loyalty had to be earned.
A Global Mindset
By 1920, there were already about 2,000 Harley-Davidson® dealers worldwide in 67 different countries, just 16 years after C.H. Lang first took a chance on a little company from Milwaukee. During the 1920's, overseas sales made as much as seventy-five percent of the amount earned by domestic dealers. Harley-Davidson still remains a global presence in the motorcycle industry.
A Relationship That Defines a Brand
Without a network of enthusiastic dealers, Harley-Davidson would not have survived the Great Depression, and possibly would have foundered in the challenging days of the late 1960's on through the early 1980's.
It's a relationship that didn't merely stand the test of time, but defined a shared heritage. Without the existence of a network of dealers, Harley-Davidson may well have ended up a footnote to motorcycle history.
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