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Friday, October 3, 2008

Hard work, risks built Classic Motorworks

Second of two parts
Kevin Mahoney's introduction to Royal Enfield came in an unexpected mailing that addressed him as "Dear Dealer." He wasn't a dealer and hadn't expected a mailing from then Royal Enfield importer Martin Scott. He set it aside.

Mahoney picks up the story from there:

"A couple of weeks later I ran across it again and called Marty. I found him to be an interesting guys and we struck up a friendship. In the meantime a buddy and I decided to buy three bikes from him. One for me, one for him and one to sell to defray the price of ours.

"He and I had restored quite a few cars and decided that we’d try vintage motorcycles for awhile. When you take a car entirely apart and the parts are sitting on the floor it can be very overwhelming. You also know you have at least a good year before it will resemble a car again.

"A week or two later Marty showed up and we moved three crates into my basement. We opened the first one, a Blue Deluxe. I was overwhelmed by it. It also occurred to me that I could make something of it as a business.

"You should know that when I decide to do something I am usually like a bull in a china shop. Within a week Marty agreed to let me see what I could do. This was late in 1998. I commissioned a website and put a big ad in Walnecks (for dealers). I also bought a booth at the Cleveland IMS show. The ad came out early and out of nowhere I was swamped with phone calls at my desk at the hospital.

"Now I was really in trouble as I had no dealers and had no idea of what to do next. I got my secretary to pitch in with her daughter on nights and weekends and we sent postcards to every motorcycle dealership in the U.S. offering our bike. A bit later I took some bikes to the show in Cleveland and was absolutely overwhelmed by customers.

"I met my first dealer prospect there, Peter Askey from Uncommon Motorcycles in Northeast Pennsylvania. A couple of weeks later I met him again at a dealer show and he signed on. Again, I had no clue what I was doing, but we faked it and it worked out. I now was employing my secretary half time and my business partner's son to handle the back end of the business. I was able to sell the hospital and move into this full time.

"I took off with a trailer full of bikes and spent almost the next two years on the road going to every bike show large and small across the country and stopping in hundreds of dealerships trying to sell bikes. It was a great time. After about six months my then new wife, an attorney, came along with me. We bought a motor home and had a wonderful time traveling and meeting motorcycle people. I laugh when I look back at it.

"At that time it was not uncommon for an Enfield to smoke when first started. I used to stop outside each city and fire up the demo bike to clear any oil from the sump, thus insuring a clean running (and warm) bike when I proudly fired it up for a prospective dealer. We had lots of adventures and made a lot of very good friends.

"After the first several months I bought Marty's inventory of parts for abut $10,000. It now stands at well over $600,000. Because of the parts we needed a new place to put them. We rented our first office in a small place next to 'Big Jeffs' tattoo shop. The comings and goings there were great entertainment.

"I had been getting hounded by dealers and customers for accessories so I decided to try a few. I traveled to India and made some deals with some vendors of accessories and a sidecar. Our first catalog was a couple of pages on a copy machine. We sold almost nothing. I kept at it refining my vendors, doing a lot of R and D and expanding our line.

"We put up our first webstore and printed a respectable catalog in color and things started to move. We now stock over 5,000 different part numbers, which is an unbelievable task.

"Because of the logistics and the vagaries of doing business in India it is not as easy as it sounds. A good example just happened to us. Our sidecar sales were up this year beyond our expectations and we ran out. We finally got a full 40-foot container a few weeks ago. It was stopped in port because the wooden packing was not marked properly. The contractor the supplier used screwed up and forgot.

"After several weeks the container is now on its way back to India to be marked and then shipped back. Here is the excuse from my supplier, copied from his e-mail:
Dear Kevin,
It is God's will. We can not do any more than His wishes. We will need Invoice & packing list & reason letter for returning container from USA. Obviously Invoice and packing list will have same content as that of ours. I will come back to you if any thing else is required.
"In the past the factory has been very frustrating to deal with for parts. Waiting for a year was not uncommon. In the past two years they have changed dramatically and we now get most items in 90 days or less. All of this is the reason that our inventory is about four times what it should be based on our sales.

"I got divorced about 12 years ago and my ex-wife and kids moved to Prescott, Ariz. I spent a lot of time on the plane going to see them and I had them all summer, which was great. I re-married about eight years ago to the attorney I mentioned earlier. About six years ago she and I were strapping bikes into the trailer when it was 30 below zero, which was hell. I looked at her and said 'Why are we doing this, we don’t have to live here.'

"In short order we moved to northern Phoenix in a community called Anthem. It was only an hour from my kids. She and I spent the first two years doing six months in Arizona and six months in Minnesota.

"About four years ago we became aware of a program that brought Russian orphans to the U.S. for a month in the summer. They were adoptable and if things worked you could go through the process and adopt them. We had no desire for more children, but this sort of fell in our lap.

"Russia is a country that has been ravaged by alcohol, drugs and lack of work and they have orphans stacked up. As a people Russians don’t adopt kids, so the problem only grows. In the single state we ultimately adopted from there are over 250 orphanages. Also, as you might expect, the older kids' chances of getting adopted approach zero.

"We had a 9-year-old over for the summer and decided that whether we liked it or not we needed to adopt her. We went to court in Russia on Christmas Eve and she was ours. Seven days later the laws changed in Russia, which has made adoption much more difficult.

"I have strong opinions about this. The Russian government does very little for these kids and the places they are in are run by well intentioned people with no money (the staff were paid in toilet paper while we were there). The institutions are a dog-eat-dog environment and the affect on the kids is terrible. At age 16 they get thrown out to the streets to fend for themselves.

"I think it is a national embarrassment to the government, which is why they have made adoption more difficult. Most Russians do not understand why foreigners would want to adopt these kids. They have no concept of the generosity of Americans and others. It is a commonly held belief (and not discouraged by the government) that foreigners only adopt these kids because they want to harvest and sell their organs.

"We came home with a terrific daughter who is now 13. She has brought a lot of joy to our family and we will forever be grateful that this opportunity came our way. This meant that we need to be in one place so she could attend school. Now we spend about two months in Minnesota as a family and then go back to Arizona.

"I commute on an almost weekly basis the rest of the year between Phoenix and Faribault. To say that I am on a first-name basis with flight crews would be accurate.

"Sometimes people ask why I didn’t move the business to Phoenix. There are three reasons: shipping parts from the Midwest is much better than from Phoenix; the ox to move this inventory would be huge; and mostly because we have such a good group of people. They have been very loyal and hardworking and it would not feel right to move their jobs. Most of what I do is based on their work and they are far more important to the business than where it is located. It is easier for me to commute than disrupt what we are doing.

"I have loved every day since we opened this business and intend to keep at it until they carry me out feet first. I love being in a niche business and have no aspirations to become large. When I ran the hospital I had up to 350 employees. I have no desire to replicate it.

"I do ride. In my stable I have the first ES bike, the very last iron barrel (made especially for me by the kind guys at the factory), a '76 Bonneville that I restored, a 2001 Bonneville, a 1970's Vespa, a Fly Scooter, a 1960’s Yamaha 250 and several vintage Royal Enfield’s and Indians from the 1950s that are awaiting restoration.

"I am currently in the market for a “Rat Rod” that I want to put a flathead Ford engine into. My son and I were involved for many years (since he was 8-9) in Quarter Midget racing. After his mandatory retirement at the age of 15, we moved into Dwarf cars (like a Legend car, but much faster and more sophisticated).

"We helped sponsor Dan Holmes when he was on the AHRMA circuit and later for our recent run at the Bonneville Salt Flats. We also help a couple of other RE racers around the country. I have a race team that runs a Hyosung 650 very successfully to help develop parts for our newest venture, http://www.asianiron.com/ (Classic Motorworks' webstore for Hyosong motorcycle accessories).

"I am making much less money now than I have in 20 years, but I am happy doing it."

8 comments:

  1. Thank you for sharing this inspiring story with us.

    ReplyDelete
  2. Kevin, the last sentence sums it all up, "I am making much less money now than I have in 20 years, but I am happy doing it." When you look at the big picture that is what makes you truly "rich" and not the money. Much happiness to you and your employees...for we all share in that love of the motorcycle and all associated with it.

    ReplyDelete
  3. Note to everyone: Kevin Mahoney obviously put a lot of time into writing this autobiography. He made me promise that, in return for doing this for my blog, I have to save it so it would be available in case anyone wants it in the future! It certainly would be a good starting point for a business journalist looking for someone to profile.

    ReplyDelete
  4. Dear kevin sir i read your blog,I like it i feel so good about you.earlier i didn't knew Royal enfields were sold out of India.

    I still don't own Royal Enfield but i will.Your story made my love and respect for royal enfield much deeper.
    I would like to see your story to be made as a movie in hollywood and bollywood.

    Manish gaikwad.
    (India)
    mvgaikwad9@yahoo.com

    ReplyDelete
  5. Great story Kevin, I take my hat off to you sir!
    PS, have you ever considered renting Enfields to Brit tourists on The Strip, I think it could work..............

    Britmick in Vegas
    mick123moores@yahoo.com

    ReplyDelete
  6. Being that I and a friend are trying our hand at yet another venture together, close to these lines, I am inspired and fueled on after reading this story. I'd like to print this out to read again when I am discouraged.

    ReplyDelete
  7. Hi Kevin, Your autobiography was very interesting, but I wasn't surprised at your integrity. My name is Dee, I sat next to you on a plane going to Milan, Italy, I will never forget, how you helped me get to a safe place at 6:a.m.that morning. Thanks again.

    ReplyDelete
    Replies
    1. Dear Dee,
      It is very nice to hear from you and thank you for for your kind words. It was nice to meet you on the flight and I remember you well.
      Best,
      Kevin

      Delete

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