April 3, 2006
Section: Business
Page: E1

Growing your business
Ferdie De Vega
Staff
The Desert Sun

Bigger turns out better

Halle and George Fetty say several factors influenced their decision to move their Valley V-Twin shop to a larger building in Indio. The business sells pre-owned American motorcycles, apparel and accessories. It also provides parts and service and is an authorized dealer for KYMCO USA scooters.

In 2003, the Fettys had bought out the owner of a motorcycle shop located next to Engine Joe's Cycle Service in Cathedral City. They changed the shop's name "and started building from there" Halle Fetty said, noting they originally just sold pre-owned American motorcycles.

She wasn't new to the business world. She had owned a pizza restaurant in La Quinta 14 years ago, before she met her husband, George. She operated it for one year. Her parents previously had owned it for a year. Fetty said she has learned from the mistakes she made with that business, "which has served us well"

At the restaurant, "I was staffed too heavy and shortly after I opened, I think it was Little Caesar's, started doing two pizzas for (the price of) one," she said, adding there were high food costs. "I was doing a premium pizza, and people were looking for cheap.
"It was a case of everybody thinks that they can be successful at running a restaurant, and reality hurts really bad. "With the mistakes I had made in the restaurant and with the mistakes I felt we made with the original (motorcycle) shop, we knew what we could become," Fetty said. "We had a goal in mind, and we went forward with that."

At the Cathedral City shop, they added accessories and apparel and soon outgrew the space, she said. "The city wouldn't let us display motorcycles outside. We had no frontage," George Fetty said.

They had sublet the space from the neighboring business, whose owners were going into a new venture, Halle Fetty said. "This building (in Indio) presented itself, and we made the move. We wanted to come this way."

The Fettys faced some obstacles as they tried to take over a long-vacant, former auto parts building on Indio Boulevard. The city would not allow it to be used to sell motorcycles at first, Halle Fetty said.

"We have, from the get-go, battled the stereotype of  bikers," she said. "We decided to find people who would stand up for us." She contacted Assemblywoman Bonnie Garcia, R-Cathedral City, who had helped Fetty with her Motorcycle Awareness Month resolution and proclamations.

Fetty said Indio city officials later contacted them about the building.

The entire process took six months, including nearly four months of renovations, said Fetty, who financed it with inheritance money and a Wells Fargo credit line.

If a business is seeking to borrow money, some of the key factors that a bank uses to evaluate a potential borrower are the ability/capacity to repay, credit history, equity, collateral and experience, according to Business.gov.

The Fettys recently talked about their business.

Growth

Question: How much have your sales/revenues grown in the past year?
Answer: Halle Fetty: They pretty much stayed the same.
George Fetty: Last year was the same as the year before.
Halle Fetty: In the month and a half we've been here (in Indio), we've probably increased sales by 25 (percent) to 30 percent.
George Fetty: There's more retail traffic, too.

Q: To what do you attribute the growth?
A: Halle Fetty: Location, location, location. And advertising, too. Being linked on other Web sites obviously has helped, too. We're the official dealer (in the valley) for Lo-Jack for motorcycles - Harley, Buell and Victory.
The Web site has been our biggest for sales.

Q: What practical lessons can another business learn from your experience?
A: Halle Fetty: In general, don't do anything on a handshake. Contracts for everything. It doesn't matter if you're opening for the first time or moving. You need to get smart with the permits and what the permit entails.

Q: What have your biggest mistakes been?
A: Underestimating the costs. No. 2 was not setting up the right software originally. We operated with QuickBooks from the get go. Then we added inventory. Friends helped me transition to point of sale.

Q: Do you have outside experts?
A: An accountant and attorney.

Location

Q: How did you pick your new location?
A: Halle Fetty: I searched on the Internet for this sort of thing. I had spoken to a Realtor, and he said the rule of thumb for any business that's going to move is to double your square footage. I saw this place and said, "Ugh." George said, "No way." I said, "(The cost) is right and the square footage." The growth is on this end of the valley.

Q: Do you know the history of that location?
A: Yes. It was an auto parts store. It was vacant for 10 years.

Q: Do you need visibility?
A: We're just like a car dealership. You never see a car dealership behind something.

The market

Q: How big is the market?
A: Halle Fetty: A year ago, when I was doing all the research for my proclamations and resolutions for Motorcycle Awareness Month, in La Quinta alone, there were 3,500 registered motorcycles. There were about 7,000 valley-wide 11/2 years ago.

Q: Who are your competitors?
A: There's a few (valley-wide). I don't think anyone's doing what we're doing in the way we're doing it (in the east valley).

Q: How much attention do you pay to your competitors?
A: None. I can only try to satisfy the customers I have and the customers I potentially will have.

Q: What have you done to set your business apart?
A: Motorcycle awareness and safety, big time. We will not sell a novelty helmet in this store ever. We promote safety and awareness.

Finances

Q: Who handles the accounting?
A: Halle Fetty: me.

Q: How do you track expenses?
A: QuickBooks

Q: Do you have an outside accountant?
A: Yes.

Customer service

Q: How do you focus on customer service?
A: Halle Fetty: Everybody who walks in, you already have the advantage that there's a common interest. People walk in, they know what they want. Everybody who comes in ends up being a friend. Everybody's made to feel like the door's always open.

Q: How do you measure customer service?
A: Do they come back? Do they bring other people with them? The referrals cement in your head that you're doing the right thing.

Products/services

Q: How do you decide to add new products?
A: Halle Fetty: You go to a trade show, and you've got to have it. You get a new catalog from a vendor or a customer suggestion. You can't buy to appeal to yourself. You've got to appeal to a cross-section.

Expansion

Q: How did you decide to move and expand?
A: Halle Fetty: Our neighbors (at the Cathedral City shop) went into a new venture. This building (in Indio) presented itself, and we made the move. We wanted to come this way.
George Fetty: There were numerous things. The frontage is a big thing. And being able to put bikes on display. That was huge.

Q: How did you finance the relocation/expansion?
A: Halle Fetty: Inheritance and a Wells Fargo credit line.

Q: What was the cost of the relocation/expansion/renovation?
A: We thought it would be $35,000 to $40,000. It ended up being $85,000.

Marketing

Q: How do you market your business?
A: Halle Fetty: No. 1 is the Web site. Radio has been one of the most effective ways.
Print advertising in the upper desert has been extremely effective.

Q: How much do you spend on marketing?
A: $25,000 a year.

The startup

Q: Did you have a business plan?
A: Halle Fetty: Not a formal plan.

Q: What was the startup cost?
A: $10,000 (for original shop in Cathedral City)

Q: What was the source of startup funds?
A: Savings

 BEST ADVICE

Halle Fetty: Two things: Don't neglect your family, and appreciate all your friends. Family and friends are your most valuable resource.

George Fetty: Research your vendors first and all the people you're dealing with