Monday, December 01, 2008

Salida dealer becomes Coachmen partner

By Leslie Albrecht
lalbrecht@modbee.com

last updated: October 13, 2008 02:54:16 AM

SALIDA -- In these dark economic times, a bright spot is flickering off Highway 99. Three months after announcing that it was going out of business, Dan Gamel's RV Centers says it will stay open after all.

The 32-year-old recreational vehicle retailer has pared its operations to the bone, shedding dealerships, employees and inventory.

Now Dan Gamel's RV Centers is reinventing itself as an exclusive seller and distributor of Indiana- based Coachmen RVs. The company's products run the gamut, from $12,000 "towables" to plush $400,000 motor homes.

Nick Schafer, general manager of Gamel's Salida location, said the direct link with Coachmen will give Gamel's more control over inventory, the costliest of the dealer's overhead expenses.

The cost of carrying inventory almost sank Gamel's a few months ago. Sales had been steady for the first six months of 2008, and the Salida dealership was outpacing its dismal 2007 numbers. But in June, customers stopped coming in, Schafer said.

He thinks it was the housing bust, not spiking fuel costs, that led to the bottom dropping out of Gamel's sales. A dollar more per gallon adds about $20 to the cost of a weekend RV trip, Schafer said.

Gamel's found itself sitting on top of about $50 million of inventory it couldn't afford to keep. To spark sales, the dealership slashed prices by more than 50 percent in some cases, Schafer said.

That strategy helped burn through about $35 million in inventory, said owner Dan Gamel.

The company closed dealerships in Santa Rosa, Bakersfield, Chico and Fresno and in Yuma, Ariz. About 200 of the company's 500 employees lost their jobs, including 22 at the Salida location.

The dealership approached several manufacturers with the idea of an exclusive partnership. Coachmen took the offer. Gamel and Coachmen also will work together to create an online RV store.

Now Gamel has four dealerships -- in Fresno, Salida, Rocklin and Redding -- and distribution centers in Chino and Fresno. The distribution centers handle only Coachmen products; the dealerships are headed in that direction but must first sell off inventory from other manufacturers.

On Sunday, a few customers browsed at the Salida location. Among them were Renee and Dave Downing of Ione, who said they wanted to take more RV vacations now that their children are grown.

The Downings said high gas prices haven't affected their desire for a new RV. They plan to use the vehicle for weekend fishing trips that won't require more than a tank of gas. The rough economy isn't dampening their desire either.

"I'm retired and my pension check is coming no matter what the stock market does," Dave Downing said. "I'm not going to stop living because of what's going on in the world."

Downing said he was glad Gamel is staying open. "We're still planning to buy. If (Gamel) goes down, that's one less person to shop with," Downing said.

Founder Gamel said Sunday his short-term goal is to shepherd his company through the winter, traditionally the slowest time of year for RV sales.

He spoke by telephone from his apple ranch near Bass Lake, where he was filming a TV ad. The ad will ask RVers who are considering a new vehicle to buy now so Gamel employees can enjoy a stable Christmas season, said Gamel.

"We're not going to make any money for the next six months, and I haven't made any money for the last couple of years," said Gamel. "I know I'm not going to make any profit this winter, but if I can keep my people employed, I'm a happy camper."

Bee staff writer Leslie Albrecht can be reached at lalbrecht@modbee.com or 578-2378.

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