Anytime a new company enters the market, it needs to be prepared to face a variety of challenges, and in powersports finance, startups should prioritize building robust, consistent finance packages, Hasham Malik, founder and chief executive of Speed Leasing LLC, told Powersports Finance.
“One thing that is a really important piece of this is how these people are competing,” Malik said. “Throwing money at it and poorly constructed leases or loans are only going to drive somebody out of business. You can start throwing money at 200 or 300 FICO people and give them a lot more money for the bike, but you’re not going to last very long, and there’s a history of that in financial services.”
While the motorcycle market has been struggling for the last few years, the benefit for startups in the financial space is that it isn’t as crowded as the automobile sector. That means fewer competitors, but even as more startups pop up, that doesn’t necessarily mean there’s competition if you possess a better loan package that will build customer loyalty.
“The key, from my perspective, is that you want consistent, predictable outcomes for every product that you have,” Malik said. “The [dealer] knows ‘Okay, I know what I’m going to get from these guys, and I know that they are going to stick around and provide it for a long time.'”
Speed Leasing specializes in providing leasing programs for pre-owned Harley-Davidsons. Since launching in 2017, Speed Leasing has been growing rapidly and is on track to lease $30 million by the end of the summer season. Part of the company’s strategy is assuring customers of their quality through reliable finance programs.
Risk and return are evaluated “very carefully,” Malik added. While making sure that loan or lease packages are consistent is a significant aspect of Speed Leasing’s approach, the lessor emphasizes the emerging companies need to focus on staying ahead of the curve, as the powersports finance space is continually changing.
“The real thing for us is that we look toward the future and wherever the industry is going,” Malik explained. “Whatever was done two years ago, three years ago, a year ago is ancient history especially with everything going on with the evolving technology in financial services. That turns around so quickly. Every several months there are changes in technology.”
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