Elgin motorcycle dealership owner says closure was heartbreaking
The owner of the former BBK Motorsport in Elgin attributed the closure of his business mostly to investing into growth at the wrong time and noted the recent federal government shutdown also may have been a factor.
Owner Brian Martin, who closed the business at 227 DuPage St. in late December, will hold an out-of-business auction Saturday featuring a few used motorcycles and mostly motorcycle accessories including tools, equipment and gear.
"It's heartbreaking ...," said Martin, who lives in Burlington and whose relatives also worked at the store. "It's like somebody died in the family."
Martin said he bought the business in late 2003, initially with a partner. It consisted of a Kawasaki motorcycle dealership on Dundee Avenue and expanded in 2012 with a Honda dealership on DuPage Street.
The original location closed in 2014; the DuPage Street location added Yamaha and Suzuki motorcycles and did very well through 2016, Martin said. In 2017, "everything went disastrously," he said.
Martin said he added to the staff and invested resources "expecting to get to the next level," but the market became flooded because other dealers increased their inventory at the same time, he said. Revenues declined and he took on debt at a higher interest rate, he said.
"I was trying to hang on ... " he said. "I was stubborn."
Martin said he got approval late last year for a loan from the Small Business Administration but lost his Honda inventory because he owed money to the company.
"I thought I was done," he said, so on Dec. 22 he posted on Facebook that the business closed.
Then, Martin said, his bank told him a loan still could move forward if the SBA quickly wrote a so-called "exception letter" that accounted for the loss of inventory. That gave him temporary hope, he said, but the SBA ceased activities during the partial government shutdown Dec. 22 to Jan. 25. The letter didn't materialize on time and the closure of BBK Motorsport became final, he said.
An SBA representative didn't respond a request for comment.
Martin said there is "a very real possibility" he'd still be in business if the shutdown hadn't happened but can't say for sure. "Loans are tricky. The wheels can come off at any minute," he said.
"It wasn't the lack of profit that killed us. It was the lack of cash," he added.
BBK Motorsport had a sales tax-sharing agreement with the city approved in 2012 that rebated half the extra tax revenues from the new location up to $50,000 through 2018. The rebate threshold was reached by the end of 2016, City Manager Rick Kozal said. The agreement included the removal of a billboard once the billboard's lease expired, Kozal said.
The city commissioned an analysis in 2012 that showed the annual economic impact of BBK Motorsport included economic activity of $1,386,850 and the equivalent of 15 full-time jobs.
Martin said he used the tax-sharing profits to rehab the building.