Overpromised and Underdelivered So they have around 130 dealers now. I remember this wonderfully detailed post from Kings Kid a while back:
https://www.stockhouse.com/Bullboards/MessageDetail.aspx?p=0&m=29921817&l=0&r=0&s=FUT&t=LIST
Specifically this paragraph:
Their profitability level is 128 dealers, this is reached by estimating that the avg dealer will sell about 40,000 miles per month. For the avg dealer to reach the 40,000 miles per month they need to sell 1 car per month where miles are given and 3 service/tires per month where miles are issued. (40,000 miles is equal to $2,000 revenue to FUT) Numbers that seem very reasonable and achievable! I also feel the number of 128 dealers is very achievable by the end of 2011, my guess is that, that number will be surpassed by the start of Q4 again this is just my opinion and not what I was told at the AGM, the number I would like to see my the end of the year and I think is very reasonable is 150 as the projected dealers by the end of the year are between 65 and 80 and I feel that is low, 80-90 is more realistic in my opinion.
They are at that dealer level now. So why are they still showing no signs of being anywhere near profitable, and in fact in need of a roll back and possible highly dilutive financing? I can understand being a little bit off but it looks like now they'll need at least 250 dealers or more before they stop burning cash. This is why they are going to the US. They originally thought Canada was a big enough market but apparently not so now they have to hide behind the flaw with a chance of great growth. One day this could be a great company, but for now my $25K investment net of sales for my 1.1M shares left looks to be a lost cause. My apologies for anyone who followed me into this stock based on my blog. More often than not I get them right, but this one is a real stain thus far.
https://tsxwealth.blogspot.ca/2012/01/2011-year-in-review.html