My father used to say that even selling nails was fun if you sold a lot. Many of us chose the boat business not only for a livelihood but to have fun even when sales weren’t over the top. It was certainly more fun when they were.
Recent financial events have taken the fun from even such a great endeavor as “messing about in boats.” We are all examining the question of how to get this fun back and at least stay alive financially until things improve. I have been a member of ABBRA (American Boat Builders and Repairers Association) as well as MRAA for virtually all of my career in the recreational marine industry. I have noticed that these boat yard guys get hit more gently when adversity overtakes the boat business, even though many are also dealers. That must be because real boaters continue to fix up and spruce up when they can’t (or won’t) afford a new boat.
The asset least viable for return on investment on your balance sheet is probably new boats – for now. This is especially true if they are “old” new boats. Conversely, dealer after dealer has found some measure of deliverance in his used or pre-owned inventory. Fixing up some of those old dogs has turned them into gold, rather than the tarnished brass we thought they were when the good times were rolling.
While we are on viable assets, think how much your accessory shelves can do with the price of one or two new boats invested in hardware staples and a few of the latest gadgets to excite your customers. Trips to your dealership will result in many accessory sales for each boat sale.
New Inventory Birthdays
That new inventory to which you have sung “Happy Birthday” a time or two will eventually go away. Hopefully your boat builder partners are helping by shuttling it from dealer to dealer to get it out of the pipeline before they pile new products on top of the clog. If they haven’t figured it out, financial institutions should soon realize that helping with short sales and retail financing will help raise the industry to renewed viability. Unfortunately, nobody will be making any profit on this stuff – until we start maintaining it. The sooner it has a new home, the better.
Good customers who were reliable candidates for a new and larger boat every 3-5 years are working on stretching that cycle. Most still enjoy the boating lifestyle in one or more of its permutations. Most of these folks still have some money. I don’t have any research to quote, but I strongly suspect that the unemployed ranks contain a low percentage of boaters compared to the still employed and retired. If they want to make the old boat last, the best thing for dealers is to put on their boatyard hats and work with them. I’ll bet most of you have already figured this out.
Boaters consider themselves a fraternity – including the ladies. They hang out together and around dealerships. Most of us dealers have finally learned to encourage this. Now we need to make sure that we are loyal fraternity brothers (or sisters) too, and have just as much interest in putting a new shine on older boats as their owners. Two-foot-itis will eventually return them to purchasing new boats – or buying pre-owned ones if we still have any around. Have you noticed how scarce they are getting? Meanwhile, we still have to meet the payroll and pay the rent. Creative upgrading coupled with regular maintenance has always worked well for boatyards – from outboard to motoryacht specialists.
You may not be able to throw out the lavish spreads common in the good old days, but boaters won’t mind if your open house has the right content. Invite your suppliers to pitch their (your) wares and demonstrate wonderful new technology. It’s fine to have the boat suppliers there, too, but your main goal is to maintain and strengthen your relationship with past, present and future customers. The dealer that doesn’t warmly welcome a boater who purchased elsewhere last time is bordering on terminally stupid. Upgrade money can be your lifeblood until spring – and maybe all summer. We need to be aggressively marketing electronic installations, repowering and all the neat little do-dads that enhance the boating experience.
We will be selling new boats again eventually – maybe sooner than we think. We probably won’t be selling as many, at least not for a long time. Among other reasons, fiberglass doesn’t have the grace to rot like mahogany did in my youth. The economic crunch has made this evident to boaters. A new engine on an old boat is a pretty close second to a new boat. A decent fiberglass hull can outlast 3-4 powerplants, but each repower can fill your coffers a bit.
Those of us who based our feelings of self-worth on the passage of acres of new fiberglass through our dealerships had better re-evaluate our values. Satisfied and regularly returning customers are “where it’s at.” Can I have an AMEN to that?