Q&A with David Foulkrod, chairman of the Marine Retailers Association of AmericaPosted on
David Foulkrod, the recently elected chairman of the Marine Retailers Association of America, also is operations manager at Kemah, Texas-based Consolidated Marine.
The business is described as being “born from the recognized need to provide the Gulf Coast market and beyond with the very best of yacht sales and services.”
Consolidated’s services include brokerage, a full-service repair shop and charters. Its outlets include the Waterford Harbor sales office, Seabrook Yacht Services, South Texas Yacht Services and Yacht Equipment Services.
Prior to joining Consolidated Marine, Foulkrod, 50, worked in a family startup yacht sales and service business called Ship and Sail Inc. He started there in 1983 and was named president of the company in 1998. Foulkrod sold a majority interest in the business in 2008.
Before coming to the marine industry, Foulkrod worked at an auto dealership through high school and in specialty farming during college. He received a bachelor’s degree in business administration from Ohio’s Bowling Green State University in 1982.
In addition to his work on the MRAA board, Foulkrod is president of the Boating Trades Association of Metropolitan Houston. He has been active on the board for many years and has served as a show director and chairman of the Houston International Boat, Sport and Travel Show. He also serves on the Texas Advisory Panel on Recreational Boating Safety.
Foulkrod and his wife, Marybeth, have been married since January 1983, and the couple have two college-age children – a son who attends the University of North Texas and a daughter who attends Stephen F. Austin State University.
Foulkrod, who lives in League City, Texas, enjoys working with classic cars and is restoring a 1967 Mustang GT. In addition to boating, he enjoys riding motorcycles camping and woodworking. He also has been active in his community, coaching youth sports, working with his church group and leading local Cub Scout and Boy Scout troops.
Q: What would you like to achieve during your term as chairman of the MRAA?
A: First of all, I’d like to continue to harness the talents that we have on the board. We have a very talented board. We’ve divided that board into committees, and those committees have taken actions to really help the growth of MRAA in the last couple of years. Second, I’d like to use the talents of the board and improve and grow the [annual dealer] convention. I know that when you change venues, many times there’s bugs to work out and we want to go ahead and continue this growth and improve the convention for attendees and exhibitors next year.
Q: Why was it important for you to get involved in the MRAA, and why do you think more dealers should be involved with the association?
A: MRAA has tried to be a voice and represent dealers on a national level in Washington in terms of enhancing our business and protecting the marine business. MRAA has tried to put together programs that save dealers money, make it more efficient to operate [their businesses], and provide better systems for those dealers. MRAA, through the convention, has tried to put together training to make dealers better and stronger. We have quite a few dealer members, but there’s a lot of room for growth and improvement in membership.
Q: What is the single biggest issue facing dealers today?
A: Our business starts with the consumer, so regaining consumer confidence and regaining that market cycle that we’ve fallen out of is first and foremost. You can talk about financing at different levels, and dealers having inventory and what have you, but it all starts with the consumer. You have to have a healthy consumer market to have a healthy industry. It’s a set of building blocks to get to where we need to be and consumer confidence is part of that. Shoring up lending, having programs available – all these things are part of the package.
Q: Where do things stand in terms of floorplan financing – have there been any improvements in this area?
A: There have been slow improvements. That’s one of the things the MRAA has tried to do – be a voice with the federal government on improving lending programs. There have been small and gradual improvements, but I know a lot of dealers are still having difficulty with that issue.
My understanding about the SBA floorplan program is it was slow to get off the ground and the procedures to get through it and get approved were difficult, and not a lot of folks have ventured that road. The MRAA has tried to push to have improvements in the program, to increase the offerings. I haven’t communicated with any dealers to date that more recently have had any success with the program.
Q: Has the retail credit situation improved any or is it still difficult to get consumers approved for loans?
A: I think a lot of dealers are seeing more customers coming out today that are paying cash. We have fewer lenders out there in the marketplace and they are looking customers over stronger than they have in the past. Loans are getting approved, but it is a more difficult lending situation.
Q: Are consumers still expecting great deals due to the number of repossessed units or used inventory that’s been in the field? How are dealers handling this situation – are margins any better than they were a year ago?
A: The repo market does push margins down. Smart dealers will provide value-added packages and incentives to the consumer to make buying that new boat from them a value, be it an added service package or specials they throw in. There are other ways to attract the consumer and give them value and try to fight for bigger margins. You’re always going to have a certain percentage of the market that’s going to walk through your door and expect that you’ve got that perfect repo at a next-to-nothing price. Those opportunities are vastly reduced and so, as a dealer, you have to have your staff prepared to sell around that situation.
Q: Do dealers still view boat shows as a good way to get in front of consumers? How about dealer-sponsored events – are they more popular?
A: Dealers definitely see the boat show as an opportunity to present products and offerings to a wide variety of consumers. Shows are still well-attended. I believe that despite the Internet and all the electronic shopping that’s out there, people that are involved in outdoor activities still like to touch and feel and get out and see [the boats]. I believe that people are going to go to shows and use the shows as a basis for helping them make a decision, whether it’s at the show or within three months or six months of the show.
I think you’re going to find that dealers want to have reasons to get the consumer back through their store – to visit with them, to stay with them. Yet the industry margins are forced down, and so there are going to be more creative ways that dealers are using to drive traffic to their stores – [for example] customer loyalty programs because they’re challenged on both ends of the spectrum, the financial end of it and the promotional end of it.
Q: There’s a perception that many dealers still don’t use e-mail to its full extent or embrace social media and other technologies. Do you think this is true?
A: The [dealer] convention that we just had had a lot of seminars that dealt with technology and there were a lot of presentations on it. I’m not sure the dealer community is as backward as people say it is. I think most dealers have e-mail and utilize websites. You’re going to have varying degrees of how they utilize technology, and I guess the goal – through the convention – is to bring up the dealers’ level of awareness on these new technologies and to break the barrier that some dealers think some technologies are hard to get into or use. You can touch your toes in the water slowly and get in there and develop those programs.
We [at Consolidated] are using the Internet for our website, for multilistings, for promotions. We are utilizing e-mail. I have my foot out in Facebook, testing that out to see how we can utilize it for the dealership. I came back from the convention with the idea – although I haven’t implemented anything – of buying an inexpensive video recorder and posting some video footage out there, too, relatively easily and inexpensively.
Q: What are your expectations for 2011 – do you expect many more dealer failures?
A: I don’t want to see any more dealer failures, but knowing the challenges I would expect there’s going to be a few that are going to have some difficulties. I talk to people and there’s some that are doing real well and some who are still struggling. I hope the numbers will be much, much less than we’ve seen, but I think there’s going to be a few out there.
I expect, as always, the members of the industry will step up to the plate and do the things they have to do to push this industry along. We’re still going to have challenges over the next year. I think consumers are going to be out there shopping. We’re going to sell product. Dealers are going to need to look at ways to continue to diversify their incomes to support the foundation of their dealership. I’d like to say we’re going to see a slight increase in sales, but my expectations are that we may have another year that kind of repeats itself.
This article originally appeared in the January 2011 issue.