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Boat Demand Remains Strong, But Inventory Shortages Prevail

Sentiment remained solid for November despite challenges getting new and used boats to sell.

Sentiment remained solid for November despite challenges getting new and used boats to sell.

Dealer sentiment on current conditions remained strong in November, according to a new survey that polled 57 retailers about monthly conditions, though it ticked down to 81 from 85 in October.

The 3- to 5-year outlook also dropped to 66 for the month, versus the 70 reading in September, but has fluctuated more dramatically (the reading was 59 in August), reflecting strong retail demand against an uncertain economic backdrop, according to the Pulse Report, a survey conducted by Baird Research in conjunction with the Marine Retailers Association of the Americas and Trade Only Today.

“Replenishment,” wrote one respondent to the survey when asked what is not working for business. “Due to large quantities of ordered boats over the summer, inventory restocks are virtually non-existent.”

Those shortages carried over to parts and accessories, according to some.

“Certain electronics and accessories, as well as certain models of engines, are hard to get and are holding up and discouraging sales,” wrote one retailer.

Most respondents project growth in the low single-digit range for 2021.

Most respondents project growth in the low single-digit range for 2021.

Despite the shortages, dealers were largely optimistic on the 2021 retail prospects, with 55 percent of respondents saying they expect growth between 3 and 5 percent for the year ahead; many indicated they would project more growth if they could get new product.

Just 33 percent projected declines in the coming year.

“Despite representing 15 boat lines, growing more and more concerned with the ability of our manufacturers to produce and deliver product,” wrote one dealer.

“Demand will be high, but growth will be hard due to lack of inventory,” wrote another. “Prices have been jacked through the ceiling by the manufacturers and this will hurt us in 2022 as prices never seem to come down.”

The pandemic continued to weigh on retailers.

“Sure nice to take a year off winter boat shows, save a couple hundred thousand dollars, do all the housekeeping we've been putting off for years and give our weary staff a nice long break over the holidays,” wrote one dealer. “Governments need to figure out how to get rapid, at-home COVID tests in consumers hands so we can look out for our families properly without shutting down the economy and cancelling Christmas! With the hundreds of billions spent to date, it's a joke this hasn't already happened.”

Others were concerned about the post-election political climate.

“Worried about a potential change in national administration and what it will do to our economy and to regulatory practices,” wrote one dealer.

Read more about the November Pulse Report in the January issue of Soundings Trade Only.

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