Continuing Demand, Dwindling Inventory

Dealers comment on whether they will attend fall shows and the continuing supply chain issues
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Marine dealers say consumers were still looking to buy boats in September, but many were hampered because they had few or no new boats in stock. The demand contributed to strong dealer confidence, both in the short and long term, according to the Pulse Report survey, which is conducted by Baird Research in conjunction with the Marine Retailers Association of the Americas and Soundings Trade Only.

Despite strong confidence, retailers expressed uncertainty around their inability to get new product, the presidential election and the coronavirus. Dealers were split on whether they felt safe enough to attend the few fall boat shows that haven’t been canceled, or whether they would even have enough inventory to make it worth their while to exhibit. Some 53 percent said that although they normally attend the Fort
Lauderdale International Boat Show, this year they will opt out, versus the 47 percent that said they would attend in person.

Dealer commentary varied widely on the topic, with some saying they wanted shows to continue as usual and many others saying they wished shows would be outright canceled. “If there are shows, we’ll go. If not, we’ll probably do an in-dealership event,” said one of 86 survey respondents.

“In this Covid era of uncertainty, all consumer shows should be canceled. Show producers need to stop soliciting exhibitors,” said another. “There is no compelling reason to have shows until we get on the other side of the pandemic.”

“Up in the air, depends on local rules and laws,” said one dealer, expressing the ambivalence conveyed by several dealers. “But if it is possible — it will not be an easy decision — but probably yes, but at a reduced level of expense.”

Several respondents were frustrated by the uncertainty around whether local shows would occur, and one had hoped organizers would cancel FLIBS because he is required to attend.

“Thinking of not going to the boat show in January, but if we back out, we probably will lose the spot we have had for the last 20 years,” said one dealer. “I think the NMMA should just cancel it.”

One dealer said there wasn’t enough inventory to exhibit in a boat show, even if it had taken place.

In this month’s survey, 69 percent of the 86 dealer respondents said they saw retail growth in September — a month that typically accounts for around 6 percent of annual retail sales — but 82 percent said new-boat inventory was too low, versus 1 percent that said it was too high.

“Not having product in stock to sell and deliver does hurt,” said one respondent, while another said: “Supply chain. Cannot get accessories to rig boats. Everything is back-ordered.”

Used inventory also remained near record lows, with 89 percent of retailers saying it was too lean. “Never seen an inventory situation like we are experiencing in 30 years of sales,” said a dealer.

Dealer sentiment on current conditions edged down to 85 from 87 in August, still remaining in extremely positive territory. The three- to five-year outlook rose from 59 in August to 70 in September, reflecting strong retail demand, as well as economic uncertainty around the pandemic and the presidential election.

“Concerned about the election and general economy, what next year will look like with Covid, and people being employed. And if access to credit will tighten up,” said a dealer.

Still, some said they are already seeing demand carry over to next season. “Customer orders are starting to pour in, as customers realize they have to order now to get a boat before next season,” one retailer said. 

This article was originally published in the November 2020 issue.

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