Focusing on Education

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More than 80 percent of marine retailers responding to the monthly Pulse Report poll said new- and used-boat inventory was “too low” at their dealership during December, versus just 5 percent that felt it was too high.

Demand continued into winter, with more than three-quarters — 76 percent — reporting retail growth for the month, further squeezing inventory already made sparse after strong summer demand and a manufacturing pause during the spring.

“If you have the boat, it will sell,” said one of 42 dealers responding to the monthly survey, which is conducted by Baird Research in conjunction with the Marine Retailers Association of the Americas and Soundings Trade Only. “There is not much you could do wrong the past few months. While the winter months have slowed sales activity, there are still buyers coming in steadily. We are trying to balance 2021 projections with what we feel like we will even be able to obtain from our manufacturers.”

Another respondent was only able to get about half the new boats the dealership could sell, and said that good trade-ins are also hard to come by.

“Manufacturers are going out and signing new dealers and getting them inventory, causing shortages for their current dealers,” said another dealer.

Boat sales remained robust for some dealers, despite many in-person boat shows being cancelled, though some respondents say the absence of shows had hurt.

“New boater demand continues to outstrip supply,” said one dealer. “Margins up, show expense down. Net income up significantly as a result.”

Another pointed to canceled boat shows and delayed vaccine rollouts as two things that were inhibiting business.

“Hard to determine the impact on no regional boat shows, and how effective open-house promotions and online presence will work,” said another respondent. “Boat shows usually account for 20 to 25 percent of annual sales.”

Several said inventory shortages continued to thwart sales in December, but others said shortages pressed consumers to order boats early.

“Consumer demand high, as they see boating as an excellent way to spend time with family during Covid,” said one retailer. “Consumers realize they need to order or purchase early if they want a new boat for next summer. Special orders [are] at an all-time high.”

Without boats to sell, most dealers say they are focused on beefing up training and credentials for their staff during the slower months.

“Time to train staff, upgrade qualifications,” said one, while another said: “Educating my staff and seeing the results.”

Following up with 2020 customers was the second most popular option for dealer respondents when asked how they’d spend the slower months, followed by those who said they will address their service backlog.

Looking forward, many are concerned they will run out of inventory quickly, given backlogs that seem to be growing this winter.

“Really scared I will not have any inventory by spring. Or by the time I get the new inventory in, the season will be over,” said one.

Dealer sentiment on current conditions dropped from 81 to 71, and the three- to five-year outlook dropped to 53 from 66 in November (down from 70 in October) — potentially related to the recent presidential election.

“Just worried about tax implications that will be coming with the new administration,” said one dealer. 

This article was originally published in the February 2021 issue.

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