This month, 51 dealers took part in the Pulse Report survey to assess recent retail trends. The monthly survey is conducted by Baird Research in conjunction with the Marine Retailers Association of the Americas and Soundings Trade Only.
Boat inventory remains extremely low, limiting the amount of retail activity this summer. Every new boat off the production line is already sold, and inventories are still at or near record lows. The restocking cycle seems promising to support wholesale activity through 2022.
Half of the dealers surveyed reported a decline in retail, versus 39 percent who reported growth. Inventory availability remains the critical factor in retail performance. One dealer remarked, “Sales are down for June because of lack of supply of boats.” Another added, “Demand is there to purchase boats, but inventory shortages negate it. Parts can be a challenge.”
The trend report marks a deceleration in retail sales from recent months, but on a year-over-year comparison, the decline reflects what will likely be a continued retail falloff in summer and fall months as dealers lap the strong growth in 2020 and continue to manage record low inventories. Some 98 percent of dealers said that new-boat inventory is “too low,” while no dealer considered inventory “too high” for the fifth consecutive month.
Used inventory also remains extremely lean, with 93 percent of dealers reporting used inventory “too low.” One dealer noted, “completely out of new boats.” Another added, “Can’t get boats and engines.”
We also asked dealers if they have added service staff to keep pace with demand and if supply chain shortages have interrupted or delayed service — both of which prompted many responses. “We were able to add a couple of team members but could use a couple more. Service is crazy busy. Keeping up on parts/accessory and inventory stock is much more labor intensive.” Another said, “We ramped up our service staff approximately one year ago, and that has been paying dividends for us this year.”
Other comments included, “Long lead times on parts and accessories are creating scheduling nightmares with both sales and service. It was a struggle to find staff before and after Covid-19”; and “Still very hard to find quality personnel. Supply chain issues are delaying our completion of service requests on average of secen to 10 days. Some are delayed by weeks.”
As for supply chain, one dealer noted, “The lack of communication is the big issue we are facing right now. The manufacturers are not staying out front. We as dealers need to know what is going on other than ‘I don’t know.’ ” Another said, “The impact is unrecoverable regarding new unit sales, and order target dates not being met is increasing customer dissatisfaction.” One commenter said, “Due to Covid, we are still waiting on delivery of our 2021 boats; it looks like we may get the remainder of our new boats after boating season.”
Sentiment on current conditions moderated slightly but remained positive at 55, versus 61 last month, even as inventory availability continued to frustrate dealers. The three- to-five-year outlook ticked higher (55 versus 53 last month). One dealer commented, “Used to be able to stock items one week out; now we have to project one to two months ahead to keep up with demand and balance the shipping delays.”
And one said, “I detect a bit of a slowdown in demand for new boats as things start to open up from the Covid shutdown. Glad we were able to do so well during the shutdown but feel that the party is going to slow down a bit.”
This article was originally published in the August 2021 issue.