Ninety-two percent of dealers say new-boat inventory is too low, which sounds like a whopper of a number until you learn that 96 percent of dealers say used-boat inventory is too low.
“We will not sell any product unless it is sitting on the showroom floor,” wrote one of the 77 dealers who responded to February’s Pulse Report survey, conducted monthly by Baird Research in conjunction with the Marine Retailers Association of the Americas and Soundings Trade Only. “Boat companies are not telling us when or even if we will get the boats. It is getting real tiring telling the customer you have no clue when their boat will be in.”
Another dealer lamented: “Getting put off by the boatbuilders, and the excuses don’t end. Ordering 12 to 18 months in advance has no merit for the dealer and, further, the customer. The businesses that rely on product and turnover as part of their business model may be crippled. If we cannot get inventory soon, I’m afraid a lot of doors will close.”
Lack of inventory was by far the top concern that respondents expressed, followed by continuing challenges with finding and retaining good staff. And yet, even despite those issues, the Marine Retailer Sentiment Index improved to 51 from 38 in January, and the three- to five-year outlook rose to 48 from 41 in January. On the 0-to-100 scale, the number 50 means dealers feel neutral about conditions.
“Over half of dealers reported retail growth (58 percent) compared to 16 percent that reported a decline — an improvement from recent months,” according to Baird’s analysis. “Dealers continue to report that limited inventory availability is impacting retail sales, with many selling production slots and preorders.”
Used-boat trends also ticked upward, with 43 percent of dealers reporting growth and 27 percent reporting a decline.
Survey responses indicated that overall, the economy was a positive for consumer demand in February. That sense mirrored numbers from the U.S. Department of Labor, which reported that the unemployment rate fell to a new pandemic low of 3.8 percent in February, from 4 percent in January, as the omicron variant of the coronavirus receded.
In some cases, dealers suggested that consumer awareness of inventory shortages was driving sales. As one dealer wrote: “Lack of new inventory is making the consumer buy now, knowing we will run out of inventory early in the season.”
Dealers reported various approaches they’re taking to keep bringing in revenue. One talked about building up a reputation for strong customer service. Another mentioned growing the service division. Still others reported an increased focus on boat rentals, and attention to social media and other online marketing efforts.
And a handful of dealers bucked the widespread sentiment about inventory being in the doldrums. “With manufacturers starting to get caught up in the factory, we are seeing some decent inventory coming in,” one dealer wrote. Another said: “We are seeing more inventory show up at a regular basis.”
Several dealers also suggested a need for big-picture thinking around marine marketing and the return to in-person boat shows, given all the challenges that dealerships continue to face. For instance, one dealer suggested that until the inventory situation improves, marketing efforts should focus not on boats, but instead on the joy of getting out on the water. “We currently do not need promotions without product,” the dealer wrote. “However, dealers and manufacturers still need … advertising to remind people of boating.”
That dealer’s thinking is in line with the “Get On Board” campaign that has been running since June 2020 in a joint effort between Discover Boating and Take Me Fishing. The campaign focuses less on boats and more on the experience of being on the water, and it has generated younger and more diverse visitors to DiscoverBoating.com than previous campaigns, according to NMMA president Frank Hugelmeyer.
Another dealer said the return to in-person shows, such as February’s Discover Boating Miami International Boat Show, was adding to the dealership’s existing struggle of trying to keep up with customer demand for service amid staffing shortages. “With boat shows opening back up and our participation in the shows,” the dealer wrote, “we are getting behind in service with all the required work for the boat shows.”
This article was originally published in the April 2022 issue.