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A boat show angle to manufacturer showrooms?

No question the factory showroom model is seen as a mixed bag, but generally it is viewed with optimism. It’s safe to say advantages and downsides are still being identified.

If you missed Part 1, please see Tuesday’s Dealer Outlook.

On the plus side, there’s agreement this concept could boost big-boat sales. Given that dealers cannot, or will no longer, shoulder the financial risks of stocking many big boats, the so-called factory showroom could prove helpful to all — dealers, builders and customers.

“Looking forward, the ability to stock a half-dozen or more big Marquis and Carver yachts isn’t in my cards anymore,” says Ohio dealer John Sima, of Sima Marine. “I’ll gladly fly bona fide customers to Florida every day if it means selling some boats, and I’ll be with them on every flight.”

Sima hits one of the biggest advantages of this factory showroom concept: keeping his existing customers. We know that, traditionally, satisfied customers are most likely to move up within a brand. However, that move is highly influenced by the customer’s opportunity to see and touch his next dream boat. Absent that stimulus, the customer is left wide open to the draw of other brands. Access to a factory showroom, therefore, can keep that door shut.

But that raises an interesting question. Existing customers aside, if the models aren’t in stock to see, how does a prospect become interested in the brand in the first place? Boating magazine ads? Maybe. Web sites? Sure, to some degree. Boat Shows? Ah, yes!

Like them or not, boat shows continue to stand alone as the single, most effective, cost efficient method of generating initial interest in a product by large numbers of prospects. The Miami and Fort Lauderdale shows — where builders have a big presence — notwithstanding, how are manufacturers and dealers going to create the very necessary initial awareness (buzz) for their brand in markets across the country? Dealers won’t have stock boats to take to the local show?

Realistically, builders will need to find a way to have a real presence in these shows or risk leaving themselves and their dealers vulnerable to other brands that do. Does it mean consignment boats or a fleet of traveling show models? Logically, manufacturers will have to find new ways to help their dealers be impact exhibitors in shows.

Nothing comes without cost, of course. While there are no rules-of-thumb in this new concept yet, clearly boatbuilders that adopt the factory showroom model, or some variation of it, must have the ability to sustain first-class regional showrooms. Concurrently, dealers must be financially capable of supporting such a model by successfully closing sales using it.

Of equal potential, this new system could be a big game-changer for improved relationships between dealers and manufacturers. Here is a genuine opportunity to work together to transparently identify any cost-sharing needs and balanced benefits with which both can prosper.

So is this a “new normal” or just a flash in the pan? Like anything else, the devil can be in the details worked out between dealer and builder. But it’s apparent that to make it work the integrity of the manufacturer must be absolute and the commitment by the dealer will have to be beyond question.

The idea is not for everyone or even needed by everyone. It is not likely to lead to widespread factory-direct selling. Dealers will continue to be the primary distribution channel for this industry. But for those who see an advantage in adopting it, this concept will likely morph into some combination of stocking coupled with the power of a factory regional showroom.

That will make it more a “new normal” than a short-lived marketing idea. We’ll see how it plays out.

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