Former VP of West Coast giant starts his own dealership; other ex-employees find jobs in yacht sales
For every challenge, there is an opportunity. Barrett Canfield found that out in late June when Nautical Enterprises suddenly closed its doors. The loss of the West Coast's largest dealership surprised many in the industry and left Canfield without a job.
Undaunted and refusing to leave the industry he loves, Canfield turned around a month later and started his own dealership, South Coast Yachts. He's taking over the Beneteau line and the same San Diego office he occupied as vice president of Nautical's Southwestern Yachts division.
"It seems like the longest month of my life," Canfield says, speaking with Soundings Trade Only in mid-July. But in retrospect, he adds, "It did happen very fast. I had to work fast to protect the relationships I had with people."
He found a financial partner in Rick Day, a Beneteau customer who had just sold his high-tech company. "I needed to find somebody who's high energy, a good business driver and knows the Beneteau line," Canfield says. "He's run a large sales organization and he is a good motivator. He also happens to drive his Beneteau First 40.7 very well in the regattas."
With Day's business sense and Canfield's knowledge of the boating industry, the partners have a "perfect alignment of core values," says Canfield. They put together a business plan outlining their expertise, their plans for marketing, boat shows, and a cash-flow analysis, and submitted it to Beneteau. The plan involves being exclusively a Beneteau sailboat dealer with a territory that covers San Diego and Orange counties in California, as well as Arizona. South Coast Yachts will also sell some brokerage yachts.
Canfield picked Beneteau because that's his specialty. "It's what I know and what I built my career on," he says. "I've been with Beneteau for 15 years. I love the boats, I love the company, and I think it's a great career to stick with.
"With Beneteau having the biggest market share of sailboat sales in the U.S., we feel that this is the best focus for our team and also for our customers," he adds. "We're taking a slow, steady approach and aligning with the size of the market right now."
A more conservative business model is the key to surviving in today's market, says Wayne Burdick, president of Beneteau USA. "The model is one that will be changed, but changed in a good way," he says. "We're taking a more conservative approach to what's in the field. There's no question you have to size the field inventory to the market."
Excess inventory was a big factor in Nautical Enterprises' abrupt shutdown, according to Canfield and others familiar with the company. As the credit crunch worsened, the parent company of H&S Yacht Sales and Southwestern Yachts had difficulty obtaining affordable floorplan financing as well as retail financing for customers. In addition to Beneteau, it was an authorized dealer for Lagoon, Hunter, Jeanneau, Silverton, Navigator, Californian and Fairline.
Canfield is starting his dealership with five new Beneteau yachts, compared to at least eight new boats in stock at any one time when he was with Southwestern. The inventory at South Coast includes the new Beneteau 34 and 40 that Canfield displayed at the San Diego Yacht and Boat Show in late July. He says it was heartening to walk the show and see many of his former colleagues from Nautical Enterprises already back at work after losing their jobs a month earlier.
"Everyone landed back in the industry that they trust and love, and it was very visible at the show," he says. "We just all have different-colored shirts now."
David Geoffroy, executive director of the Southern California Marine Association, says he was thrilled to see so many former Nautical Enterprises employees at the San Diego show, representing the same lines they had for their former employer. "It's nice to see that these great lines are getting picked up by great people," he says. "There's no real lapse of representation for those brands, so the local guy is not going to get confused by this, because they're going to be dealing with the same people."
Some of that continuity is apparent at South Coast Yachts, as well. Canfield hired a few of his Nautical Enterprises colleagues on a contract basis, including four service personnel and three people in sales. He also hopes his new dealership will help ease some of the pain caused by NEI's closure. He says that when Nautical Enterprises suddenly ceased operations in mid-June, it sent shock waves throughout California's marine industry.
"In its best year, Nautical sold almost $70 million in new boats into the Southern California market," he says. "This affected the local economy in a very positive way. Everyone from delivery captains, to canvas makers, to marinas that provided slips benefited."
Canfield plans to return some of that business to these vendors. "It's amazing how many people we've affected and can affect again," he says. "My goal is to build our new company back into a revenue-generating business for our local community and industry.
"We're being conservative, but we're priming ourselves for growth when the industry returns," he adds. "It will be back, and our goal is to be here when it does."
This article originally appeared in the September 2009 issue.