Megayachting may be in a deep slumber, but it is far from dead.
"What you've got is a big bear that has crawled into its cave, and come spring it is going to re-emerge," says Bob Saxon, a 29-year veteran of megayacht management and now president of Bob Saxon Consultancy in Fort Lauderdale.
By the end of 2009, 919 yachts of more than 80 feet will be scattered about the globe, says Saxon, who spoke at a March 19 breakfast of the Marina Mile 84 Association, a group of marine businesses along the New River and the State Road 84 corridor in Fort Lauderdale and Davie.
Bad times notwithstanding, 131 yards still are operating, still employing people, and still working on three- to four-year backlogs of orders for yachts for the rich and super-rich.
When the tide turns, Saxon says, "All these yachts are going to be looking for crew, engines, oil, documentation, insurance, legal assistance."
Saxon says most projections suggest the economy may start to turn around by year's end. He exhorts companies to adopt a 10-point agenda now to get ready:
- develop a business plan
- improve your product or service
- know your competition
- know your clients and be ready to meet their expectations
- keep marketing and advertising
- keep staff, if possible, and train them
- look for new opportunities
- manage and lead better
- look for new ways to generate business
- set yourself apart from your competition
None of this will bear fruit without an attitude change. "Start thinking positive," Saxon says. Don't let the unremitting barrage of bad news paralyze you. "When the market comes back, you've got to be ready."
He thinks businesses ought to be ready to score at the Fort Lauderdale International Boat Show, which runs this year from Oct. 29 to Nov. 2. Signs that the big chill in business activity may be warming ever so slightly are appearing like tiny buds on trees. Credit is loosening a bit, consumers are spending a little more, and buyers and sellers are dickering in the brokerage market. They just can't agree yet on price. Sellers are holding out for more; buyers are pushing for less.
"Take your summer and put a plan together," he says.
Saxon is fond of quoting the fourth century Chinese military general and philosopher of war, Sun Tzu, who wrote this in his book, "The Art of War":
"Whoever is first in the field and waits the coming of the enemy will be fresh for the fight. Whoever is second in the field and has to hasten to battle will arrive exhausted."
Saxon counsels businesses to be fresh. He says every business ought to have an overarching philosophy of how they do business, specific goals, a system of accountability for reaching those goals, and a spirit of optimism. "Pessimists never succeed," he says.
And complacency is always a drag. "Businesspeople are like barnacles," he says. "They pin their head to a rock, and they just stay there. They become prisoners of their own comfortable habits."
Change is integral to the life of any business. "When you're green, you're growing," he says. "When you're ripe, you're rotting."
He says owners, executives and employees on the firing line - sales staff - should be observing the patient (the business). If it shows signs of illness - orders aren't coming in, customers are holding back, business is falling off - if the business just isn't working the way it used to, don't assume it will get better on its own. In all likelihood, things are changing around you.
"Change is silent," Saxon says. The business must change, too, and adapt. Saxon suggests taking a Dale Carnegie course or reading Carnegie's book, "How to Win Friends and Influence People," to hone people and leadership skills, and improve your attitude. Survey clients now to find out what they'll want when the sun comes back out; it might not be the same as before this rain started. And start thinking strategically.
He also suggests taking an honest look at the product line. This requires leaving your ego at the door. "Build the better mousetrap," he says.
Saxon says it should come as no surprise that downturns are fertile soil for innovation. Campbell Soup Company introduced its cream of chicken and chicken noodle soups in 1934 during the Great Depression. The first McDonald's franchise opened in 1955 after the 1953-'54 recession. The Hula Hoop came out in 1957 during the '57-'58 downturn. Apple's first computer came out in 1976 after the 1973-'75 recession. Diet Coke came out in 1982 at the tail end of the 1981-'82 recession. And Apple's iPod was released in 2001 in the wake of a bursting dot.com bubble.
Winners in tough times are "creative, energetic and imaginative," Saxon says. "Be proactive to market changes. React swiftly. Operate with a high degree of paranoia."
In other words, watch the competition. Whether you're the gazelle that must keep a step ahead of the lion to survive or the lion who must run down the gazelle to eat, Saxon says, "When the sun comes up, you better be running."
Bob Saxon can be reached at bobsax firstname.lastname@example.org or (954) 224-5307.
This article originally appeared in the May 2009 issue.