Marine retail dealer sentiment improved in August from the previous month, but the mood was less optimistic than at the same time in 2016.
The MRAA/Baird Marine Retailer Sentiment Index rose to 73 from from 69 in July, but was several points lower than the reading of 81 in August last year, which also represents the all-time high for the monthly index, which began in December 2013.
Seventy-seven retailers participated in the August survey.
Baird said its survey results suggest that “sentiment remains well above water — supportive of modest retail growth. While the peak of the retail season has passed, limiting the appeal to some investors, we still believe growing wealth among affluent consumers will support growing demand for boats and the lack of used supply will steer buyers toward new boats.”
"Value selling is working,” said one dealer that participated in the survey. “If we can show prospects that they are buying a quality product at a fair price, then we are able to easily close transactions. The issue lies with the dramatically increased pricing from manufacturers; they are getting a bit out of line."
Baird said 48 percent of retailers reported new-boat sales growth in August, an improvement from 44 percent in July despite a difficult prior-year comparison.
“While our checks indicate a modest reversal in the moderating retail momentum reported in July, August is past the peak of the retail season and represents about 10 percent of annual sales,” Baird said. “Thus, our checks appear slightly better in a mildly choppy environment.”
Baird said new boat inventory edged higher, but remained at a balanced level in August; 36 percent of retailers considered inventory "too high" and 29 percent considered it "too low."
Baird said 48 percent of retailers reported growth in used-boat sales in August, compared with 51 percent in July, noting that the trend “remains healthy.”
“Meanwhile, we're encouraged that used inventory remains lean — a key factor we think supports higher new boat retail demand,” Baird said.
Baird said 54 percent of the retailers in the survey indicated that used boat inventory was “too low,” compared with just 10 percent that considered it “too high.
Baird said retailers indicated that the economy, access to credit and OEM promotions positively affected demand in August, although none of those factors had as large of an impact as they did last year.
Weather had the most impact, and it was negative. Trade-in activity, government action/inaction and new products also negatively impacted demand during the month.
The Pulse Reports are designed to provide industry professionals with a regular, timely look into retail trends at the dealership level. They were launched by the Marine Retailers Association of the Americas and Baird Research in December 2013 as the first report of its kind compiled specifically for marine retailers.
Soundings Trade Only joined the partnership with Baird and the MRAA in February and will continue to participate in the distribution of the survey and the reporting of its results in future months.