Most marine retailers who responded to a new survey said 20 to 30 percent of their boating customers were younger than 45 and that attracting the next generation was a long-term key for the industry.
“Appreciate industry’s attempt to recruit younger age boaters,” wrote one dealer who responded to the monthly Pulse Report conducted by Robert W. Baird in conjunction with the Marine Retailers Association of the Americas and Soundings Trade Only. Responses about the state of the business varied based on region — during an unseasonably cool spring in Northern states.
“Manufacturers and floorplan financiers must formulate better programs for Northern dealers,” one dealer wrote. “We cannot function with higher overhead, shorter seasons, lower margins as compared to years ago, and the internet menace. The curtailments add to the problem. These hurt the cash flow even more during the off-months.”
Another dealer wrote, “Weather in the Northeast is not making the spring season fun, zero urgency and excitement.”
Still another said the season was “gaining momentum,” but added that weather had hampered weekend boat demos.
Several dealers also blamed internet commerce and the information age for infringing on sales and making margins tougher because consumers are more price savvy than ever.
“As a brick-and-mortar store since 1966, we are hurt by internet sellers whose low prices we cannot meet and who do not provide warranty support,” one dealer wrote. “We receive little support from manufacturers we represent who sell through any channel.”
“All manufactures are looking,” another dealer said. “Internet will continue to change our industry completely.”
Dealer sentiment rose in April, in both short- and long-term outlook, according to the survey. Dealers said weather had been a drag on new boat sales, but they largely remained optimistic.
Sentiment about current conditions was 76, ticking up from 74 in March, while sentiment on the three- to five-year outlook also improved, from 64 in March to 72 in April. Attracting the next generation of boaters is key for the industry long term, and dealers recognize the importance.
“Our checks suggest marine trends remained positive in April, suggesting a solid start to the selling season,” senior research analyst Craig Kennison wrote in the report.
“However, as is the case across our coverage, weather remains a headwind. Sentiment remains positive, but some dealers appear cautious in their outlook.”
Retailers indicated that the economy, new products, OEM promotions and access to credit all positively affected demand during April.
Several retailers indicated that the workforce shortage created headwinds in April.
“We need to encourage people to go into the mechanical and skilled trades,” one dealer wrote. “We do not have enough staff to meet demand even though we pay one of the highest wages in our area.”
New boat inventory appeared to be balanced, as 30 percent of dealers considered inventory too low, versus 19 percent who thought it was too high.
Several dealers expressed inability to receive new boat inventory.
“Having inventory is going to be important this year,” one dealer wrote. “Those who have it will be in a position to have a big year. If you don’t have it, good luck getting it!”
Another retailer wrote, “No. 1 limit to sales growth in 2018, 2019 and beyond will be inability of supply to meet demand. The No. 1 limit to increasing supply are across-the-board labor shortages up and down the supply chain.”
Finally, one dealer said, “Concerned about consolidation of brands and retailers will lead to a tail wagging the dog world. Several groups will dominate the business leading to fewer options for the consumer, driving margins down [and] leading to a bubble waiting to pop.”
This article originally appeared in the June 2018 issue.