SOUTH BEND, Ind. — Dealers attending Nautic Global Group’s meeting Friday to introduce new CEO Jim Malone were wondering how the company will address getting product — including parts and accessories — into the hands of dealers when they need it.
“It’s no secret that it’s been a struggle to get parts,” said Matt Gruhn, moderator and president of the Marine Retailers Association of the Americas.
Malone’s answer seemed to catch at least some dealers in the room of about 25 off guard.
“Last year, I’m ashamed to tell you that our total parts sales was 2 million lousy dollars,” Malone said. “What does that say? That says dealers found other ways to buy parts because we haven’t been as responsive as we need to be. For dealers, that ought to be a profit center, and it ought to be a profit center for us.”
Already in his short tenure, the backlog of parts has been reduced from 1,800 to 349, “but it still makes me crazy that we’ve got 349 late parts,” Malone said. “As long as dealers can’t think of us first to handle parts, that will be a profit area that is lost for us.”
Dealers also have complained that lead times are not what they should be, Gruhn said, asking how Malone planned to address that issue.
“We’ve already begun to do that,” Malone said. “Our current production schedule is 20 percent higher than it was this time last year.”
The company is, in particular, “dramatically increasing capacity” of pontoons and hurricanes, which is already up more than 30 percent, he said.
Nautic Global is increasing capacity, so the capacity capability is higher than expected demand, Malone said.
“That should translate into shorter lead times and more definitive lead times, which is certainly as important as length of lead time,” Malone said. “Often what has been more aggravating sometimes is to be told what the lead time is and not have it there.”
Despite that increase, the company plans to shift more to a pull strategy rather than push, he said. At the same time, the company plans to build more oversight into the process to eliminate what Malone called “nagging quality issues and detail stuff that is a pain in neck to the dealer network.”
Part of that is in a renewed effort to retain labor, he said, as well as dealer collaboration. “We’ve got to listen and act and react, and build that into the process.”
“In any great organization, you’ve got natural tension in a positive way between manufacturing capabilities and selling capabilities,” Malone added. “Up until recently, you’ve been able to sell more than we’ve been able to make conveniently. We’re about to flip that, and based on selling be able to pull that instead of push through the process, and those go back and forth.”
Having more capacity means sales guide production and also means penetration gets deeper so the company doesn’t find it has outgrown its ability to do that, he said.
“That’s what I mean by push and pull,” Malone said. “The more consistency, product and product control, the more reliability overall. Dealers are going to get product when we told them we’d get them, and we all have an increased ability to plan with a higher level of certainty.”