Ed Lofgren has been president and CEO of 3A Marine Service in Hingham, Mass., for nearly 60 years. The dealership carries new boats from Four Winns, Parker Marine and Robalo, and services what it sells. It also does robust business in equipment, but not just any parts and accessories.
“We stock impulse items and DIY items,” Lofgren says. “The impulse items are life jackets, boat horns and Coast Guard kit equipment. For do-it-yourselfers, we have the stuff they want, and we’re willing to tell them how to do that.”
He adds: “We don’t depend on selling lamps and tide books.”
Lofrgen says his approach began about 20 years ago, when outboard manufacturer Evinrude came to his dealership and made a big push into parts. “They came into your
facility and helped you set up for accessories,” he says.
Today, his business isn’t the only one in the boating industry that has created more diverse opportunities to keep money coming in. Whether it’s expanded parts and accessories departments, adding online sales or focusing on repowers, dealerships have created profit centers that keep business steady.
“I knew for a fact that you need to have parts to succeed,” says Carlton Phillips, owner of Prince William Marina in Woodbridge, Va. “If you fix a man’s boat, he will come back and do business with you.”
Lofgren says his company has four or five profit centers, with sales and service being primary. “We do a good parts and accessories [business] as well, plus storage and transportation,” he says, estimating that 10 percent of the company’s yearly income is parts and accessories sold over the counter. Another 5 percent is sold through service. He says the accessories showroom is on the small side, but the inventory turns over at least four or five times a year.
When the economy slowed at the end of the previous
decade, 3A Marine still had enough service business that it had to bring in people to work on boats. Today, the
company, which is landlocked across from Hewitt’s Cove in Hingham, has about 14 employees.
More recently, one of the areas where the company has expanded is in online parts sales, with a focus on older
Evinrude and Johnson outboards and OMC sterndrive parts. Purchases are made via PayPal. “We do a lot of
shipping to dealerships and marinas that need old Evinrude and Johnson parts,” Lofgren says.
He estimates that online sales add 3 percent to the bottom line. His daughter, Melanie Krause, who co-owns 3A
Marine with Lofgren and his wife, Angela, manages the parts and accessories business.
When he bought Prince William Marina about 40 years ago, Phillips had experience owning an automotive service shop. He put that experience to work in marine. “Someone walked in and wanted to buy the auto shop,” he says. “I had a boat down here, and it was a mom-and-pop marina that was struggling.”
As soon as he purchased the facility, Phillips emphasized service and having parts on hand for repairs. “We have $800,000 in parts, and we do $3 million a year in service business,” he says. The company employs 12 technicians, all of whom art are certified by engine manufacturers annually, and they get paid on a commission-based plan. Phillips says there is one downside to having all those parts on hand. “It gradually crept up on me,” Phillips says. “I probably have $100,000 in obsolete parts.”
The marina is on 13 acres and includes 312 slips with floating docks, a drystack building with 250 slots and ground storage for another 250 boats. There are four forklifts, with the largest rated to carry 18,000 pounds. There’s also a 50-ton Travelift. “We do a lot of bottom painting and shaft repairs,” Phillips says. “One of the biggest things we do is pod-drive repairs
because there’s just not many people who work on those.”
Prince William Marina is a family-owned operation. Phillips’ wife, Debbie, is the general manager, and his son, Doug, is the service manager. Grandsons and nieces and nephews have also worked at the yard. There are two dedicated parts persons, and the company has a total of 50 employees.
Service makes up about 12 to 14 percent of the total business at Prince William Marina, which carries the Sea Ray, Galeon, Cobalt, Bayliner and Scout brands. “Everything revolves around service in our business,” Phillips says. “That’s how we built the business, and it’s how we continued to do well in [the last] recession.”
Borrowing again from the automotive side, specifically from Lexus, Phillips says developing a certified preowned-boat program “saved the business 10 years ago.” When Prince William Marina takes in a boat on trade, it puts the boat through a checklist, then offers it for sale as a certified model with an extended warranty.
The Power of Repowers
John Tomlinson and Mike Thomas knew the importance of becoming a Mercury dealer when they started TNT Custom Marine. They also own, with another partner, the former Spinnaker Marina that’s now TNT Marine Center in North Miami.
“We’ve been doing repowers ever since I got the outboard dealership 18 or 19 years ago,” Tomlinson says. “We’re repowering something every single week.”
And with boats constantly getting bigger, engines are growing, as well. Offshore Performance Specialties in Fort Myers, Fla., is one of Mercury Marine’s biggest repower centers, but owner Donnie Carter has more flats boat and bass boat customers who buy single engines. TNT is on the east coast of Florida, and Tomlinson estimates that he outsells all other dealers in the state for large outboards.
“Twins, triples and quads — we do those 10-to-1 versus a single,” he says, adding that they are all engines in excess of 300 hp. His scheduled repower jobs include maybe one for twins. The rest are all triples or quads, and many of those are for multiple 400- and 450-hp engines.
TNT has a walk-in parts department, but Tomlinson says it mainly feeds the service techs to make sure they have the parts they need quickly. With so many customers shopping online, Tomlinson and Thomas decided not to focus on parts and accessories.
Tomlinson doesn’t stock many engines because of the choices customers now have in colors, shaft lengths and lower units. “There’s four different colors, three different shaft lengths and two different midsections on the V-8 300, and I guarantee the one you have isn’t going to be the one you need,” he says. “I order as needed.”
Mike Lund and Mike Lardani started Outboard Specialties in 1998, offering independent boat repairs on all types and brands of outboards in the Pompano Beach, Fla., area. The business started in the back of a truck, moved to a warehouse and eventually ended up in the half-acre yard that the company now occupies.
“I was well-versed in Mercury and Yamaha, and Mike was Johnsons and Evinrudes at the time,” Lund says. As the business grew, the business partners wanted to become a dealership for one of the big outboard companies, but there was one problem, Lund says. “In our town, every manufacturer was represented, and represented well.”
Finally, in 2005, an opportunity opened up to become a Suzuki dealer. Initially, the business did service and repairs, but it slowly narrowed its focus to specializing in repowers. “If you were to describe our business, we’re a Suzuki repower dealer who services what we sell,” Lund says. He handles the sales and business, while Lardani coordinates the service and scheduling. “We try to split the responsibilities.”
Outboard Specialties has 13 employees plus the co-owners. Lund estimates the business sells about 600 engines a year, with twin 300-hp Suzukis the most common choice for repowers. “We don’t stock anything below 90 hp,” Lund says.
Because of the size of the shop and yard, when a boat comes in, Lund says, “It’s being worked on now.” In addition to repowers, the company sells parts to do-it-yourselfers and will make sure a customer knows how to use what he buys. The most popular DIY product is an oil-change kit.
When a customer comes into the shop, he’s usually done his research and knows what he’s looking for. “It’s very rare that we get a buyer who walks into the shop and says, ‘I’m down to between Suzuki and Yamaha,’ ” Lund says.
When Outboard Specialties signed with Suzuki, Lund and Lardani also decided to become a dealer for JL Audio. “We probably install a third of what we sell, and two-thirds we sell over the counter,” he says. “With the installation, the average system goes out in the $4,000 to $5,000 range.” The systems include multiple speakers and are most often installed on center consoles and walkarounds.
Like their counterparts at 3A Marine, Prince William Marina and TNT Custom Marine, Lund and Lardani have found ways to focus their businesses by offering services that help drive people and money in the door. One could say that adding JL Audio was a sound decision.
This article originally appeared in the April 2020 issue.