What's happened to boat sales- 2008-2011

M

Matt Gurnsey

New member
I was just looking over some statistical data for the month of September. I thought some of you might find these numbers interesting.

All these numbers are for Year-To-Date through September in Washington State, and I have presented them 2008, 2009, 2010, 2011. (percentage 2011 vs. 2008)

  • All fiberglass: 2590, 2063, 1392, 1106 (-57%)
    Bayliner: 351, 382, 206, 160 (-54%)
    Sea Ray: 231, 174, 118, 80 (-65%)
    Ranger Tug: 12, 21, 22, 20 (+66%)
    Defiance: 6, 4, 9, 10 (+66%)
    Arima: 27, 15, 10, 17 (-37%)

    C-Dory: 27, 11, 7, 7 (-74%)

Many of the boats sold in 2010 were left over 2008 / 2009 boats. There were very few 2009 boats built by any of the manufacturers as the drop in sales from 2007 to 2008 left a lot of boats in stock. (sorry I don't have the 2007 numbers) Some left over product carried over into 2010. Almost all of the C-Dory's sold in 2010 were 2008 / 2009 built boats.

I included Bayliner and Sea Ray because they are the number 1 and 2 seeling brands in the state. Ranger is number 16 for this year, Arima number 19, Defiance 27 and C-Dory is number 33.

Tough times for the economy, and the industry. For a manufacturer, fixed costs (rent, insurance, heat, etc) are split bnetween half as many boats, and volume discounts from suppliers goes away at these levels, so the cost to build a boat increases dramatically on a per unit basis.

Anyway- wanted to give all of you a view behind the curtain...
 
Nice post Matt, that is the harsh reality that we face .
Also the encroachment of the internet into what used to be retail parts and services the dealers provide has put a big dent in our bottom lines . Maybe someday you will all be purchasing your Chinese made boats at Wallmart .
Marc
 
It doesn't help when the state of Washington tells you they are going to raise boat yard permit costs 700%. Yes, seven hundred percent increase.

It's a good thing I love what I do, 'cause I sure ain't gonna get rich doing it! :D
 
That comment about a loss of retail business to internet sales gets me thinking that there must be a certain lineup of products a local shop could carry that is locally relavant, hard to ship, locally sourced, or just very specific that could draw on some of the limitations of the web for boat related purchases. Maybe we should start listing out what we can't find on the web or what we don't like buying on the web that is boat related. Oh, and they couldn't rip us off with super high prices either such as 29 bucks for 1in stainless T rail fitting. It could even be such a focused selection that they sell it out of the service shop if needed and reduce the need for floorspace. And adjusting hours might help as well. Just imagine a shop with stainless hardware, wiring supplies, and adhesives and many of the products to supply a boat nut in the throws of maintenance that was open until 10pm when most folks end up working on boats to prep just a bit more for a trip. Far fetched, but I end of scouring the local Lowes in absence of other options and Lowes is not my favorite marine store.

Just thinking...

Greg
 
Greg, I know where your are going but I'm not sure that just hard to get items are the whole problem. I love to buy on line for project for the future. Item that I'm going to install later. but for the parts I need today, the parts I need to install the projects I bought on line I go to the local marine store in Everett and from the constant crowd that is in there so does everyone else.

I think the market is not for motor parts I can get on line but for the oil, tape, fiberglass, epoxy, nuts bolt, screws, etc... that I spend my money on locally at the store that has the best prices and best service.
 
Matt and Marc – I wonder what you sell in your stores that many C-Brats buy online at West Marine and other online retailers? I know folks on this site want to support C-Dory and the dealers but I don’t think any of you have online parts and accessory stores where we can see your product selection and shop online or place an order over the phone. Online stores for specialty retail has been the great equalizer for many small businesses, creating another sales/revenue channel for them. The closest marine dealership for me is 97 miles, Cabelas is 3 hours away.

In 2009 West Marine did $20million in online sales with the average sale being $210.00. In 2009 they had 285,000 unique visitors come to their web site each month. In 2010 West Marine web sales grew to $34million. These are just the web sales numbers and do not include phone sales or in-store sales. Overtons online sales were $8million online in 2006 (last numbers I had handy for them). These number show the opportunity that exist in aftermarket sales. It's a big pie.

Seems every part on a C-Dory is discussed on this site and someone is looking to replace, repair or upgrade something every day. I am surprised that I cannot shop or buy C-Dory specific items on the C-Dory factory site other than promo items. Not sure if it’s worth the effort for you dealers or the factory but if it were me I would explore selling parts and accessories online, run some numbers and see if it were worth applying the resources to an online store.

From a boat selling/marketing perspective the C-Dory.com site could be improved on by adding video and more detailed photography. How about a video sea trial? Ranger has done a great job with their videos. You can’t have too much product information.

Kevin
 
Kevin makes a great point and before some one chine in with,"you can't do that with a small business" I will give you a good example. Johns sporting goods in Everett is a tiny fishing store. two years ago he started a online store for most of his products. It has token off and is now equal to 4 time what he does in sales out the door of the shop. He found a nich with fishing guides and lodge owners that are living in this are but work in Alaska. They know what they want and he can build up shipments for them and have them shipped to the lodges or boats. He also does a bit of sales elsewhere around the country to the great lakes areas. it has not only saves his one man out fit but he now has 3 or 4 working the store, two of which just handle the one line stuff.

maybe some of the service/ boat dealers could do the same.
 
Hello Matt,

In my humble opinion, the reason why most fiberglass boats are in decline, but not boats like Ranger and Defiance, which have improved in sales over the last 4 years is fuel economy -- or at least the perception of greater fuel economy. The Ranger Tug is geared toward people who cruise, while the Defiance is geared toward people who fish. Both boats get superior fuel economy for their class. What we are seeing here, in my opinion, is similar to what happened with horse-drawn carriages in the days of the early automobile. Times change, and those manufactures who tried to make carriages and buggy whips at the dawn of the age of the automobile perished if they persisted to stick by their out-of-date products. In my opinion, power boats will become a toy only for the wealthy class as gasoline rises to perhaps $8 per gallon within the next few years. The dawn of this new age, I think, is for boats that have superior fuel economy. The key will be to keep the size and weight down while maximizing the load capacity and space. That's why my wife and I bought the Marinaut. Fuel economy we felt was the most important factor, because of lower operating costs, greater range and higher resale value.

Rich
 
We are on the same page Tom with consumables and project supplies instead of motor parts or appliances or electronics. I just also wish the store was open in the evening instead of in the morning so I could tap into the supply while I am working on the boat and hit a dead end because I lost or broke a fastener or came up a foot short on a wire.

I could also see some potential for a catalog shopping desk like they have at Fisheries. If you can drag folks in with consumable goods, they might stick around to order a bigger ticket item through the shop if they could see a picture and browse product catalogs/websites in the store while a knowledgable person is nearby to provide a bit of guidance on the purchase. I see people drag their feet for months on a purchase only because they don't have the confidence to make a decision so they browse the web and often get more confused until they just give up and by the one thier brother has on his boat.
 
Tom,

Part of the problem with using John's as an example is that he sells a product that has limited sales appeal to specific people and buys his products from companies that are themselves relatively small. I think it's great and I'm happy to hear someone is doing well these days.

However, if you take the normal run-of-the-mill items that a West Marine store carries (nuts, bolts, screws, caulking, electrical fittings, etc) a small dealer is never going to be able to compete with the pricing. There's just no way (without a massive investment) to purchase enough from a fairly large manufacturer (like Perko, or Seadog (not really a manufacturer but occupies the same niche), or Blue Sea Systems, or the like, to get competitive pricing.

I love Blue Sea Systems products and I use and sell a lot of them but I still don't sell enough to buy directly from them with deeper discounts. I still have to purchase through a distributor like Fisheries Supply. And therein lies the biggest problem for the "little guy" (us)...the distributor. They're not evil but they are another hand held out for part of the profit dollars. And I can't go around them because I'm not big enough to buy direct from the manufacturer so I can never (or hardly ever) sell my goods and compete against the big money online guys.

I can't imagine (and I've tried) what a small dealership can carry in store or online that can't be found cheaper elsewhere. Even small outboards are getting tough with online volume outfits willing to sell and ship them anywhere in the country. And it's starting to happen with larger outboards as well.

I'm not bitching, it's just the way it is and I can decide to move on if I can't stand the heat but I don't see an easy answer to it either and most of us don't have the hundreds of thousands of dollars it would take to underwrite the buying levels it would take to offer online competitive pricing.

Les
 
I think I know why they went up and it is related to new inspection requirements that equate to loads of new field staff and associated resources and data collection/maintenance that previously didn't need to exist. The same thing has been hitting the City/County level as well but at least we can apply for grants to soften the blow a bit.

Stay in the business for all of us who need you knowledgable, helpful, boat folks.
 
Another part of the problem is that boat prices have gone through the roof. I remember when I first looked at, and fell in love with the CD 22, in the early to mid 90s and they were about 30-35 thousandish with a trailer, motors, and a decent amount of rigging in Washington. And if you searched really hard and negotiated really well, you could find one for about 30 thousand. Jump forward a decade and by mid 2005, AMD (Alaska Mining and Diving) and others wanted not quite, nearly double the mid 90s price. I begged AMD to sell one for 52 thousand in 2007 and they would not do it, no way. I bought used. All I can say is wow.....

To put things in perspective, my paycheck did not come close to doubling in that time; in fact it barely keeps up with inflation. Thinking back to those days, right on up to today, I probably got a 25-35 percent increase in pay over that time. When boats go up fast like that, quite frankly it puts the average guy out of the game pretty quickly. Easy bank financing didn't help any as it just drove the prices up and up due to increased demand. It also shot the cost of materials up too (for no damn good reason) and they have yet to recover. And unlike houses, boats have not gone down really. They just stayed there for whatever reason. Yep, hardly anybody is buying them. It isn't rocket science folks. Paychecks have not kept up with boat prices.

That is what has happened...at least from my view...a typical guy just can't afford one anymore. Heck it was a stretch before. Now it is a pipedream....I am sorry to say that with how much they cost any more, the C-Dory dealership may as well be on the moon.....
 
T.R. Bauer":1c6gk113 said:
Another part of the problem is that boat prices have gone through the roof. I remember when I first looked at, and fell in love with the CD 22, in the early to mid 90s and they were about 30-35 thousandish with a trailer, motors, and a decent amount of rigging in Washington. And if you searched really hard and negotiated really well, you could find one for about 30 thousand. Jump forward a decade and by mid 2005, AMD (Alaska Mining and Diving) and others wanted not quite, nearly double the mid 90s price. I begged AMD to sell one for 52 thousand in 2007 and they would not do it, no way. I bought used. All I can say is wow.....

To put things in perspective, my paycheck did not come close to doubling in that time; in fact it barely keeps up with inflation. Thinking back to those days, right on up to today, I probably got a 25-35 percent increase in pay over that time. When boats go up fast like that, quite frankly it puts the average guy out of the game pretty quickly. Easy bank financing didn't help any as it just drove the prices up and up due to increased demand. It also shot the cost of materials up too (for no damn good reason) and they have yet to recover. And unlike houses, boats have not gone down really. They just stayed there for whatever reason. Yep, hardly anybody is buying them. It isn't rocket science folks. Paychecks have not kept up with boat prices.

That is what has happened...at least from my view...a typical guy just can't afford one anymore. Heck it was a stretch before. Now it is a pipedream....I am sorry to say that with how much they cost any more, the C-Dory dealership may as well be on the moon.....
Click to expand...

T.R.-

Wow! Good analysis from the consumer's perspective!

And if new boat prices are that high, used boat prices should also be up because that's where the demand should be focused, unless there are so many used ones available that the supply drives down the prices.

I think we're probably seeing both parts of that happen right now.

In the long run, a used C-Dory should be a sound investment and hold its value well, I'd think!

Joe. :teeth :thup
 
The rate of depreciation is another sore point for the new boat shopper...
I have an 09 Ranger Tug that I bought one year old at a deep discount over new...
I have eyeballed the new 27's but there is no way I am willing to swallow the bite I will take on the value when it turns one year older... I am sure that my attitude is not unique and I am further sure that it impacts good dealers/people like we have posting in this board...
Interestingly, I have an 08 Duramax HD2500 truck... It's value today as used with very low mileage (18K and looks like brand new) is roughly $5K less than what I paid for it and the value will continue to be high for years yet...
My 08 Tug with only 150 engine hours has dropped by nearly 45%... The paint on the engine still shines, you can eat off the bilge, and the boat is rushing down the road to having lost half of it's value... That fact alone has to cripple sales of new boats...

My daughter and her husband have a 36 foot SeaRay that is only a few years old and has almost no hours on the engine and looks like a new boat right off the show room floor (they are meticulous)... They keep it at the country club docks and it is in heated storage in the winter, and they use it mainly to run over to Put-In-Bay for an evening out... He was trying to trade up to a new 40... The 36 has almost no trade in value - they offered $200K LESS than his cost... He said the hell with it, he's gonna double his money by folding it over and putting it back in her purse... So there is another dealer hurting...

denny-o
 
A few things - the average item that cost $32,000 in 1993 would cost about $50,245 in 2011 due to average 57% rate of inflation. Boats have gone up in cost a bit faster due to a large percentage of the cost being in raw materials and due to the fact that the raw materials re tied directly to oil prices. Hence I would disagree with the statement that raw materials prices went up "for no damn good reason".

However, I agree with your main point is that the buying power of the average guy has gone down relative to inflation. During that same duration of time, the average wage in the US went up about 48% but much of that increase is driven by those in the upper income brackets whose net income went up at a much faster rate than the average guy (see the U.S. Census Bureau data or this link for recent U.S. historical income data.
 
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