WOODS: Keeping the boat business afloat
Boating is huge national pastime. It’s a huge deal in Mississippi, too. If you doubt that, then take a leisurely cruise across the Ross Barnett Reservoir Dam on a cool, spring or early summer day and checkout the watercraft traffic on the “Rez”. Take a quick exit to one of the big I-55 north lakes like Enid, or Grenada. It’s the same thing. People are boating in everything from small fishing flat-bottomed johnboats to speedy bass boats to large lumbering cabin cruisers. You’ll find the same identical activity on practically any body of water anywhere in the state especially on weekends.
Tough Economy Tough on Recreational Pursuits
It’s no secret the down economy the past five years or so has also hit the recreational boating industry as well. Recreation it seems is one of the first places where a lot of people can cut back. It impacts hunting, fishing, boating, and all types of vacation travel. When times get tough, even people with expendable funds tend to become more reserve in their spending. This carries over to all types of reductions in sales for things like boats.
Thom Dammrich, president of the National Marine Manufacturers Association, says the national boating industry is roughly a $30 billion industry. That would be in normal times I suppose. He pointed out in a recent report that 40-60 percent of annual boat sales are actually conducted at winter and early spring boat shows, like the one held recently in the Jackson area.
Those trends have slowed considerably with the national economy. Truth is new boat sales are just plain down. However, creative and proactive boat dealers have found ways to turn a buck.
Altering the Business Plan
Boat sales business modeling has changed considerably in recent years. Dealers are selling more used units than new ones. The maintenance business is roughly 10 fold what it was years ago because current boat owners are simply keeping the boat they already own and use, but are more diligent in keeping them maintained in top mechanical running condition. This has generated lots of new business for boat dealers back in the repair shop.
Recreationalists looking for a first boat are searching the markets for high-quality, little-used pre-owned boats. Some of these are on the lots of dealers as trade-ins or units that dealers have bought off the private market. To that end, more used boats are on the market by private owners that can’t afford to operate a boat now, or just decided to cut back in that area. This puts some good boats on the market for new shoppers, but of course, it is prudent to use care when buying a used boat from a private source. Use a good dealer to inspect the boat, or buy from that dealer who can stand behind the boat should problems arise.
Boat Buying Trends
Boat dealers also have noticed a trend by buyers especially for first-time boaters to buy a downgraded unit with fewer accessories, amenities, or electronics on board. This can shave considerable dollars off the price of a new boat. It still offers the buyer a solid watercraft for use now to which they can add custom features to later.
For now at least it seems the market is soft for high-end electronics like weather radar, high resolution GPSs, video screen fish finders, depth gauges, leather seating, canopy tops, and bigger engines. Plenty of people still want to go boating but have decided they can do without all the extra bells and whistles at least for the time being.
The NMMA sales data is suggesting that dealers are selling smaller boats rather than the bigger cruiser models. Center console models are very popular for “day” boats used by anglers, watercraft cruising, waterskiing, and general boating pleasure. Simply put in today’s market these types of boats are more affordable. Sales continue to be sluggish for “weekender” boats with sleeping cabins and deluxe customized features.
In talking with local boat dealers such as the Bass Pro Shops in Pearl and the Lake Harbour Marina it seems that their boat sales are holding their own. They concur with the same information presented here that buyers are downgrading, and downsizing, though there might be an exception when it comes to fully equipped bass boats. Buyers are still willing to take on a payment book for a boat specifically designed for high impulse bass fishing.
Also they agree that maintenance work continues at a steady pace. People are keeping up what they have. Boaters that might want a new rig are resigned to using their old boat a few more years. However, they might be willing to buy some new gear, upgrade electronics, or add a custom accessory or two. That way they didn’t spend the big bucks on a new rig, but were happy with stepping up the boat they have.
Consumer Nation recently reported that boat sales are up in early 2012. “Sales are picking up across the country. Pre-owned sales continue to dominate the current boat sales market, but more buyers are coming to boat shows and dealer showrooms looking at the new units as well. Maybe this heralds a sign that the overall economy is improving if people are now willing to go back to shelling out hard earned income for new recreational toys. Let’s hope so.
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