Marinas have weathered the recession better than any sector of the marine industry and likely will remain solid investments for years to come, veteran consultant and “father of the marina industry” Neil Ross said Thursday morning at the International Marina & Boatyard Conference in Fort Lauderdale.
“Your marinas, not boat manufacturers, will remain the most economically stable sector of the entire recreational boating industry,” Ross predicted in his talk to a nearly packed hall at the Greater Fort Lauderdale/Broward County Convention Center.
He said well-run marinas should remain a solid business model for delivering services and returning a reasonable income well into this century.
“You know it. … Use it to your advantage. Make it happen, folks,” he said.
Ross, of Kingston, R.I., started the first Sea Grant boating and marina program in 1969 and co-founded the International Marina Institute in 1986. He expects to see more rental boats, more rack storage for boats under 45 feet, upland storage on mobile cradles for boats to 70 feet and fewer, but bigger, in-water slips (40 to 70 feet, with some to 120 feet and a few 250 feet and bigger).
He also expects a resurgence of small wooden runabouts as nostalgia sets in in the era of fiberglass boats whose systems are more complex, more highly integrated and more expensive to buy and repair.
“Boating, unfortunately, is going to become more costly,” he said. Marinas and boatyards will have to respond to boats’ growing complexity and size – and more demanding customers – with better-trained staff and more sophisticated equipment.
Ross said the last four recessions suggest that marinas are the last sector in the boating business to go into recession and the first to come out. He said that in the first year of a recession a marina operator typically sees few changes – maybe shorter boat trips and owners staying on their boats at the docks more; in the second year, a 10 to 15 percent slip vacancy occurs, along with a decline in fuel sales, more repair work, fewer boats to fill slips that become vacant, staff reductions and shorter work weeks; in Years 2 to 3, boats move to better marinas because they no longer have a waiting list and the better marinas fill their slips and upgrade their facilities; and in Years 3 to 4, almost all marinas recover, with more than 95 percent of them surviving without a change of ownership and waiting lists fill up again.
Ross expects a full recovery for the marina industry “in a year or two. … This year is going to be much better, I’m predicting.”
He said changing economic conditions, combined with changes in the boating business, require marinas to gradually make themselves over every 20 to 25 years.
In the keynote address, Vince Morvillo, who though blind from birth has owned a marina, now owns Sea Lake Yacht Sales in Houston and won the 2004 Ensign national championships with a sighted crew, said marina operators must embrace and manage change and see it as a gift instead of a problem.
Morvillo said his blindness has turned out to be a blessing because it forced him to look for creative and innovative ways to get on with life and helped him find new ways to take his yacht business forward in the turmoil of Hurricane Ike in September 2008 and the recession that began two months later.
He said marina operators must brainstorm creative solutions to problems brought on by the recession the way they did when they were starting their businesses.
“The problem isn’t really the recession,” he said. “The problem is the engine that drives our business and creates new products and services and business models. It’s the loss of the entrepreneurial spirit and our complacency and comfort with the way things are.”
– Jim Flannery
