Boat dealers were rolling up their sleeves to get any sales closed in January as they continued to battle high inventory levels and interest rates, and cautious buyers.
“It’s still a buyer’s market, with heavy price discounts required to move any unit,” one dealer replied in this month’s Pulse Report survey. “Coupled with high interest rates, consumers are still timid when it comes to buying a unit. Manufacturer promotions are helping drive traffic, but still with a lot of tire kickers rather than buyers.”
Creativity helped one dealer, who said, “We had our own open house/boat show and could offer better discounts because we didn’t have all the costs of going to a big show. This is our second year, and we doubled our sales from last year.”
For this month’s Pulse Report, Soundings Trade Only, Baird Research and the Marine Retailers Association of the Americas surveyed 49 marine dealers asking about retail sales trends, managing inventory and the most effective ways to close deals.
“You have to ask for the sale. A boating store is a destination store, not an impulse buyer’s store,” one dealer responded. “If someone walks into your showroom, there is more than likely a reason for him being there, even if it is slight interest. There is at least some interest in buying. You just have to get them over the hump.”
Retailer sentiment in January decreased to 28 from 43 in December while the three-to-five-year outlook basically held steady at 28 compared, with 27 in the final month of last year.
Some 38% of dealers reported retail declines for new boats, while 29% said they saw growth. For used boats, 38% said sales were down, while 26% reported a boost in revenues. Typically, January represents 3% of annual retail sales.
Inventory remains a sore spot, with 89% of dealers saying they had too many new boats in stock and 5% saying they didn’t have enough. For used boats, 56% of dealers said inventory was too high, and 22% said they didn’t have enough preowned models. “Inventory is our main concern,” one dealer responded. “We have too much. It is aging and costing way too much to hold.”
Another added: “Trades on boats less than 2 years old are impossible to get completed.” A third said that pontoon-boat sales have stalled, adding, “Our market is saturated, and everyone is trying to get rid of their inventory at low prices.”
Premium brands and higher-priced boats continued to be bright spots, with dealers saying boats from Cobalt and Nautique, among others, were sold. One dealer said it was moving brokered models, while another said that packaging customer service, storage and docking helped close deals.
One dealer overcame objections by demonstrating the value of the equipment on a given model, saying, “We focus heavily on value versus pricing. We show and demonstrate the features and options, then explain why they can use that option and how it works for them to have a better experience.”
This article was originally published in the March 2024 issue.
