July saw marine retailer sentiment increase for the second straight month, with a 44 for the current outlook compared with 38 in June. On the other hand, the three-to-five year outlook was down at 23 versus June’s 32. A neutral outlook is 50.
“Just sticking with the basics and continuing to work deals and communicate with customers quickly and accurately,” one dealer said in response to this month’s Pulse Report survey. “Speed of communication is critical.”
Another added: “We’re narrowing our targets for marketing and trying to bring in income streams where trends have been increasing for numerous years rather than just a ‘hot new thing.’ ”
In this month’s survey, Soundings Trade Only, Baird Research and the Marine Retailers Association of the Americas asked 83 dealers about profit margins, managing inventory, other revenue sources and workforce challenges. Some 52% of dealers reported retail declines for new boats in July, while 27% said they saw growth. Used boats were also trending negatively, with 40% of dealers saying sales were down and 26% saying they were up.
“Hearing so much about how expensive products are now,” one dealer said. “People are keeping what they have and not upgrading like usual, especially in the wakeboat market.”
Another added: “There are more shoppers than buyers, with serious buyers aware of the slowdown and higher dealer inventory levels, making it a true buyer’s market with heavy discounts to lower inventory and overhead expenses.”
Inventory is still a challenge, with 83% of dealers saying it was too high for new boats and 1% saying they didn’t have enough. For used boats, 51% of dealers said they had too much inventory compared with 17% saying inventory was low.
When asked to assess their financial situation for the balance of 2024, 60% said managing inventory was their primary focus, followed by revenue generation and diversification at 13%, and cost-cutting/expense-management at 10%.
“Even though inventory is high and the selling season has been quite volatile, we are looking forward to 2025 product rolling in,” one dealer replied. “As long as manufacturers continue to promote their brand along with any kind of incentive, sales will be there.”
Another added: “We are aggressively working with customers on any existing inventory to move out units, greatly reducing our floorplan expense, and pushing the older units that are expensive to hold.”
Other dealers pointed to the uncertainty that comes with an election year, continued high interest rates, more difficult loan approval, fewer manufacturer incentives and higher unit costs. One dealer said it cut 2025 orders by about 40%. Another said the dealership was looking to cut day-to-day operations costs and pick up a new boat line with better margins and pricing.
“We hope that once the election is over, regardless of which way it swings, it will alleviate some pressure on the market and increase consumer confidence,” a retailer said, “hopefully helping to encourage shoppers to become buyers.”
This article was originally published in the September 2024 issue.
