June saw marine retailer sentiment up slightly for current conditions (38 compared to 32 in May) and for the three- to five-year outlook (32 versus 29). A neutral outlook is 50.

“Year to date, sales are down,” one dealer said in response to the monthly Pulse Report survey. “We’re not deep in the red. However, our focus is on implementing optimal strategies to enhance our daily operations, ensuring we remain agile during this challenging phase in our industry.”

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Another added, “Nothing is easy. Every aspect of our business is a grind, and even when you overcome every objection or obstacle, you sometimes still are not able to earn the business.”

For this month’s Pulse Report, Soundings Trade Only, Baird Research and the Marine Retailers Association of the Americas surveyed 87 dealers about profit margins, managing inventory, other revenue sources and workforce challenges.

Baird says June typically represents 15% of a dealership’s annual sales. More retailers reported retail declines, with 49% saying sales were down compared with 34% who saw growth. For used boats, 36% saw sales growth and 44% said they sold fewer preowned models than in May.

New-boat inventory continued to be a problem, with 74% of respondents saying they had too many units on their property, and 7% said they didn’t have enough. For used boats, 30% of dealers said they didn’t have enough, while 36% said they had too many.

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“The biggest contribution to the problem we are facing is the amount of inventory out there, both new and used,” one dealer wrote. “The used market is flooded with people that bought at the height of the pandemic and are drastically upside down. New boats are being released that are selling for less than we paid for some of the exact same boats. It’s going to continue through 2025 until the supply/demand evens back out.”

Dealers who are moving boats say they are cutting prices, which has reduced profit margins. Some 42% of dealers said their profit margins were “down,” while 39% said the numbers were “down significantly” and 19% said things were “about flat.”

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Retailers said boat and engine manufacturers who work with them by offering rebates and other incentives were helping ease the stress of high inventory and moving boats. “Summer incentive promotions have definitely created increased urgency for the consumer to make his/her purchases in a timely manner,” one dealer said. “It has also allowed the consumer to repower their older boats while being incentivized by the manufacturer and the dealer.”

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Conversely, a difficult financial outlook continues to create headwinds for consumers and dealers. The upcoming election is also on consumers’ minds. “Higher interest rates, higher fuel prices and too many recreational fishing regulations — state and federal — are negatively affecting new sales,” one dealer lamented.

Another added, “The market is flooded. All of us dealers are in the same situation — a lot of aged, expensive inventory — and we are all just trying to free up some money.” 

This article was originally published in the August 2024 issue.