Marine dealer sentiment decreased in November (47 versus 62 in October) while the three- to five-year outlook was flat (29 versus 29 in October), according to this month’s Pulse Report survey. A neutral outlook is 50.
The seemingly never-ending broken record of inventory being too high among dealers played again in November, with 79% of them reporting new-boat inventory being “too high” versus 4% saying it was “too low.” Similarly, dealers reported used-boat inventory as higher than they would like, with 49% saying “too high” versus 22% saying “too low.”
“In our world as independent retailers, we have to rely on the manufacturers to objectively police and manage field inventories so that both parties remain whole,” one retailer said in response to the monthly Pulse Report survey. “In times like this, the old adage of ‘cash is king’ certainly rings true, and inventory management is a key component in terms of cash flow.”
For this month’s Pulse Report, Soundings Trade Only, Baird Research and the Marine Retailers Association of the Americas asked 78 retailers to assess current trends in North America. More dealers reported retail declines in November (56%) than growth (22%), a result that is consistent with October trends. According to the survey, November typically represents around 3% of annual retail sales.
When asked what was working regarding sales, dealers illustrated some positives while also communicating pain points. “Late-season discounts are helping a little,” one dealer responded. “Some people are buying small things like tubes and life vests as Christmas gifts. Service has been good. The warmer fall weather has spread out our typically tight winterization season.”
Another said, “Product training! We’re constantly scheduling training to stay up-to-date on current inventory to better help the customer. Expanding knowledge to pass on to our customers helps develop the relationship of trust and dedication to the brand.”
As far as what sales tactics were not working, dealers had plenty of gripes. “Amount of non-current inventory in the marketplace,” one dealer replied. “Floorplan companies’ lack of flexibility with curtailments.”
Another said: “Finance interest rates are too high for most lower credit score qualifiers of 774 and below, and they no longer have the cash down payment to get the monthly payment to where it needs to be to fit their budgets. Inflation everywhere is sucking the cash out of all but the wealthy. It’s hurting marine sales.”
The outcome of Election Day did leave more than one dealer optimistic. “Our mood and optimism are very much elevated since the Trump victory, as well as the Republicans taking the Senate and maintaining the House,” one dealer replied.
Another added: “Hopefully with the incoming administration, we will see an uptick in confidence, a reduction in finance loan rates and an uptick in business.”
