Boats Group Rate Hikes Spur Backlash

Stewart Roach says he sometimes wonders if Boats Group — which owns some of the most dominant boat-listing websites — is trying to put dealers like him out of business. Roach has been selling boats for almost four decades. He owns Norwood Yacht Sales in Quincy, Mass. It’s a business with just two other brokers, and he says it can’t sustain the new monthly rates that the Boats Group brand YachtWorld wants him to pay to list boats for sale online.

“If you’re paying rent at $1,200 and this is close to $3,000, it’s not sustainable,” Roach says. “I’ve been through every recession there is. I’m 59 years old. I thought I’d do this until I was 63 or 64, but it’s going to put me out of business.”

Maryline Bossar with ACY Yachts in Annapolis, Md., took to LinkedIn after being told the cost of listing boats on YachtWorld and Boat Trader would double starting in February. “As a marketer, this sudden rate hike is simply unacceptable,” Bossar says. “It cannot be justified by Boats Group, save for their ambition to grow profits while their products are only marginally improving, and lead generation [is] staying flat. We are, simply put, in shock.”

At HMY Yacht Sales in West Palm Beach, Fla., director of sales Tim Derrico says Boats Group tried to hike his company’s monthly cost to $65,000. “It’s a 75% increase from the previous rate, which was a lot,” Derrico says. “They were already universally despised, but you’d still swallow hard and sign a contract. Now they just went too far.”

The recent rate hikes have led to brokers using words like “evil,” “greedy” and “ridiculous” when describing Boats Group, which owns about a dozen brands, including YachtWorld, Boat Trader and Boats.com. Since early 2021, a company backed by the global investment firm Permira has owned a majority stake in Boats Group. At the time of that acquisition, Boats Group CEO Sam Fulton stated in a press release: “Looking ahead, we are confident we will be able to deliver more value across our platform by providing our customers with enhanced solutions, and offer an exceptional experience that will help consumers around the world find the boat they love.”

That’s not how things have worked out, according to dealers and marketers who now say they are being fleeced. Derrico says the most recent increase led him to look at what HMY was getting for its money. In 2024, he says, HMY sold close to 500 brokerage boats, not counting new boats. “Only 53 of those deals, we can put on a Boats Group lead, whether it’s Boat Trader or YachtWorld or whatever,” he says. “Our average deal was over $1 million, but our average Boats Group deal was $300,000 and change.”

He says HMY ended up signing a contract for one more year, but not at the rate Boats Group wanted, and with the intent to find other options going forward. “What I’m hearing is everybody saying the same thing: We’ve got to stick with them for another year, but we’re going to do everything we can to wean ourselves off of them,” Derrico says.

Boats Group declined an interview request from Soundings Trade Only. In an email, vice president of marketing Courtney Chalmers stated: “While we respect the work that STO does, it’s somewhat ironic that there’s interest in publishing a story about brokers and their use of online marketplaces like Boats Group on the heels of a significant industry lawsuit centered on that very topic.”

That federal class-action lawsuit was dismissed in January. It accused boat brokers of conspiring to inflate sales commissions. Defendants included the International Yacht Brokers Association, numerous brokerage firms, including HMY, and Boats Group. Derrico says the issue with Boats Group rate hikes has nothing to do with that lawsuit. Paul Flannery, president of the IYBA, agreed.

IYBA members, Flannery says, have been vocal about challenges they are having with Boats Group pricing. “The big guys are disgusted, and the small guys are scared,” he says.

While the IYBA does not advise brokers about which services to use for online boat listings, in October 2024, the association officially launched its own boat-listing service called Yachtr. Flannery says the “elegant solution is for the nonprofit to own and control the database that supplies the data to any public-facing site. There’s no substitute for the creativity of the free market and what it can create as an app or a website or another way to get eyeballs on something, but the app has to come from a central place that’s trustworthy and pure.”

Roach says he thought most dealers would move to Yachtr, but defending the class-action lawsuit burned through a significant amount of money the IYBA could have spent to make Yachtr listings more competitive in online searches. “You probably have to go to page three of the search results to see something that’s listed on Yachtr,” he says.

Flannery says the IYBA board of directors met in early February and greenlit a plan to address that concern. The IYBA, he says, spent about $500,000 on legal defenses in addition to significant funds that individually named defendants spent. Flannery says they are all hopeful that a March 10 court deadline will pass without any new activity, which would mean that lawsuit is over for good.

“Yes, there was a significant distraction last year with our legal defenses,” Flannery told Soundings Trade Only during the first week of February. “We have a plan that, in our board meeting yesterday, was approved to aggressively bring forward an industry-owned solution.”

Derrico says one major challenge is that people who want to sell their boats see online search results and believe that Boats Group websites are all-powerful entities because of how high they rank. But in reality, those search results are not driving most business at HMY, he says. Some 85% of HMY sales come from repeat clients and referrals.

“One of the problems we have, and everybody has, is our clients still think their boat needs to be on YachtWorld no matter what we tell them,” Derrico says. “We’ve got to spend this next year educating brokers and the clients that, no, you don’t have to be there.”

The question that Derrico, Roach and others are now asking is what to do for boat marketing instead. “Will it be Yachtr? There’s another group out there that’s already got something up and running kind of good, and the guy behind it is a genius that’s been involved with some huge international corporations and developing websites,” Derrico says. “That’s probably got a better chance of making it than anything. That could be out by the end of the year, and they’ve got money.”

Flannery says there is no shortage of people and companies that think their boat-listing service could be the next big one. “But you just can’t show up with a new name and a WordPress website and solve the problems that the industry has,” Flannery says. “What the industry is quickly realizing is that if they do chase these things like a bunch of crows, it’s out of the frying pan and into the fire. What’s to stop any of these places from becoming the next problem?”

Derrico says he’s also now wondering just how much online search traffic HMY Yachts needs. If most of the company’s business is coming from repeat and referral clients, he says, maybe the marketing focus should be elsewhere altogether. “We just don’t need that much fresh business, especially that way,” he says. “We’re just going to go after trying to generate new business in a completely different way, based on the modern world of technology.”