Boat Dealers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 3,500 boat dealers in the US sell new and used boats and related products and services. Related products and services include motors, parts, and accessories; parts and labor for maintenance or repair work; and motorized sports vehicles (ATVs, snowmobiles). Dealers may also facilitate financing, offer slip and storage facilities, provide boat brokerage services, or offer extended service contracts.
Seasonal Sales
The boating industry is highly seasonal and sales peak during the summer, when weather is conducive to water-related activity.
Dependence on Credit
Both dealers and boat buyers depend on access to credit to fund purchases.
Industry size & Structure
The average boat dealer operates out of a single location, employs 9-10 workers, and generates about $4-5 million annually.
- The boat dealer industry consists of about 3,500 companies that employ about 34,200 workers and generate about $15 billion annually.
- The industry is fragmented; the top 50 firms account for 31% of industry sales.
- Large companies include West Marine and MarineMax.
- The majority of the recreational boating industry involves the use of small boats (26 feet or less in size).
- Pre-owned boats accounted for almost 79% of all boat sales in 2021.
Industry Forecast
Boat Dealers Industry Growth
Recent Developments
Feb 20, 2023 - Boat Dealers Expect Lower Sales in 2023
- About two-thirds of boat dealers expect new-boat retail unit sales to fall in 2023, according to January’s Pulse Report in Soundings Trade Only. For the report, Baird Research and the Marine Retailers Association of the Americas surveyed nearly 100 dealers about their outlook for 2023. About a fifth of dealers expect growth in 2023, and 12% expect flat sales. Dealers surveyed saw a decline in both new (66%) and used (62%) boat sales in December 2022. Factors harming the business include limited access to credit, the economy, a slowdown in trade-in activity, and government action/inaction. Nearly 60% of dealers said their new-boat inventory was too high, while about 20% said they didn’t have enough product. For used-boat inventory, 40% of dealers said it was too low, while 32% said they had too many preowned models in stock.
- Consumer confidence levels declined in January 2023, following an increase in December 2022, according to data from The Conference Board. The Conference Board’s consumer confidence index fell to 107.1 in January 2023 from 109 in December 2022. According to Ataman Ozyildirim, a senior director of economics at The Conference Board, “Consumer confidence declined in January, but it remains above the level seen last July, lowest in 2022. Consumer confidence fell the most for households earning less than $15,000 and for households aged under 35.” While plans to purchase homes have cooled, plans to buy cars and appliances have held steady, per Ozyildirim.
- New powerboat retail unit sales fell in 2022 by an estimated 15 to 18 percent, to an estimated 250,000 units sold, according to data from the National Marine Manufacturers Association (NMMA). The change normalizes the sales to pre-pandemic growth years (2015-2019), and early indications show that retail unit sales in 2023 are expected to remain on par with 2022. Demand was strong in 2022 for entry-level boats such as personal watercraft, freshwater aluminum, fiberglass fishing boats, and pontoon boats less than 26 feet. According to Frank Hugelmeyer, NMMA president, “Last year was a healthy year for recreational boating with momentum coming off of record sales in 2021 due to continued demand and the fact that supply chain shortages prevented our industry from overproducing like we saw happen in other sectors over the past two years.”
- Boat dealers are getting a six-month extension to comply with new amendments to the Federal Trade Commission’s (FTC) Safeguards Rule, which requires non-banking financial institutions (including marine retailers) to develop, implement, and maintain a comprehensive security system to keep customer information safe. The Revised Safeguards Rule applies to all customer information and includes any customers of other financial institutions that have shared information with a dealership. Customer information that’s protected under the Safeguards Rule applies to Personally Identifiable Financial Information (PIFI). PIFI includes not only social security numbers and credit card information, but all transactions that take place that might disclose a customer’s financial information. The new deadline for compliance is June 9, 2023.
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