Boating Industry Canada October 2015 - (Page 4)
BY ANDY ADAMS
your Industry at the
End of 2015
THE SUMMER of 2015 is now officially over. The first day of
Fall was September 23 and we can now look back at the last
four months or so with clarity.
In Ontario, it really was a pretty nice summer weather wise
and many other parts of Canada also enjoyed sunny warm
days, but it was too warm in some cases. Life is rarely perfect.
Although as a final salute, the Fall in Ontario is perfect right
now - sunny, 21 celsius and as I look out on the lake...there
are no boats on the horizon.
I believe this is because too many of us have to work for a
living; a cruel situation I know. Some days, perfection eludes
That reminds me of my investment portfolio performance
through 2015...the word cruel that is. Maybe problems in
China, or global uncertainty, tanking oil prices or currency
woes are behind that sad performance. No matter. It was not
the wildly positive investment environment that would have
driven big sales increases in the boat business.
We like "positive". We are all about good times and good
friends. See John Morris' Ad Nauseam column in this issue on
page 18. Cheers! Is the glass still half full?
So what happened in sales for the boat business? Well, here
is some perspective from NMMA Canada.
Following weak sales in the first quarter (down 8% YOY),
the pace of decline has decreased (down 2.1% YOY in Q2 and
down 1.4% YOY for the first 2 months of Q3)
While new boat sales in Canada have been trending downward for the past 2 years, the pace of decline seems to be moderating. Data through August indicates sales are down 2.5% in
2015 YTD, suggesting we may be on the road to recovery;
however, since GDP has been contracting for the past 2 consecutive quarters, we will need to continue monitoring its
impact on boat sales. The strength of the US dollar is impacting
sales of US product.
Reflecting a shift in new boat designs and consumer preferences though, wholesale shipments of outboard engines in
Canada were up 10.9% YOY for the 12 months through
August. Corresponding dollars were up 14.3%. Warranty card
registrations were up 1.4% (R12M YOY) in August.
Ok...not a disaster but not a great year either according to
NMMA data. Luckily, we have a good relationship with GE
CDF and the latest Canadian sales data appears on page 12 in
the GE Spotlight report.
The GE data is drawn from slightly different sources and the
YOY 2015 volume change data to August was down 6%. On a
regional basis, BC was the place to be while Ontario was soft
and Quebec was softer.
A key measure from GE was "aged inventory over a year
old" and at 18% that is at the high end of what their decades
of experience say is healthy. We, as an industry, need to balance
that off which means selling off non-current inventory as well
as being cautious about ordering new inventory.
Overall, you could say the business is soft right now and
these numbers are across the broad spectrum of the industry.
That means there are still winners, but there are probably others who are performing below industry norms. It's a challenging business environment for new product sales, but I want to
make a point.
New boat sales are important and valuable, but they are not
the only source of revenue. Service and accessory sales are also
important revenue generators and that is where the industry
can keep the game going.
I believe this is particularly true because typically, boat
owners enjoy up-scale incomes and lifestyles. While the average person may be suffering, (or seeing their investments drop
significantly) those whose portfolio attracts better quality
investment advice, may be doing quite well. They will still
expect to have summer vacations and can probably well afford
to maintain their boat (or boats).
So, anticipating that the market will continue at this sort of
pace, ramp up your efforts to sell service. This is the year to
prospect for sales of new tops and canvas, upholstery repairs,
engine and drive rebuilds and even winter paint jobs.
Among the boating public, I believe the money is still there.
It may just be harder to get.
Andy Adams - Editor
To read the digital version of Boating Industry Canada anytime visit www.BoatingIndustry.ca and click
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Boating Industry Canada
Table of Contents for the Digital Edition of Boating Industry Canada October 2015
PRODUCT FOCUS – IBEX SHOW 2015: IBEX 2015 was a treasure trove of new products and Boating Industry Canada brings you the show coverage plus a number of video interviews. – by Andy Adams
IMPACT - MARK BRUCKMANN: A long overdue profile on Bruckmann Yachts, at the heart of Canadian boatbuilding since the dawn of fiberglass. – by Andy Adams
MADE IN CANADA – MARSKEEL: For Mars Metal of Burlington Ontario, it’s what’s on the bottom that counts and their MarsKeel diviosion has established itself as a global leader in lead ballast keels – by Glen Cairns
MADE IN CANADA – VOYAGER: Voyager Self Steering Inc. was founded by Peter Teitz, a Canadian sailor and retired machinist/patternmaker living in Kitchener, Ontario. – by Glen Cairns
Boating Industry Canada October 2015