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Is there any loyalty left in the marine industry?

I recently read a story about a small company that produces about 1 million greeting cards annually, but of the 10,000 retailers worldwide selling their products, the majority are small independent businesses. The company is MikWright, Ltd., and the story appeared in the National Federation of Independent Business (NFIB) My Business magazine.

“We feel a commitment to them,” (referring to small independent retailers) explained MikWright’s owner-partners Tim Mikkelsen and Phyliss Wright-Herman. “They’ve helped us become what we are today,” they add.

I must admit I immediately admired their loyalty to their retail partners. And that got me wondering about our marine industry. More specifically, have boat manufacturers chosen to ignore the old wise saying -“dance with the one that brung ya!”

One could easily conclude that manufacturers have forgotten, given the deals recently inked with “big chain” operators to sell the same boats traditionally sold by independent dealers, and/or because of recent reports of dealers receiving letters telling them their dealer agreements (such as they are) won’t be renewed when they expire.

What hit me most about MikWright, Ltd. was this: They have been courted by the “big boys,” the giant chain retailers like Target. But MikWright resisted these requests in spite of the fact that, in addition to cards, MikWright also sells a variety of products ranging from notepads to plaques — and big box stores could certainly boost those sales.

Still, MikWright remains resolutely loyal to their small independent retailers and I think highly of that. The lesson I see here is a good one. It’s fine to branch out and expand your customer base if you’re a manufacturer, whether of greeting cards or boats. Indeed, it’s important that a manufacturer does so for continued success. But in doing so, it’s equally important to remember the principle that it’s never smart to forget the people who got you where you are.

Though Mikkelsen and Wright-Herman have been asked to waltz with the biggies, they continue to dance almost exclusively with the same type of retailers that made them successful in the first place!

Now, if that kind of loyalty works for a manufacturer in the highly competitive greeting card business, you’ll never convince me that it can’t work for manufacturers in the boat business!

Comments

15 comments on “Is there any loyalty left in the marine industry?

  1. Doug Reimel

    Just my thought. It is called a MBA (masters in business administration) for a reason. They know best through education to take care of themselves, their bonus check and their golden parachute. There are to many educated ________ who have zero common sense. They cannot do business with out a lengthy disclaimer. There word is what is forgotten the moment the dealer takes possession of the product. It is called the 30 day period we are closing. It is the quarter that we are looking to get their bonus. It is the short term gain in favor of building a business. The dealer does the ground work and then is kicked to the curb for the proverbial greener pastures. The vision of the MBA is completely different than the entrepenuer who blazes the path. after all the term loyalty in the MBA’s world is a gray area with many many meanings. Quote:” depends on the definition of (is) is.”

  2. JR

    For the most part Norm is correct. I used to be one of those small dealerships and while some of the manufacturers treated you like gold , others did not. I did not let that go unnoticed. I worked harder for the ones who did treat me as important as the big guys. I sold my dealerships and have worked for some of the biggest in the marine industry to understand how they tick. My challenge was working in a corp enviroment, after being a principal. recently I have found a home with Brunswick. I am now a rep going to both small and large dealerships. I have not forgot how I felt and I feel I am changing that conceived notion, that we are not paying attention to all dealers equally. I will add it is with the support and directive of Brunswick. This is truly one of the best companies I have worked for in my 26 years in the Marine industry and they, Brunswick, truly get it.

  3. schwarzel

    Loyalty from the big boat builders is gone. I remember the days when you could count on what a builder told you, and you could take it to the bank. Today that is long gone. All for a market share of what some one can do for them. Builders don’t look at long term deals just what can you do for me today. Its to bad, I for one liked having a “family” type relationship with our boat and motor companys. Today it is the mushroom treatment. (keep’em in the dark and feed them crap) And as time goes on, I for one don’t believe a thing a company will tell me. The little guys who build boats out there know about loyalty. Dealing with small boat companys, I have found that they take care of the customers and the dealer much better than the big guys do.(It’s a pride thing you big companys don’t understand) And Yes you don’t do the “numbers” of boats that you could do with bigger brand names but I for one can sleep better knowing that I am selling a product that the people who build it will stand behind it. After all we are selling a life style. People can spend their hard earned money on
    any sport. It’s nice when they spend it on a boat. But hay what do I know, I’m just a dealer!

  4. Al Wisneski, President

    An addendum to Norm Schultz’s excellent observations would be that retailers (both very big and small) should slso remember the smaller manufacturers who helped them build their businesses. Too often this is forgotten when large manufacturers copy other company’s products, have them made in China, and use their clout to muscle out the “small guy” who helped them in the beginning.

    I am not naive to the fact that there may be economic considerations, but when conditions are competitive, where does loyalty, partnering and even ethics enter into the buying/stocking equation? Too frequently they dont! And that is a negative reflection on both the industry and some of its decision makers.

  5. Geoge Hawkins

    Nothing new regarding manufactures loyalty to the retailers and distributors who pioneered their products.
    I opened a retail boat and accessory business in 1952. Many brands of boats and motors were promoted over a period of 25 years. In most cases, as soon as the boat or motor line became popular through my promotion, other dealers would try to sign up for the line. In almost every case, with exception of the four or five loyal manufacturers, the majority would sign on as many dealers as possible with no regard to location, or the ability of the pioneer dealer to make money with their product. In one case, a new to the business ( super store dealer ), only one mile away from my dealership was signed on. In this case it was a top outboard motor company. My policy was to cancel the dealership of offending companies. The motor line was canceled, within one year the super store dealer closed shop, the motor Manufacturer had the nerve to try and have me take back the line. I was, of course, very loyal to those who gave me a chance to prosper. Apparently nothing has changed. Buyer beware, be sure you have a written franchise, spelling out your territory, not for just one year, preferably three years or more.

  6. GC

    Loyalty long gone. JR must be delusional about BC as they would throw you under the bus at any given opportunity. The Merc reps laugh about giving the “Black Needle”

    What’s left of this irrelevant industry goes like this; Economies of scale are moving toward mega dealers when possible. Smaller dealers sell off-brand names no one wants and work on junk in the shop.

    Get over it.

  7. mike evans

    i have been in business some twenty years and i will tell you that their is not one ounce of loyalty to the small guy at all . i have learned to quit being friends keep it just business period, that way you dont get your feelings hurt. The big guys are only after the big numbers, J R you wont get one person to agree with you on brunswick they always try to beat the independent everytime. My advice to the little guy is not to do business with any boat companies that are owned by motor companys if you do you will get beat everytime period. Just do the best you can and thats all anybody can ask

  8. C. John Madison

    Oh what memories of signing a great dealer and friend, Bernie. Yes there were 11 pages to the manufacturers dealer agrement. Bernie and I still laugh about his comment “wheres my protection”? I was quick to give him the hand signal saying right here. That pretty well was the manufacturers intent regarding his dealership protection. He signed anyway and the relationship was short lived when the line in question was spun off to yet another manufacturer. I guess nothings really changed.

  9. Jim

    Brunswick gets it JR? Please! All they get is the almighty dollar and they demand and command loyalty from their dealers or else. There are some builders who get it and who take good care of their dealers, however their names are not Brunswick or Genmar. There are some dealers who try to get by without stocking enough product, and they do their builders a disservice, not to mention themselves. As long as there are too many builders, and too many dealers as there are today; loyalty from both sides will be problematic. It’s just the nature of the beast.
    Sadly, it will probably remain in what have you done for me lately mode from both sides.

  10. John

    This comes from the perspective of a rep of a large boat company. If small manufactures enjoy working with small dealers, that’s fine. A large manufacturer has an obligation to the shareholders of the company (public or private) to grow the business in units and/or profitability. Larger manufacturers need larger, more aggressive dealers that want to grow. Small companies remain small because they do not sign the aggressive dealers. A small dealer that does not care about growing and taking market share needs to be sure to only sign boat brands that think the same. In general, if a dealer meets or exceeds the manufacturers expectations, he/she stays a dealer. If the manufacturer does not meet the expectations of the dealer, the dealer drops the brand. It works both ways.

    From a manufacturers perspective, it is less expensive to do business with fewer, larger dealers and we have more time to spend with each dealer.

    Large manufacturers reps need to do a better job of letting the dealer know exactly what the expectations of the manufacturer. This will let the dealer know that if he does not perform, he may be cancelled. The boat reps need to do a better job of working with the dealers to help them come up with new and more effective ways to retail the boats so they will order more.

    Now to Norm’s story; the key is that the card company is a small company that has remained small. They apparently do not care about growth. Would you invest your money in something that did not grow? No, most people want a decent return on their investment.

  11. Anonymous Bob

    To John from the boat company:

    I, too, am a manufacturer rep and I am not exactly in sync with you. This is an instance where size does not always matter. Quality products will always be successful, while aggressive typically equates to short-term success. Short term because strong arm tactics have very limited runs of success. With a small industry like the marine industry, your avenues for growth are severely restricted when you have strong armed your dealer network. Yes, larger dealers will typically move more units, but you have to be careful that you do not become too big to take care of your customers. Look at the struggles Wal-Mart is having now. Customers are rejecting the tactics of Wal-Mart and beginning to shop at smaller places now because Wal-Mart lost (or never had) the personal touch.

    Dealers know they have to perform, otherwise the food disappears off their table. But we can’t afford to sacrifice quality just for the sake of unit growth. Not all companies want to be the biggest, baddest player in their industry. The card company Norm highlights is probably more profitable from a margin standpoint than some of their competition. Customers will pay more for a quality item because the overall value is greater. Contrary to your post, bigger does not always equal better.

  12. Blaine Schwarzel

    Well John old buddy your part of the problem. All you care about is the bottom line. You could care less about the customer. I am in southern Ohio, You best better care about your customers here, because you will not get REPETE customers. Big boat builders have forgotten about the customer, the buyer and user of the product. With out him we all are SUNK. All they want to do is just cram your lot full of product and then vanish into thin air. When times get tuff the little guys make it, the big guys die off. A wise man told me once, part of a cherry pie is better than no pie. The big guys want all the pie, better watch, you may choke on a pit.

  13. JR

    Well nice conversation and while in principal I did agree with what is said here. I wanted to add to my comment. Remembering I was a small dealer, twice, and had good and bad from most manufactures I dealt with. However, this particular Brunswick company I now work for, I understand alot more of what goes on, from this side of the fence, now. However with that said, there is alot of Regional Reps, manufactor reps etc, who do not get it, nor do they understand the small dealer. I do. And I have the support of my company, to do what is best for everyone involved. I have been enpowered. So being that I am one of a few who understand the small dealer and work for the big Corporation you would assume, based on your past experiances, that I am in La La land. I am not. Change is coming, be it 1 dealership at a time. We are going back to the way business should be.

    -JR

  14. Jim

    Good luck JR and I hope you are able to accomplish what you have set forth to do; after over 25 years of experiencing just the opposite, I am still “from Missouri”!!

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