A View from Here

Bill's Sisson's weekly Trade Only blog

Will the Goliaths gobble the Davids?

Many in the industry say 2008 will be a make- or break-year. We agree with that and we speculate that it will be a survival of the fittest story, with the Goliaths gobbling up the Davids.

The Davids could be holding on until the economy rebounds and then sell for the best possible price. And why not, that’s a prudent way of doing business.

We found it interesting when MarineMax, in its teleconference call Thursday, said it is grabbing market share from weakened competitors, and expects to snap up more dealerships when market conditions are right.

If all this comes to fruition, then we’d be writing about the lack of competition within the marketplace. Something to look forward to.

What do you think will happen in 2008?

Lois Caliri
Editor

Comments

6 comments on “Will the Goliaths gobble the Davids?

  1. David Wollard

    The question seems to be directed at the dealership side of the business. Marine Max (a publicly traded company) needs to continue to gobble up dealerships. It is the only real way to report growth in a soft economy.

    On the manufacturing side, the Goliaths will always seek to acquire smaller business, however I do not feel that small business is in danger within the marine industry. The marine industry was built on the backs of small industry. In today’s challenging market place I am amazed how well certain smaller companies are doing, many with significant backlogs. Almost always these businesses have honed their skills, processes & products towards certain markets.

    The small business success I speak of is good news in a time when what has been reported lately seems like bad news. I say Goliath be Goliath, but watch out for the David’s of the industry.

  2. CarlM

    First I thought David won?
    Secondly I think it is better said that “the strong will survive” (strong does not mean big)
    Just because your a big goliath does not preclude that your fit or that your house is in order.
    But when the big goliath hits the wall he makes a bigger thud- but that thud is the sound of opportunity for those prepared to take advantage. Any sucessful business must position itself in front of the stream of opportunities(money). Even in down markets there are many opportunities but none will walk up to you! You must seek them out and be prepared to take advantage.
    To answer your question I think we will have 2 New Yorkers running for president-1 real the other appointed. Ussually in national election years the economy does well as the politicos do not want to be voted out. As far as MarineMax goes, isn’t it expected that they will eventually purchase all the Searay dealers out?? I think that was what was presented to Brunswick a decade ago as the foundation of the business plan. It’s not a bad thing for all that are involved.
    Like I said put yourself in front of opportunity- and buy some MarineMax & Brunswick stock it’s at very low point. I also think some non focused manufactures & dealers will exit the market place. I’m sure everyone knows the likely ones in their markets.
    I just read a report that there are over 800 boat builders in the USA That is an increadable number to compete with. I also found out today that for the first time a used boat dealer was awarded & included in the top 100 boat dealers in the USA. Most dealers hate used boats.
    I think 2008 looks A-ok now get back to work ;-))

  3. Jody Imars

    Although my business is a retail supplies/services company and we do not sell boats, I couldn’t read this without responding. Our “Goliaths” are West Marine, etc. We are having a record year, with gross sales up over 9% compared to the same date last year, and net figures even higher. It amazes me that some propaganda from a Goliath would cause such a stir. Has anyone been reading how well the Goliaths are really doing lately? Do some homework and check out Brunswick & West Marine’s figures. Size doesn’t matter… It’s how you run your business and how you treat the customers and potential customers. Survival of the fittest, you say? Do you remember how the story of David & Goliath turned out?

  4. Anonymous Bob

    Let’s hope consolidation takes place. There are way too many dealers and way too many builders in the market today. With the lack of market growth and a shrinking user base, consolidation is inevitable. Boating is still a hobbyist industry; granted, an industry with a lot of wealthy hobbyists who all feel their boat, gadget, or widget is the next best thing. But, simple economics dictates some sort of fall out will occur once we reach the law of diminishing returns. Yes, the mega-yacht and luxury builders will weather the storm fine, but the trickle down effects of that spending don’t go very far. Until the industry finds a way, or makes a truly serious effort, to bring in new, young boaters, the probability of consolidation and attrition is, in my humble opinion, quite high. All the automotive wisdom (from another post) in the world won’t help us until we figure out how to expand our base.

  5. J. S. Cole

    iT IS GOING TO BE A GREAT YEAR FOR THOSE WHO KNOW HOW TO SELL. THE ORDER TAKERS ARE GOING TO HAVE IT TOUGH. BASIC RULE: GET OFF THE DEAD RUMP- KNOCK ON DOORS – AND ASK FOR THE ORDER. BINGO–PRODUCT MOVES-MONEY IS MADE.

  6. Les Stowe

    We need to start thinking out of the Box. How can we help our great passion of Sailing and Boating? Here is an idea: International Performance Sailing Center. This would be the only facility of its kind in the world. A Fleet of One-Design Sailboats, approx. 15 boats, 30 ft. sportboats. Also, 4 Grand Prix 42 ft. ( approx.) boats, for Match racing. Venues would be as follows: Jr. program ages 13 to 19 yrs. old. reepresenting yacht clubs from all over the Globe.
    Ametuer Program, all members of a specific Yacht club – NON PROFESSIONALS ONLY
    Open Class – all members of a yacht club no restrictions.
    Sailmakers challenge – from all over the USA. 5 regions, Northwest, Southwest, Mid-west/Great lakes region, Northeast, Southeast.
    Women’s keelboat challenge – from all forms and classes of womens one designs.

    The facility would host One Design Regional and National Events, such as Hobie Cat, Stars, A-Cat, J24, and other one designs.

    Their would be a 8000 Sq. Ft. Clubhouse, Full Commercial kitchen, Meeting rooms, Shower Facilities, launch ramp, Approx. 10 launch cranes, and Dry storage area for at least 250 boats and vehicles.

    Private Hotel with 200 Rooms to accommodate skippers and crews for the regattas. A 24 hour small restaurant with meeting rooms.
    A 60 Slip Marina, with 250 Linear Feet on Side Tie space for One Designs to Raft up to for the major regattas.

    YOU SAY THE INDUSTRY NEEDS NEW IDEAS AND HAS TO BE AGGRESSIVE IN THE BAD TIMES. YOU ARE RIGHT.
    I CAN BE REACHED AT http://www.lloydstowe@yahoo.com or Cell phone (949) 322-1480 if someone has the PASSION FOR SAILING AS I DO.
    Thank you,
    Les Stowe

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