Thoughts on grading dealers

No, I don’t consider our dealership an A dealer. I consider us to be a B dealer. We’re doing everything we possibly can … and we will be an A dealer.
But we actually have a lot of stuff left (to do). We’ve got an excellent sales and F&I department. But we’ve still got some changes to make in our
service and rigging departments. I won’t consider myself an A dealer until I feel like I’m perfect in all areas. That will be a two-year process. This year, we’re in the process of building a new facility, and by the time we really get going in that facility, we want to be on top of our game. We want to have an A game. -- Brad Reeves, Louisiana dealer whose company is moving into a $3 million facility.

Unfortunately, too many companies select a dealer based on the guy’s ability to place an order today and pay for it and not whether he meets all these criteria. It seems like that so much of the mentality in this industry is that I’ve got to make the quarter. I’ve got to sell X thousand units for this quarter, and I’m short a little bit, so hey, here’s a guy that’s … well, he looks like a dump, but he’s willing to buy some boats, and he’s got the money in his pocket, so let’s take him on. -- Ben Sherwood, Boating Industry magazine columnist and author of "How To Succeed In Marine Retailing."

I think that all dealers have to recognize one basic thing and that is that they’re in business for two reasons: to take care of the customer and to make a reasonable profit. You can just stop there. And then say, OK, what do we have to do to achieve that? There’s no question in my mind that the biggest failure we have in this industry, and this is substantiated by the independent program that was conducted by Statistical Surveys back in the mid-90s, is that we’re just failing to provide the experience that the customer expects. It’s just that it’s probably no more than 25 percent of the dealers that are really performing like they should. Twenty-five percent of the dealers, I would say, are probably A dealers. -- Retired marine dealer Noel Osborne, now of Osborne & Associates (specialists in business and financial planning for the recreational industry).

The most important thing for me is that dealers need to make the proper customer presentation that allows them to be profitable and professional. If they don’t come on to the customer in the right way in all aspects of their
business and do it where they can do it on a profitable and professional basis, then everything else fails. -- Phil Keeter, president of the Marine Retailers Association of America.

In the industry, a lot of people used to refer to A- or B-level dealers by their volume. But what Noel (Osborne) is telling you is that they could all have the same volume. It’s about how much money they make. And a profitable dealer is so much safer for us as a customer than someone who is marginal. Because that marginal guy, if he goes broke, who’s left on the hook? Usually
the boat company and the engine company. So those A dealers are important. And what he said is absolutely true, that A manufacturers hook up with the A dealers and the C manufacturers hook up with the C dealers. It happens every time. -- Phil Dyskow, president of Yamaha Marine Group.

What are you worth?
By Tom Johnson, Boating Industry magazine editorial advisory board member and dealer standards and quality task force member.

Sam Snead once said that the only reason he worked so hard at golf was so he could afford to go hunting and fishing. I wonder how many boat dealers know why they are in business. Perhaps they have lost sight or totally forgotten why they own their business.

Despite all the excuses for staying in business there really is only one good reason to own a business and that's to make money. You can be a successful and poor doctor, or a poor but great artist or even a successful accountant with low income. But you can't be a poor, successful business owner. That's how you tell a successful business owner from an unsuccessful business owner - by how much money they are making.

Boat dealers often have a self-esteem or self-respect problem. They accept the years of long hours and low pay as if they can't do anything else. They are both ignorant and too closed minded to make the necessary changes to improve their lives. They don't see themselves as worthy of a better income.

They suffer through owning a mediocre business while their wife, kids and employees have to adjust to these poor standards. We live in the richest nation in the world, and you work in a difficult industry that demands risk, experience and professionalism. A boat dealer should command the respect and income that goes with this profession.

Our industry often talks about grading the dealers. Everyone has their own scale that they use to weigh the pluses and minuses of another dealer. I'd recommend we use our own scale to weigh ourselves. We each can decide what grade we deserve.

First of all, figure out what you are worth. You have thousands of dollars, vast knowledge and years of experience invested in a very specialized industry. You deserve to be making a lot of money right along with all of your employees.

If you are making a reasonable amount of money, the future for your wife and kids is secure and your employees are making a decent living, give yourself a “D”. If not, you are flunking and deserve a big “F.”

If you are making at least what you are worth, the wife and kids are well taken care of and your employees are doing better than average give yourself a “C.” When you make twice as much money as you did as a “C” and at least five times as much as you ever thought you would, give yourself a “B.”

If you get to the point of being happy because you are making much more than you are worth, you have freedom and peace of mind, your family's future is secure and your employees love working for you, give yourself an “A”. Isn't that what you should have been doing all along?

You have no excuses. Just demand more of yourself and of your business. You have the MRAA, Spader, the industry, the library and a world full of knowledge to help you. Just look in the mirror, see a potentially great successful businessman and then decide to live up to your potential. You only get to live once, why not be a success for yourself and all the people that depend on you

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