Marinas maintain

For marina operators, 2003 was what many would call a stable year. Because marinas are “downstream from the buying decision,” they weren’t hit as hard by the recession as boat builders and dealers, according to Jim Frye, executive director of the Marina Operators Association of America.
This stability is reflected in the results of the 2004 Boating Industry Marina Survey. The majority of the respondents, over 60 percent, said slip occupancy rates were about the same in 2003 as the previous year, a similar result to the 2003 survey. More than half of the respondents, 52 percent, said 2003 revenues were greater than 2002 revenues by an average of nearly 11 percent. This also is comparable to 2003 survey results.
In addition, one-third of the respondents in this year’s survey said their marina-related revenues were about the same as last year, compared to about one-quarter of the respondents in the previous year’s study. And similar to the 2003 survey, more than 61 percent of the respondents reported raising slip rental rates.
Boat usage often declines during a recession, but that doesn’t impact marinas as much as one might expect. “Whether a boat is being used or not, it still needs to be stored and serviced,” Frye points out. Marina operators have been hit during the past few years in areas that require active boat use, such as fuel and boating supply sales.
This may explain why the average respondent reported marina-related revenues that were 8 percent lower than the average revenues reported in the 2003 survey. At the same time, average marina-related expenses increased by 4 percent and the average compensation declined by 6 percent.
Despite these financial issues, the respondents do not appear to be worried about their customer base and their ability to generate income. And perhaps that is justified: the majority of the respondents did report a revenue increase this year. Issues that relate to bringing in customers and keeping them were listed as concerns by relatively few respondents. Competition was a concern for 12 percent of the respondents, maintaining customers was an issue for 15 percent, and 18 percent were worried about marina expansion.

Regulations a top concern
The No. 1 concern of these respondents was environmental regulation, with nearly 80 percent indicating that they worry about how it will affect the future of boating and the marina industry.
“Although it may not always be the most expensive imposition on a marina business,” says Frye, “environmental regulation is seen as a threat because it’s imposed on the operator by a government agency rather than the marketplace, and it’s sometimes difficult to recapture the cost of compliance.”
He added that marina operators often are frustrated with regulations that are “frequently handed down with little or no explanation.”
One possible reason for marina operators’ concern over environmental issues rather than finances comes from looking at the big picture. With many boat builders and dealers reporting strong sales during the first half of the year, the boating industry may be on track to experience its first year of significant growth in a long time. Environmental regulations, however, have a direct impact on the finances of the typical marina operator and are not likely to diminish with time. As the economy improves, more consumers will likely enjoy recreational boating, which will be reflected in revenues. Environmental regulations are not likely to ease and will continue to impact operators’ bottom line.
There were 140 anonymous, useable responses to the 2004 Marina Survey. It should be noted that the figures contained in these results are not based on audited financial records. While Boating Industry magazine makes every effort to ensure the accuracy of the data, it can make no representations or guarantees regarding the data.

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