Dealership Makeovers

Much effort goes into keeping the 28 palm trees around Prince William Marina looking vibrant, but co-owner Carlton Phillips says they’re worth the fuss.

More than just swaying gently in the breeze blowing off the Occoquan River in Woodbridge, Va., the trees represent a customer-first attitude that permeates everything the dealership does.

Before turning to boating, Phillips, who owns the company with Bob Bagley, owned a racecar and Corvette repair business.

“No one needs a race car. No one needs a Corvette, and no one needs a boat,” Phillips says. “So you better take care of the customer.”

Since the dealership moved a quarter-mile downriver to a new facility on a 16-acre site seven years ago, sales have quadrupled. Prince William Marina, located about 20 miles south of Washington, D.C., sells 350 to 375 new and used boats a year and houses 250 boats in the adjacent boatel, with another 350 along its 2,000 feet of river frontage. The company only leases slip space to its customers. Its 65-plus employees stay busy year-round, says Phillips, doing everything from servicing boats and arranging financing for its customers to keeping those palm trees looking lively.

The showroom is 8,125 square feet, and the dealer’s five service bays are built into a hill directly underneath the showroom. The company sells Baja and Sea Ray boats and is one of only two Sea Ray Ambassador dealers in the United States. The designation is given to companies based on their facilities, sales and service capabilities and customer satisfaction scores.

Phillips says that he and Bagley designed the store “by the seat of our pants,” but it contains all the elements that a successful retail outlet needs, including an attractive exterior and pleasing atmosphere to help customers enjoy a pleasant shopping experience. The duo, like most successful dealers, understand that the appearance of a store is not just a feel-good approach, but equally important is that a well-presented product and a shopping experience that meets a consumer’s expectations can lead to greater sales and ultimately, stronger profits.

An upscale experience
Upon entering Prince William Marina, shoppers see a hardwood floor with a large compass motif imbedded in it and are greeted at a reception desk and directed to the appropriate area.

“We greet customers with a live person, a friendly face that sets the tone,” Phillips says. “That’s all business is anymore — it’s people skills.”

While a commitment to customers does characterize a successful retailer, the importance of a good shopping environment has become increasingly vital as buyers’ tastes become more sophisticated. For example, do-it-yourself powerhouse Home Depot has been sprucing up its stores in response to the positive shopping experience and higher ticket sales reported at rival Lowe’s, which can be partially attributed to more attractive stores. Target has a more upscale reputation than Wal-Mart, partly due to carrying a wider array of designer goods, but also due to better-looking, more open retail environments.

“The days of having merchandise behind the counter in a cardboard box are gone,” says Kit Rehm, president of the Marine 1One distributor alliance, based in Norcross, Ga. “Shoppers want environments and displays that are pleasing and fulfill their needs.”

Smart marine dealers have recognized that retail trends have changed dramatically over the past decade as shoppers demand a quality shopping experience, says Barbara Miller, a retail design consultant who has worked in the powersport and marine industries for 10 years and has designed more than 700 stores.

“When we provide a more upscale experience at a dealer, we see more margins because customers don’t haggle as much,” says Miller, owner of Barbara Miller Retail Design, based in Minneapolis. “People go shopping for the experience, the entertainment factor. You have to admit, boating is fun. If you can make it fun in your store, customers will spend more money.”

The shopping experience includes everything a customer sees and everyone with whom he or she interacts. It all must work together in a unified way, from the sights and sounds in the store to the product selection and even the store temperature, Miller said.

Although the “seat-of-their-pants” design strategy paid off for Prince William Marina, Miller says a marine dealer must do his or her homework before planning a new store or redesigning a current one.

The first step is to examine the business, where it is today and where the dealer wants it to be in five years. A study of vehicular traffic patterns around the store is another important consideration because the idea of a good location cannot be overlooked, she says.

After taking these steps, the dealer can put together a plan and visit other stores and trade shows for display and merchandising ideas. Miller also recommends hiring professional design help to determine traffic flow within the store and soliciting employee input on matters that affect them, such as the relationship of the technical library to the parts department.

“You have to pull shoppers deep into the store, past the merchandise,” Miller says. “You have a story to tell, and you want (shoppers) to get past the different chapters.”

Location, location, location
Reeves Marine carefully scouted sites before buying 8 acres two minutes from the Red River in Bossier City, La., and across the street from CenturyTel Center for its new $3.5 million retail location.

“We’re going to where people are living as opposed to a congested shopping location,” says Rodney Reeves, who owns the company with his brother Rusty and son Brad.

A Bass Pro shop is about six miles away, located near the boardwalk area of the city where waterfront casinos operate. The CenturyTel Center is Bossier City’s gathering place for concerts and other public events, making it a perfect venue for a retail location.

“This is where the auto malls want to be,” Reeves says. “We’re going down in (showroom) size, but it’s a good location, with 35,000 cars passing a day.”

For 10 years, Reeves Marine has rented 65,000 square feet of space in an outlet mall that formerly housed an RV dealer. The new location will have 32,000 square feet.

Reeves is paying particular attention to the front of the store. “You can’t put a slinky (looking) store front across from the arena. To the side of the building, but still out front, we’ll have a pond with a bridge across it,” he explains.

The new store will feature the showroom on the main level with sales offices upstairs. A walking plank extending from the sales offices over the showroom floor will give a panoramic view and add a nautical touch. The marine dealer is working with its boat vendors on signage and displays that relate to their products.

“A good location is key, but you don’t need the largest showroom,” says Reeves, who will put about 25 boats in the showroom and another 300 outside. “It’s doesn’t have to be fancy, doesn’t have to be the Taj Mahal unless your customers can pay for that. You have to make it functional for your family, the people who work for you.”

Reeves believes the new location, where construction began over the summer, will result in additional sales of between $2 million to $5 million and will bring longer store hours to handle the anticipated influx of customers.

Plan to succeed
A dealer could have the best-looking showroom ever but still fail because he or she lacks a comprehensive business plan, says Noel Osborne, a former marine dealer who now consults in the industry and conducts business training for Yamaha Marine.

“You can’t just open the door and let whatever happens happen,” says Osborne, who owned five dealerships in the Pennsylvania and Maryland markets before selling them in 1990. He later bought Naples Boat Mart in Florida, building that business from $2 million to $10 million in annual sales over eight years before selling the company to an investor group that included his son in 1998.

“You have to have a target, a goal to shoot at,” he says. “You should have a business plan, with 12-month increments for each department.”

But a business plan should include plans for the facility because a dealership is much more than merely four walls surrounding a sampling of boats and engines. Osborne puts it plainly; customers have to perceive a company as a great place to do business — to be the first place that pops into their minds when it’s buying time. And there’s help out there to assist dealers. In addition to people like Osborne and Miller, the industry offers a number of resources to create a facility that attracts and retains customers.

Marine 1One, for example, will unveil model store concepts during its show in Las Vegas just prior to the Marine Retailers Association of America show in November. The concept store will feature plannogram ideas for such categories as fuel and watersports items, with fixtures by Lozier Corp., and point-of-sale signage to present a consistent look, says Rehm, Marine 1One’s president. The concept store will be designed to help dealers recognize the importance of merchandising.

“I see a lot of used fixtures out there,” Rehm says, “add-ons that don’t match or a company building their own fixtures. Dealers need to take one step back and find an appealing store set they can adapt to their market.”

Lozier is a leading fixture manufacturer, and the company’s design department can help retailers with traffic flow and shelving concepts, says Scott Muller, senior store designer for the Omaha, Neb.-based company.

“Some want fixtures that disappear so shoppers just see the product, and some want fixtures that are part of the environment,” Muller says.

The company can help retailers develop ideas for featured items, assisting in the selection of the appropriate fixture to achieve that goal or to create focal points within the store. A standard shelving package can be accented by spotlight shelves designed to draw attention, canopies to tie design elements together and shelving in accent colors to set merchandise apart.

“I always try to tell retailers to leave enough space for customers to shop,” Muller says, “but it gets down to retailers deciding how much has to fit in the store.”

Rehm reiterates the importance of merchandising, especially end cap displays and gondolas that attract shoppers. That’s why Marine 1One developed the concept store.

“Consumers are aware of modern merchandising techniques,” Rehm says. “It’s not a fad but a trend, and dealers who recognize this will be much better prepared to work with consumers.”

Following market trends
But design techniques that work for one store in one market won’t necessarily work in a similar store in a different market. Among MarineMax’s 71 stores in 17 states, only one was built from the ground up, says Sam Lowrey, director of real estate for the Clearwater, Fla.-based retailer.

The retailer has grown through acquisitions or long-term leases, mainly with dealers of Sea Ray and Boston Whaler boats. “We’re primarily looking to continue the success of the dealers we acquire,” Lowrey says.

The company pays close attention to the flooring, lighting and office configuration of the stores, which often do get changed with the help of Pavlik Design Team, based in Fort Lauderdale, Fla. In particular, border tiles are added to the floor to highlight traffic patterns and uniform logos and signage are added to brand the stores as MarineMax outlets.

Each store has a greeting station where shoppers are welcomed and pointed in the right direction. Parts, accessories and service areas can only be accessed through the showroom, which allows customers a chance to walk among the new boat models.

“In retail, it’s critically important to understand store flow and customers’ buying procedures,” Lowrey says. “We want the traffic flow to come to a greeter who will direct customers to a salesman or the parts and accessories or service departments as appropriate.”

MarineMax doesn’t have a specific schedule to retrofit existing stores, using lease renewal periods as an opportunity to examine a specific store. The recent renovation of and expansion of the Oakdale, Minn., store to 18,500 square feet of interior display and service space, for example, was triggered by a lease renewal.

Lowrey advises working with a store’s operations team on any proposed changes to traffic flow and store design. Since MarineMax has a presence in many diverse geographies with different target customers, customizing a particular store to a particular customer only makes sense.

“You build to your target customer,” Lowrey says, “and the local operations guys really need to give their input so the space is aesthetically pleasing from a sales perspective but also works for the type of boats that you service.”

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