Never before has the marine dealer network at large had so much energy, so much drive to improve.
Just over a year ago, all things dealer-related seemed to be operating at status quo. Dealers everywhere were selling boats and doing their best to satisfy customers on a day-to-day basis, but aside from a few manufacturer-driven programs, there was little assistance out there to help dealers become stronger.
Seemingly overnight, all that changed. And an incredible amount of the energy that drove improvements blossomed from the launch of the Boating Industry Top 100 Dealers program, a listing of dealers who are a substantial cut above the rest. In 2005, the first-year program took the marine industry by storm, recognizing the elite among the stagnant population that was once considered little more than a large group of storefronts, offering consumers new boats and engines.
Above and beyond even what Grow Boating’s Marine Industry Certified Dealership program offered dealers, the Top 100 created a wave of excitement that shot throughout the industry. Suddenly, the competition wasn’t just the dealer down the street, but rather dealers across North America, and it became an all-out sprint to not only make the list, but to make the top of the list.
While many dealers shy away from holding every single facet of their business in front of a mirror, these Top 100 Dealers relish the opportunity. And we’ve been told by many of them — even some of those who did not make the list — that the application process is one of the most revealing and beneficial measures they’ve ever undertaken. All of that speaks to the mission of the Top 100, which is to help raise the bar of professionalism for marine dealerships everywhere.
“Congratulations on moving an industry forward,” wrote Rob Youker of The Sportsman (Ranked 65) after last year’s ranking was released. “You have moved the dealership professionalism bar up. Marine retail companies throughout the country are already formulating plans to qualify for next year’s Top 100. The word is out. The race is on. The industry is moving forward.”
He was right. The push to make the list ended with 35 new companies climbing into the ranks of the 2006 Top 100, and all told, this year’s class represents $2.88 billion in revenue — up from $2.6 billion last year — or 8 percent of the entire $37 billion marine market. They account for 357 storefronts and employ 6,502 members of the marine industry’s workforce.
But the Top 100 is not a numbers game. The ranking itself is based much more on qualitative data than quantitative. It’s based on how professionally dealers run those storefronts and the processes and practices that deliver the boating lifestyle to the consumers who enter them. And it looks deeply into how well they develop those employees. It’s based on what they offer their customers – above and beyond the boat, engine and accessories -- and in turn, what their customers think of them. It’s based on best practices and outstanding initiatives. And the strength of the list is found far more in these companies’ overall business operations than their top-line revenue or units sold.
So as the dealer body at large unites to improve itself, so, too, does the Boating Industry Top 100 Dealers program raise the bar of expectations for dealer excellence. This year’s crop of Top 100 Dealers experienced a 37-percent increase, on average, in revenues, underscoring the fact their outstanding business practices work.
The power of motivating yourself toward improvement is exhibited greatly by Sima Marine. Ranked 85 on the inaugural list, Sima jumped to No. 45 this year by focusing its efforts on improving customer service.
In fact, in a year of “cleansing and reducing inventory,” Sima focused on retooling its already sound business practices, hiring consultants and improving internal operations. The result was an incredible leap in customer satisfaction index scores: from an average of 93 last year to a perfect 100 percent across three brands this year. In addition, the company says that it increased its revenue by 23 percent over the same period in 2005.
Planning for success like this seems so simple, yet it is one of the main ingredients that separates the Top 100 from the rest of the dealer body. And nowhere is that more evident than at the very top of the list.
Take Hall Marine Group (Ranked 4; See Top 5 profile, page 58) for example. Above and beyond its process map documentation, Hall constructs, reviews and updates a planning pyramid organizer on a monthly basis.
“This is our plan, our roadmap,” says Jeff Hall, president of the Lake Wylie, S.C.-based dealer. “It gives us direction, purpose and sense of accomplishment when we complete and achieve success. Before this, we would focus on issues that came up as they came up. Now we can focus on issues that we need to in order to help us remain and become more successful.”
This incredible document addresses everything from SWOT (strengths, weaknesses, opportunities and threats) analysis-style information to accountability for action plans. It establishes goals and the challenges the dealership may face in reaching those goals. Not surprisingly, for a company that is on a never-ending quest for improvement, it cites nearly twice as many challenges as it does strengths.
And when it comes to challenges, there may not be a company that is as sound at identifying, reacting to, and correcting them, as Galati Yacht Sales (Ranked 2; See Top 5 profile, page 54). The simple question of the company’s short- and long-term goals turns quickly into a dialogue of not just product line and territory plans, but of customer support initiatives. And these aren’t your typical customer service ideas. The company’s drive to satisfy its customers is much more focused on going above and beyond to provide additional perks to customers than it is on fixing any self-perceived shortcomings.
Galati has launched extensive efforts to provide customers with interactive owners’ manuals in addition to proactively securing additional slip space for its customers. And the company is also exploring options to start a school to train future captains.
When it comes to combining planning opportunities and employee training concepts, Singleton Marine Group (Ranked 3; See Top 5 profile, page 56) may have the perfect recipe. Most dealers attend dealer meetings annually. This six-location company holds its own dealer meeting.
Owner Austin Singleton plans to close his stores and host a three-day “training and teamwork jamboree” that will allow employees to work together on key aspects of the business. The agenda includes a store-by-store corporate review, a presentation of the corporate vision for 2007, a marketing plan review and presentation, breakout sessions for sales and service employees, process mapping with a GE-provided Six Sigma black belt, computer system training and other such initiatives.
“This is our first time hosting something of this magnitude,” Singleton says. “We want to provide the opportunity for our team to work together in a nurturing, highly conducive environment that will create not only a stronger sense of camaraderie, but will also maximize the opportunity for ‘collective mindshare.’ Ultimately, we anticipate that our team will contribute ideas and recommendations that can directly improve and impact our business.”
Noting a different type of direct impact on the company’s business, Crystal-Pierz Marine, (Ranked 5; See Top 5 profile, page 60) underwent a corporate reorganization that sought to streamline and reenergize sales and service. The key piece to this move was the promotion of Luke Kujawa, formerly vice president of sales and marketing, to president and COO of the 11-store chain.
The 33-year-old Kujawa, known best for his innovative retail marketing, has been the driving force behind the company’s operational excellence and has been promoted to continue to refine the company’s business plan.
“We are continuing the family-oriented legacy that my parents have built, yet are committed to strengthening the company with some changes that will help pace our steady growth, and consequent market presence, by bringing in sound business practices,” Kujawa said. “This is a natural progression that is steering us on the path we’ve been heading toward over the past few years.”
As his career has progressed from a marketing focus to more of an operational focus, Kujawa has contributed significantly to building a strong infrastructure at Crystal-Pierz, integrating such things as inter-store benchmarking, Six Sigma dashboards, and an in-house CSI program. Along with other managerial changes, Kujawa’s promotion is aimed at helping the company achieve its 10-point list of short- and long-term goals that includes everything from implementing better job descriptions to improving profitability and reinforcing its position as the premier marine dealership in the upper Midwest via 15-20 strategically located facilities.
Of course, the dealer with the highest number of “strategically located” facilities, MarineMax (Ranked 1; See Top 5 profile, page 52) and its 85 stores, demonstrates the best all-around planning and forecasting procedures in the Top 100. Its Mid-Atlantic Marketing Plan 2006, just one example which it included in this year’s application, is an 88-page document that outlines market overviews, sales projections, the marketing budget, a marketing calendar and tactical differences from the previous year. MarineMax’s operational excellence has made it the only billion-dollar dealer in existence, and yet the company just invested $500,000 dollars in Six Sigma initiatives to improve itself.
These incredible efforts to improve aren’t just evident in the top rungs of the Top 100. Six Sigma initiatives were launched in the last year by Slalom Shop Boats and Yachts (Ranked 6; See Best In Class Award, page 14), Link Recreational (Ranked 22) and Clark Marine (Ranked 31; See Best In Class Award, page 14). Like Crystal-Pierz and Singleton Marine Group, both Slalom Shop and Link Rec took advantage of GE’s At the Customer, For the Customer Program to capitalize on the Six Sigma education. Link worked diligently at improving the boat delivery process across all six of its stores, while Slalom Shop undertook an “eye-opening exercise” that keyed on reducing the service cycle for its customers.
“With the new process,” explains Slalom Shop Owner Darrell Wilson, “we believe we can reduce the time in and out for customers in-season from the industry standard 2-3 weeks down to 3-5 days, and, in many cases, 1 day.”
That’s similar to Clark Marine’s game plan. Led by Owner Rob Brown, Clark took a different route to implementing the ideas. Brown read a number of books on the expansive, complex subject and applied many of the principles he learned to improve a number of his company’s systems. The most significant of those efforts, however, is the company’s attempts to improve the actual time spent on performing a complete service in relation to the amount of lead time it takes to do so. Brown has created a chart that documents incremental increases in its efficiency rating noting scores that are “considered acceptable,” a season average for the ramp-up period, a 2006 goal, and an ideal rating that he asks simply, “How do we get there?”
Systems improvements stand as one of the main components of the Marine Industry Certified Dealership program, and 68 of the Top 100 Dealers had already become certified or were working their way through the program at the time they applied to the Top 100. Some dealers, in fact, have noted special efforts they have made to earn certified status.
SunDance Marine (Ranked 100), for example, appointed a new employee to both develop the necessary tools required for certification and evaluate all of the company’s systems to “better allow us to do business effectively and profitably with honesty and integrity,” according to Joseph Clawges, president.
Similarly, Legendary Marine, which jumped from No. 71 in last year’s list to 52 this year, used systems expertise brought on by recent hire Bill Fraine. A long-time FedEx executive, Fraine established new systems for Legendary that sought to correct problems in sea trial and boat delivery processes.
Delivering the goods
The value and impact of a strong boat delivery process became readily apparent, both through those dealers that were working to improve it, and those who had capitalized on outstanding ideas.
Boats, Inc. (Ranked 37) has what might be considered your average “minimum of three hours” delivery, but the company follows it through with some incredible perks. Each customer is provided a slip at the company’s marina for up to two weeks, at no cost, so that any delivery instruction review that may be required can be handled immediately. And just to make sure the customer stays during the break-in period, as part of every deal, the boat’s first maintenance is included in the pricing.
And speaking of staying, Staten Island Yacht Sales (Ranked 33) encourages new boat buyers to stay overnight on their new yacht prior to delivery day. This gives the customer the opportunity to go over the boat and pick out any problems or think of other questions they might want to ask. Then the company provides a Welcome Handbook to explain the delivery process, in addition to training programs such as Jump Start classes, an overview of what every yacht owner should know; Operations Lessons, which review, demonstrate and explain all the systems; and Pilot Lessons, which demonstrate how to pilot the boat.
At H&S Yacht Sales and Southwestern Yacht Sales (Ranked 17), delivery day is said to be the most exciting event with what truly becomes the red carpet treatment. “We make this day a special and fun event for our customers,” says Doug Ament, president. “We deliver each new boat for customers by having their boat in our delivery slip with banners and red carpets out.” During the festivities of this all-day event, the owners, officers of the company, service writer and other staff members greet the customer with a “thank you” and a “congratulations.”
While other dealers, such as Galati Yacht Sales, use the red carpet treatment, as well, Marine Center of Indiana (Ranked 50) features the most unique boat delivery process we’ve seen.
“We want to build on the anticipation,” explains Mike Hoffman, president, “such that when the scheduled delivery day occurs, the customer, along with family and/or friends, turn anticipation into pure pleasure, enjoyment and satisfaction at first site of their fully outfitted and detailed boat. Anticipation cannot be turned into instant pleasure without atmosphere.”
Imagine being a customer and being escorted to a large door that slowly opens to a dark room. The room illuminates with colored spotlights dancing around the walls, floor, ceiling, and of course, the shiny new boat. Music is pumping to one of six programmed themes – think racing music for Baha buyers and Jimmy Buffett for pontoons – and the excitement continues to build as the customers approach and are introduced to their new boat. The customer relations manager emerges from behind a display, congratulates all those present and begins a detailed walk through of the boat’s features and benefits.
The common goal
In the past, there might have been much less external incentive to improve systems in this way. In recent years, however, even before certification and the Top 100 sparked a desire to improve, Customer Satisfaction Index scores became the benchmark by which all dealers would be judged.
And in looking for a direct link between the aforementioned boat delivery process and CSI scores, one need look no further than Sima Marine. The company developed, documented and practiced its boat delivery program, training the staff, providing uniforms and even using the company’s financial manager as a test customer – all in an effort “to ensure we were meeting our own expectations for what we wanted in the delivery process,” according to John Sima, owner.
The end result for Sima is an increase from a CSI score of 93 to 100 — one of only three dealers to record a perfect score in this year’s Top 100 — for three of its boat brands. Sima used more than just an improvement in a process. Much like an increasing number of our Top 100 Dealers, Sima employed a dedicated person to hold responsibility for CSI numbers to achieve better results.
With that in mind, it comes as no surprise that our Top 100 Dealers average a CSI score of 95.4. This group of dealers has achieved such a high rating by putting the emphasis right where it belongs: on the customer. And whether it’s putting accountability and responsibility on a sole individual, a few people, or an entire staff of a dedicated customer relations department, these companies are hearing positive feedback from their customers and the numbers show it.
Arrowhead Yacht Club & Marina (Ranked 8) has perhaps the most extensive array of customer service-driven initiatives: a boat valet, on-water catering, room service; 24-hour gas pumps; and chauferring services, just to name a few. And one of this Cobalt dealer’s top customers is none other than Cobalt Chairman and CEO Pack St. Clair, who has sent letters of commendation for the service he, as a boater, received.
Cannon’s Marina is another dealer that moved up the ranks in the 2006 Top 100. Cannon’s (Ranked 36) implemented detailed process maps and specific strategies in the areas of sales, service, parts and boat delivery, in addition to an internal CSI measurement system. The company’s two-fold CSI strategy incorporates a CSI team that evaluates every customer survey and then disseminates the information to all team members so that everyone can understand how the marina and their specific department is perceived by the customer. All told, the changes and more intense focus have led to a better-than-perfect CSI score of 100.8 because of “extra credit” available from Scout Boats.
Most of the systems improvements – especially those in the realm of the service department, boat delivery and follow-up – are aimed at improving the customer experience. But nowhere is there a more direct route to improving customer service, and the scores that go along with it, than in those dealerships that have hired or appointed personnel to maintain responsibility for fully satisfied customers.
Making employees accountable for CSI – whether it’s done by creating an incentive plan tied to the number, like Sail & Ski (Ranked 12), or by allowing employees to spend up to $200 to make customers happy, like Lockwood Marine (Ranked 72) — keeps the customer-centric state of mind ever-present.
Much like the program at Sail & Ski, Parker Boat Co. (Ranked 18) monetarily rewards a full-time customer service rep based on the number of responses she gets to her CSI surveys. And at Russo Marine (Ranked 7), an ongoing initiative to “fully embrace the wants and needs of our customers” has resulted in plans for a training program and a reward program based on the increase in overall sales and service CSI scores.
It is the execution of plans like these that separate the Top 100 from the rest of the dealers. While the masses are balking at the $2,500 certification would cost them, the Top 100 Dealers continue to seek out such improvement opportunities and have truly separated themselves as the elite among the pool of marine dealers at large.
MarineMax Repeats, Is Retired From Top 100
We’ve told you from day 1 that the Boating Industry Top 100 Dealers program is not about volume and unit sales. The program was designed and continues to be a mostly qualitative review and ranking of the industry’s leading dealers, with no consideration given to overall revenue.
But no ranking of the best-of-the-best among marine dealerships would be complete without MarineMax, the industry behemoth, at the top. In fact, this $1.2 billion conglomerate dwarfs almost all of its boat builder partners, and it is now six times larger than any other dealer in this year’s ranking, having recently purchased our 2005 No. 3 dealer, among other businesses.
With that kind of revenue to fuel countless business initiatives not otherwise an option for smaller dealerships, MarineMax truly is in a league of its own, building a world-class company at its corporate headquarters and watching as the process improvements filter down to its 85 storefronts. The company has been guided by incredible leadership that has seemingly made all the right moves and investments at all the right times. Whether it’s the planned $500,000 investment in Lean Six Sigma this year or its extensive online MarineMax University, these are efforts afforded to very few.
Perhaps on a store-by-store basis, dealers could compete with a single MarineMax location, but as a corporation, its inclusion in the Top 100 creates an unbalanced contest that would most likely find MarineMax atop the list year in and year out. With that in mind, we have honored MarineMax by retiring it from the list of Top 100 Dealers, recognizing the company with a “Best In Class” award from here on out — in a class all its own.
MarineMax must reapply each year to earn the designation, but it will no longer be eligible for a spot on the list. In the founding spirit of the Top 100 and its mission to help all dealers improve through the sharing of best practices and benchmarking data, MarineMax has indicated it will continue to apply each year.
About the Top 100
The work to begin compiling Boating Industry’s list of the 2006 Top 100 Dealers began in earnest last spring when we revamped and expanded the four-page application form that would serve as the starting point for everyone involved.
The application — which explained the Top 100, its purpose and methodology — consisted of 69 questions divided into five sections. The questions were of both a qualitative and quantitative nature.
Each of the five parts of the questionnaire focused on a specific aspect of a dealership’s business: Company Data; Sales and Profits; Service and Customer Satisfaction; Training and Education; and Marketing. Dealerships supplying answers containing sensitive information could mark those answers NFP (Not for Publication), meaning we could evaluate their information but could not reproduce it.
More than 5,000 applications were e-mailed to dealerships across North America, 3,500 more were sent by standard mail and 75,000 were bound into issues of the magazine for dealers to complete and return. In addition, more than 700 of the 3,000 dealers that were nominated by manufacturers and suppliers were called by Boating Industry’s editorial staff, notified of the program and urged to submit applications. In all, more than 400 usable applications were received.
Once the applications were received, the editors fully evaluated each one, conducted further research beyond the information provided — and many follow-up interviews as well — then sequestered themselves to discuss the merits of each application and supplemental materials.
A point-based system was applied to each individual question for an initial tally. However, qualitative information was given a much greater weight than quantitative information, and numbers were far less important to the final rankings than attributes such as professionalism, customer service strategies, business planning processes, operational systems and procedures, marketing initiatives and a steadfast commitment to personal and professional development.