A while back, Gary Poole made the rounds of all his lenders to review Buckeye Marine’s financials.
It wasn’t that the Bobcaygeon, Ontario, dealership was having cash flow problems; in fact, the Canadian economy and Buckeye Marine were both booming, which was exactly the point.
“I figured a downturn was coming, so I wanted to get all of our credit bumped up as high as I possibly could during the good times, knowing that it would last us through the bad times,” says Poole, one of the owners of the family business established by his grandfather in 1949.
Being proactive drives several of Buckeye’s survival strategies. For instance, having secure cash flow allows the dealer to purchase distressed inventory — an ongoing revenue channel that is becoming more critical as Canada’s economy begins to slow down in the wake of the U.S. recession.
Just before the Toronto International Boat Show in January 2009, Buckeye bought out a Regal boat dealer that was closing its doors in Quebec. And, although they hadn’t yet received the inventory, Poole and his team were able to sell most of it within the first few days of the Toronto show.
Poole credits part of that success to a pitch the team incorporated into its qualification process.
“We congratulated them for looking at product when the prices were low, knowing that the value of the boat will appreciate. If you bring it up before they even tell you they are interested in the boat, it makes them feel that they are smart consumers. And I really believe they are … it’s smart to buy now,” he says.
This isn’t the first downturn in which being proactive has worked to Buckeye’s advantage.
“The last time we had a downturn in our economy, we ended up building our facility … [for] probably 25 percent less than if we had built it in an up cycle,” says Poole. “So there are opportunities [in tough times] but you have to be prepared for them.”