The use of 20 Groups as a means to build stronger, more profitable businesses continues to grow in the marine industry, with the American Boat Builders & Repairers Association becoming one of the latest organizations, and first associations, to help form and sponsor a group.
ABBRA partnered with Performance Inc., an ADP company, more than a year ago to form a 20 Group for owners and operators of boatyards and marinas. The group, which ABBRA sponsors, meets twice each year to share ideas and best practices and to examine the metrics, which each business submits to Performance Inc. on a quarterly basis, that are used to gauge how they are performing. Those numbers are then compiled by Bob Schwartz, the senior-level facilitator for Performance Inc./ADP who oversees the group, and sent back to the members in a composite that ranks how each business is faring, compared to the benchmark numbers and the others in the group.
The 20 Group concept is not new to the boating industry. Performance Inc. also administers three groups for Sea Ray, and other manufacturers sponsor groups run by Spader Business Management, Inc. and Parker Businesses Planning, Inc.
But while those groups are more established, the ABBRA group has only met a few times, and its focus on boat repair/reconstruction and parts and accessories sales at boatyards and marinas make it somewhat unique.
Schwartz says one of the benefits of the group’s work will be to establish solid benchmarks in those areas for the businesses in question. But those numbers are a result of a process that must be refined over time.
“We really don’t have definite targets for ABBRA, for the boatyard people yet,” he says. “We’re getting there but we have a lot of work to do. It’s a new group so the numbers we are collecting are a little shaky sometimes. It takes a little time to get the numbers as solid as we would like them, but having said that, we are moving in the right direction.”
Those numbers measure numerous aspects of the businesses’ operations, from parts and accessory gross as operating profit to labor gross as a percentage of labor sales. The group has targets that members try to reach, and exceed, in each category. For parts gross, for example, Schwartz says the group has a goal of between 30 to 35 percent, meaning that the business should only pay 65 to 70 percent of the price it ultimately sells that part to the customer for.
“The numbers start the conversation, and based on those and based on the demonstrated ability to perform in a specific area, we continue from there,” Schwartz says. “Everything is based on data. Opinions are nice, but everybody’s got opinions and that’s not what we’re after.”
When the group gathers twice each year, one of the members takes a turn hosting the meeting. In return, all of the other members tour the host’s facility, review operations and make suggestions for how the business can be improved. The host then has objectives that his or her business must try and attain before the next meeting, when those objectives will be revisited by the group.
“A big part of our group is our objectives,” Schwarz says. “So we will review the composite, we review the agenda and as a result of those we have the members submit formal objectives. We want to know what the number is now, what’s it going to be and what do we want it to be, and also how are you going to do it?”
If one of the members of the group is not making progress or is not keeping up with the other members in a certain area, they hear about it.
“If we have a person who is not doing a good job, we love them, but we don’t love them for that particular conversation,” Schwartz says.
The ABBRA group currently has nine members who are spread throughout the country in a number of different locations along the East Coast, two in Florida and one in California. Several current or former ABBRA officers, including former presidents Jonathan Jones of Haven Harbour Marina and Bill Munger of Conanicut Marine, are members of the 20 Group.
Schwartz says the group is always looking for new members and is currently trying to find a business in the middle part of the country that would like to join. But in order to do so, the company must be one that is approximately the same size, in terms of sales, as those that are already in the group. The prospective business would then have to be approved by all of the other members in the group in order to join, a necessary step when so much of what 20 Groups do involves the free exchange of information and ideas.
And to be a member of the group, a business also has to be a member of ABBRA.
“It’s always nice to have an organization that will say, ‘Hey Bob, how about doing this for us, and if you do this for us we will support you for our members,’” Schwartz says. “We will do what we have to do so that people hear about you, and that’s what ABBRA does. They’re very supportive.” — Jonathan Mohr