Dealers report new boat sales down by nearly half

SIOUX FALLS, S.D. — New boat sales for the average dealer tracked by Spader Business Management were down 47 percent in the first quarter when compared to the same time frame in 2008, the company recently reported. Sales dropped from $1,083,738 to $574,357. Pre-owned boat sales were down 2.3 percent.

The training and consulting firm tracks North American boat dealers, both large and small, to compile an average profile, then compares year-over-year trends in a number of different categories.

New boat inventory levels were down a little more than 14 percent for the first three months of the year ending March 31 — from $3,775,363 to $3,231,572. Spader reported used boat inventory was up 23.8 percent to $453,918 in the first quarter, resulting in a total inventory decline of 11 percent.

Total dealership sales fell 36.1 percent compared to Q1 2008. F&I revenue fell 53.8 percent and service revenue dropped 19.4 percent for the month, while parts and accessories revenue was down 15.1 percent, marina revenue was down 0.9 percent and other department sales fell 58.5 percent.

The total dealership gross margin percentage was up by 3.5 percentage points because with boat sales down, a greater percentage of revenue is coming from higher margin areas, Spader explained. The average dealer reported a significant increase (5.0 points) in gross margin on parts & accessories. New boat gross margin percentages were down by 1.2 percentage points compared to last year.

Spending was down by over 20 percent in terms of dollars spent. However, as a percentage of gross margin, the average dealer spent more in the first three months of 2009. Personnel expenses, floor plan interest expense and fixed expenses were all up in terms of the percentage of gross margin spent on those items.

The average dealer reported a net loss of $127,013 for the first quarter of 2009. That is 10 percent more than the average net loss of $114,808 reported for the first quarter of 2008.

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