New boat sales down more than 36 percent

SIOUX FALLS, S.D. — New boat sales were down by 36.5 percent and total dealership sales were down by 25.5 percent for the average dealer tracked by Spader Business Management during the eight-month period ended Aug. 31, compared to the same period of 2008, the company reported in a recent statement.

The average dealer reported year-to-date new boat sales of $2,732,903 and average total dealership sales of $5,704,576 for the first eight months of 2009. This compares to the average new boat sales of $4,304,229 and the average total dealership sales of $7,656,982 reported for the first eight months of 2008.

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.

Pre-owned boat sales for the average dealer tracked by Spader Business Management brought in $800,899 during the first eight months of the year, down only 8.7 percent when compared to the same time frame in 2008, according to Spader.

New boat inventory levels were down 20.9 percent for the first eight months of the year — from $3,442,941 to $2,725,038. Spader reported pre-owned boat inventory was down 3.8 percent to $396,151 during this period, resulting in a total inventory decline of 19 percent.

F&I revenue fell 42.3 percent and service revenue dropped 11 percent for the period, while parts and accessories revenue was down 8.8 percent, marina revenue was down 14.5 percent and other department sales fell 2.4 percent.

The total dealership gross margin percentage was up by 0.9 percentage points because with boat sales down, a greater percentage of revenue is coming from higher margin areas such as parts & accessories, service, finance & insurance and marinas, Spader explained. Unit gross margin percentages were down by 1.7 percentage points to 15.3 percent, compared to last year.

“Spending in terms of dollars is running about 19 percent lower than the dollars spent in 2008,” said Spader. “However, as a percentage of gross margin, personnel expenses, floorplan interest expense and fixed expenses are all higher.”

The average dealer’s net profit for the year as of the end of August was 2.2 percent of sales or $124,343, compared to 3.5 percent of sales in 2008. This represents a more than 50-percent decrease in net profit dollars, Spader pointed out.

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