Boat sales down, but bottom lines stronger

SIOUX FALLS, S.D. — New boat sales in August for the average dealer tracked by Spader Business Management were down by 3.9 percent compared to new boat sales last year at this time, according to Spader’s latest financial report.

However, the average dealer reported a net operating profit of 4.1 percent of sales so far in 2010. This compares to a net operating profit of 2.1 percent a year ago.

“It seems that while sales remain flat to slightly down, the average dealer has adjusted their operating expenses in order to produce a stronger bottom line,” Spader said.

Total dealership sales were up by 1.7 percent over total dealership sales at this point in 2009.

The average dealer reported year-to-date new boat sales of $2,799,821 compared to new boat sales of $2,914,797 in 2009. Total dealership sales were $6,175,452 compared to $6,070,471 in the prior year.

Pre-owned boat sales for the average dealer brought in $785,358 compared to $810,699 in 2009, a decrease of 3.1 percent.

New boat inventory levels were down from $2,830,553 to $1,967,168, a decrease of more than 30 percent. Spader reported pre-owned boat inventory was down nearly 24 percent to $313,810 during this period, resulting in a total inventory decline of 28.3 percent.

Dealers spending in terms of dollars was nearly the same as it was a year ago. While floorplan interest expense is down, other variable expenses are higher than last year and offset the decrease in floorplan interest expense.

The average gross margin percentage earned on new boat sales continued to run 1.7 percentage points higher than the average gross margin earned last year.

The Spader 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.

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