There may not be a company doing more to shake up the boating industry than OneWater Marine Holdings.
Since 2010 – first as Singleton Marine Group and now as OneWater – the company has united nine dealer brands under one umbrella. As of mid-2016, the company had 35 locations stretching across the southern U.S.
It’s something we haven’t seen since MarineMax began consolidating dealerships across the country in 1998 and, like that effort, it has the potential to reshape the dealer landscape in North America.
In 2015 alone, the company acquired three dealerships: American Boat Brokers, Captain’s Choice Marine and Rambo Marine. More acquisitions have continued in 2016.
At the same time, OneWater grew same-store sales by 16 percent for the year (and 33 percent across all locations), while growing net profit by 27 percent.
It’s a record of success that makes OneWater stand out as the 2016 Top 100 Dealer of the Year.
The decision to pursue the OneWater strategy came out of a series of discussions between CEO Austin Singleton and COO Anthony Aisquith during their days at Singleton Marine Group at the end of the last decade.
At that point, Singleton was already one of the country’s leading dealers, but the management team saw the potential for more.
“We could pull the business back 25, 30 percent and almost put it on autopilot,” Singleton said. “That was something we really looked at. Do we want to just concentrate on higher margins, concentrate on fine-tuning the business, not do as much, pull it back, let this incredible staff run it and take a lot of it off of us?”
The answer, the two quickly decided was “heck no,” as both knew they would quickly get bored if they opted to coast.
“We made this agreement together that we were going to try to build this thing, try to become the world’s biggest retailer, as long as it remained fun,” Singleton said. “The reason we went this direction is that we knew the other direction was not going to end well for either one of us.”
In an industry where most dealers have no exit strategy, OneWater saw an opening for a model that allows those dealer principals to exit on their schedule. The OneWater model is built on the idea that the principal can stay with the dealership if he or she wants to, continuing to work, but eliminating the risk and headaches of ownership.
“We bring them assistance on the administrative, back office, logistical mess that they don’t like: dealing with the manufacturers, dealing with the floorplan companies, dealing with HR, dealing with advertising,” Singleton said. “Not all of it’s bad, but it distracts the majority of these owners from the passion that they got in the business for.”
In many cases, taking that responsibility off of the owners has reinvigorated them, helping them enjoy the business again.
“We take that burden off them, take all of the liability off of them, put a little cash in their pocket and they get to pick up the phone a year from now, three years from now, 15 years now and say ‘I’m going to the islands, I’m done,’” Singleton said. “We offer them the exit on their timing.”
Building the right team
Plenty of companies grow quickly, but then collapse under that rapid growth. The OneWater management team knew that to make their plan work, they needed to have the right people in place. It’s a constant refrain from Singleton, as he credits Aisquith and the team he has built for the company’s success in managing growth.
“This has been a monumental task and by far the biggest challenge has been making sure that we have the right people to do that,” Singleton said.
A key part of that challenge has been building a team that was capable of running the company on a day-to-day basis, but also managing potential acquisitions and integration of new dealerships.
“We have to balance those people, because it’s not like were doing [an acquisition] everyday,” he said. “You’ve got this significant increase in payroll that you’ve got to cover. So we have to keep our cost structure from an administrative side under control, but [also] make sure we don’t go in and do an acquisition poorly and cost us other resources because
we crashed it.”
From a management standpoint, OneWater has focused on finding employees who can bring business knowledge to bear. Successfully implementing OneWater’s acquisition model doesn’t require a large amount of technical marine knowledge.
“It depends on what we’re looking for,” Singleton said. “There are a lot of MBAs out there that are incredibly smart – way smarter than me – that just can’t land a job. It’s not hard to sell them on our business. Our job is pretty sexy and cool. Everyone wants to be in the boat business … because it’s fun.”
Finding the right partners is important, too. OneWater isn’t interested in struggling dealers, only looking to add successful retailers to the company.
“The most important thing we look at is are they a market leader,” Singleton said. “Are they top one or two in market share? What kind of people do they have? What infrastructure do they have in place today?”
Adding new brands to the stable adds complexity to the admin side of the business, but that won’t stop OneWater from adding new brands when the dealership makes sense.
“We like to look at specific areas, at the top dealer, and brands don’t play into that until the very end,” Singleton said. “If we were to go look at a dealer in X city, and he was the market share leader, and had been doing it for years and had a fantastic business and had five brands that we currently don’t have today, we’d probably still buy it.”
Even with its rapid growth thus far, there’s plenty more to come, as OneWater has more than a dozen conversations going on with potential acquisitions.
“We are working … [on] new ones every day,” Singleton said. “We’re enjoying every minute of it and we just want to keep having fun.”