What makes a boat repair business profitable? What separates a great boatyard from an also-ran? What do you need to know to determine if there’s “upside potential” to a boatyard repair operation? Welcome.
Secret #1 – The New and Used Boat Sales Operations
Some marinas have boat dealerships, others don’t. Some sell a particular line of boats, others are just used boat operations. Some sell foreign, some domestic. Having a new boat sales operation generates upgrade orders and more warranty work. Not having it means you don’t generate anything from this revenue stream. A medium-sized new boat sales operation can generate as much as 50-60 percent of all boat repair orders via warranty alone, so it’s a pretty big deal.
Secret #2 – Reputation, Reputation, Reputation
OK, so I paraphrased the most popular real estate jingle. Even though boat sales are way down this year, don’t underestimate the importance of having a well known and respected repair reputation! Sure it’s important to the consumer, but what is really important is how the boat repair facility ranks in the eyes of the manufacturer. Do you think that the boat dealer who sells a particular line of boats and who is the #1 ranked repair service dealer in the country for that boat line gets more work than the run-of-the-mill boatyard? You betcha! It takes many years to get such high quality ratings so don’t count on it overnight in the “upside potential” projections.
Secret #3 – Know Your Rates
Not unlike almost every industry nowadays, price matters. For a marina, the metric used most often by boaters to comparison shop is the labor rate. It is standard practice to bill jobs according to “parts and labor”, not as a flat, fixed fee for a job. The marina that is charging $75 per hour will have an advantage over the one that charges $90 per hour unless the higher priced marina has a better reputation and other service offerings that tip the balance.
Getting the labor rate is easy. The boater can get on the phone and call. For marina owners who belong to a trade organization, they talk amongst themselves, so owners know the rates of their competitors.
Secret #4 – Yesterday is Today’s Customer
Good boatyards know how to get the customer back. They know how long parts last. Maybe that propeller repair that was done three years ago is ready for more service today. Whatever the example, when combined with some of the other secrets I’ll speak about in this series, using data from the past can generate work orders today.
Secret #5 – Customer Service is King!
More than just a hackneyed phrase, customer service sets the larger boatyards apart from the smaller ones. Every employee that the customer has contact with needs great customer service skills. Even for highly skilled technicians like the mechanics. The boater wants to know the mechanic’s time invested in the order, the cost of the parts and especially what was done. Think about the last time you took your car into the dealer. Did the receipt detail what was done, the parts used, the labor rate and the length of time it took to do? Same goes for good boatyards. They itemize it and make the mechanic(s) available to discuss the repair.
Part 3 will give you another installment of 5 secrets. Stay tuned.
