Manufacturers and Dealers Should Oppose New Website!
It's this humble dealer's opinion that the last thing we need as an industry is more downward pressure on profit margins. We have worked so hard over the past few years "surviving". Please do everything in your power to gaurd dealer invoices and pricing. If this site goes live, the only one making money will be them...
Jim Sabia
~Boating Industry Magazine...
CLEMMONS, N.C. — A new website modeled after the auto industry’s Edmunds.com is drawing widespread criticism from marine industry groups. The site, initially called paydealercost.com but recently renamed seedealercost.com, would provide product information about boats, powersports equipment and RVs.
The most controversial aspect of the site is the inclusion of dealer invoice pricing in addition to MSRP and product specifications. The invoice price does not include shipping from the manufacturer, dealer prep, taxes, title, license or other fees, and it does not reflect any wholesale incentives the manufacturer may be offering to the dealer.
In an interview with Boating Industry today, Marine Retailers Association of America President Phil Keeter said he has heard from about 25 boat builders who are opposed to the site, including Brunswick, Regal, Mirrocraft, Avalon, Tahoe, Glastron, Centurion, Premier, Regulator, Triton, Tiara Yachts, Pursuit, Marlow Yachts, Meridian, Chris Craft, Maverick, Moomba and Supra, as well as those brands represented by Irwin Jacobs (Larson, Seaswirl, FinCraft and Triumph Boats).
Keeter expressed concern that if the site goes live, consumers may use the information to exert downward pressure on profit margins at a time when the industry is beginning to recover from the recession.
"You can cite Edmunds.com all day long, but that’s a completely different animal than our industry," Keeter said. "They smack everything possible into that dealer invoice. That’s not really what the dealer is paying."
Keeter suggested that unlike the marine industry, automotive dealer invoice prices build in profit for the dealer. As a result, such a site has the potential to force a shift “in the way we go to market from the manufacturer to the dealer and the dealer to the consumer," Keeter said.
A spokesman for seedealercost.com told Boating Industry the site is expected to go live in about five days. The site’s founders, former marine executives Jack Malone of Mercury and Dave Taylor of U.S. Marine, were unavailable for interviews at this time.
The goal of the site, according to a release announcing its upcoming launch, is to provide a clearinghouse of information for consumers researching a purchase. Leads generated will be offered to manufacturers and their dealers, and the site will sell advertising space to manufacturers, dealers and other companies.
"The retail environment has changed significantly over the past 15 years due to the Internet, where information on everything is available 24/7," the release stated. "Consumer expectations have changed also, and consumers require total access to all the information they need to make an informed purchasing decision – before they go to the store or dealer."
The release cited the recent marine industry research that shows more than 8 out of 10 new boat buyers have gathered information on the Internet prior to making a purchase decision, and most use the Internet to compare products and pricing.
"Unfortunately today, essential information must be gathered from a variety of sources, causing delays and frustration," the release stated. "In addition, pricing for new products has varied greatly over the past few years due to auctions, repossessions, below invoice sales, etc., causing consumers to lose confidence in the pricing they do receive. We believe this is one of the main reasons why the sales cycle is so long and why potential consumers are continually lost to other activities. In most other industries, consumers can find out everything they need regarding product and pricing online - before they go to the store or dealer. The www.seedealercost.com website is being launched to make it easier for consumers to gather essential information, and to make it easier for consumers to make the decision to buy."
Yamaha sent a letter to dealers Thursday reminding them that dealer pricing is considered "confidential information," which they are not authorized to share. In fact, most dealer agreements state that dealers can't disclose their costs, according to Keeter. Brunswick also sent a letter to dealers this week alerting them about the site and stating that they will not participate in or provide information to the site at this time.
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Comment
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Comment by Susan Patterson on February 8, 2011 at 3:31pm -
I think this is much to do about nothing. Getting proper pricing from a current dealer is not an easy task. I remember when I was on the road and had relationships with dealers that did supply me with competitor prices; however, unless accompanied by a dealer contract showing discounts they were worth the paper written on. I just don't think they will be able to accomplish getting enough valid information to do a "dealer cost" site.
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Comment by Jim Sabia on February 7, 2011 at 12:35pm -
Glenn, I am surprised to hear you say dealers are overcharging... who's to say what "justified" profit levels are? I know one thing, I don't want my customers telling me what they should be. A great ownership experience comes with a cost and full service dealerships will become a thing of the past leaving only room for dealers that simply deliver a product at a price... period. Customers want the lowest price and a site with our costs on them will force that to be the case... I see many more dealers closing if this site is supported! We do have a choice and an obligation here...
As an alternative, the industry as a group should own this site and control what appears on it. maybe the MRAA or NMMA could run it based on what its members agree should be published.
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Comment by Glenn Adams on February 7, 2011 at 11:53am -
Unfortunately this is imminent. The best practice would be to support by providing them with the correct unbiased information. No one is going to like a site such as this, with the exception of buyers and marine lenders. It might make the industry more honest. I watched this in the auto industry and they are still surviving. this forces the manufacturers to support the dealers way more than in the past. Lets face the music large retailers are less competative with large overheads and consequently are becoming a thing of the past wheras the small guy has a places in the market as long as they have internet access. Dealerships will have to take more focus on good business practices, relationships with clients, and low overhead to survuve any longer. Buyers will pay justified profits.
For way too long dealers have taken advantage of buyers with high " dealer fees", overpriced rigging expenses, lenghty wait times for repairs, ect.
Profit is a good thing needed for everyones survival, open and honest dealers turn profits and find ways to cut expenses . This is all our part in the marine industry evolution.
Everyone should be able to make a profit in leiu of the invoice being placed online. At the end of the day, these sites will hurt the salesperson more than the dealership and again force the Mfg to pay more in rebates.
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Comment by jim yates on February 7, 2011 at 11:53am -
This is not what our industry needs. We need to simpilfy the buying process not complicate It.
-Jim
National Account Manager - www.mpcnetwork.com
Marine Industry Directory & Website & Official Boater's Directories & Website
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Comment by Nic Stark on February 7, 2011 at 11:34am -
Simply put it makes no rational sense to provide the public with "dealer invoice pricing"
1) This industry is not like the auto industry in any way other than we sell to the public.
a) basically every family these days has 2 cars - very high possibility of a car sale
b) At a guess less than 5% of the families would even think of have a boat, let alone purchase one. - very low possibility of a sale.
c) Auto dealers invoice price is likely as unreal as what they call MSRP. Unlike the boat dealers there is no massive rebate based on sales volume.
These are but a few reason it makes no sense.
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Comment by Susan Patterson on February 7, 2011 at 11:27am
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How do they plan to get this information on pricing Jim? Are there dealers that would supply? If supplied by Manufacturer or dealers, what is the validity of these prices- are they going to post where they got them from?
© 2012 Created by Jim Sabia.
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