sailboat profits

saillessinseattle · #1 07-27-2012

I am trying to figure out the retail margin on mass produced sailboats, brand new from a dealer. Like a car when you look at the difference between list prices and invoice prices (what the dealer pays to the factory).

I want to understand how much negotiation space I have on prices for boats like beneteaus, janneaus, bavarias, hanses, etc. (more custom makers are a curiosity but out of my current parameters). Does 10% off list sound like a good deal? How about 20%?

And how about options like extra tanks or inverters? Is getting these installed after market more cost effective, or better? Thanks for any pointers or suggestions.

I am looking for a cruiser in the 37+ range for coastal fun.

zedboy · #2 07-27-2012

If you're looking to save money, why not buy a used boat?

A sailboat hull has no moving parts and lasts a very long time. A well-cared-for used boat will have updated sails, rigging, and gadgets, look bristol, and you will get a lot more for your buck.

Minnewaska · #3 07-27-2012

You're not likely to make much ground on the listing price of a new hull. However, commissioning it to legal and comfortable sailing condition will cost anywhere from 25% to 50% above the basic hull. Much of that work is or can be done by your local yard after you take possession of the hull and that's where you can negotiate significantly. They may be happy to provide some options at cost, to get the profit on the hull.

kd3pc · #4 07-27-2012

everything is negotiable.

Is the boat sitting at the dealer, being built or scheduled to be built or just a number....? All will determine what the list price is to you, the buyer. There is no set amount even within the same manufacturer.....each dealer (just like cars) gets kicks and has their own margins to cover. Some dealers agree to sell a certain number of boats, and depending on where and how many they have according to that plan will determine the absolute bottom sales price. After sales prices vs advertised list prices will generally show 6-16% margins...not that you will get that every time...

The more gadgets you "order" will allow them more leeway, as well as more profit for them. Most of the boats will be very basic equipped from the factory and the extras are done by the selling dealer's yard, or one nearby at a cost to them.

After market installs, if you can find good people, are almost always cheaper than through the dealer, as you will be "paying" for the install twice - once to the dealer a percentage, and then to the installer AND, and this is a big AND....you now have TWO people who will point fingers WHEN something fails....Make sure you get in writing WHO the warranty is through and how it is maintained.

In this market you would be remiss to NOT look at used boats. There are several in our area that are better than new, and at a significant price reduction over new....

Best of luck

saillessinseattle · #5 07-30-2012

This is helpful thanks. So for beneteau or jeanneau for instance the options they list like say, extra water tanks are not necessarily all done at the factory, but some are installed at the point of delivery? Of course some are factory only. And I know stuff like dodgers, anchor, fenders are local. How about all rigging, is that done locally too?

I will probably end up ordering something as I cant find what I need in dealers inventory. I assume margin is less flexible in this case, but from what you described a little more flexible if I end up ordering a bunch of optional equipment.

Minnewaska · #6 07-30-2012

Tankage options may be available at the factory and, if so, there is probably no advantage to waiting. Modifying spare water tanks into fuel tanks (you can make water, you can't make fuel), is probably a local mod. The big dollar commissioning items that are often done locally are the electronics, such as navigation, radios, airconditioning, invertors, gensets, specialize alarms, etc. You point out the dodger and that is a great example of getting what you want, rather than a factory catalog item. Cushions, davits, dinghies, anchors, and on and on.

olson34 · #7 07-30-2012

30 years ago I was repping a line of small sailboats for a builder nowadays long out of the business.
My "gross profit" was about 17%. I was told ( no proof) that big dealers for the major lines of production boats were getting about 20% or maybe more.
Of course there's doing what you gotta do to make a deal... and sometimes I settled for less.

Unlike those big boys, though, I had no flooring costs. Bank Flooring really kills the dealers in lean times.