How much of that type of margin, if any, is in the price of a new Nordhavn, Krogen or other builder that sells direct? That seems like a pretty steep dealer markup for higher priced boats. Is there that much negotiating room on new boats? Where does one find these types of numbers and data? You can PM me if desired.
Kevin
Portland, OR
Companies that sell direct fall into two groups. Those who use only their own salespeople and those who open it up to other brokers. However, as a general rule going through dealers is going to add 10-20% to the selling price over direct sales and broker sales.
Now, because they're a volume production builder Sea Ray can build a boat like this for 10-20%, maybe 30% less than a builder like Nordhavn or Krogen could build the same boat.
So when buying a boat like the Sundancer, you generally would expect to get 20% or so off of MSRP.
When a semi-custom builder like Nordhavn or Krogen quotes you a price there isn't a lot of room left for negotiation generally. Some will negotiate a little, some won't. But even with those who do, it's typically less than 5%. And you're really working from a quote, not an MSRP as you think of one. Some don't publish prices or make them difficult to get to. Others publish prices even on Yacht World.
We're talking two entirely different types of boats and channels of distribution. A builder like Sea Ray couldn't reach their volumes without a large dealer network.
Builders like Princess would fall somewhere in between. They use a specific network of brokerages/dealers. They may have a little more room for negotiation than factory direct would have.
It's very important for a builder to choose a means of distribution right for them. If you're going to go with dealers and provide the type discounts they expect, then in return, you should expect them to stock some boats. You can go direct and offer a better price but with no boats stocked and no dealers pushing your brand you might not penetrate the market.
Some builders are finding another route. For instance, Hatteras continues to change their methods, but it appears their current plan is to have their own sales centers with boats to see and have a network of brokers who can use their facilities and inventory.
One more brief case study and that is Grand Banks. One of their many issues has been the escalation in price. They had something most resembling a dealer network, but no one stocking their boats. Some have some Eastbay models in inventory but not the Aleutian or Heritage models. So higher costs but lacking the benefits. They were considering some sales centers and set up one in the PNW. Then things changed and they turned back. In my opinion right now their prices reflect a dealer structure but you can't go to a dealer and see a boat.
Another issue with structure is getting people to whom selling your boat is a primary issue. Bluewater is a Grand Banks dealer. They have one Eastbay in inventory, nothing else. They have 24 other new boats-Viking, Sabre, Back Cove, Jarrett Bay (which they own) and Regulator. In semi-custom yachts they sell Princess. Now you tell me how many Grand Banks' they are going to sell. Grand Banks lists Galati on their web site, but Galati doesn't list Grand Banks on theirs.
The price structure of many production builders is available on seedealercost.com. It's the boat equivalent of the auto sites.
Yup, and very expensive to maintain. Watched a 3 year old one go through a fuel leak chase down and bottom of tank fitting redo.
