Breaking news: WM acquired by private equity firm

[psneeld]

If you think West Marine has wild prices...I have worked for over a dozen small businesses since retiring from the USCG and can see why. In all fairness, West Marine isnt always the highest, some things are competative, and when they have sales, I sometimes jump on many items....then on top of it, I get bonus rewards points.

So many times the bosses in the small businesses have laughed themselves silly on certain projects or pieces of merchandise that people have paid at least 10X what they probably should have. Granted they werent JUST retail places I worked in.

Its the way of life .....and as a dopey, follow orders, non business minded government/military employee, I was never sure whether to think it was right or evil.

But after seeing good bosses get screwed the other way so many times, I only could think that without the windfalls, they would go bankrupt for the deals that went sour.

Then I related it to getting medals in the USCG, take them and smile when you got them whether you really deserved them or not...because the ones you really deserve....aint no sane minded individual around to see what you really did.

 

[Bigsfish]

Not sure what type of business you guys are in but in companies I have run I had to have lawyers on the payroll to make sense of the government regulation in manufacturing, dealing with OSHA, EPA and other government regulators is not cheap. I could not do it myself and hired people to do so. Further while I had accountants on my payroll I still needed outside consultants like CPAs and tax lawyers. One of the reasons I retired at 50 was I would not have to deal with government rules and regulations. I was not driven by power and had enough income, I haven't looked back. You guys probably have more money than me but I have enough to live my life. Now if my income tax and be done on a postcard!!

 

[BandB]

This is why CostCo is so interesting to me. A typical large grocery store might carry 35,000 SKU's. CostCo carries around 4000. Their claim is that they've "vetted" all the brands for quality. So if you want Peter Pan, you're out of luck. (Jif is the best anyway and they have it). But CostCo has that pesky membership fee and that's why it works.
It would be hard for WM to carry a "grocery store level" of SKU's because many of their products are so expensive. Could they carry 6 different brands of dock line? All the various VHF's? Maybe online but tough to do in every store.
At the same time they'd have a hard time following the CostCo model. Although I remember when I paid an annual membership fee to BOAT US.

Costco has entered into special agreements. On many products they have a version no one else has. They even have their own model numbers of HP Printers. Pots and pans they have a pot from one set with a top from another so no way can match item for item. Their bid process is very elaborate. I've seen examples of their holiday bidding. Plus size. They are the largest purveyor of choice beef and of prime beef in the US, and the largest seller of wine. Plus they have people so convinced that they believe they're the low cost provider even on items they aren't.

West Marine could carry a much wider selection, closer to grocery store, if they were willing to invest in the inventory. If they just moved all the stuff sitting in their two large distribution centers into stores it would make a huge difference.

 

[BandB]

Not sure what type of business you guys are in but in companies I have run I had to have lawyers on the payroll to make sense of the government regulation in manufacturing, dealing with OSHA, EPA and other government regulators is not cheap. I could not do it myself and hired people to do so. Further while I had accountants on my payroll I still needed outside consultants like CPAs and tax lawyers. One of the reasons I retired at 50 was I would not have to deal with government rules and regulations. I was not driven by power and had enough income, I haven't looked back. You guys probably have more money than me but I have enough to live my life. Now if my income tax and be done on a postcard!!

I've been in large and small. Yes, when I ran a public company I had to conform to SEC and to tax laws and have audited statements but that's true in every western country and many eastern. If you want to be a publicly traded company that's part of it. Being a public company is expensive in any country. The accounting and reporting requirements are pretty universal and are there to protect stockholders.

OSHA has become easy today because the hard work was done decades ago and I've never had an OSHA recommendation I didn't find reasonable. EPA is fairly simple for 99% of all businesses, more complex for a few industries. I heard stories of complications when the water and air requirements hit in the 70's.

But we were talking small business. Small businesses aren't listed on exchanges and don't have SEC compliance. They have audit requirements only for lenders, not the government. We are sole owners of our businesses and do no audit, no public filing. Our taxes are straight forward as pass through entities since we keep our records all on a tax basis. Our business today is a hobby for us that our CEO and CFO just took much further than we ever planned. The only government regulation that bothers us is trash and recyling where it's different in every town and so, even though we're only in three counties, we have at least 15 different rules and many different providers. Now to companies in many states, life is complicated by the nature of our country having many states. Canada has this with provinces. However, most other countries have uniform laws throughout.

Political rhetoric acts like there's been a recent influx of regulations running small businesses out and that's simply not true. 99% of the regulations are decades old and most of them don't even impact small businesses. Small businesses have lost to competition. Then small US manufacturers lost to offshore manufacturing but that happened thirty years ago.

 

[Bigsfish]

BandB

You can find prime beef at Costco? I never knew. I may have to check it out.

Thanks.

 

[Bigsfish]

BandB

The companies were privately held that were sold to corporate majors. Then again it was during the '70s and '80s and '90s, I would never do that today.

 

[Sailor of Fortune]

There is nothing better than walking into an old time chandlery where the people speak "Boat". I've shopped at lots of them over the years, mostly Roses in Gloucester Ma (lived nearby), CG Edwards and Westerbeakes in Boston. Many of the New Bedford Ma places, Hamilton Marine etc.

I never got to HopkinsCarter but probably will.
Sailormans,Marine Connection and Marine Exchange are all cool places that you can roam around for hours ,talk boat speak to knowledgeable people.
These places are getting harder to find and are pressured by internet sales, dwindling margins etc.
Hopefully Parks will make the Southeast GT and we can all pick his brain (harass?) and learn something. As Nomad Willy (Eric) says," Its not all moonlight and inflatable SUPS".

 

[Bigsfish]

Steve

Parks can be bribed with beer.

 

[dhays]

Not sure what type of business you guys are in but in companies I have run I had to have lawyers on the payroll to make sense of the government regulation in manufacturing, dealing with OSHA, EPA and other government regulators is not cheap. I could not do it myself and hired people to do so. Further while I had accountants on my payroll I still needed outside consultants like CPAs and tax lawyers. One of the reasons I retired at 50 was I would not have to deal with government rules and regulations. I was not driven by power and had enough income, I haven't looked back. You guys probably have more money than me but I have enough to live my life. Now if my income tax and be done on a postcard!!

Lol, I am a small business. The tax code is expensive to comply with. Trump isn't going to improve that. Healthcare regulations are expensive to comply with (I am a provider) but Tom Price isn't going to make that cheaper to deal with.

For the rest, I have to do it all myself. I serve as chief of IT, HR director, Marketing Dierctor, CEO, COO, and CFO. If the toilet gets clogged, I am the one to fix it.

I am doing well enough to pay my bills and my wife just retired early at 58. That means at 59, I have to work another decade to retire.

Trump announced that he will have a tax plan to present by Sept. Maybe that will appear the same time his magic health care plan and secret plan to destroy ISIS are announced? [emoji23]

 

[Sailor of Fortune]

Steve

Parks can be bribed with beer.

Thats the difference between old time chandlery operators and new corporate chandlery operators.

I have first hand partying stories with the Roses family and employess (they are family too).

A couple of years ago we called on Searsport Maine with the tug and crane. Wayne Hamilton (Hamilton marine owner and founder came aboard) A gentleman, mariner (owns/operates pilotboat too) and just a a boating enthusiast perused tug several times over the 5 days we were there. Boaters like boats, big, small or in between we all seem to have an affliction that we need to investigate other boats.

 

[CDreamer]

FWIW - yes, CostCo has excellent prime beef. Even their Select is better than most places. I buy their racks of pork ribs because they're so much better. Per BandBs comment, CostCo does have proprietary products (Kirkland) but it's not much different than WM's polishes, dinghies, etc. Personally I think it's the membership requirement that makes CostCo work. I pay the annual $100 Corporate membership (regular is $50) but I get it back at the end of each year as a rebate check. Which means I buy too much *^#* I guess.

 

[Bigsfish]

Dave

Not wanting to turn this into a political discussion put you do sound like a bitter man not willing to give a Trump a chance which is very common today. I don't know if he will succeed or not but I'm will to give him a chance after the past eight years that I saw no growth of our country and more civil unrest.

 

[Sailor of Fortune]

FWIW - yes, CostCo has excellent prime beef. Even their Select is better than most places. I buy their racks of pork ribs because they're so much better. Per BandBs comment, CostCo does have proprietary products (Kirkland) but it's not much different than WM's polishes, dinghies, etc. Personally I think it's the membership requirement that makes CostCo work. I pay the annual $100 Corporate membership (regular is $50) but I get it back at the end of each year as a rebate check. Which means I buy too much *^#* I guess.

I had not thought of Costco, but you are correct. Everything Kirkland is high quality in my book. If membership makes it work maybe it will set a new bar?

 

[Bigsfish]

I hate to pay a membership fee to be able to spen my money at a place of business. Not sure the rationale is as I've never understood it.

Occasionally Costco will offer me a free month with a guest card, I'll check out their meat department.

Thanks for the heads up.

 

[dhays]

Dave

Not wanting to turn this into a political discussion put you do sound like a bitter man not willing to give a Trump a chance which is very common today. I don't know if he will succeed or not but I'm will to give him a chance after the past eight years that I saw no growth of our country and more civil unrest.

I hope Trump is a successful President, ie his presidency is good for our country. Time will tell.

 

[BandB]

I had not thought of Costco, but you are correct. Everything Kirkland is high quality in my book. If membership makes it work maybe it will set a new bar?

Bet you didn't know you can buy some Kirkland products on Amazon.

 

[CDreamer]

Yeah - as I recall Boat US was a membership deal back in the day...(I want to say $10 per year?).
Some MBA prolly told them to drop the membership requirement.

As if that was keeping people away...a $10 membership. "Gee, I'd like to buy this $900 compass but..."

 

[BandB]

Yeah, I posted at the same time you did. My concern about my irony not being clear preceded your excellent reply. The description of your retail strategy is exactly what I like to see at the stores that I frequent.

The point I was trying to make is that while we as consumers love to whine and complain about a retailers short-comings, we don't seem to be willing to give up the lure of the absolute lowest price. Unless we are willing to support retailers that provide the service we want, they will disappear.

The thing is that what people say they do and actually do are very different things. They say they'll pay more for excellent service, but the majority will not. They say they will pay slightly more for American produced but the majority will not. It's like the controversial television show or radio talk show that everyone swears they'd never watch of listen to but the ratings show they are lying. Or like the political candidate that no one will admit they voted for but somehow they won.

The key then for the retailers is relationship building. Where they know you and you know them and you feel they take care of you. That takes a stable group of employees and a lot of effort. But you can build such a relationship that people would be ashamed to go order online from someone else. It's very difficult, but you need to engage customers in such a way that it becomes automatic to shop with you.

 

[Sailor of Fortune]

Bet you didn't know you can buy some Kirkland products on Amazon.

Your correct , I didn't know that but we stock the tug via Costco and can't do "Mail order" in most situations. Usual shopping day in NY/NJ is $1500-2000 for staples and meat etc. (6 guys), usually supplemented 2 weeks later or so. A big foreign trip we buy groceries via restaurant suppliers because we can be gone for extended periods of time. I love Kirkland products (except their salsa).

 

[Sailor of Fortune]

Steve

Parks can be bribed with beer.

Irv, did we get punked? Last year Parks said he couldn't make it but next year he would be there and supply all the beer.. Retirement does that to a fella.

 

[Bigsfish]

Steve

When Parks was in business at Hopkins Carter you could bank on what he said. Now he's retired he may not be so reliable, life is funny that way. LOL

Love ya Parks.

 

[CDreamer]

Yeah - Kirkland salsa isn't great. But those gi-normous packs of toilet paper and their mixed-beer cases just make me feel warm all over. Maybe WM could start selling Garmin products that way. Or two ICOM vhf's in a vac-pack.

 

[psneeld]

Yeah - as I recall Boat US was a membership deal back in the day...(I want to say $10 per year?).
Some MBA prolly told them to drop the membership requirement.

As if that was keeping people away...a $10 membership. "Gee, I'd like to buy this $900 compass but..."

BoatUS is still a membership deal...$24

And it offers enough discounts to be worth it, but you dont need it to buy at West Marine.

 

[Bigsfish]

Memberships. My long time buddy was a VP st Brands Mart (discount store in south Florida) and they charged $5.00 for a membership card. I never could see paying $5.00 for the privilege to spend my money at a store. One day we were talking and this subject came up so he gave me a card and I bought quite a lot of stuff from them. In a short time they discontinued the policy of charging $ for a card. Principles.

 

[rwidman]

Yeah - as I recall Boat US was a membership deal back in the day...(I want to say $10 per year?).
Some MBA prolly told them to drop the membership requirement.

As if that was keeping people away...a $10 membership. "Gee, I'd like to buy this $900 compass but..."

I think you are confused. You never had to pay to shop at BoatUS before West Marine bought them out and you don't have to pay to shop at West Marine now. If you are a BoatUS member, you earn "points" when you shop at West Marine and eventually, you will receive a gift card in the mail.

A BoatUS membership is included when you get TowBoatUS but I think you can decline it or join without the towing service. A BoatUS membership will get you discounts on slips and/or fuel at many marinas so if you travel, it will quickly pay for itself.