Scuba diving is a relatively costly recreational endeavor, which made it particularly susceptible to the downturn in consumer spending in 2009. However, luxury expenditure has rebounded faster than per capita disposable income.
Los Angeles, California (PRWEB) January 11, 2012
The Scuba Diving Instruction industry foundered in 2009, but revenue has bounced back considerably since then. Nonetheless, the tough times are not over. Because the industry’s core consumers are traditionally young professionals, a complete rebound in revenue has not yet occurred. According to IBISWorld industry analyst Caitlin Moldvay, "The number of certified divers declined at an average annual pace of 1.5% over the five years to 2012, and spending per person also sank." Industry revenue is estimated to fall at an annualized rate of 2.1% rate to $459.2 million, mostly as a result of a dive in revenue of 28.3% in 2009.
Scuba diving is a relatively costly recreational endeavor, which made it particularly susceptible to the downturn in consumer spending in 2009. However, luxury expenditure has rebounded faster than per capita disposable income. Disposable income was stagnant in the past five years, growing just 0.1% annually on average through 2012. Moldvay states that, “Rebounding spending on scuba diving since 2009 relieved some pressure on operators, including an expected 3.5% increase in 2012 revenue. However, a tight lending environment forced some businesses to consolidate and led many to lay off employees. The number of industry employees is expected to decline at a 2.7% five-year annualized rate to 8,885 in 2012.”
In the next five years, the rebound in consumer spending and dropping unemployment rate will likely bring business to instructors that were barely treading water. Moldvay expects industry revenue “to rebound at a 2.3% annualized rate. Profit is also expected to rebound as domestic scuba tourism resurfaces and inbound trips by non-US residents continue to rise. New technologies like the Nautilus Lifeline, which offers two-way contact for divers and boats, are also expected to become more affordable and make the sport safer, drawing more people toward scuba diving.”
“The Scuba Diving Instruction industry is highly fragmented” adds Moldvay. “In 2012, the top four companies in the industry accounted for less than 5.0% of revenue. The majority of companies in the industry are small establishments that have five to six employees. Typically, operations are confined to a local or regional market.” The largest scuba diving certification agencies, such as the Professional Association of Diving Instructors (PADI) and the National Association of Underwater Instructors (NAUI) operate as membership organizations that provide certifications through affiliates and are not included in the industry’s major players.
The distribution of establishments that provide scuba diving is primarily based upon a region’s proximity to oceans and lakes and its respective population levels. The West region accounts for the majority of industry operators, followed by the Southeast. The West region holds an estimated 37.2% of industry establishments. The West region is famed for its scuba diving, particularly in California and Hawaii. For example, Catalina Island, the Channel Islands and Monterey are all popular scuba diving destinations within California. Hawaii boasts year-round warm water; in addition to being a prominent tourist destination, the state is a popular location for scuba divers.
The Southeast region is another prominent center for industry operators. In 2012, the region accounted for an estimated 32.1% of industry establishments. The Florida Keys is one of the most popular locations in the world for scuba diving. The Florida Keys is a 120-mile island chain that is home to the United States’ only living-coral barrier reef. Because of its warm weather, Florida is also a key tourist destination, making it popular for industry operators to locate their scuba diving business in the state.
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This industry offers scuba diving instruction, in the form of escorted scuba diving trips or scuba diving certification classes. This industry does not include scuba gear sales; however gear rentals are generally part of classes, so they are included in the industry. This industry only includes revenue from instruction-related training; it excludes membership dues, merchandise sales and other revenue sources.
Scuba Diving Instruction Industry Report Key Topics
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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