Reduced incomes and tight credit conditions constrained demand for new boats
New York, NY (PRWEB) June 24, 2014
The Boat Dealership and Repair industry struggled to remain afloat during the economic downturn. However, as economic conditions improved, industry revenue followed suit. During the recession, consumers opted to delay discretionary purchases such as new boats as unemployment levels rose and disposable income weakened. Difficulty in obtaining credit further strained already weak consumer demand for new boats. Nevertheless, as disposable income and consumer confidence reversed course, industry revenue is expected to rise off a low recessionary base. To this end, IBISWorld expects industry revenue to increase at an annualized rate over the five years to 2014, rising in 2014.
Despite these positive conditions, the industry faces potential hurdles that will likely hinder robust growth going forward. Due to aggressive competition from other leisure activities, according to IBISWorld Industry Analyst Brandon Ruiz, “Boating participation has declined, presenting a threat for industry operators.” According to the National Sporting Goods Association, the most popular sporting activities include exercise walking, exercise on equipment and swimming. By contrast, fishing, which often involves boat use, ranked as the seventh most popular sporting activity. Faced with stiff competition from other forms of recreation, “many operators have experienced falling profit margins. To this end, IBISWorld estimates profit margins will fall in 2014,” says Ruiz.
The Boat Dealership and Repair industry has a low level of market share concentration. Despite the economic recovery, industry profit is expected to remain tight in the five years to 2019. As operators within the highly fragmented industry compete for contracts with manufacturers and for a share of the money-conscious consumer market, many companies will be forced to keep prices low to stay afloat. However, as consumers release pent-up demand from the recession, industry operators are primed for increased revenue growth. As a result, IBISWorld forecasts that revenue will increase at an average annual in the five years to 2019.
For more information, visit IBISWorld’s Boat Dealership and Repair in the US industry report page.
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IBISWorld industry Report Key Topics
The Boat Dealership and Repair industry sells new and used recreational boats like canoes, sailboats and motorboats (except personal watercraft), boat parts and accessories. This industry also provides repair and maintenance services; boat repairers may be employed by a boat dealer or operate as an independent shop.
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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