Archive for February, 2012

Ready, Set, Compete

February 12, 2012

Ok let’s get the obvious stated first. IT’S A BUYERS MARKET FOR BOATS, HOUSES, PLANES, or any other high-priced item that requires a deployment of capital in what has been a down economy. From the looks of things overseas and at home one really can’t point to a sign of “green shoots” “tea leaves” “crystal ball” “silver lining” or any other jargon the talking heads and economist like to use for indicating they know what’s coming.

It really looks and feels like this financial crisis which began in 2008 is going to be a malaise that reaches more into the fabric of change effecting how people live for years to come. Those waiting for a snap back are going to be waiting a long time as pay attention and you can see this is not something in history repeating itself but more a fundamental cleansing of bad habits and living above our means that was bound to catch up to us and did. Never has the world been so small and connected via the technology that we all love and use everyday but that also means worlds economies are intertwined and prone to all catching the same cold as bad economic decisions trickle from one land to the next.

That’s about as negative a rant as you will ever see from a person like myself who is an eternal optimist and always glass half full mentality. But a wise quote I once read said to “face reality for what it is, NOT for what you want it to be”.

The reality is buyers will be less in number but mighty in opportunity. Boating will never go away as it remains for many the greatest return of pleasure for dollars spent. What I suspect you will see is a continued adjustment to living within means which is hard to measure at times. You will decide the shiny $400k new boat looks great at the boat show but the grown up thing to do is look at that 2008 or 2009 model for $200k instead. That’s still a boat buyer but one that made a shift in habit that is hard to measure.

Buyers are out there as our growth indicates but sellers are competing for them and it’s a competition that requires effort, price and conditions that many find hard to meet. If you have a boat that you’ve decided to sell it has to meet a set of criteria not dictated by us but by our observation of the market on a daily basis. The boats that sell are priced at the lowest rungs of the ladder (buyers start on the low rungs first), have been kept up cosmetically (don’t give up on your boat or it will sit and be passed by every time), and have owners willing to see that selling requires competing more and less “I’m not giving my boat away” or “but mines the nicest” chest thumping.

Competition is one of the reasons Knot 10 has grown in a business that many others are hanging on for dear life. We have had other brokers claim we are ruining the industry, not making any money, only successful because we charge 7% instead of 10% etc etc. NOPE THAT’S NOT IT. Business is a competition and every business has challenges to their model. Our strategy is simply to be as good as we can be with what we offer realizing it’s the customer that decides. That end point customer does not subscribe to any “industry standard” notion. Why is it some 10% brokerage operations we admire locally still do great and are growing? Why is it that competitors of ours have advertised 5% or 6% rates with no impact on our business (or us complaining) whatsoever? It’s because the buying and selling customers look at what is presented still have and will always have a choice in whom they do business with.

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