Marina Dock Age, May/June 1997

Weathering an Economic Downturn: Can Storage Cover Your Cost?
by Dennis P. Kissman

I’m not suggesting gloom and doom for marina owners just when were coming out of a downturn in the economy and the future is looking bright, but there is one thing that we do know for sure: The soft economy that we experienced for the past several years will occur again when we are least prepared. However, there are ways we can minimize the impact on marinas. Rather than being proactive, most marina owners and operators react to changes in the economy. If you react, then the effects of a downturn in the economy will surely affect you.

As a rule, the marina industry is considered a reactive industry to the overall marine industry. In a sense, that is true. The marina owner must store and service the products the marine industry produces. Beyond this correlation, marina owners are in control of their own future and face an altogether different set of problems when it comes to addressing changes in the general economy.

To reduce or prevent the financial hardships associated with a downturn in the economy, you must first recognize what your core business is and the reason a marina exists in the first place.

Marinas exist because boat owners need a place to store their boats. In recent years, the industry has promoted the full-service marina concept to attract and retain customers. It is important to grow and remain competitive when times are good. But when times are bad, if the marinas core business (the storage of boats) cannot sustain the marina’s financial obligations, then it is in for some hard times.

The strength of the marine industry is selling new products, while the strength of the marina industry is caring for existing products. When positioned correctly, marinas are less volatile in a downward shifting economy than the industry in general. Continue »