Future of DiveShops?

[Eric Sedletzky]

The dive business is one of the very last in retail to have a 100% markup policy on goods.I'm actually surprised they have lasted this long.
I remember back in the late 70's when I worked at an excercise equipment store selling olympic weight, benches, dumbell sets, etc we had a 100% markup. That was when we were all there was for that type of commercial gym equipment. Then larger stores came in like Oshman's and eventually big box stores like Big 5 and a host of others. That was the end of the 100% markup when they could sell the stuff with a 50% markup and in some cases even less on sale. That was even before the internet and 100% was already gone.
Now most retail sits at 25% to 50% and in the case of some retail as low as 5%.
To be sore that you can't get 100% markup in 2014 is nuts. NO OTHER retail industry gets that kind of profit.
So of course dive shops make an easy target and are vulnerable to the internet.
That's not the customers fault. Yes, scuba is a small niche hobby, but maybe it's time to start thinking about moving scuba in with other sports in the same building/business to help pay the overhead instead of just scuba sales trying to pay for everything.
I'm trying to think of ways to make it better for them, because we need them, but pretending like 100% markup is normal in this day and age is not the real world. Some of the manufacturers MAP pricing policies are not the new world reality either. Dive shops buy and own that stuff, they should be able to sell it however they want.
Times are different, people are counting every penny and look for the best deal they can find, that's life now. You should just be glad they're still diving at all, it could be worse.

 

[CAPTAIN SINBAD]

The dive business is one of the very last in retail to have a 100% markup policy on goods.I'm actually surprised they have lasted this long.
I remember back in the late 70's when I worked at an excercise equipment store selling olympic weight, benches, dumbell sets, etc we had a 100% markup. That was when we were all there was for that type of commercial gym equipment. Then larger stores came in like Oshman's and eventually big box stores like Big 5 and a host of others. That was the end of the 100% markup when they could sell the stuff with a 50% markup and in some cases even less on sale. That was even before the internet and 100% was already gone.
Now most retail sits at 25% to 50% and in the case of some retail as low as 5%.
To be sore that you can't get 100% markup in 2014 is nuts. NO OTHER retail industry gets that kind of profit.
So of course dive shops make an easy target and are vulnerable to the internet.
That's not the customers fault. Yes, scuba is a small niche hobby, but maybe it's time to start thinking about moving scuba in with other sports in the same building/business to help pay the overhead instead of just scuba sales trying to pay for everything.
I'm trying to think of ways to make it better for them, because we need them, but pretending like 100% markup is normal in this day and age is not the real world. Some of the manufacturers MAP pricing policies are not the new world reality either. Dive shops buy and own that stuff, they should be able to sell it however they want.
Times are different, people are counting every penny and look for the best deal they can find, that's life now. You should just be glad they're still diving at all, it could be worse.

Just from the way it sounds ... I like the idea of moving scuba into buildings with other sporting goods. I often wonder why Dicks does not have a scuba section? They have a cross bow hunting section which is not a mass sport either. Why not Scuba? If they could have a scuba section, it would also expose scuba to a larger potential customer base.

Has anyone here ever thought and experimented with this idea? If yes what was the outcome?

 

[dmoore19]

Don't know where that comes from. I have a couple of friends in retail, clothing, shoes, lots of things are priced at a 50% margin.

 

[Eric Sedletzky]

Just from the way it sounds ... I like the idea of moving scuba into buildings with other sporting goods. I often wonder why Dicks does not have a scuba section? They have a cross bow hunting section which is not a mass sport either. Why not Scuba? If they could have a scuba section, it would also expose scuba to a larger potential customer base.

Has anyone here ever thought and experimented with this idea? If yes what was the outcome?

Sport Chalet has been doing this for years.
The problem is that they have trouble finding staff that is knowledgeable enough to run the dive shop section and answer questions, sign people up for OW, do air fills, etc. Many times when they are short staffed or someone calls in sick they send someone in from skiing to work the counter.
But for the most part they are able to get the right people in and it runs smoothly.
They have the buying power and support system that a stand alone shop struggles with because they have other parts of the store that support each other. One thing SC is known for is great customer service.
They even have dive charter bookings through their stores and have good prices on that.
It's hard to tell if store like Dick's will catch on and introduce a dive shop into their stores. If they did I know I would use it because they just built one in my town.
The dedicated dive shop in my town just just expanded their store to include other water sports item such as surfing and stand up paddle. They are looking into kayaking and other gear like a swimming pro shop and any other water related sports. The new owner sees the writing on the wall and also saw that 50% of his sales (when he was GM of the old business) was non diving related.
To me it seems perfectly logical to have other more popular venues help cover the rent, insurance, utilities, wages, and other bills. Scuba alone isn't enough anymore.

 

[webedivin2000]

Diversity is what it usually takes or in our situation having a commercial diving business inside our operation helps!
Being in this business for 42 years, 22 owning the business were I started I really see on these board some misconceptions about mark up and reality of the sale!! First, manufactures on paper mark up equipment 50 percent, in the past years electronic/ computers are less then 40 more like 35! Some lines are now at 40 once you pay freight! Having higher volume sales gives you better profit but not many LDS are high volume anymore, since online sales! Which is another interesting point as what we can advertise at is controlled by the manufacturer, and believe me they wI'll slow shipments if you negate there policy!
Manufactures do a great job watching the gate, but usually not on there profit makers , OL!
I am moving on from this thread as beating dead horse never does much good but food for thought! Clothing for instants has over 600 percent mark up in Macy/JCP/Sears you name them! However person make a shirt with a moray eel on it, they want to sell them to a dive shop for $9.95 and retail for $19.95 however how many of you go buy a underarmour shirt that sells for $29.95 and is whole sales to dicks for $9.00! Accepted reality!!!
For online shoppers there are great deals and niche buyers, no one will never stop that, but using a business for your personal gain, wasting sales people's time to find out what your really need and buying
On line is an acceptible practice! If you want to buy in line go for it, however do it with the risk that online buying comes with!!! "Showroom" on your computer from you couch not in your local shop!

 

[Wookie]

That's not the customers fault. Yes, scuba is a small niche hobby, but maybe it's time to start thinking about moving scuba in with other sports in the same building/business to help pay the overhead instead of just scuba sales trying to pay for everything.

The most successful scuba only non resort stores I see who have a pool on site also have swim lessons. What an amazing concept, rent out a pool all day to moms and kids for swim lessons instead of letting it sit empty. It also opens up a whole new line of retail, as you can't just swim in a bathing suit like I did down at the river, you have to have goggles, and a wetsuit, and a flutterboard, and hand fins, and foot fins, and and and all of that other stuff.

 

[oly5050user]

Sadly, THAT is the future of dive shops. Me, I would have taken the new, unused suit and let the customer try on suits until they found one that fit, and made the exchange with a smile. What harm would it have done? I do not have the same need that you do, to punishing someone for shopping online. With customer service like you provide, I would shop online too.

You say "what harm would it have done?" We'll when the next customer walks in and the size suit you need was given away for nothing but a trade did costs you something, you lost a sale because size you needed was out of stock..the size that just walked out the door that you gave away for free was the last one of that size you had in stock you just lost a sale and income from that suit you gave away. Giving any item away as you did costs something. Time you spent with this so called customer, $ spent to stock it,inventory it,enter it into your point of sale,paying employees to get it on display,shipping to your store. Even just hanging in your store costs $. You have an investment in it and that investment could have been making you money elsewhere instead of hanging there waiting for a freeloader to take it out of your store with no return on investment to you.

 

[nimoh]

You say "what harm would it have done?" We'll when the next customer walks in and you need then entropy away as you did costs you something. size that just walked out the door that you gave away for free was the last one of that size you had in stock you just lost a sale and income from that suit you gave away. Giving any item away as you did costs something. Time you spent with this so called customer, $ spent to stock it,inventory it,enter it into your point of sale,paying employees to get it on display,shipping to your store. Even just hanging in your store costs $. You have an investment in it and that investment could have been making you money elsewhere instead of hanging there waiting for a freeloader to take it out of your store with no return on investment to you.

Another option is to charge a 20% stocking fee for the exchange. I think the customer would be unlikely to accept it, but I think it's better than saying "no".

I do not work in retail, but it seems ridiculous to me to expect a store to exchange something that wasn't purchased from them....for free.

 

[muzikbiz22]

The most successful scuba only non resort stores I see who have a pool on site also have swim lessons. What an amazing concept, rent out a pool all day to moms and kids for swim lessons instead of letting it sit empty. It also opens up a whole new line of retail, as you can't just swim in a bathing suit like I did down at the river, you have to have goggles, and a wetsuit, and a flutterboard, and hand fins, and foot fins, and and and all of that other stuff.

Frank, I'll go on record and say that you are the smartest person on this board. The local shop that I call "scuba home base", is exactly that. From OW to rebreathers, AND childrens swim lessons. Here is a quick 1 minute video the shop had done, and was featured on local tv. I am not an employee of the shop, but one of many customers that are fanatical about calling this shop "home". They do a fantastic business, are active in the community, and they just plain "get it".

 

[Scubatude]

You say "what harm would it have done?" We'll when the next customer walks in and you need then entropy away as you did costs you something. size that just walked out the door that you gave away for free was the last one of that size you had in stock you just lost a sale and income from that suit you gave away. Giving any item away as you did costs something. Time you spent with this so called customer, $ spent to stock it,inventory it,enter it into your point of sale,paying employees to get it on display,shipping to your store. Even just hanging in your store costs $. You have an investment in it and that investment could have been making you money elsewhere instead of hanging there waiting for a freeloader to take it out of your store with no return on investment to you.

I gave nothing away for free but some of my time. All I did was trade like for like. In addition to that, I helped a diver, and gave a customer a positive experience in my shop. Yes they are a customer. Someone who has a need of the product I sell and is close enough to my shop to walk in. So they didn't buy the wetsuit from me. Who cares? Treat them as if you value them (because you should!) and maybe the next item they need will be bought from your shop. If they get treated with hostility, they will not be back. I am willing to bet that more of that precious time you talk about was spent explaining to the customer, who will never be back, why online is evil and why you won't do something within your power to do as a punishment for their actions, then would have been spent to make a customer happy.

You are all free to run your businesses anyway you like, and treat customers any way you like. But don't bitch and moan that sales are down or not as many people are coming in if you are going to treat them poorly. You are not the only game in town. Customers have a choice where to buy. If they chose to go someplace else, it is not their fault...it's yours.