good or bad time to buy a dive shop?

[ZoCrowes255]

The dive industry is suffering horribly right now. I was just talking to the PSI Rep yesterday (PSI=major southeastern distributor) and he repeated what we have heard from everyone, the entire dive industry is hurting. It's not just sales but traffic. Student enrollment is WAY down.

It's caused by a mixture of the economic slump we are currently in and the fact that people are still afraid to travel.

wexwind once bubbled...
Any feedback on the state of the industry and whether or not this is a good time to buy into a retail shop / charter boat business? What are some recent industry trends? Has 9/11 helped or hindered the industry domestically in the US? Are there profits to be made or only lost?

I'm looking into buying a dive shop in a popular california dive destination spot. Location is good, they have a 40' boat and pool facility. Revenues have dropped consistently and significantly over the last couple years. Broker says this is due to owner/manager involvement issues. Seems like a pretty good price. The shop's been in business for 13 years. I used to manage/work in a dive shop in college (ten years ago) and am a PADI DM, however, have been out of the diving loop for some time.

Any advice/feedback/suggestions is welcome!

Thanks,
L

 

[ZoCrowes255]

Knavey once bubbled...
I for one see the internet sales of dive equipment taking a LOT of business from the LDSs. I think an LDS that manages to figure out how to incorporate the LeisurePro style with a LDS front office will be the success story.

If you can find an LDS that will order your equipment and then let you try it out, THAT will be the one that survives. Best of both worlds...but with the manf lock on prices right now, it will be hard to do.

Not a business owner...not a highly qualified diver...just someone who watches the latest trends and sees what the internet is doing across the board.

Leisure Pro is a major factor BUT the big one is that there are no new students. Almost every dive shop you talk to says that people actually learning to dive is at a low. There is a shortage of new divers.

 

[RICHinNC]

The biggest reason i would not go into a dive business is how controlled (by everyone else) my inventory would be. I have spoken to so many lds owners that would like to carry certain items but the main company they do carry will not allow them to do so. So much for free enterprise. The current condition can not be blamed totally on 9/11.....a lot of the current condition is self inflicted by the big guys it seems like to me.

Make sure you have a lot of money in the bank to pay your bills and eat with.

 

[Zagnut]

..but I think (and I have seen) that the LDS can be successful if you innovate and keep up with the trends. I've heard alot of scare stories about owning a LDS these days, but my LDS, Scubatoys, seems to be doing quite well. Larry, the owner, has a recipe for success and for him it's working. He has integrated the online store with the LDS and it works quite well for him.

Read these two articles about Scubatoys. They share alot of the same info but do have some different info as well. His shop has expanded four times and I believe they are moving to a new and bigger building again soon. His business has increased tenfold since 1997.

I don't know alot about the shape of the industry as a whole, or if Scubatoy's success could apply to other LDSs in other parts of the country, but I do know it is possible for a LDS to be successful. I see it every time I go in to get my regs serviced and my tanks filled.

http://www.psionic.com/warp/public/779/smbiz/tech_awards/scubatoys.html

http://business.cisco.com/prod/tree.taf?public_view=true&kbns=1&asset_id=88605&MagID=88222.html


This is not intended to be a testimonial for Scubatoys...just an observation that Larry at Scubatoys is making quite a successful go out of owning a LDS.

 

[matt t.]

You might want to look closer at the charter boat aspect of the business. One of the LDS here only has the store to "advertise" the charter boat they run. The store doesn't do much business at all.........Good Luck!!!

 

[ericfine50]

I agree that a lot of dive stores are run like hobbies. You need to run it like a business. You have to have a business plan. set prices that are realistic because people are going to hunt on the internet. Having a good web site is important. You have to ask, can the area that I want to have the shop sustain x # of stores? why was business down?

For the new diver - Keep them active and make it fun to dive with the store, take a specality class, use the boat, refresher classes. Also, how does your staff handle customer service, returns. Are the instructors teaching quality divers?

You said you have acess to a pool? - How about add swim fins, goggles, kick boards, or offer swim lessons?

Good luck
Eric

 

[joed]

Several dive shops here in New England have gone out of business over the years. The largest one and the oldest one that I knew of, New England Divers disappeared in a heartbeat. A friend of mine just bought a shop. He says it is not fun right now, again a new shop not one with a track record. The more successful dive shops around here also sell ski equipment for the cold months. I think a dive shop needs something else to sell when poeple are not diving in the cold weather. Maybe sell guns and amo or bait for fishing. The point is you don't want anyone driving buy without stopping for something they need. Another 2-3 successful shops here also do mooring servicing and commercial diving. I think you need a commercial end, just catering to the recreational diver is only good on a fair weather weekend. Also make sure you can get the equipment lines you need. Will the equipment manufacturers extend their line to you if you take over this existing shop? My friend who statred a new shop can't get US Divers gear because another shop 20 miles away has it. Make sure in writing you can get all the lines that you need.

 

[wexwind]

Wow, thanks to all who took the time to give the excellent feedback. This is my first post to this discussion board and I'm amazed at the response. Thanks to all of you who took the time to give your advice and feedback. I will take it all to heart as I continue to consider and investigate this business. The feedback has been invaluable. Don't be surprised if you hear from me again soon. Since there are so many replies, if anyone wants a personal response to your reply, please send me a private message as I can't respond to all of these great messages.
Cheers,
Lance

 

[Otter]

wexwind once bubbled...
... Thanks to all of you who took the time to give your advice and feedback. I will take it all to heart as I continue to consider and investigate this business. ...

Remember, advice is sometimes worth what you paid for it
Otter

 

[gbrandon]

ZoCrowes255 once bubbled...


Leisure Pro is a major factor BUT the big one is that there are no new students. Almost every dive shop you talk to says that people actually learning to dive is at a low. There is a shortage of new divers.

And why do you think that is? Ill tell you why, because here in america, the line dividing the have and have not's is greatly widening. The rich keep getting richer, and the poor stay poor and the middle class get poor'er. Nowadays people dont have the disposable income they used to. Diving takes money. (unless you happen to live next to the ocean, and even then, most people prefer the warm waters outside the us.. ) Mankind is its own worst enemy.