The LDS of the future

[MXGratefulDiver]

The dive shop of the future will sell equipment strictly over the internent, reducing inventory, storefront and employee costs. They will run their training as a separate cost center ... charging appropriately to maintain a profitable business. Classes will be offered via internet, with staff sufficient only for in-water work. Fills will be done by mobile fill stations that can go to where the divers are. All three of these business units can either be part of the same business, or operate independent of each other.

... Bob (Grateful Diver)

 

[Rich Keller]

Perhaps there is room in the market for focused 'tank filling' gas vendors. Some guy with a compressor who can set-up in a convenient location and do nothing more than pump/rent tanks at a low price?

The option to get tanks filled at places other then a LDS already exists. PHMSA - Cylinders - Authorized DOT Cylinder Retesters: Domestic Once you start to see a bigger decline in LDSs others will come along to fill that need like charter boat operators. The charter operator will not be doing this to help the industry as much as he will do it to help himself to better compete with boats who do not provide the same service.

 

[redacted]

I don't know . . . I think we are already seeing at least a few "LDS of the future" shops. ScubaToys is one, Dive Right In Scuba is another. Both have embraced the internet as a sales and marketing tool, and are concentrating on providing customer service that brings people back.

I would like to see dive training priced where it could be thorough and dive professionals could make reasonable money, but I have to admit that, had an OW class cost $1000 when I got certified, I would not have done it. A $275 class (plus personal gear) got me into the sport, where I have proceeded to spend a GREAT deal of money over the last six years. Not all of it benefited the original LDS, but it benefited SOMEBODY.

I believe those examples just represent version 1.0 of the LDS of the future. They will have to evolve because their success with retail gear sales will eventually limit access to training, service, and gas. I see the successful online gear retailers reaching out to under-supported areas to avoid a major decline in divers by establishing smaller satellite franchises or affiliated dive clubs. Bigger manufacturers will oppose this expansion as it will move power and control away from the manufacturers and distributors to the retailers and diving customers. I do not see a large jump in the cost of training or gas because independent providers and clubs will step in and be successful if those costs become unreasonable. The only guys who will get rich at this will be the CEOs of Divemart and Bestdive. Others will get by as the competition of free enterprise will regulate efficient, competitive operations.

 

[SeaCobra]

Ah, the dive shop of the future, this should be good. First HOG regs are not designed any different than other popular diaphragms already on the market. They are the same Asian imports as others are using, just being marketed for less money and sold through on-line sources. The difference is that HOG will allow the owner to pay for a class ($250 at DEMA) so they can spend money on tools and then buy service kits themselves (at retail direct from the manufacturer) and spend their time servicing their own regulator. Whether this is a good idea or not is up to the individual, I fail to see the logic. Even though I am perfectly capable and equipped I do not change the oil in my car, I pay my mechanic to do it and spend my time more efficiently.

Next fair mark up? Hmmm, fair mark up is the amount that allows the seller to earn the profit necessary to have a successful business while offer a price to the consumer they feel is valued. Depends on the resource you are reading, but in specialty retail a 52% mark up on primary items is the average needed to meet expenses. That is pay your rent, turn on the lights and pay your insurance. If you want to do something like eat, or heat your house that will take more.

The base problem as I see it, is that most dive shops are run by divers that opened a business instead of business people that decided to open a scuba shop. In my research I asked a number of shops in my area how much do the charge for an ow class and more importantly why, only 1 shop out of about 10 showed me a list of expenses that make up the class and came to a number based on a logical business model. The rest charged a little less than the other guy. Can you guess which shop has students in their classes and people signed up on their trips?

The dive center of the future is going to have be a business with a living, breathing plan. One based on logic, not emotion. I have applied this philosophy to my classes as well as the retail products in the store. I will need to look at the numbers every month to make sure the plan is viable and make adjustments where necessary.

 

[Aqua-Andy]

Online sellers are cheap because they have lower overheads (no showroom) and bulk purchase deals with manufacturers. Only large dive centres could match that, especially if they wish to stock from multiple manufacturers.​

I love this argument, because it is a total farce. Every online shop I have dealt with so far has a store front and provides classes. Yes, they do get better prices because they place larger orders with the manufactures, but this is because they have chose to broaden there customer base by offering there products online. News flash: the internet is open to anyone that is willing to put the effort into starting up a website. In this economy it is hard to justify paying $600 for a reg set, $700 for a BC, $200 for fins, up to $100 or more for a mask, when you can price shop and save close to 50% off those prices for gear that is just as good. I believe one other part of the equation is most local dive shops don't carry enough inventory, if I,m paying the prices dive shops charge I want to be able to feel and touch the product "not be told we don't stock that but we can order it for you" then be told that there is no returns on special ordered items. My experience when ordering from a local shop is that when you order something it is not ordered that day but they will wait until they have a large enough order so they don't have to pay shipping, I hate being told it is on it's way then having to wait three weeks to a month for the item to arrive(yes I know what shipping tomes are and unless you are ordering from china and paying the cheapest rates it doesn't take that long). If I have to special order an item I would rather order it online and receive said item in a few days and if the product is not what I expected I can still return it to the online retailer and not be stuck with a n expensive item I don't want. I believe if you followed a local dive shop owner around for a day you might be surprised, you will probably find them at Home depot rather than the locally owned mom and pop hardware store, Walmart instead of a local high profit clothing store, large grocery store instead of small locally owned grocer. It is kinda hard to expect customers to pay over inflated prices when local shop owners won't do it them selves.

 

[Rich Keller]

Fills will be done by mobile fill stations that can go to where the divers are.

I do not think there will be enough profit for someone doing just that. If they are doing that and also making a profit in some other area as well it might work. It would be easier to take filled rental tanks to a popular dive spot then the compressor itself. They might also bring 300cu/ft storage bottles set up as a cascade to refill tanks for the second dive of the day. This would be a good solution for a local dive club though so the fill station is going to a location where they already know the divers will be rather then trying to hit a few different locations during the day.

 

[Rich Keller]

First HOG regs are not designed any different than other popular diaphragms already on the market. They are the same Asian imports as others are using, just being marketed for less money and sold through on-line sources. The difference is that HOG will allow the owner to pay for a class ($250 at DEMA) so they can spend money on tools and then buy service kits themselves (at retail direct from the manufacturer) and spend their time servicing their own regulator. Whether this is a good idea or not is up to the individual, I fail to see the logic. Even though I am perfectly capable and equipped I do not change the oil in my car, I pay my mechanic to do it and spend my time more efficiently.

I do not own a HOG reg but it is my understanding from the research I have done that the only differences are that there are no special tools required to do the service as there are with other regs and you can easily buy parts unlike most other manufactures. The only reason most regs need special tools is they are manufactured in such a way that it requires special tools to be serviced to keep the diver from being able to do it himself and dependent on the LDS. The same also applies to not selling parts to the diver, only the shops. That being said even if the entire industry started making regs like HOG that a diver can service themselves there will always be a large part of the market who will never feel comfortable doing that so the LDS will never be gone completely but there will be a lot less of them in the coming decade.

 

[cardzard]

I have said this for years, 3 things will determine whether a dive shop survives in the future.


1. Realistic pricing - Pretending the internet does not exists is a sure way to fail.
I understand the MAP pricing policy, but as mentioned before there are shops that have embraced the internet and are doing very well.

Example: Sell a new diver a bc and they go home to find it 1/2 price online.
They feel you ripped them off. Acknowledge the internet and sell it for reasonable price compared to online and you gain a customer that will continue to give you a shot at their business in the future.

2. Training - This will never be sold over the internet and is where most shop will find future customers. GREAT not good Instructors is what will separate shops and keep divers returning for more instruction.

Example - We all see divers fresh from OW certification that make you wonder how they were certified and think they now know everything. Then we also see divers fresh from OW cert that have great trim, buoyancy and are eager to learn. Both have a card, I know the difference was their instructor not how much they paid or the agency standards.

3. Customer service - Whether it is gear service or just filling a tank, nothing beats great service. It also must be timely and competent service regardless of the price.
Also having a dive club/group component is a must and they must DIVE not just talk about diving or new gear. This will promote divers getting underwater and that is good for both divers and shops.

Example - You go to a shop and they act as if you are bother not a customer. They give you just serviced gear which later you have to return because of shoddy service and you are told it's your fault, that they did nothing wrong. I do understand that things sometimes are not the shops fault in the service department, but BAD customer service is 100% a shop's fault. The #1 rules in business is the customer is ALMOST always right even if they are wrong.

Shops that preform well at these 3 things will do well in the future and those that don't, will not last.

That's my 2cents on how a shop in the future works or maybe you already found a shop that understands already.

 

[boulderjohn]

First of all, the problem is not exclusive to dive shops. When a local bookstore went bankrupt and was in the process of closing down, it had a sign on its door that said, "Sorry! No Public Restroom. Try Amazon."

I think that in general, shops that are threatened by Internet sales have to ask themselves what they can offer that the Internet cannot. They need to find a way to emphasize that. Interestingly enough, I think there may not be one common formula. I know two LDSs in the same area that are surviving (not thriving) with two very different approaches. Both are barely surviving on gear sales. One really focuses on instruction. Although it does not make a huge profit on it, it does OK and has a large volume of classes. It does very poorly in dive trips, having a lot of trouble selling its sponsored trips and doing nothing beyond that. In contrast, the other shop does very poorly in instruction, not getting nearlyas many students. On the other hand, it does an outstanding job with travel, filling its many trips and setting up travel opportunities outside of those trips.

The ability ofgas fills to work independently depends heavily upon where you live. In our area, there is not nearly enough local demand right now to make such an enterprise even worth considering.

 

[Rich Keller]

Example - We all see divers fresh from OW certification that make you wonder how they were certified and think they now know everything. Then we also see divers fresh from OW cert that have great trim, buoyancy and are eager to learn. Both have a card, I know the difference was their instructor not how much they paid or the agency standards.

This is where I see the independent instructor being the biggest factor going forward because he is not selling gear. If the LDS dose not pass you through the OW course they can not sell you more gear. I would expect that the OW divers that you see with no idea are coming from shops who value a quick profit over the safety of the diver in the short term and the industry in the long term.