Future of DiveShops?

[cerich]

I believe the term for that is "Loss Leader".

There are more reasons to have something in a store than simply the profit to be made from that individual sale.

Yes the dive industry offers everything that CAN'T be bought online as a loss leader and tries to make it up with the ONE area they HAVE the most price pressure on.... It's an amazingly bright business model of doom.

Most LDS's that are working the model we generally have are completely screwed. Some awesome service, geographic/demographic well placed will soldier on but in most areas it will be Internet retailers or regionals/mega stores that likely also carry other stuff than just dive.

 

[Eric Sedletzky]

As has been said we (scuba diving) started from a cottage industry and in my opinion thats where we stand, theres nothing wrong with it, we just need to understand it and cut our cloth from there, as an industry we are just not big enough globally to sustain the present equilibrium.

I've been saying this for years. The industry is just too small no matter how good a dive shop is, not enough people are walking in and buying stuff period. How do we/they get more people into scuba? we/they don't. Everybody on earth knows what scuba is, this isn't 1949. If they wanted to get into scuba they would have, they don't want to and have no interest in it, simple as that. Yes it's a cottage industry, always has been always will be.
They tried to artificially inflate the popularity of diving in the 80's and 90's, remember?
How did that work out besides the mountains of used gear dropped on ebay and craigslist, or sitting in a storage unit somewhere collecting dust.

 

[CptTightPants21]

Tell me MrCultureJammer what would the ideal LDS look like to you? What would they have to do to earn your business if relationships don't carry a lot of weight? I'm honestly asking as a LDS owner in SW Tennessee.

This is something I have actually thought about.
1. Fair Prices--beating, matching, or within ~5% on all online prices
2. A pool onsite is a plus. If you don't have a pool onsite, it had better be 15+ depth to make up for it
3. Large Inventory that can be demoed at anytime free of charge. This is what is weighing down my LSD, my guy never has anything in stock and loses a ton of business because even the regulars have stopped asking for things and just get it online. A dive shop that had lot of different regulators, tanks, masks and fins to test out would get a serious chunk of my business.
4. Fun and knowledgeable staff. BP/W, sidemount, great product expertise
5. More of a social scene, movies, drinking nights, etc
6. Excellent training- I know of a shop that is hugely successful, but what I have seen of their training is a joke.
7. A shop that does not nickel and dime people. I see this with a lot of PADI shops although there are plenty of others. Have an all inclusive price, don't charge X, Y, Z, and then tack on G...open water students should not need to pay for rental gear for certification dives or pay you $25 dollars for a referral to a tropical location. I also don't like air fill prices that are different for every type of tank and air fill. Either charge flat pricing for air fills or spit it up with greater than or less than 100cuft. This bull**** where a 108 costs for than a 100 bc it has 8 cuft more is a real turn off.
8. Be able to do 100%, if you can't do trimix, you had better at least be able to do 100% O2.
9. Return phonecalls. When a person needs to call twice and then actually go into the store to get a quote on a $3200 drysuit---GTFO
On a more personal note:
1. If I ran a shop, all of my instructors would be tech certified (cave or deco/nitrox). I want people who are not only super knowledgeable with real world diving, but who have a proven track record of performing skillfully at depth.
2. I would offer discount programs and good rental prices--rent anything and half of that rental fee can go towards store credit to buy that item up to 50% of total. So Tank rental would be $10. If a steel tank was $300 a person could rent a tank 32 times and $150 would be applied to the purchase. I think that rental fees are a big reason that a lot of new divers don't do more dives. Spending money on gas and admission on top of what could be 100+ rental fee bill per person kills them. Charging lower prices and getting them to feel like each rental is at least going towards ownership will get them to dive more. I could see myself offering newly certified divers the chance to do some shore dives or boat trips for super cheap ("Hey, come join us for a shore dive, full rental gear $40 bucks)

I think a lot of it comes down to price and inventory--like a DiveRightinScuba or LP. If a shop has just about everything I want in inventory @ a good price I would not need to order online.

 

[redacted]

I've been saying this for years. The industry is just too small no matter how good a dive shop is, not enough people are walking in and buying stuff period. How do we/they get more people into scuba? we/they don't. Everybody on earth knows what scuba is, this isn't 1949. If they wanted to get into scuba they would have, they don't want to and have no interest in it, simple as that. Yes it's a cottage industry, always has been always will be.
They tried to artificially inflate the popularity of diving in the 80's and 90's, remember?
How did that work out besides the mountains of used gear dropped on ebay and craigslist, or sitting in a storage unit somewhere collecting dust.

How many customers "walk in" to DRIS, Leisurepro and Scubatoys every day?

 

[RJP]

Everybody on earth knows what scuba is, this isn't 1949. If they wanted to get into scuba they would have, they don't want to and have no interest in it, simple as that.

Right. That's exactly why you don't see Coke or Nike or Apple ads anymore. Since everyone knows what those things are... no need to continue marketing those things.

Wait, what!?!

---------- Post added November 15th, 2014 at 11:58 PM ----------

This is something I have actually thought about.
1. Fair Prices--beating, matching, or within ~5% on all online prices
2. A pool onsite is a plus. If you don't have a pool onsite, it had better be 15+ depth to make up for it
3. Large Inventory that can be demoed at anytime free of charge. This is what is weighing down my LSD, my guy never has anything in stock and loses a ton of business because even the regulars have stopped asking for things and just get it online. A dive shop that had lot of different regulators, tanks, masks and fins to test out would get a serious chunk of my business.
4. Fun and knowledgeable staff. BP/W, sidemount, great product expertise
5. More of a social scene, movies, drinking nights, etc
6. Excellent training- I know of a shop that is hugely successful, but what I have seen of their training is a joke.
7. A shop that does not nickel and dime people. I see this with a lot of PADI shops although there are plenty of others. Have an all inclusive price, don't charge X, Y, Z, and then tack on G...open water students should not need to pay for rental gear for certification dives or pay you $25 dollars for a referral to a tropical location. I also don't like air fill prices that are different for every type of tank and air fill. Either charge flat pricing for air fills or spit it up with greater than or less than 100cuft. This bull**** where a 108 costs for than a 100 bc it has 8 cuft more is a real turn off.
8. Be able to do 100%, if you can't do trimix, you had better at least be able to do 100% O2.
9. Return phonecalls. When a person needs to call twice and then actually go into the store to get a quote on a $3200 drysuit---GTFO
On a more personal note:
1. If I ran a shop, all of my instructors would be tech certified (cave or deco/nitrox). I want people who are not only super knowledgeable with real world diving, but who have a proven track record of performing skillfully at depth.
2. I would offer discount programs and good rental prices--rent anything and half of that rental fee can go towards store credit to buy that item up to 50% of total. So Tank rental would be $10. If a steel tank was $300 a person could rent a tank 32 times and $150 would be applied to the purchase. I think that rental fees are a big reason that a lot of new divers don't do more dives. Spending money on gas and admission on top of what could be 100+ rental fee bill per person kills them. Charging lower prices and getting them to feel like each rental is at least going towards ownership will get them to dive more. I could see myself offering newly certified divers the chance to do some shore dives or boat trips for super cheap ("Hey, come join us for a shore dive, full rental gear $40 bucks)

I think a lot of it comes down to price and inventory--like a DiveRightinScuba or LP. If a shop has just about everything I want in inventory @ a good price I would not need to order online.

It's funny... you never hear anyone say "If I had a dive shop I would run it like a real business."

At a minimum I'd like to see people who are customers of dive shops at least say something like "If I had a dive shop... I would recognize that the tenets of micro and macro economics would actually apply to my dive shop just the same as if I were running a pharmacy or a car dealership or a grocery store."

 

[drrich2]

Awap:

Here's the funny thing; in an online virtual world, a lot. It's much easier for me to shop major online vendors, and hear from objective 3rd party users (customer reviews) there, than it is to drop into the LDS which I drive back & forth past on the way to work, and happen to like! It's easier to shop across the country than down the road.

Richard.

 

[mjrob]

I'm scratching my head over 2000% markups and how anyone could possibly make a profit on $5 air fills. They can't, it's as simple as that. If you have a real store, a real compressor and fill panel (and another compressor as a backup--they do break and require maintenance) I don't think I could build a model showing a profit at $10 a fill. No, I know I can't. However, we pile up all the filthy money we make on $1 o-rings every night and roll around in it. Debauchery 'R Us, and all that.

This thing can be done and it can be successful--and have customers and a staff that enjoy being in the store. Obviously, it's not for everyone and if price is your only concern--not that there's anything wrong with that if that's all that matters to you--brick and mortar or, in our case, tilt-up concrete stores might not be your cup of meat. So be it.

There's a lot more than just air fills and o-rings (and lights and b/c's and bp/w's and thermal protection and business licenses and power bills and trip sales and fish ID books and classes and classrooms and first stages and, well, you probably get my drift) involved in a successful dive shop. In fact, it's almost like real work. Almost. It's still a lot more fun than a heck of a lot of things people do.

Oh, we also create jobs (like a real business), pay lots of taxes to keep those potholes filled, donate our time and money to various charities, events and organizations kind of like all good businesses do...after we finish rolling around in all that o-ring profit, that is.

 

[Bob DBF]

Right. That's exactly why you don't see Coke or Nike or Apple ads anymore. Since everyone knows what those things are... no need to continue marketing those things.

I guess there is competition in those industries, not much of that going around in the local dive shops.

It's funny... you never hear anyone say "If I had a dive shop I would run it like a real business."

Most folks can't run a business to begin with, add to that the need to further their hobby goals dosen't help with clarity of purpose.

At a minimum I'd like to see people who are customers of dive shops at least say something like "If I had a dive shop... I would recognize that the tenets of micro and macro economics would actually apply to my dive shop just the same as if I were running a pharmacy or a car dealership or a grocery store."

Having managed a retail sales / service operation, I don't know whether I am more astounded by the way the dive shops in my area operate or by what the local / Scubaboard consumers expect of them.

In one case at my LDS, I was trying to order a 19 cuft pony bottle, no valve. Their deal was $200 up front, and two to three weeks delivery. I ordered it online for $100 total and it was in my hands in less than a week. I would have given them the business for $120 or so delivered in a week. When I was managing, a special order was done using the second model, on a regular basis. Payment up front was never a big deal, it was all about taking care of the issue, everyone got what they needed. If I couldn't meet their needs, I directed them to someone I felt could help them.
It seems here folks want it in the LDS for less than the online price.




Bob
----------------------------
I may be old, but I'm not dead yet.

 

[Eric Sedletzky]

Right. That's exactly why you don't see Coke or Nike or Apple ads anymore. Since everyone knows what those things are... no need to continue marketing those things.

Wait, what!?!

I see your point but it's not really the same.
Way more people drink sodas, use Apple products, and wear sneakers than dive.
Besides, diving is an activity not a specific product.
To make a fair comparison you would need to put up a Scubapro add on one of those bill boards. Then people driving buy would go Huh???

---------- Post added November 16th, 2014 at 12:38 AM ----------

How many customers "walk in" to DRIS, Leisurepro and Scubatoys every day?

I don't know, maybe, probably, sort of not enough to keep their doors open without selling stuff on the net? But who really knows? We'd have to flip through their books to really see. I just wonder how many are robbing Peter to pay Paul?
What ever happened to Scuba Toys BTW?
I thought they were the little darling for a while. How long is the current online shop going to be the little darling before someone else comes along?
How many are there now? how do they all survive selling stuff cheap with free shipping and a free key chain or mask defog, or whatever the little freebie is that day.
I can see how it worked when there was a few, but now there are too many. I thought they needed to swallow up all the volume to be able to make it. Hmmm, I wonder what plan "B" is?

 

[drrich2]

I see your point but it's not really the same.
Way more people drink sodas, use Apple products, and wear sneakers than dive.
Besides, diving is an activity not a specific product.

Speaking of which, people who buy a smart phone, sneakers, soda or a computer will be back at regular intervals to buy more.

Most scuba divers can do fine for a very long time with 1 BCD, 1 reg., 1 mask, 1 set of boots & fins. Maybe a tank or 2? Dive computers probably tend to get replaced on average after a few to several years.

That leaves the LDS market for the established diver down to gear servicing, gas fills and maybe group trips (which divers soon learn they don't need the LDS for...). And additional training, but nitrox courses are pretty cheap, so after AOW & maybe Rescue, you're largely back to square one with a lot of divers (unless you convince a lot of divers to pursue Master Scuba Diver or Dive Master ratings, or you teach tec. courses).

Assuming the typical dive shop caters mainly to recreational divers, what is the major ongoing income stream from the established customer base? How do you LDS make most of your money off them?

Richard.