Ontario Dive Industry

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Chet once bubbled...
Do you not think the diving market is changing in Ontario. It seems the only dive stores that are surviving in Ontario have another business associated with it or are the only game in town?:confused:
I haven't been around it that long to judge. However, our region, if you include Kitchenr, Waterloo, Cambridge, Guelph and the surrounding smaller communities, are about 500,000 people. In Kitchener we have 3 LDS, all seem to be doing OK. All are full time shops. One has a spouse with other employment, I believe the other two are couple both working there full time. If I had to guess, I'd say the one I trained at and frequent most is the busiest. Prices are similar, but again the one I deal with most is probably the highest priced over all, but that may reflect the brands and type of gear carried also. They're also willing to spend the most amount of time on a customer or potential customer and will continue to get the majority of my $$$.
 
In reading these posts, I have to agree that unfortunately, some LDS management can sometimes be arrogant. In this changing market though, that attitude, thankfully, is the exception, not the rule.

Some owners, and yes, some Instructors too, tend to forget from time to time that this is a service industry ... which means the customer comes first. And without customers, who're ya gonna teach to start off with?

As an MI, I can guarantee you that industry wide, Dive Leader candidates are taught to treat their students the way they themselves would like to be treated, positions reversed.

Remember the first time an Instructor asked you to take your reg. out of your mouth, and then to remove your mask in shivering 40 degree Toby water while wearing (gasp!) a wetsuit?

Why'd you do it?

Because you trusted the Instructor.

That trust has to be returned into our other business dealings with customers.

If the Leaders you deal with have perhaps misplaced those values, rather than considering giving up diving, look around ... there are plenty more of us out here who'll treat you like family.

Happy Diving.

Tim
 
Most people don't really know just how much overhead is involved in running a store, I have 2 friends who own a store and it's staggering just what they pay in different insurances let alone other expenses. No support from manufacturers or certification agencies, if you are spending lots of money they listen if not to bad somebody else will.
 
Very interesting.........!!

I've been directly involved in the scuba industry in the Toronto area for over 30 years. When I started there were about 20 stores in the GTA. Today there are perhaps 10 or 12 despite a prodigious increase in the population. Many of the stores from the past closed for good. Some re-opened under a new name but the overall number of stores serving a much larger population base has not changed much.
Just for fun, how many of you have been diving long enough to remember these names: Underwater World in Scarborough (my first retail involvement); Penguin Diving services in Scarborough (the first store I started); Canada Scuba School in Scarborough; Argosy Sports in Scarboough; Supreme Divers in TO and in Scarborough; Collegiate Sports Scuba in Scarborough; W.C. Diving Adventures in Scarborough; Aquapro in Scarborough and there are 2 others that used to be in Scarborough that I cannot recall the names of. That's at least 8 stores in the Scarborough area alone. Today there are none!

I don't know the 'big picture' reason for the illogical decrease in stores as the population grows but I do know the many personal reasons why a store owner gets out. Often it's simply poor business management. Sometimes it's deliberate competition. Often it's lack of customer support but that can usually be traced to poor business management or poor service. Occasionally it's personal problems.
Many stores are opened by very enthusiastic divers who want to get cheap gear or go on dive trips and think the best way is to be a store owner. They are obviously not serious about running a good, long term business and likely don't have any business savvy and should close.
Many owners blame the customer for not supporting them. Buying at Costco is a good example. A dozen store owners called me to see what I could do about the sale of scuba gear at Costco (the answer is nothing!). Generally I believe that a customer will support a business where he gets the best service and treatment. The LDS that has had a contract with Costco (there's only one store involved) has spent a lot of time and money to sell a bit of scuba gear at a very low profit (not a good way to stay in business) and and done nothing to improve their image as a professional scuba store either. That arrangement has not cost Scuba 2000 any lost business. In fact, we picked up a few customers like the one who purchased a reg system in 4 boxes at Costco and came to us to get them assembled because the kid at the Costco booth didn't now anything.
We are not the store of choice in Ontario(see the 'Dive Store Poll' in this forum) because we are the cheapest. Our prices are competitive but our overall service cannot be matched by any store. Hours of operation, location, parking, in-store pool, active web site www.scuba2000.com , weekly newletter, knowledgeable staff, experienced instructors, preferred equipment lines, available stock, quick guaranteed service, quality and quantity of scuba courses at all levels, dive trip organization, dive travel and a lot more are all part of 'service' and that's what keeps us busy year round. You'd be amazed to know how many divers come to S2K from Mississauga and far beyond. Some travel past 5 or more other dive shops to come to S2K and again, it's not because our prices are the lowest. We just have a lot more to offer and we try to make each customer feel at home, welcome and well-served.

How many times have you ordered something at a dive store, sometimes even paying for it in advance and then waited months for it to come in? I wouldn't support that store either!
How many times have you bought something that didn't worked as you hoped on the first dive and then the dive store balked at replacing it or even repairing it?
I'm a very demanding consumer (almost obnoxious) but I and the staff at S2K treat every customer the way I'd want to be treated. We're the only store that returns course or equipment deposits if you decide to not complete the course or sale. That's what I want and that's want I give!

As far as prices are concerned, as with most specialty retail businesses (bike shops, clothing, ski shops, stereo/TV, etc), the accepted retail price as required to return sufficient to operate the business is double the wholesale price. Realize that if the owner pays $180 for a 80cf Aluminum tank (that's about right!), he should sell it for $350. From the $170 gross profit he has to pay the shipping on the item, his rent, his salaries, utilities, taxes, insurance and a proportionate share of every other expense in the store. If you think he's putting $170 in his pocket, do not open a scuba store! You'll fail for sure. BTW, in this example scuba tanks sell for about $200 in the GTA. The $20 barely covers the shipping. And some divers want a deal on tanks! Why should I take money from my kids college fund to buy you a scuba tank?
Fortunately it's possible to get a proper return on most items and that return also covers the losses on the tanks.

So what's my point?
Contrary to Chet, a properly run scuba-only business can survive and the diver wins because he's being served by scuba professionals not by the kid who also sharpens skates.
Contrary to Ninja, there's no saturation. There are less stores now serving more divers. In a couple of areas like St. Catherines and Ottawa that's not true but generally it is. The good news is that most of those remaining stores are run better that the ones that are gone (seems logical!).

What can the divers do to help?
The dive store business is not easy and the owners who try extra hard to serve your needs deserve your support. If a dive store does not serve you well, don't hang around because the owner's a nice guy or the store is handy. Go find a better store and use it. Either that or don't complain! It always strikes me as silly when a diver comes to me and says he's been using the same store for 2 or 3 years and they never have stock or never get his gear fixed on time or never take time to explain things to him. I don't think that's a store problem - that's a customer problem. Get out and the store will close! Go to a good store and help him stay open. Give him your business and tell your buddies to do the same; be demanding but fair; a good store owner will repay you by always being there when you need him with product, fair prices, service, advice or whatever you need. What more do you want?
 
In response to that statement made by seahunter. Well lets see where do I begin? I do agree with you to a certain extent. In the GTA area I believe your store is the only full time scuba store? The rest are what I call weekend warriors or they have another source of income ie other job, or sell other products or another service associated with it. The last real dive store, like yourself was the store on Eglinton W. I do not argue that your last store was one of the better stores I have seen, I assume the new one is too, but apart from yourself the rest in my opinion are trying, but they will have to or have other sources of revenue outside the recreational scuba business to stay with the ecomomy. There maybe more people in GTA, but diving has been on a decline for the last few years in this area, you may not think so, but it has. Perfect example are the amount of people on dive charters in ON. US customers in all areas out number ON people. Toby is dead compared to 5 yrs ago, St. Lawrence and Kingston have had a increase in business, but this is do to the US not ON. In the GTA with the increase in pop, there has not been a increase in diving. On average, stores in Montreal and the rest of the country are doing better then ones in GTA, there are some exceptions to the rule.
Maybe what I am saying is there is one big fish and a lot of guppies in the GTA. But like it or not in TO the market is changing.
Chet
 
I have a question directed to you ...up to this point Ihaven't seen your comments on Genesis's thread / petition...As a Scuba retailer in Canada ..do you face the same restrictions they apparantly face in the US ?. Other than the usual problems in working with suppliers, are there any specific problems you encounter?
 
You've not yet seen Scuba 2000 Chet! And you call yourself a diver!! Seriously, do come for a visit whether you need something or not. Jump in the pool, check out the displays, say hi to me for sure. That's all free! But please do support your LDS and you can maybe help them by taking some ideas from S2K back. I welcome good ideas too.
BTW, we make it easy. We're open 7 days a week, all year from 11 am to 9pm.

If the comments about distributer control in the US are true (they could be a fabrication to shift blame for pricing to the manufacturer), then we do NOT have such rules here and I don't favor them. The retailer is the one who bought the gear for resale and he's the one with his neck sticking away out. He should have control over what he does with it.
The distributers (including Genisis among others) do have a MSRP (Manufacturers Suggested Retail Price) but the retailer is not bound to it. There is a new concept called MAP (Minimum Advertised Price) which is the lowest price a retailer is supposed to use in advertising to the public (on the internet or print ads) but even that is legally unenforceable. However the distributers can encourage a retailer to honor some pricing guidelines by using other methods. Those who consistently discount heavily (usually at the end of the month when the store rent is due) may find they get a lot of backorders or that the shipment is delayed or their order is being held in priority sequence (we all know what that means). If you've ever ordered something that is supposed to be a stock item but it takes forever to get it in, you may have been dealing with one of those retailers. This is just one example of how discounting is NOT beneficial to the diver. Closed stores, stores that have to split their staff between selling hockey sticks or bathing suits and scuba gear, stores that are open 3 days a week from noon to 6 so the owner can have a second job, stores that have low prices but no stock, no service, no loaner gear, no refund policy, no buy-back policy are all other examples.
The bottom line is that the retailer (if he's a businessman) knows what's required to stay in business, give great service and grow. If he ignores that or doesn't know, he hurts me, you, the gear manufacturer and the sport.
Please note I did not say the retailer has to gouge his customers! We do not discount. But we do have competitive prices, unbeatable package pricing, numerous policies to save you money plus lots of stock, great service from the distributers and lots of great policies to protect you and your enjoyment of the sport. It must be reasonably good judging from the multitude of divers that travel great distances past many other stores to fraternize S2K.

Just to wrap up and to create more replies, few things are more irritating and less beneficial to the diver or retailer than you walking into the store and saying that you can find an item for a lot less somewhere else! Firstly I probably know that; secondly it doesn't affect our pricing policies (that is, I don't use another store's pricing policy to determine what I need to get to survive); thirdly it indicates you are looking at price only and don't care about stock, quality, guarantees, service (If that were my policy we wouldn't sell Scubapro); fourthly it indicates you don't know (nor care) about discounts that are related to your buying patterns ( I can't tell you how many divers come in for a regulator and don't like our price but are amazed to find they can get the reg AND a $700 BC in a package for $100 more than the reg alone or save 5% for cash); fifthly it indicates you are a money shopper only and don't care whether the LDS lives or dies (be aware that Costco will NEVER offer air fills or organize dive trips); sixthly (is that a word?) you're probably a pain in the butt to deal with and we love that (it's a challenge to us and you're the winner when we're successful) but it is harder for us to be enthusiastic; seventhly (?) I don't need to be reminded that some stores just aren't businesses and make my job of serving you harder than it should be.

There, now I can go and have my 6th coffee and start replying to emails and phone messages which are generally divers hoping I can solve their problems - not complaining, it's my job and very gratifying but it's not always easy nor a joy contrary to the public perception of a dive store owner's lot in life. I do NOT spend most of my time on a reef with a semi-naked student (in fact, I can't remember the last time -Oh yes, it was Ginnie Springs in May '01).
Please don't send this to my wife!!
 
Your right seahunter, but if you lowball everyone your customers will be paying 10.00 for air and 100.00 for charters next time they go to Toby, Brockville etc cause they can't make ends met.

JB
 
You've actually touched on an ironic situation in the dive industry Jimmy.
Generally when a dive store or charter operation can't make ends meet they simply close. That was my point - support your LDS or lose it!
However, your comment is interesting. When a business is not producing the income it needs to survive, it most commonly has a sale. It needs more income so what does it do? - drops the prices!
Their theory is that they'll get more sales and hence more money. In fact (and any knowledgeable businessman knows this), they do not get a large increase in sales and they definately do not get more money. A 25% drop in retail prices requires a 100% increase in sales just to get the same amount of profit you would get before the drop in price! Unfortunately, even assuming the discount produces a 100% increase in sales, your cost of sales also doubles so you don't even make as much as before.

The real answer to increase net profit is to increase income AND lower costs at the same time. That is best done by an increase in retail prices. You may have slightly less sales but the return on each is higher and your cost of sales is less. But most dive store owners are not businessmen and when times are tight, they panic and drop prices. The slide to closing the store begins at that point.

Scuba diving today is cheaper than it's ever been in the last 25 years (relative to income of course). I can give you dozens of examples to demonstrate that if you like. I know you were trying to be facitious about the cost of air but if you think about it, $10 for an air fill is very reasonable and it's impossible to find an all-day dive charter boat trip for less than $100 anywhere else in the world (that's $100 US!). A $10 airfill means your tank of air for one complete dive cost less than 2 beers(even draft). Perhaps store owners should post the cost of a compressor in the store - $25,000 initially plus a lot of electricity every month plus filters and oil at about $100 a month plus maintenance. Before you question the cost of an air fill be fully aware that even at $10 a fill you're not coming anywhere near covering the cost! It's so silly that we stopped charging for air at Scuba 2000 two years ago. I'd rather give it away in the hopes of attracting customers than argue with divers about the 'high' cost of fills.
 
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