The changing Scuba Industry

[CuzzA]

So, if you spend enough money at your LDS, the owner will not run off with one of his students, die, retire, lose the shop to hiway expansion, or get sick; all resulting in another cclosed LDS?

Of course any of those things could happen to any business. That wasn't my point. My point is more specific in that if everyone has the attitude that I will buy my gear online and only use the shop for fills I doubt that will sustain the business and consequently lead to them closing. How does a shop curb that growing trend? I contend that they have the policy that we're going to offer the best prices on gear and even if we miss the mark on some things we'll guarantee to fix it when you come in. So it behooves one to do business with us, because not only are you getting the same great deal you would get anywhere else, you are helping to insure that we'll make enough money to stay open for the fills and service on that gear. It's a safety net for the sales funnel.

For the other things that happen in life I would hope, like a good business person should, they have contingencies and plans for the things that happen in life. I.e. key man insurance, business buy/sell agreements, etc. Highway expansion? Not very common. Run away with a student? Again, not very common. Why run away? He/she probably likes you because you own a scuba shop and they get free fills.

 

[bmbeaty]

Its really hard for me to comprehend how someone would feel ripped off based on the price someone else paid for an item. If I want to buy something, I do some research, figure out what it's worth, and then go about figuring out how to get it for the best price with the most value. I.e., I'm ok with paying a little more for better service on the backend of the deal- but there is a limit to that.

If I pay x for a product, and someone else does the extra work involved (negotiating, price matching, coupon cutting, etc) and they pay .8x, how is that ripping people off? They put in extra work and got a better deal. If I'm upset at anyone, I'd be upset at myself for not properly educating myself on how to get the best deal. Something no one has mentioned about a shop that offers price matching is that they very likely consider their prices to be very reasonable prices, and that they need to sell x number of said product for cost + y to keep the shop running. However, which is better- sell a product for cost + 1/10y or not make a sale at all? I'll take the 1/10y, and rely upon people who would rather pay a higher price for the convenience of not dickering down the price/hunting down better prices/etc to keep my doors open.

 

[BRT]

But just as you can't judge the cost of car ownership just by the cost of gas for the miles you drive, for a dive shop compressor bank, you've got to factor in cost of equipment, electricity to run it, parts and labor for maintenance and servicing, somebody's got to run it, monitor, etc..., hopefully somebody occasionally tests the air quality.

I've never run a compressor; perhaps some of you working in dive shops would care to comment on how lucrative (or not) it is?

Richard.

I wasn't speaking to the overall cost of running the compressor although stand alone air shops with high electricity costs and low fill prices do speak to that. I was responding to someone who thought that the cost of electricity was higher than the cost of a fill.

 

[BRT]

You missed capital equipment, ongoing maintenance, filtration, and testing costs. A compressor (K-15, 5407) for commercial scuba duty will set you back $18,000. Banks are another $4,000. Electricians and plumbers/tubing maybe another $4-5,000. Remember, this isn't in your house, but a dive shop where the city may have some say as to who does what. A busy shop fills 100 cylinders a day 100 days a year. Someone like rainbow reef fills 200 a day 300 days a year. They have multiple compressors. Each compressor takes 2 filters minimum every 50 operating hours at about $38 bucks each. Testing is $100 per system every quarter. Then you gotta pay a guy to fill tanks. Electricity is a drop in a bucket.

I was responding to someone who thought the electricity cost might be greater than the fill price.

 

[buckled plates]

The demographics are inescapable, 80 million baby boomers aging and leaving active sports. In 1975 there were 800,000 private pilots in the US, today there's half that many. Similar issues, cost, time, culture, and opportunity affecting new entrants. 1% of the population has an interest in diving, and only a fraction of them dive regularly. 35-45 year olds make up the largest cohort and that population pool, though much smaller than the baby-boomers, is only now coming of age.

 

[Schwob]

A small shop isn't Costco. They don't order stock by pallets. They don't have 10,000 people a day buying hot dogs and sodas.

Their cost of goods and cost of operating expenses compared to sales is much higher than Costco, so they need to sell the exact same stuff at a higher price to stay in business.

If they try to run their business pricing stuff at the Costco discount off list price they will be go bankrupt.

For some reason I thought big warehouse clubs like Costco don't stock or own inventory. I thought they rent floor and shelf space to those who sell the stuff (be it the producer or someone else). But I just heard or read that somewhere, don't really know. Thought that's why stuff sometimes is sold off at interesting prices (costs more to keep paying the rent or to take it back). And maybe why once you find something you like... it disappears...

 

[Schwob]

Some thoughts:

So, who has that relationship with their tire dealer or their car dealer or their grocery store where they feel like family and trust the place?

Who (especially if not that comfortable about it) wants to learn diving (maybe initially entrust their live to) from someone they know is a non-trustwoorthy, somewhat dishonest fact skewing or hiding sales person focused on making sales?

Who woukd want to go on a boat ride with a captain or owner operator, 20 miles out in the open ocean if they had reason to think he is an unscrupulous pirate?

None of you are that of course (we'll I hope), but I am wondering, how did we arrive at comparing an LDS with these businesses with that sort of teputation?

Well I guess the need to upset to be able to survive and all that stuff does not help.
Let's face it (and you all know, nothing new here) it is a tricky business to "be the friend of your clients" in any business. Who doesn't know someone who used to be a friend, but drove being an amway seller or some such a thing a bit too far...

That's it, just thinking that I prefer an honest shop and true good friends over, lets say "pretentious friends with a sales agenda..."

 

[diver0008]

So, who has that relationship with their tire dealer or their car dealer or their grocery store where they feel like family and trust the place?

I do.

I trust the garage that I have been going to for over 20 years. My father went there and dealt with the father of the man who runs the shop now, with whom I am a friend. I go to their Christmas parties, drop in with coffees once in a while, exchange emails, and shoot the sh&t for hours when I stop in for service. He's a good guy, I trust him and his mechanics, and he gives me discounts and freebies all the time.

I try to send business his way at every opportunity.

The same goes for the business services company that I use, and one of my main suppliers, among others, family businesses too, I must mention.

As a small-business owner, I have similar relationships with many of my customers. They trust me after years of reliable and friendly service, I am invited to many of their social functions, and we engage in interactions beyond the professional.

Of course this is natural when you have repeated and continued contact with people with whom you share something in common or are of sympathetic character, and when it exists within a respectful and mutually beneficial business environment, it is more than ideal; win-win.

Building relationships is a key component, dare I say strategy, in sales and management. Most people like friendly attention, and some people are great at it naturally and sincerely.

A dive shop that does this has nothing to lose.

 

[redacted]

I have not seen an LDS yet that I would want to send a friend to.

 

[The Chairman]

Someone like rainbow reef fills 200 a day 300 days a year. They have multiple compressors.

Dude, you have no idea. They have almost finished updating their compressor farm.Damned impressive. They could supply all of Monroe County if needed. They are going way beyond the former air express. Wow. Truly impressive.