The Great local dive shop vs. online debate

[Rick Murchison]

Trying to explain the vagaries of owning and running a small business to someone who hasn't is akin to trying to explain passing a kidneystone, or getting popped in the face by a Portugese Man-o-War. You can flap your gums all day, but until one has the experience one won't truly understand.
Rick

 

[jbd]

like the LDS owner needs to raise the price to $200 from the $150. Of course the prospective customer would probably think the LDS was gouging them.

Dee, that was a good explanation of the financial realities of teaching.

These threads about the cost of learning to dive remind me of when I learned to fly. If I took the lessons in a 152 it was $55/hour. If I took the lessons in 172 it was $70/hour. I asked how many hours it would take. The answer was at least 40 hours but more probably it would be 50 to 60 hours. Maybe dive instruction should be priced the same way? I once saw a contract form for diving lessons. The price quoted was $55/hour for how ever many hours it took.

 

[MikeFerrara]

You folks still don't get it. If I sell on the net I get my dealorship pulled then I have nothing to sell at all unless of course I get it on the street. Anybody selling SP regs online is either not a dealer or is in violation of their dealer agreement. As for selling that reg for $250, thats about what it would cost me. It wouldn't be worth the time it takes to ring up the sale. Anybody selling a $600 (msrp) reg for $250 is not buying it from ScubaPro. Folks those prices are too good to be true and they are. As far as I can see its like buying a watch from inside a guys jacket on the street corner. Even vulume buying would not allow one to sell for that price. Why? because SP does not sell them that cheap. There is dirty sh## going on and we can't compete while playing buy the rules as they have been set forth.

 

[MikeFerrara]

For me to make money on an OW class including a descent per hour pay rate for me the instructor I would need to charge about $800/student. This cost is based on a class size of six. I did not figure in trvaling expenses. Since I own the shop, I work for free in the hopes that someday the shop has something in the bank. I can't hire an instructor for two reasons. One reason being that I don't know any who can dive and the other because even if they could I couldn't pay them. If I could get this price I wouldn't care where you baught your equipment. Nobody believs us though. Why do you think there are so many crappy instructors? It's because thats what you get fo less than minimum wage!

 

[raviepoo]

Here's a different scenario...

Nitrox class. Four students. Each pays $100. Deduct the (retail) value of the $25 Nitrox text book. Deduct the money that goes to PADI for the card ($15 I think. Please correct me if I am wrong.) No pool session. No open water dives as I am given a refferral for them. I supply my own photo for the C card. The shop is left with $60 per student, some of which goes to the instructor. Do they break even?

Another scenario.....

This time it's a class of half a dozen students. It requires 6 open water dives. I pay my money for the class, which covers two lecture sessions. I also pay my entry fee to the quarry and my fee for all boat dives. I pay to rent tanks. I have also bought several items from the shop (admittedly none has been big ticket YET but I will almost certainly buy tanks from them eventually) and paid them to service a reg that is not in warranty. Please tell me that this shop is making some money off of me.

Third scenario.....

I buy a dry suit seminar at shop A. Shop A assigns an instructor to do the pool seminar with me. Instructor does not contact me to set a date. I pester the shop periodically. 6 weeks later Instructor finally leaves me a message saying that he is not available for a pool seminar until mid-August. AAARGH! The entire summer is gone. The shop only rents dry suits to divers who are drysuit certified or have done a pool seminar with them. The shop has missed out on several hundred dollars of drysuit rentals from me because they assigned me to an instructor who does not have time to teach me. I have missed out on a good chunk of the brief Northeast diving season because I don't have appropriate exposure protection. Who is the loser in this scenario? Certainly my (non) training hasn't cost the shop any money. But they have lost an opportunity to make money off of renting (and maybe selling) me a very expensive piece of gear.

I guess I just don't understand the LDS business model.

Dee once bubbled...
...and although I can't address most of your questions, maybe I can shed some light on the classes and the way they were structured in our shop a couple of years ago.

 

[tchil01]

The LDS that I go to also explained another trend he faces beyond the on-line issue. When he started the shop back in 1991, most of the divers that they trained stayed around and dove locally. You always get people who get their C- Card and never dive again, but he estimated that back then maybe only 10% of his students got certified to go away and dive. Now probably only 10% of the students continue to dive locally. Obviously a cold-water wreck diver is going to be more gear intensive then someone who only dives in the Caribbean occasionally on vacation. He does put together a pretty good basic package that these traveling divers seem to like, but over the years drysuit, tank and other more technical gear sales have fallen off.

A group of us divers, in addition to the instructors and TA’s that work with him are looking for ways to encourage the students to dive locally.

Ty

 

[SeaGypsy]

Many in the dive industry say that they can’t do this or that because of manufacturer contracts. If this is the problem you should find a way to limit the manufacturer’s ability to dictate terms to you.

Why not work with other LDS owners to create a buyer’s group? At the very least the smaller shops would be able to get discounts normally available only to large, multiple store operations and Internet operations. Ideally you’d be able to put an end to the manufacturers interfering in your business by telling you what you can charge for an item. (Which looks like illegal price fixing.)

 

[DuckDive]

MikeFerrara once bubbled...
Anybody selling a $600 (msrp) reg for $250 is not buying it from ScubaPro. Folks those prices are too good to be true and they are. As far as I can see its like buying a watch from inside a guys jacket on the street corner. Even vulume buying would not allow one to sell for that price. Why? because SP does not sell them that cheap. There is dirty sh## going on and we can't compete while playing buy the rules as they have been set forth.

And that's why I ask: where does the stuff come from then?

I find it difficult to believe that all of Leisurepro's/DiveInn's/etc stock is stolen goods. That means that somewhere along the line the sales channel splits. Therefore, at some point, somebody sells to one bunch of people with one set of rules, and another bunch of people with another set of rules.

Whoever they are, those are the people who set this up. If anyone's causing the LDS to go out of business, it's them. IMHO, the power to even things out lies squarely with the brandname owner.

Mark.

 

[MikeFerrara]

tchil01,
You are correct if a diver sticks around, continues their education and dives enough to need things now and again they are worth much more to the shop. The vast majority, however only dive the Caribbean. Some get certified for one trip only. They spend their money at the resort. Since a lousy diver can see the reef they don't see the need to become a good diver. All they want is a card that gets them on the boat. Our insentives for divers to dive have gotten better and we work harder at it but it is still less successful than it used to be. The dovers who get certified then dissapear represent a cost. We don't need them at all except we must wade through them to find/make real divers. If they stick around it is an investment. The cost of instruction will go up. My own teaching will become more exclusive. Anymore, if I'm not going to make money I could be out doing my own dives. If I am going to teach I either need to make a worthwhile wage or at least get the satisfaction of turning out great divers. The great divers are rare and the money is non existant. Our prices will go way way up. The ones who want plastic to get them on a boat can go to the minimum wage instructor down the street who is badly in need of coaching on his own diving. I will teach the ones with the money and the desire. Anything else is a wast of my time.

 

[raviepoo]

I originally intended to be a warm water diver. My OW instructor fostered this attitude by making disparaging remarks about cold water diving, and calling tech divers "crazy." She even said "You don't want to dive deep. There's nothing to see below 60 feet."

The thing that got me interested in other forms of diving was reading Bernie Choudury's "The Last Dive." The book convinced me that I was missing out by not taking advantage of opportunities to dive locally.

Now every time I turn around I need a new safety sausage or reel or lift bag. I don't mind spending money. I just don't want to WASTE money. I don't want to buy a pice of gear because it is what the dive shop happens to sell. I want to be sure that I am getting the right gear. I find this all very confusing. I don't want to buy a Zeagle Ranger now and then have to ditch it for a backplate and wings next season.

I find this all very confusing.

tchil01 once bubbled...
You always get people who get their C- Card and never dive again, but he estimated that back then maybe only 10% of his students got certified to go away and dive. Now probably only 10% of the students continue to dive locally.
Ty