With all the talk surrounding marina chains and consolidation, MDA decided to ask a panel of the industry's leading marina chain executives to share their views on the current state of chains in the industry, the opportunities and obstacles that exist and what the future will bring.

BRUCE BLOMGREN,
BRANDY MARINE
Chains are more of an ownership position than a consumer advantage. There has been considerable flurry to "consolidate" marinas. Most consolidators are Wall Street-backed with high return expectations. They have tried to view marinas as a shape that will fit into a certain cookie cutter. This is not the case. Marinas are truly located on some of the highest valued land, waterfront, with returns that are 3 to 5 percent below typical investors' expectations.

Thus those who have consolidated properties have tried to accomplish cost saving by combining like activities. But marinas on the whole are unique to their location and market segment. Most have varying profit center descriptions.

So consolidating activities is also difficult. Boaters may be offered a little better insurance plan or some discount on transient travel to another "chain" property, but to our experience, those boaters are not "brand" loyal; rather, they want certain services in an area and will be price-conscious to find them.

Those marinas in chains typically have a higher sophistication in equipment and computers, etc. But they also can lack in local relationships. Marinas are typically a "second home" location, and relationships principally drive the decision if there is more than one option for a consumer. Chains, if able to claim an entire market, will then be a force-fed element to the consumer as they then can control service expectations, price and elasticity in the market.

The [industry] elements that favor chains are the dealership, parts and service of vessels. My prediction is that it will be the boat dealer chain that will join with the marina management type to make the biggest statement in chain impact in the industry in the coming decade.