Boating industry stays afloat
Local businesses deal with uncertainty

by Christopher Key

 

“The two happiest days of my life were the day I bought the boat and the day I sold the boat.”

This is a commonly heard refrain here in the boating capital of the world. It illustrates perfectly the contrary condition of boat ownership. Those who don’t currently own some sort of watercraft generally describe themselves as being between boats. The lure of our spectacular maritime environment seems to be nearly universal in its appeal and that seems to be strong enough to offset the seasick economy.

“It’s a business of peaks and valleys,” said Jon Lindhout of Boondocks Boats and Motors. “Our challenge is to flatten that out as much as possible.”

The company started as a boatyard some 15 years ago. It was called Marine Services Northwest and, over the years, evolved into a full-service boat dealership. The name was changed several years ago to distinguish it from the dozens of businesses with the word marine in their names. They sell SeaSport Boats, Mercury, Volvo Penta and Yamaha engines, and offer full haul-out, repair and rigging services. Boondocks employs 25 people at the height of boating season.

“It’s a small company and we’ve been able to retain some of our employees for ten years or more,” Lindhout said. “We’re very proud of that. I try to bring in people who have integrity, who are willing to learn and work hard. We’ll train as necessary and move them around until we find the right fit. The toughest people to find are qualified service personnel. Sometimes we have to look outside this area to find them. Our people believe in what we do.”

Lindhout’s door is always open.

“We have good relationships here,” Lindhout said. “It’s more like a big family rather than isolated departments.”

Boondocks has felt the pinch to some degree.

“It has certainly affected the timing of those thinking about a boat purchase,” Lindhout said. “Some people are just going to wait until things stabilize. We have to be strong enough to weather the storm. During tough times, leisure industries take a hit. The companies that have a good foundation will survive the tough times.”

The desire to get out on the water isn’t affected much by the economy.

“People are just spending more money locally rather than flying off to some remote vacation paradise,” Lindhout said.

Part of the secret to survival lies in having strong product lines.

“SeaSport is definitely a niche brand,” Lindhout said. “Higher end boats like this attract buyers who are pretty well off and less affected by swings in the economy. We don’t have to sell 250 boats a year to be successful. We sold nearly 75 boats in 2002 and that was an extremely good year.”

The service end of the business is, as you would expect, highly seasonal.

“I think people are saying to themselves, ‘Well, things stink, but I’m still going to use the boat,’” Lindhout said. “Service and rigging and haul out are very busy right now, so people are still using their boats. Family time out on the water is still very important.”

The economy isn’t the only challenge for maritime supply businesses like Redden Marine.

“The business started as Redden Nets in 1958,” said operations and sales manager Ken Brown. “Over the years it gradually diversified from just making gillnets to being a commercial fishery supply house. With the decline in that industry, we have come to rely much more on recreational boating. Ten years ago, 80 to 90 percent of our business came from commercial fishing. Now, it’s down to about one third.”

Redden now operates branches in Homer and Cordova, Alaska, as well as the Bellingham store. Brown refers to the business as a nuts and bolts, no nonsense supplier.

“Hardware is our forte,” Brown said. “We’re a huge resource for special order items.”

One of the headaches a business like Redden Marine faces is the lack of standardization in the boating industry.

“There are thousands of boat builders out there,” Brown said. “Every last one of them uses some weird pipe sizes or fittings.”

The Bellingham operation employs about 25 people, including those who work in warehousing and distribution for the Alaska branches.

“It’s not too hard to find good people in this labor market,” Brown said. “We have a pretty mixed bunch when it comes to tenure. Some of them have been with us 30 years, some for six months. It’s a tight-knit group. Nobody gets rich, but you can make a good living here.”

Alaska operations have felt more effect from the low economic tide than the local business.

“The Alaska stores are heavily reliant on tourism,” Brown said, “and that has taken a big hit.”

His cautious optimism is tempered by the uncertainty in fuel costs.

“All the boat builders seem to be busy,” Brown said. “There hasn’t been any slowdown there, so far. We’re helped to a certain extent by boaters who want to save money by doing their own repairs and maintenance. We also have a hydraulic service and supply sideline that is not dependent on the maritime trade.”

There are also more uses for a net than just catching fish.

“Our netting is now used by driving ranges and for baseball backstops,” Brown said. “You can see our products at Yankee Stadium and Shea Stadium. It’s called diversification at the right time.”

Phil Riise of Seaview North Boatyard also has a reputation for good timing. He started out 30 years ago with the Seaview West yard at Shilshole, then added Seaview East on the ship canal in 1985. Seaview North came into being just last year.

“I have notes about this (Seaview North) site going back to the mid 1990s,” Riise said. “I saw tremendous potential here. Crowded conditions in the Seattle area have led to some movement of boats to the North Sound. As our clientele has aged, many of them have moved to this area to be closer to the San Juans.”

As the new kid on the dock, Seaview North takes an all-inclusive stance.

“Our approach is unique,” Riise said. “We offer a full service boatyard plus do-it-yourself maintenance and we welcome independent contractors. We feel there is a demand for all these services. The contractors can do their thing and we can complement them. The do-it-yourselfers get stuck and we’re here with advice and assistance. Nothing makes us feel better than a boat owner who leaves saying that the staff and management were helpful.”

Riise and his crew are always open to improvement.

“I spend a lot of time talking to boaters and brokerages,” Riise said. “It’s important to get that feedback. So far, everyone has been most appreciative. Several surveyors have told me that it’s great to have a place to bring damage cases and deal with just one person to insure the job gets done.”

Seaview employs about 70 people at its three facilities, 12 of them in Bellingham.

“We’ve had no problems at all hiring good people here,” Riise said. “It was a pleasant surprise to find such a deep labor pool. There are a lot of good people here who don’t want to leave.”

Riise has firm beliefs on how to keep those people.

“Employees have to be compensated fairly,” he said. “We offer health benefits and company participation in a 401K plan. If the company is profitable, everyone participates. You have to have constant communication with your crew. They need to know what is expected and what the goals are. Positive feedback is the most effective tool I have. There’s an atmosphere of mutual respect. You’ll hear us use the word ‘sir’ a lot. At the same time, I do hold people accountable.”

Riise refers to his management style as tough, but fair.

“Everyone wants to be acknowledged for having done a good job,” said Riise. “They want to know how they can do better. It’s all about ownership and responsibility. Be sure you mention our manager, Cary Johnson, in the article.”

Over the years, Riise has won a reputation for running very clean operations.

“I’m chairman of the boatyard committee for the Northwest Marine Trade Association,” he said, “and I’m very vocal on compliance issues. I like to think we’re industry leaders in environmental compliance. That has been very much a part of our success. If everybody plays by the rules, then the costs are equal and the playing field is level.”

Part of Seaview’s efforts to upgrade their site include a stormwater treatment system.

“We’re moving ahead with repairs to the wharf,” Riise said. “Part of our agreement with the Port of Bellingham included their remediation and dredge work in the contaminated area. Their vision feeds into ours. Once that work is done, we can optimize the site with a larger lift. Our bread and butter is the 20 to 50 foot boat, but the larger lift will allow us to handle larger yachts and some commercial vessels.”

Eventually, Riise would like to remove the ramshackle buildings on the site and replace them with newer ones.

“That will allow us to provide stack storage,” Riise said, “as part of our five year plan. That’s one of the things we’ve seen in the population centers. Dry marinas help take the pressure off wet marinas and help boat owners lower their maintenance and storage costs.”

Riise can’t say enough about the welcoming business climate in Bellingham.

“From day one, our process with the Port was a good one,” Riise said. “Redden Marine and many others have been very receptive. We would have died without Hardware Sales. There is such a great working atmosphere here.”

He realizes as a newer business on the Bellingham waterfront, Seaview has to prove itself.

“We have to combat the rumor that we don’t let do it yourselfers or independent contractors in,” Riise said. “It’s just not true. We’re making a huge investment here and changing the place from what it used to be — a pigsty. We want to be part of a win/win situation. We’re here to work with other businesses on a collaborative level.”

John Eastwood is another newcomer to the Bellingham boating scene and he likes the independent approach. His business, Pacific Mobile Marine, offers maintenance and repair service at your slip.

“I cover Bellingham, Blaine, Anacortes and La Conner,” Eastwood said, “and there’s no charge for an initial inspection of your vessel’s equipment.”

Eastwood is an ASE (Automotive Service Excellence) Certified Master Technician with 30 years experience in both automotive and marine systems. His office is a truckload of tools.

“I just moved here after 21 years in Olympia to be close to my family,” Eastwood said. “My brother owns Puget Safety Equipment out in Irongate.”

Low overhead is the key to his success.

“I like to work independently on power and sail boats up to 50 feet,” said Eastwood. “It’s a niche of sorts. Boatyards want you to come to them. It’s hard to get people to work on your boat right at the dock. The demand for this service is definitely there.”

Eastwood is doing some advertising and making cold calls to local businesses and vendors, but his best advertising, he says, is his work. He is very aware of the uneasiness in the business.

“Suppliers keep telling me that boat owners are just letting their boats sit until the economy changes,” Eastwood said. “If you want to make the best use of your money, let me work with you to decide what needs to be done. ”

The natural hesitancy to spend money on luxury or leisure items in a stormy economy seems to be offset by the need for stress relief. There aren’t many more effective treatments for stress than exploring our extensive maritime environment. Local businesses catering to the recreational boater are breathing easier as that becomes more and more evident.