Before most buyers can move on to their next high-performance boat, they have to sell or trade their existing one.
And that’s where the great big question begins: How much is your boat worth today?
The simple answer is: What somebody is willing to pay for it.
Of course, setting a price that is fair—a relative term to be sure—to the seller and attractive to a buyer is more complicated than that. Neither the seller nor the buyer wants to feel he is giving away the farm, to speak, but on the other hand, everyone wants “a good deal.”
First thing you need to do? Throw away the listing books. Those books are guides, not absolutes. We haven’t sold a pre-owned boat at the “retail” price listed in any of the listing books such as the NADA guide, BUC or ABOS with exception of one area. What we have found in most cases is that pre-owned boats sell somewhere between high and low “wholesale” book price. That may not be a pleasant fact to a lot of sellers, but that is, I’m afraid, the reality of today’s pre-owned market.
The one area this does not apply is older boats, typically less than 32’ in length. There are certain manufacturers, certain models, certain sizes that boats will actually sell for over retail book (i.e. older Donzi Classis – 16, 18, 22”, 21 Cigarettes, smaller older Baja’s, etc.). These boats and others get to a point where the boat’s book value shows a lessor value than they sell for and the buyers typically are willing to pay up to get these models and financing is not an issue.
Still, that pricing scale presents a great deal of price variation among similar models of similar vintages. What are the variables that affect the asking price? Is the boat “clean,” meaning free of damage to its hull and interior? Does the boat need paint work? How many hours are the engines, and how well have those engines been maintained? And in most people’s mind: is it a freshwater or saltwater boat?
If you look at the Pier 57 website, you’ll find that the asking prices for our pre-owned models are in the wholesale “book value” range as an ask price depending on what book you are looking at. Again, that’s where the market is right now and has been for some time. I know that can be hard to accept, but if you want to sell your boat it’s a reality you need to embrace.
Recently a consumer who wanted to sell their boat called. The consumer told us what he thought his boat was worth. I listened, and then told him I have the same boat with fewer hours on a trailer for a slightly lower price, which I thought was more in line with the current market conditions sitting in our showroom that he could use as a comp. The consumer told me we were not asking enough for ours. Listing a boat and selling a boat are two different objective. Our goal is to sell your boat for you and respect that no one wants to give their boat away but in order to sell, it needs to be in line with current market conditions.
Let me try put it another way: From time to time we get told our asking prices are too low on our boats. But no one has ever walked into our showroom and offered our asking price on a pre-owned or new boat. Regardless of what we are asking, they always make an offer that is lower, sometimes a lot lower. I believe the only people who believe our prices are too low are those who are trying to sell similar models at higher prices.
We have always had this philosophy: set the price to make the phone ring and leave room to arm wrestle over the price, not take hair cuts or play with funny trade numbers. We believe all our customers will come back. As a dealer, we do not want to show high trade numbers that later on set us up to deliver even worse news when the customer comes back to trade it in. The majority of our business comes from “referral and repeat” so this is very important for us.
Our philosophy at Pier 57 is that we want to make a small profit from a lot of customers, not a lot of money off a few customers, so we always are looking to give buyers and sellers the best value possible and back it up with customer service. That’s because if you feel you were treated fairly and feel we provided value, you will tell your friends and your friends will come to us or call us to help them find what they are looking for. If we gouge you, you won’t come back. That’s not our approach and it never will be—and it’s the same approach we use when it comes to helping you set a price for your pre-owned boat.
Scott Sjogren is the owner of new and previously-owned retailer Pier 57. He has previously contributed to Powerboat Magazine.