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The Promo Boat Paradigm has to change


Horton
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Horton's original post was:

"Here in south / central California we had just enough promo boats for tournaments last year. This year we will have 1 or 2 less factory supported promo boats. The remaining promo boats engine hours are going to be more of a premium. We are in a pinch.

 

Talking to boat industry people has convinced me that we simply need to find a new paradigm. Expecting new boats to simply show up at tournaments is no longer realistic. I think the hardest hit is going to be college tournaments.

 

A boat company executive challenged me to ask you guys for new ideas."

 

 

 

 

 

 

In summary: too few boats, and those that remain are running from hours. My idea would spur the opposite. Everyone can disagree, but I fail to see how my idea is illogical. The specific request was to "find a new paradigm".

 

 

 

Dave, while I've never been part of a program, given the number of boats I've purchased I've been a de facto uncompensated promo owner for years. As such, while I recognize and appreciate their time and travel commitment, they don't evoke financial sympathy from me if they can't break even anymore. If promo drivers are being lost because of that (which doesn't appear to be the problem anyway, the problem is manufacturer cut backs), then to an objective outsider, it would seem they need to renegotiate, rather than try to keep hours off their boats. If the factories are trimming programs because they're not seeing the value, doubling the hours doubles the exposure and doubles the value to the program. Stop the incentive to stay away from events to save resale. Classic chicken or the egg.

 

 

 

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The three event world is not fueling the sales for the big 3. The boat manufacturer is already selling the boat at a discounted price to the promo boat owners. These companies are making money on 150k plus wakesurf and wakeboard boats. The organization needs to come up with a way to support the promo boat owners and make guys want to stay involved so that we continue to have boats available. I think the LOC helping the promo boat owners is a good thing. I have been very fortunate because most of the places I have taken my boat to waive the entry often cover your hotel room or provide a place to stay. Those little things help and I was happy to take my boat to the places that took care of me as a promo boat owner.
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Chad, I understand. Sounds like you were fortunate. But your experience doesn't provide a solution to Horton's posted problem. But, see #3, below.

 

If the manufacturers are pulling back for want of more clear evidence of resulting sales from promo boat exposure annually, that's short-sighted and flawed for 3 reasons (minimum):

 

1) It discounts the value of the perceived goodwill of the brand to participants

2) It discounts the reality that one ski ride (or event) doesn't translate to immediate sales, rather, it understandably takes multiple exposures to convert to a sale

3) discounts the importance of brand exposure to participants who also own or will buy $150,000 surf and wake boats.

 

As to #3, I think that's a bigger number than (some) may realize. I think there are a lot of people out there who may have a 15 year old 196 that they're happy with, but are also own or will soon be in the market for a V drive. I can think of 4 of my lake neighbors who have slalom boats and Vdrives. I do too. If I heard on here that a manufacturer ended or so massively trimmed their promo program so that it was not contributing to the furtherance and support of the core crowd upon which their current success has built for deacdes, it would have an effect on me when shopping for my next Vdrive, for sure. Maybe more folks in Vonore, Loudon, and Orlando need to hear that. Yes I realize that the days that a customer could get Bob Alkema or Walt Meloon on the phone are long gone, but it would be remiss of the manufacturers' review of their programs to not understand the influence that competitive 3 eventers have on many boat buyers OTHER than just people in the direct drive market.

 

Point is, if there is some evidence that the current model is not sustainable, and contributing to that enigma is manufacturers are pulling back in terms of number of units and providing insufficient financial perks, they should be shouldering a larger investment in these programs because its influence goes much further than how many 3 event skiers bought prostars by the end of the year.

 

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@buechsr sorry but you so out of touch. A person will not buy a promo boat for retail or close to retail and then run the boat in multi events and the sell the boat for a 5K loss or more. Promo people who get involved do not get reimbursed for the extra gas to get the boats to tournaments nor due they rarely get free hotels. They mostly do it for the love of the sport. They have higher insurance cost and higher maintenance costs due to the additional usage. The reason the boat companies discount for a promo boat is so a person will have a reason purchase and promote the brand at tournaments by answering any questions about that certain boat. By interacting with the participants the hope is that when they are in the market they will buy that boat. Having the availability to ski behind it not only in a tournament but in practice can be invaluable to people when buying a boat. No dealer pressure.

When hear that well known promo teams are pulling back which make boats not as available that should tell you things needs to be changed.

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Dave,

I'm the one proposing an idea for change! Promo programs have been, more or less, the same for decades. Anecdotally at least, boats are more scarce, with less manufacturer interest/justification, which could easily snowball within and across all 3 programs. Respectfully, it would appear (some) of the current players in the current system are the ones out of touch hence why this thread even exists! If the current framework worked, there'd be no scarcity of boats/hours and manufacturers would be bring more people into their programs. The opposite is the case. Yet I'm the one out of touch? Other than those who suggested event participants pay more, I think I'm the only person who offered a paradign shift in this thread, and yet the old school status quo excuse for why things are the way they are get likes, and I get told my proposal is illogical. :/

 

Secondly, I never suggested promo boats should be sold "for retail". I understand owners need financial incentive to participate given their contributions in other currency like their time. If you actually read my idea, it does just that! My idea would have no net effect on the expense for the owner, nor for the manufacturer. It merely rewarded (maybe, compelled) owners for more exposure. We both know there is a huge difference between dealer cost and "retail". Either way, the net effect is no different to the owner or manufacturer.

 

Third, you should read my most recent post. We are in complete agreement as to the value of the promo program and why an end of the year audit of "direct" sales is a flawed study of the value of a promo program.

 

Fourth, I completely agree that promo drivers do it for the love of the sport. But there are exponentially more consumers out there doing even more to promote the sport, always on their own dime, with no annual/semi-annual new boat hookups. I don't begrudge the deal promo owners get and I don't blame them for wanting to keep hours off their boats so they can recoup their investment. My idea, however, at least addresses those (potential) trimetrically opposed interests of events/owners/manufacturers.

 

 

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ok @buechsr I do not get your idea at all.

 

Lets say the Acme boat company can build a 3 event boat for $50.

Acme needs to make a profit so wholesale is $70

The dealer pays $70 and needs to make a profit so prices the boat at $90.

The Promo guys buys the boat for $90 and puts 200 hours on it so the boat is now worth $80.

The Promo guys sells for boat for $80 and is out $10.

 

In your plan how does the Promo guys get his $10 back?

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@buechsr I don't have the answers you are looking for however I can tell you that we are lucky the big 3 still have promo programs of any sort and should do the best to make it worth it to guys who still want to be involved with a new promo every year. Looking for more from the manufactures is not going to happen and @horton knows that. That is the reason for this thread. The bottom line for the three event boat customers like yourself, we all believe wholesale is retail. In my 20 yrs plus experience with promo's customers want the best price possible and the least amount of hours. I bet there are not many customers on this site that have are want to pay retail prices for their ski boat versus the wakeboard/wakesurf industry customers who want every option on the boat and more. It takes as much time to make the ski boat as it does to make a wakeboard/wakesurf boat that will bring in over twice as the amount of money for the ski boats. I can only speak to what I know about Malibu, but if I wanted to order a new TXI it would take till march to get it. They are sitting on over 2000 confirmed orders today and I can assure you these aren't ski boats. With that said, it is unrealistic to look for manufacturers to get too excited about investing or throwing more money into the promo programs.
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@buechsr I’m with @Horton. I don’t understand your plan. Either you are not explaining it correctly or you really don’t get it. The MFG’s have thrown every different program out there. Nautique s Dealer buy back easily 2000 if I remember correctly. prior to Nautique’s current program did not work. MC dealer trade or buy back didn’t work. Malibu has has the same program for many years as far as turning boats over. I was on a program for over 40 years and I have seen pretty much every program come and go from all of the big 3. Nothing has stuck to allow the boat companies to recoup there investment dollar. Now with boats over 100K and surf boat over 200K publicity own companies the ride is over. I. Eli eve it take jut as much time to build a ski boat VS a wakeboard boat and the wakeboard boat is 1.5 to 2X more money with a bigger market.

If we use a 3yr old boat well at least the whole event will have the same advantage or disadvantage. The promo guy are tired of losing money and having little to no support just grief if they can’t make an event. If I remember correctly we are all volunteers and nobody is getting paid to do any of this.

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@The_MS higher hour, great hull, great pull is awesome all day long and twice on Sundays. Already deprecitated a few more hours don't make much difference. Trouble is what does that do for the continued desire for the big 3 to make ski boats? Really...I don't understand why they do now. Their accounting people have to be like "what?" We could make 100 more $150K wake boats profitably with the same resources!

Conundrum. Find a way to compensate promo boat owners so they continue to buy awesome boats and bring em to tourneys.

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Horton:

"ok @buechsr I do not get your idea at all.

 

Lets say the Acme boat company can build a 3 event boat for $50.

Acme needs to make a profit so wholesale is $70

The dealer pays $70 and needs to make a profit so prices the boat at $90.

The Promo guys buys the boat for $90 and puts 200 hours on it so the boat is now worth $80.

The Promo guys sells for boat for $80 and is out $10.

 

In your plan how does the Promo guys get his $10 back?"

 

 

 

Dealer-excluded model will make more sense for now. Lets face it, they're not adding much to direct drive boat prep and are unnecessary for a pre-sold boat. No offense. Yes, they might have to paper it, but there is not much to prepping a new boat, and certainly every promo guy knows how.

 

My model would be for promo guy to buy from Acme for 80.

 

Promo guy runs a year and has to hit 200 hours. If so, Acme compensates him 10 (put the 10 in a promo guy escrow account, etc for a year, it doesn't matter). Promo guy can sell for whatever he wants (I think it would be closer to 70 than 80).

 

The point is, if promo guy does that which the manufacturer wants him to (travel, run the boat, etc.), he is made whole (he "spends" 70, less if sells for more), and the manufacturer's net sale was precisely the same (70), just as if it was sold to the promo guy at wholesale under today's paradigm, or a dealer for that matter.

 

Now, if dealers were required, still use the 80 sale price, and leave everything else the same. Dealers won't scoff at making 10 per unit per year, guaranteed, from a customer who requires no handholding, floor planning, etc. Furthermore, promo guy could still trade and allow that dealer to sell outside of territory as a used boat.

 

So, in summary, there is no new net expense to the manufacturer yet its ensured MORE exposure, promo guy had some more responsibilities, perhaps, but is ensured a good value for the product at the end of its usage cycle and has no disincentive to use it because he's being rewarded for doing so at the end of the year, or, dealer sells a boat it otherwise wouldn't in perpetuity without lifting much of a finger, and event organizers have access to more boats with more available hours.

 

Now, based on what I've already received so far, this will be met with "they won't do that", "that won't work", etc. Every multi-faceted problem is hard to solve in a balanced way. The problem is that the current paradigm is working, in totality, less and less for everyone. I (humbly) believe that the prospect of an "over-houred" boat scares more promo people than their schedules prevent. In other words, I know promo guys are tremendously generous with their time and travel. I'd hazard a guess that if they had more security in knowing their increased hours were not costing THEM money, they'd be seen even more. They're the only group being asked to do more (use their boat more), but doing that which they love, anyway.

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@buechsr

So basically you want the factory to work it out and pay for it or have the dealers pay for it. Either way they cover the cost?

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Chad,

I understand. My proposal does not cost the manufacturer a penny more. However, and I'm not trying to be argumentative, but just because there are 2000 orders in doesn't mean there's 2000 pre-sold boats. If my dealer has an available January build slot, there may well be an order, but it can be changed if and when a customer walks in and wants to customize it. Doesn't mean he'd have to wait until March, unless all of my dealer build slots were in fact spoken for.

 

I would agree and speculate that net profit per unit is higher for a wakeboard boat, but there is a guy on the malibu crew who really tears into MBUUs financials and its surprisingly small how much profit is in each unit. I don't think Jack Springer gets too upset seeing a txi on the line. M220 required WAY more R&D and requires WAY more in materials. If there weren't a legitimate business justification for 3 event boats, they'd have already killed them. Same with the promo program. If that's changing, I'm all in favor of finding solutions, as I would think you are too.

 

 

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@buechsr you have some excellent ideas! You really should take these to the higher ups at a few of the tournament boat companies. I'm sure they will appreciate it and immediately understand how that will improve their sales, customer satisifaction and bottom line. I bet you will be in line for a new job or at least a sizeable commission.

If it was easy, they would call it Wakeboarding

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Dave,

Please be specific as to the nuances of why the specifics of prior programs failed. Then, lets kick around what worked and what didn't. Otherwise, it sounds to me like you're of the mindset that nothing works, it's all been tried, and give up. Did you seriously type "the ride is over"? In a thread looking for ideas?

 

You're welcome to your opinion and perspective, but that's a conclusion looking for an excuse. I respect and appreciate your contributions and time through the years, good for you. But the challenges that lie ahead are going to require optimism and thinking outside the box.

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Yea unfortunately the current rules only let you go back to 2008 and I think somewhere in the towboat policys it is stated that GPS information or based systems must be used.

However competition of the day, it should not mater what boat is pulling the event provided it falls under current speed control rules..

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Any chance the Big 3 want to work in unison with each other and AWSA? If a tournament wants a promo boat they pay a surcharge on their sanction fee. AWSA then determines were the promo boats are going on any given weekend and they compensate the owner (dealer or whoever controls the boat). LOC is out of it other than paying up front when they sanction. May not get the brand they want but will get a new boat. This would also eliminate the guy or club that gets a promo and then never leaves his lake or immediate area. Skiers can choose to pay up for an entry at a tournament with a promo or take whatever boat they get at the other tournament. You would know after a season or two what skiers will pay for. If the manufacturers will play nice the boats could be distributed evenly throughout the country. If dealers control the boat rather than individual owners, they could have the local skier drag the boat to the tournament they are probably going to anyway and this way get their expenses covered. This would get the dealership and the brand more exposure. Maybe doesn’t lead to a 3 event boat sale but leads to a ski boat sale. Family comes into look at last years promo boat and decides they want the big wake machine. Sale based off of “promo” boat.
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@6_Buoys it has been my experience that anytime you ask a dealer to drag a boat to a tournament 2 things happen. Number one they don’t want to do it. It cost them money. Secondly they take a boat from stock that has not been tournament preped. If the dealer even has a 3 event boat in stock. The dealers really do t want anything to do with tournaments. If the LOC collects the money from all competitors prior to the tournament it will make it to the boat owners pocket with out delay from USA WATERSKI.
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@dave2ball I believe you are correct that was true and probably still is for many dealers. I would bet that there are several dealers in each region that would come onboard and make this work. I'm not sure how the costs of the boat would work out, but the dealer is most likely going to end up with a cherry used boat to sell that they will make money on. The manufacturers would have to play nice with AWSA to get the boats spread out. Dealer cost: tow vehicle fuel (covered), lodging (covered), entry fee (covered), insurance (covered), boat hours (covered). The dealer would have to find someone or a group of some ones willing to drive the tow vehicle, but that someone is getting lodging and entry fee (at a minimum) covered for going to a tournament they were going to anyway.
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@6_Buoys I do not see how your plan is not a lot more complicated than charging per ride or per engine hour and directly paying the boat owner for use (depreciation).
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@6_Buoys you say boat hrs travel cost are covered. The dealer is not going to do this out of the kindness of his heart. The dealer is also not going to travel long distances. So once again who will pay for this? The skier will. Either with increased entry fees, dealer surcharges. Now at the end of the year a dealer has a boat with 150-200 hrs on it. Now he has to sell for an additional discount. Which the entries surcharge may not cover in full. So they may lose money. Oh what about if the dealer has a buyer prior to the end of the season? He will sell it. There goes your promo boat and you are back to square one. This not being negative. These are realistic issues.
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I think we are trying to create a one box fits all and this is making it more difficult for everyone.

In a lot of places like Florida and Europe, tournaments are put up by a ski school or a club where the club / school boat is already on site and available. Most of those tournaments are L / R equivalent.

Then you have other places like in Southern California where there is no such a thing as a club or a ski school. Lake owners have to vote to agree on closing the lakes for a week end to be able to hold a tournament. The boat comes from Promo teams or personal non promo people. If Promo, they may be towing their boat from far away, or they may be on the next lake along. If non Promo they did not get a discount on their boat and are often sharing their boat so the event can happen. Most of these tournaments are C class and cost less to enter.

Now why not have a different rule for C and L,R where if you want to do C, you just need ZO and if you want to do L,R, you need a 3 year old or newer boat.

 

I am sure a few baller are sales reps or travel for work. There could be a simple system based on distance to tow to a tournament and engine hours used to determine the expense to the boat owner. The boat owner could also state that they will only put 8 hours max during the tournament, therefore the LOC will need to ensure enough boats are present to cover the tournament.

For example I towed my boat 100 miles to a tournament, I receive 50 cents a mile and my boat was used for 8 engine hours @ $15/hour = $50 + $120= $170 and the LOC will also likely comp the entry fees = $75 to $150 + Dinner...

 

There could also be an option to increase the pull rate to $20 or $25 per hour for a non promo person.

 

It would be easy to have a spreadsheet template for LOC to use.

 

 

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I think people are forgetting the promo person is on site all day long. We are usually one of the first to arrive and last to leave. I'm lucky that the events I go to, I'm usually a chief official too (so there all day anyways). No dealer is going to send someone to sit at a tournament all day and pay them (unless that dealer is a skier). As others have said as a promo boat owner, it is not just the cost of hours. I'm pretty lucky that most tournaments I pull are less than an hour from my home. I think the $25 is a nice start, but is not close to the actual cost of time, depreciation, insurance (you can't have a bare bones policy) and maintenance.

Also the hours limits on boats have come in the last few year. As boats are returned to the dealer, they limit both tournament and personal hours. And it is not just one brand, I have seen this from both Nautique and MC.

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@dave2ball once again I agree with you, the skier will pay in the end. I think we all agree that the "promo" days are over or close to over and the skiers that want the newest boats at the tournaments they attend will have to pay up. The other issues you and some others have stated are the current or historical problems (selling the boat before season is over, boat hours, etc). That is why I am proposing a wholesale change to the program. Dealers that want to be involved, a centralized fee, equal distribution and access of the boats, manufacturer involvement. No more promo "owners" that need to move a boat. Boats that are put on the market by the manufacturer to be fully utilized at tournaments (hrs be damned). You wouldn't need so many boats at the big tournaments if you didn't have to juggle them around to spread the hours out, just run a boat all day. @Horton you are correct, if we simply try to tweak the current system my plan is overly burdensome compared to just paying the promo owner. I was throwing out there a more in depth change to the current "promo" system. As you and others much more knowledgeable than I have said, change is coming. Is it going to happen to us or with us?
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@6_Buoys A few obstacles

 

First of all VERY few dealers want to be involved.

 

When the dealer owns the boat they ( at some point ) have to pay flooring ( bank interest ) $400 - $600 per month +/-. Like car dealerships boat dealers finance inventory. It adds up fast.

 

My $50 per engine hour depreciation number assumes that somebody is looking after these boats like it is their child. If these boats are to get a lot of hours who is going to prevent every little scratch? Go back 20 years when promo boats were dime a dozen the boats were sometimes taken for granted and honestly a lot of them were abused. Somebody has to pay for every dollar depreciation one way or another.

 

 

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Not sure I have anything new to say. Overall, it’s just sad to see the sport I love seemingly slipping away. Or hopefully I have it wrong and we are just evolving.

 

With boat prices going up and apparently less people willing to buy them it would be reasonable the boat companies choose to subsidize the tournament/promo side less. Let’s hope they continue to do what they can.

 

We have been increasingly leaning on promo owners to subsidize which isn’t right.

 

Do we have a choice other than having skiers pay to play? I am 100% fine with paying a higher entry fee to cover the hours I put on the boat.

 

I like the idea of looser requirements for Class C and perhaps a smaller boat cost contribution to the tournament. I am also happy to pay more for a record using newer boats.

 

Access to promos in the events I host has been legitimately impacted over the last few years. In those events, I used to get 6 boats over 3 tournaments. This year we got 1 boat (and he was a LOC memeber), and it had nothing to do with Covid. We used personal boats for the rest of the tournaments and compensated the boat owners a bit, but not enough. They agreed to sponsor the rest as it was “our club and friends”. It is not a sustainable model though.

 

I expect to pay to play in NorCal 2021. Do the experiment and collect feedback.

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@bishop8950 this is your quote. like the idea of looser requirements for Class C and perhaps a smaller boat cost contribution to the tournament. I am also happy to pay more for a record using newer boats.

Why should you pay less to the boat owner for a C? The cost per hour does not changed or C ‘s. If an older boat is used then you have the option not to ski. Price per hour should be the same regardless of a C ELR or boat used.

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@bishop8950 I think if we pay all boat owners the same amount that guy that owns the old boat can put money in the bank towards that new engine he's going to need eventually or whatever.
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The theory to pay equally regardless of boat year is fine but it will eventually mean you're going to NEVER see a new boat at a tournament. (Personally I think it panda worthy)

 

Why would I take my brand new 2021 $135,000 Ski Nautique to a tournament when Johnny's 2017 MC gets the same pay rate? Eventually these folks (with the new boats) will not bother bringing their new tug, welcome to tow boat socialism lol

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Outside of Nautique whose team members do not own the boat so they should not take such a hit for recouping cost we are only talking about MC and Malibu. If the LOC compensates Nautique members that is just a bonus for them. Promo members are required to bring there boats to a certain amount to tournaments per there contract. The additional money will help the promo member ease the burden.

When we talk about a private boat owner bring his boat to an event there is no reason they should not be given the same amount of money per hour use.

As to @jayski post I really don’t know too many people who will give there 21 SN or MC to pull an event with out being on a promo team. I’m not saying it won’t happen but very small percentage.

 

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@dave2ball I was under the understanding that with the current nantique program the promo guys were actually paying a lease payment on the boat. maybe that's a regional thing and I don't know maybe that was just a thing a couple years ago
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Does anybody know what further changes the big 3 are planning WRT their promo programs, like over the next 5 yrs? I think helping the promo or private boat owners is a good idea. However this might be just the excuse the mfgs need to further pull back their programs. It might be good to know their plans so what we do is complementary if pissible.
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@Horton yes they are paying a lease. But they have much less invested. The biggest thing is nautique boats go back to a dealer to sell. A Nautique promo person will not take a huge hit at the end of the year as far as recouping cost. Anything to help with the additional gas insurance so forth is alway appreciated. They should not be excluded. My bad for not clarifying in my earlier post.
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I bought a promo boat. For those at Malibu, Mastercraft, and Nautique that read this thread, when I buy my next boat - whether promo, ski school boat, or new - my choice will be based on my experience skiing behind your boats at tournaments and ski schools. Your support of the sport matters and will translate into sales because it give skiers experience with your boat, even if the sale is hard to tie directly to the promo program. I won’t buy a boat model I haven’t skied behind. Thanks for supporting the sport.
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@dave2ball, you are absolutely right. I will. We almost didn’t have a Nautique at our state tournament, but one of the women skiers made a call and Nautique got a boat there. There were some insurance hassles, but it got done. They need to hear from us.
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