When I first started diving about 5 years ago, the dive centers in my area (Houston, TX) were VERY cut throat. The owners of most dive shops seemed to literally hate divers that bought gear online. It amazed me that they had this attitude and I knew something had to change.


Some scuba agencies promote the philosophy that the only way to make money as a dive shop is by selling Equipment, Entertainment (ie: travel) and Education (ie: training)...and that you would only do well if all three were an integral part of your business.


The internet makes it soo easy for us to research and price shop, only a fool would walk into any store and spend over $500 on anything without first checking to see if they’re getting a good deal. Many dive shops tend to mark-up their equipment by as much as 300% in some cases. One problem is that they don’t think companies that sell gear online are competition. The main arguments are lack of warranty and service. But years of online buying experience and many satisfied online customers have all but ruined those arguments.


If dive shop owners continue to show hatred towards potential customers that buy some gear online...they will be out of business soon. Divers tend to be pretty darn tech savvy. We will do research online...we will ask our friends for information...we will shop around...we will get the best deal.


After reading the above, you may think I’m against dive shops. Quite the opposite, I want to help dive shops. We need you. We need your support. We need your air. We need your training. We need your travel coordination. We need your experience. So...I propose the following solution for the next generation of dive centers:


1. Reduce your expectation of equipment sales as a primary source of revenue by at least 50%.
2. Reduce your gear inventory (bc’s, regs, wetsuits) by 50% and only stock your most popular items or impulse buys.
3. Offer a price match, even if it means you hardly make any money...at least you’re keeping the customer happy which greatly increases their chance of returning.
4. Concentrate on scuba accessories, training, air fills, maintenance and travel.
5. Consider a fitting or tryout type of service that lets potential customers research gear...without feeling like they must also buy the gear from you.
6. Signup for the affiliate programs of every major online gear sales company and refer your customers to them as a last resort if you can’t match a price or sell a certain brand. You’ll end up making the customer very happy and in return make 5-10% commission on the sale through the affiliate program. Consider having 1 or 2 computer stations in your shop for online research and price shopping.
7. Provide equal support and service for gear a customer didn’t buy from you. If you’re not authorized to service a particular brand, don’t act like that brand is horrible...instead, make a deal with another company that is authorized to sell/service it so you remain the point of contact for the customer and can potentially make a bit of mark-up. Again, you’re making the customer happy which increases their change of returning to you.
8. Consider a monthly membership program that provides your customers with free air fills, annual maintenance, preferred rental rates, discounts on travel, etc. This will produce a constant stream of revenue and may end up covering all your overhead expenses.
9. And last but not least, get involved online. Join DiveBuddy.com and other social networks and stay active with your customers and past students. Write blogs, participate in forum discussions, share photos. Prove that you understand what’s required to do business in this Web 2.0 world!


If you don’t own a dive shop and you’re reading this blog...share these concepts with your local dive center. Help them understand what you need as a consumer. Buy from them whenever you can and when it makes sense. Understand that they are a part of your community and lifestyle.


For those dive shops that are sticking to their old ways...I wish you the best of luck. But I encourage you to adapt and find new ways to thrive.


Stay safe underwater and always remember to dive with a buddy!


Sincerely,


Greg Davis
Owner and Member 1
DiveBuddy.com

Comments

firediver57 - 10/24/2008 1:13 PM One last comment regarding shops that won’t work on gear bought on the web: will they work on gear bought at another shop? Of course - good service brings in customers and more business. The beauty of the American business model that has worked for years is if a business doesn’t want your business someone else will. Dive shops that turn away customers are only hurting themselves both in the wallet and reputation. I’m with SEAduction Dive Services in Dunn NC and we pride ourselves on producing good divers and keeping them happy with good service. I’m done. Safe diving to everyone.

firediver57 - 10/24/2008 1:03 PM Greg, one other thought: Where you bought your equipment should be irrelevant to any good shop. What if you are military and new to an area? Should you have to buy all new gear to do business with us? NO! I don’t care where you got it and if you come in for service it is going to get serviced. The only drawback to web purchases is the ability to get warranty work covered when done. Some manufacturers won’t honor the warranty unless it is bought through a shop regardless of who is doing the service. That means when the dive shop bills the company they don’t get paid. And that is a 100% loss on parts and labor for the shop and the tech doing the work. That is why it is important to register anything you purchase with the manufacturer. Many web purchases don’t come with the necessary paperwork to register your purchase. I wish dive shops were rolling in money like many perceive them to be. I won’t be there on a Sat. or Sun. doing tech work. I’d be diving!

firediver57 - 10/23/2008 4:45 PM Greg one of the difficuulties with the model you propose is that you will take 75% of dive store personnel off the job. We don’t make much money when you work for a dive center and if you aren’t instructor staff like my wife you may be out of a job altogether. Even busy shops aren’t always making payroll year round. This is most particularly true in off travel areas. Our shop is landlocked with a good winter season of cold and reduced diving opportunities so we slow down tremendously. We make our money in spring summer and fall and just do then. If we reduce our margins to your suggested levels we would go out of business. Also some of what you speak should be addressed to the manufacturers. They only let us buy from them at certain rates if we buy "X" amount of product. If we don’t have the volume we don’t get the price cuts. Its that simple. Not all dive centers are out to gouge you but would like to stay open for our customers. If our customers came back for advanced less

divergeorge - 10/23/2008 8:14 AM Selling equipment is one of the major profit making areas in a diveshop. Suggesting that the shop help the onilne companies sell through our store is a little off the wall. The average shop makes a $35 profit on a class and less than .75 cents on an air fill. People can contiune buying gear online, but their local shop may no longer be around to service the gear they now own.

coralreefpainter - 10/05/2008 6:53 AM You sure don’t want a dive shop to be able to pay rent, astronomical electric bills and insurance, pay employees, and generally just stay in business. Do you have a piece of jewellry? The markup is often 1100%. I never hear complaints about that. Your complaints are universal, and inappropriate. How much is an airfill? How much does a compressor cost, and how much for electricity for one fill? Can a scuba instructor support a family? American’s lust for cheap deals has made China grow like a weed, while Americans are thrown out of work. Off soapbox, because I know I’m wasting my breath(typing)

SeverinoScuba - 10/02/2008 12:23 PM Firehorse said, " It’s always disheartening to hear that a dive shop has refused to service an item bought online. "   You can get your gear serviced online too Divers Direct will take your order online, they do great work and fast too, lowest price around too...

Wakemaker - 9/27/2008 4:43 AM My opinion is based on seeing so many of my friends that must switch between dive shops and my favorite dive boats relocate per their new owner. Dive shops I originally enjoyed are out of business. (I’ve been diving since 1986). The overhead to run a dive business is high. So high, I wonder where it would be placed on a list of the Most Expensive Proprietorships; on the top ten? Will electronic commerce by the recreational diver lower diver equipment performance and comfort expectations? Many of my dive buddies get back to the boat with a ring around their face. They don’t realize the masks they bought may not curve the way their faces do. They put it on tightly just to get a seal.

firehorse5 - 9/23/2008 10:44 PM Well said. It’s always disheartening to hear that a dive shop has refused to service an item bought online. The internet isn’t going anywhere and in a lot of cases, it’s probably the very thing that drove that customer in their door in the first place and now they’re trying to spend money with them for a service they provide only to be turned away with a negative experience that they will be sure to share with their friends. How is that good business? Brick and mortars beware, that’s a recipe for disaster. Turning customers away is only going to hurt your business. It won’t even make a dent in the .coms.

Scout - 9/23/2008 9:17 AM I believe that every local dive center needs to move closer to their customers, and communicate much more frequently. DiveBuddy.com is probably the best way to do that because they can more clearly define their 3E strengths (profile), post their schedules and sales (private blog), post photos and videos of their events, stay in touch (buddy list broadcast), organize expeditions (calendar), sell on-line (redeem points), and advertise (targeted banners and boxes). We all get dozens of emails from diving-related vendors - for the LDCs to survive in the 21st century, the 3E model will still work, but only if the LDC makes more of an effort to be the diver’s first choice for equipment, entertainment and education. FULL COMMENT HERE

iScuba - 9/22/2008 4:40 PM I agree totally - a very well written and thought out article! What’s interesting is that this topic has been coming up quite often lately - even just this morning. I had to correct the asker, showing her that there ARE scuba products that you can buy online while retaining full confidence of a warranty! She couldn’t believe she’d been duped into thinking that the only way to get warranty service was to purchase your gear from the LDS. Now, she shops at the same LDS that I shop at, and I hate that the shop owner tells this to his potential customers.... shame.

RigHunter - 9/22/2008 3:25 PM Very well put! Good Job Greg.