CONTROLLING THE NUMBERS
It is the time of year when kids are back in school, football season is in full swing, hunting has begun, and unfortunately, like every year at this time, the scuba dive industry slows down. In previous years as I have visited stores and observed the dynamics of the store’s activity in the fall, I have discovered ways that this trend can be minimized or even reversed.
In the scuba diving business, as in all small businesses, we know it is not easy, and it definitely takes hard work! We have also learned that there are factors outside our business we cannot control such as weather, time of year, politics, unexpected events, etc. So let’s focus on the things we can control. Our goal in business should be to Control the Controllable. If you do not, then you are out of control of your business! The fact is we are in a very cool business that many other people would love to be in, but maybe they do not know how to get started or have not had the opportunity presented to them. Let’s face it, taking people into an environment they cannot naturally survive in and making them competent, comfortable divers, selling cool innovative equipment, and taking people on diving adventures all over the world is REALLY COOL! The best part is you get PAID to do this!
So let’s talk more about the PAID part. Are you happy with the money you are making? Is the store doing the best it can do? Is the business running smoothly? If you are laughing at me, that is okay. At this time of year, as well as throughout the year, we should be looking at our NUMBERS. What numbers? It is the numbers in your Point of Sale system that you can use to identify the strengths and weakness in your business. It is in these numbers where you can develop trends to be better prepared for the future. It is in these numbers where you can identify how good you or your sales staff is performing in sales.
"IF YOU DON'T KNOW YOUR NUMBERS, YOU DON'T KNOW YOUR BUSINESS." Marcus Lemonis The Profit
DIVING IN.
In this first article, I will keep it simple so hopefully you can take advantage of the idea immediately. Future articles will discuss other aspects the numbers play in your business.
How many new open water certifications did you do in your business this year to date? How many did you do last year and the year before? This number is what I feel is the most critical number in your business. Why?
This is where new customers are formed and new relationships begin. This is where first impressions and trust are formed. This is where customers are the most excited, they think diving is so cool, and they want to be like you (as a diver, that is)! It is where they will purchase what you wear and do as you instruct them. You are their Instructor and Leader!
If we are going to create competent, comfortable divers who will become repeat customers of our business, then it is imperative they train in their own set of dive gear. Yes, you are reading this correctly. We need to set a goal in our business and attempt to sell every open water diver a full set of dive gear, including a regulator, BCD, gauges or computer - not just the mask, fin and snorkel like we usually do. We must assume that every new diver is going to be so excited that they want all their own gear so they can dive TODAY! Excited customers want their toys! This is a goal we should set, and is all a part of training new competent, comfortable divers who will become repeat customers of our business. Do not stop reading now, because there’s more.
Typically, we focus on selling beginning divers a mask, snorkel, fins, booties, and maybe weights. Correct? Did you remember mask scrub and defog? Did you remember a nice mesh bag to carry it all in (Stahlsac Bonaire Bag)?
So look at the numbers of your newly certified divers this year and see how many have purchased a minimum set of gear - mask, snorkel, fins, booties, and maybe weights. What was the average purchase per new diver? After speaking with a few stores throughout the southeast US, there appears to be two distinct averages. One is $200.00 to $250.00 and the other is $400.00 to $500.00.
Why the difference? It’s simple. You can make the assumption that the sale process starts with middle to economy priced dive gear. Why? The sales person is uncomfortable offering high-end gear, does not know how to sell, or has preconceived notions that new divers will not purchase high-end gear. Look at other sporting pursuits or hobbies. Look what consumers purchase when they get into and are excited about golf, fishing, hunting, cars, electronics, etc. When a consumer is excited about their pursuit they will purchase quality and they will find the money. You are not the customer. Our job is to show and share – don't ever underestimate the beginning diver’s enthusiasm!
Here’s some quick math:
Store A - 100 Students x $250.00 = $25,000
Store B - 100 Students x $450.00 = $45,000
Which store are you? Which store do you want to be? How do you do that? The quick answer is simple. Selling budget priced dive gear vs. selling high quality dive gear (Atomic’s low priced package is $284.00, middle is $456, high is $524). The consumer has to purchase gear to survive in an alien environment so why not start with the best and sell the best? You will miss 100% of the shots you do not take!
The same can be done with BCD, Regulator, Gauges or Computer. Again your store can sell the above items for about $1,300 - $1,500, while many others can average about $2,800 to $3,000.
Here’s some additional quick math:
Store A - 100 Students x $1,400 = $140,000
Store B -100 Students x $2,900 = $290,000
Which store do you want to be? Now I know that not every new diver will buy a full set of gear. However, look what you are missing if you do not TRY!
When you look at your numbers it will show you some glaring facts:
1) Your sales staff may not know how to sell or tell the Story!
2) Your sales staff may not know the product so they cannot explain the product.
3) You’re assuming they will buy gear later. That’s probably true, but from Amazon and not you!
4) It shows that goals need to be set, and let’s see what you could be missing.
Here is another exercise. Take the total sales of new open water divers and compare it to total gear sales. Take out training class sales, dive travel, and repair. We are looking purely at scuba gear sales. Look at that ratio and do the same for past years. You will begin to see trends that will tell you where the work needs to begin. There is more money to make than just filling tanks and repairing regulators, and this will make your business more profitable!
Know and learn your numbers. Look for opportunities of lost revenue. All new divers should be sold scuba gear, as they have to have it to participate in the sport. Start with the best and most expensive brand that has a story to tell (Atomic Aquatics) and work your way down. Do not prejudge raw excitement and passion displayed by your new customers. Sell them gear so they will have a commitment in the sport. Finally, TRAIN, TRAIN, TRAIN, your sales staff to sell your products and services. This website is designed to help you achieve the above!
Chad Barbay