Price increases: suppliers are sounding the alarm!

COVID-19 has become a catalyst for many processes. One of them is a sharp rise in demand for yachting and boats in general. The demand for both motor boats and sailing boats is not covered by the supply, which creates disruptions in the logistics developed over the years. Distributors are forced to raise prices, and the end of the crisis is not expected in the coming years.

Rising prices for marine equipment

For many suppliers and manufacturers of marine equipment, the beginning of summer means a revision of price lists. In 2021, prices have risen so much that some distribution companies have sought to warn their customers ahead of time.

Supply and transport costs remain higher than before COVID.

So, Tecmar decided to take advantage of the experience of manufacturers such as Mastervolt, Marinco, BEP, Attwood and Garelick, which provided for a strong price increase from July 1, 2021. 

“It affects whole product families, very different, at different levels. There are two influences: the cost of raw materials (including steel, copper, petroleum products, or acrylic). 

On the other hand, the costs of supplying and transporting materials remain higher than before COVID, ”discloses Thierry Lambeau, head of Tecmar.

"Games" with stocks, their depreciation and raising

Faced with rising prices, distributors are trying to flatten prices with their leverage instruments. 

“It's easier to boost retail because the stores will hand over the goods directly to the boatmaster. On a global scale, it is difficult to get supplies, so we cannot overstock for a long time, ”explains Patrick Carro of Interdist.

Overstocking is an increase in supply and a decrease in demand for products.

“We are increasing stocks wherever we can to limit growth and ensure product availability, but this is not enough. Often we have a 90% order, but there is still a small € 30 piece that blocks the site. There is a rise in prices.

At the first assembly of a yacht or vessel, we work, roughly speaking, according to the instructions. It is easier because all the necessary details are known in advance. More worried this summer is a yachtsman who broke a part on his boat. Therefore, we no longer sell products, but ready-made solutions at once, ”says Thierry Lambot.

Foggy future

Unfortunately, the price hike in the summer of 2021 is probably not the last. Distributors expect the situation to be unstable in the coming months.

Expect inventory problems.

“The next 18 months will be unprecedented in the maritime industry: boat sales growth that hasn't been seen in a long time, double-digit growth for everyone, including those companies that have already exhausted their distribution channels. 

Expect inventory problems. We are used to an annual rate or even two, but in this particular situation, products will increase and decrease. This is due to the overstocking of materials.

We register the decrease and try to minimize the increase. But we can't juggle prices forever! " - concludes the Tecmar manager.

18.08.2021