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James you presented a new model at the boat show, what was the feedback?
The response has been fantastic. We pre-sented three new boats, the new Ferretti 650, Ferretti 750, including a sneak preview of Ferretti 6. We are known for innovation, so every year we try to bring out new model that is groundbreaking and reflecting the DNA of our brand.
What are the new boat trends?
The Open boats are the new tendency, in line with that falls Riva. – This extraordinary brand is 172 years old this year and we’ve always been known for open boats at Riva, and if you go back to the icon of the 1960s boating, Riva’s boats were it. Riva has always been synonymous with Miami, synonymous with the French Riviera, with Monaco and with celebrities and so we also try to develop something along the lines of the open boat concept. The base of the platform that we’re using is Riva 86 Domino, which has been a very successful product for us. We’ve built twenty of them to date and 4 or 5 of them are here in Miami. The boat that we’re working on now is going to be based on that model. It will be incredibly fast with 14 knots and an open hot tub. It is Ferretti patented and has never been done before. For us it really follows the innovation of the brand.
What was the main focus for the boat show aficionados this year?
What we were trying to do for them in Florida is to maintain the inventory of all the popular models that we carry, very specific to the American market. We have increased our investment in the Americas in the last couple of years, which includes a flagship showroom in Ft. Lauderdale of 45,000 square feet. We have all of our brands on display in Palm Beach, which we opened at the end of 2012. Also there is a new store in Miami Beach. So what we’ve got is a full inventory for the American market and the boat show is a great opportunity for us to showcase that with 25 models on display at a retail value of $130 million. We really try to represent one popular model of each brand. So when people come in, we can show them a big range. This is the chance to display the scale of our infrastruc-ture in the American market, something for everyone. Every boat show we mix in some new models along with the number of our inventory models. Moreover, the American market is an interesting market. It can be quite diverse. A number of our buyers are incredibly successful individuals and some of them are also quite impulsive so they come into boat shows and it’s not uncommon to for them to buy 80 or 90-foot boats in one day. It’s extraordinary.
Are these returning customers or the new ones?
It’s a bit of a mix actually. In the last couple of years we had a 30% growth in the market so we’ve been very successful, but we also have a retention ratio of an estimated 40% which means that we have an awful lot of repeat clients and also the people who buy the product for the first time and then My goal in this is not just to sell one boat to somebody come. My goal is to build a relationship with the client. Given that we have such a range of products and a portfolio, we can take people all the way up in the brands. So we start them with a 20 foot Riva and then go all the way up to our CRN brand which is now the largest that we build up to 240 feet.
It’s interesting what you’ve said. People no longer go the traditional way of taking it step by step but purchase a big boat right away.
The world economy developed so quickly that you have a lot of people that have reached a point in their lives and their careers where after such hard work they want to spend more time with their family and their friends, and having a yacht is an amazing way to do that. A number of our clients have grown with us through different boat sizes, others come in and go straight into an 80-foot plus. We also own a factory-direct organization. We’re one of the first to sell factory brands. So in America we’re the manufacturer and also the wholesaler and retailer and we deliver the boats to be serviced. So the nice thing for a client is when he comes on board, they’re buying it from the factory but after that we’re also responsible for managing and even hel-ping them with the after sales process.
Do you do trade-ins?
Absolutely. We prefer to do trade-ins of our own brands. We also have a brokerage business which also does chartering. On the brokerage side, it’s an old brokerage firm that has been around since 1945. What we decided to do this year is to supplement the brokerage business with the charter business. If a client wants to charter a boat instead of owning one or if they’d like to get some experience with yachting, we make it possible. Also, a number of our clients who own a boat, who might have their boat in the U.S or the Caribbean, and they want to have a boat in the Mediterranean for the summer, so we can help them find a boat just for the summer. Chartering is great; it generates additional income and keeps the crew fresh.
On a personal note, if you had to pick one boat, which boat would that be?
One of the nice things about my job is that I get to try a little bit of everything. I enjoy the different boats for what they do. I love going out on Riva 44 and 45 in Miami- it’s fantastic. I enjoy the performance and the handling of them. However the boat I tend to introduce everybody to is the 800 Ferretti because it is one of the best representations of what we do.