[Rhodes22-list] general boat's complaint (continued)

[David Culp]

Stan:

Thank you for your insight into the business.  I dare say that most sailboat
owners don't get the inside track on happenings at the factory; if the
factory is even still in business that is.

I want to comment on the loyalty/royalty program concerning the Rhodes.  My
experience in boat ownership over the years is that a used boat purchaser
always spends the maximum funds set aside for the purchase.  Either the
purchase price and the taxes consume the entire amount or the new owner
takes any funds left and applies them to things the boat needs.  And we all
know that used boats need something all the time.

It is a bit of a sticky wicket let's say, to request from a new owner 5 % of
the purchase price be paid to GBI when they have probably spent more money
then they intended to begin with.  The Rhodes 22 is the top of the scale in
22' boats and used prices are not cheap.  We see it all the time on the
list...  Folks are interested in the Rhodes but they are trying to purchase
it on a "Catalina" budget; so they "lurk" on the list either saving up their
cash or hoping to see a cheap boat come up for sale whereby they promptly go
off-list and complete the transaction.

You will remember in my case, that I sent GBI a check for $ 200.00 to cover
the promotional materials you sent me-but that was not 5% of the price I
paid.  In the meantime, I have enjoyed the technical support that I have
received as a member of the list from the owners and from yourself.  That is
worth something, even though I didn't realize it in the beginning.   This
boat and this list are pretty unique to the boating world.

I propose and this will make some people on this list unhappy, in fact, very
unhappy.... An Owner's association with an annual fee.  For that annual fee,
you have got to provide something however.  Which is another problem with a
royalty fee upfront; people always need to feel that they are getting
something for their money.   In this case, for the annual association fee:

Admission to the list
Technical support either from members or the factory
Availability and a price list of parts, sails, etc. that is kept up to date
so I can purchase it from you if I need something.


Except for the parts and prices, this is pretty much what we are doing
already.  Maybe you could come up with some member specials on pricing from
time to time for sails or parts or write an occasional article that only
members would get.  I don't want to burden you with a bunch of extra work,
but there needs to be something unique about membership.  In this way, the
new owner would feel they are getting something and it would generate
revenue for you over the longer term.  As part of the membership, if we
agree to give you 5% of the selling price when we sell, then I don't have a
problem with it; especially if the list helps my estate sell the boat.  I'll
even stipulate it in my will.  I figure if I owe a "loyalty fee", it is
probably to the list members who have taken their time and been so helpful
over the years.  If paying you a "royalty" fee helps keep GBI in business
then that helps them and you.  As a seller, if I pay 5% then it gets my
buyer on the list free for two years.  Then he/she can do the responsible
thing and start paying their own royalty/loyalty dues.

The other situation which started the discussion in the beginning has to do
with after-market products or other parts unique to the Rhodes.  If a member
has an after-market item to sell to the list which is unique to the Rhodes
and/or would normally be available from GBI for sale, then he/she goes
through you.  They can advertise it and discuss it; but I buy it from you
after you have added your mark up or it cannot be advertised on the member's
list by another member or by a third party.  Simple as that.  They are a
supplier of General Boats and you are the distributor to me.  Obviously, the
list membership information is kept proprietary to prevent direct marketing
by a third party.  If a member tries to go behind your back... we can take
care of that.  If something comes up for sale on the open-market that is
unique to the Rhodes 22 and there are legal issues, then that is a
discussion for lawyers and not for this forum.

Right now MJM is administering the list.  I think he or whomever takes on
those duties gets their membership free.

I hope you will take these suggestions under advisement and if it is of
interest, let us know what you think the annual membership fee should be.

For everyone else, let the flaming begin....  But just keep in mind what the
purpose is here.  Trying to come up with something palatable to help GBI now
and us in the long run.

David

PS:

Other thoughts:  The Rhodes 22 website is "technically" one of the best I
have ever seen as far as the boat information goes.  However, it needs some
polish to be a more effective marketing tool.  More timely information and
more emphasis on the recycle program and availability of used boats comes to
mind since new boat sales are down.  Also, have you ever considered a new
"entry level"  boat without all the bells and whistles which someone could
purchase at a bit lower price?  You've talked about a racer before.  Could
you come up with something without having to have new molds-marketed as a
"Sport" Rhodes 22?   Lower the interior weight, put a standard mast and
racing sails on it and a spinaker.  Catalina has a "sport model" and it does
pretty well I think.  Just some ideas I have batted around. dc







Date: Sat, 25 Jul 2009 13:46:52 -0400
From: "stan" <stan at rhodes22.com>
Subject: [Rhodes22-list] general boat's complaint (continued)
To: "The Rhodes 22 mail list" <rhodes22-list at rhodes22.org>
Message-ID: <038FA83D95464CCFB609CA722206B2D8 at rhodes>
Content-Type: text/plain;       charset="iso-8859-1"

Rose and I want to thank you all for indulging GB in the use of your forum
on an issue that is so basic to GB.

We want to thank those that take issue with our position but attempt to be
evenhanded.  (If academically interested, we can provide exhibits and
witnesses that prove the accuracy of our facts.)

We are empathetic with those who chafe at this sort of thing and remain
silent - in our younger days we probably would have done the same.   It was
not until 50 that we adopted our tribe's slogan of  "never again" and took
on anyone who wronged us:  A policeman.  A lawyer.  a station wagon full of
nuns (just kidding about the station wagon), a giant corporation to
docketing at the US Supreme Court.   We prevailed in all these pro se
actions simply because we do not complain unless the facts and logic are
solidly on our side - but we digress.

And, in particular, we want to thank those who understand the logical side
of our position and offered suggestions.


Re the issue of the Loyalty/Royalty program:   Its reasoning seems so
correct that it is hard to comprehend dissent.  Those thinking us crazy for
such radical thinking have to sit in this chair for just one day.
Interestingly, dissenters enjoy products from many segments of industry who
have already worked out such support programs, yet these dissenters seem to
be drawing their own grandfather clause line as to which industries should
not be entitled to residuals on their efforts.   Those in this group have
but to request and we will expand on the good sense of this program.   It
has been emotionally gratifying seeing former members of the "You must be
crazy" society, when, becoming members of the "List" family, seeing the
light and converting.

Re the issue of the 50 years creating a unique product now having others
take bites of its parts for their unilateral gain, if not resolved, will
come home to bite us all.   ( When I walked out of the hallowed halls of ole
PU I vowed not to go into business because I could not stand the ethics I
saw, and assumed, had to go with that territory.  But it was pre-ordained; I
ended up spending most of my life a driving capitalist.   And it has been a
blast, for me and my partner of 60 years - because we made the making of
money our secondary goal.   (The effects of that kind of religious fervor
has surprisingly turned out to be rough on our opponents.)   There are ways
we can go to stop the taking of free bites of the profitable parts side of
GB's business::

When we sold Venture Sailboats (Macgregor), dealers could buy sails
elsewhere and make an additional profit on Roger's creation at Roger's
expense.  Roger, who graduated at the top of his class at Stamford, simply
raised the price of his boat and included sails.  Being the tough business
man he is, he did it without notice and dealers had to eat their sail
inventories they bought elsewhere.  We are slow learners but could price
Rhodes sales to include a part an outside seller has latched onto.    Or,

We could simply be unresponsive to boat owners who purchase parts, unique to
the Rhodes design, from others in competition with GB or who fail to honor
agreements with GB.   We inherently do not like this retaliatory type of
solution, but it is a solution.   Or

We could simply close shop and that would close the market for unauthorized
parts vendors.   This "cutting off ones nose" solution is not our choice.
 However, not taking on rogue suppliers, eating away at the life cash flow
of the company, makes it an inevitable solution.


In an effort to avoid any of the above solutions, based on the thinking of
List members in this particular complaint of GB vs. Art C, we have some
proposals that we will present to the List next week for your appreciated
feedback.  The pro bono time we are having to devote to the problems and
questions of private sale Rhodes is becoming so overwhelming (and we hate to
be mean spirited enough to tell them where to go) that we just can't seem to
manage all of this issue in one sitting.

ss