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Fountain Building Boats to Order, Hoping to Establish Regional Dealerships

The much publicized bankruptcy, reorganization and recapitalization of Fountain Powerboats in 2009 has most industry observers still wondering what’s happening with the Washington, N.C., company. News out of the factory since the reorganization has been scant.

I caught up with the company’s Wyatt Fountain, the son of  company founder and CEO Reggie Fountain, earlier today. Here’s what he had to say.

How’s it going at Fountain? Are you building new boats?

Yeah, we’re building one to two boats a week. Everything is retail sold, with deposits.

Retail sold. Does that mean built to order?

Yes. All the orders either come from our dealers or the Fountain Super Store, which is our in-house dealership. Having everything retail sold helps us control our costs more effectively.

The fishing boats are doing the best. The sports boats, we build one or two of them here and there, but nobody in our niche is building a lot of them right now. I’m walking down the production line right now and we have a couple of fishing boats and a couple of cruisers going.

The distressed inventory market still seems to be having impact. That said, there are still people who want new boats.

We have probably 100 people working now. Our service business is doing well. We have customers sending us their boats for new paint, new upholstery, new engines and so on. A lot of manufacturers don’t have the ability to do service—they build boats and that’s it—but we always have. Plus, we are completely self-sufficient, which means we don’t have to depend on other venders. We make our own windshields, we make our own seating, we do everything ourselves. So that doesn’t just help us with our service center, it helps us do things like build new interiors. We’re going to push really hard in the service center this winter. Our sports wear sales are also doing well.

How do see you Fountain’s business evolving in the long-term?

Our goal is to have minimal stock in the field, because we don’t want inventory pressure, which drives down prices. You can count on one hand how many stock-inventory boats we built for 2010 and we will build for 2011. We want to have very little supply, which will helps bring back demand. We hope that demand exceeds supply. If a guy wants a 42, for example, we want to be able to say, ‘There are one or two in the country, or you can order one and wait for it to be built.’ We do want to get to a middle ground where there are a couple of boats in stock here and there and you will see some inventory from us down the road. But right now we need to flush out everything else.

Are dealerships still part of Fountain’s long-term plan?

Yes, but we want to have fewer dealers. We want to have regional dealers. Right now, there aren’t a lot of dealers who can do anything, period. So that will take time.