NUMBERS NOT THE END GAME FOR RIVIERA BOSS
Written on the 17 May 2016 by Nick Nichols
RIVIERA Australia's export sales surged 47 per cent in 2015, with the rate of sales for its newest product now matching pre-GFC levels.
However, Rodney Longhurst, the owner and chairman of the Gold Coast's flagship luxury yacht brand, isn't one to get excited by the figures.
Longhurst has just notched up four years rebuilding the business that he bought from receivers in March 2012 and he couldn't be happier with the progress.
Riviera Australia is a completely different beast to the shell of a company he rescued then, and even more different to the business that was run as a profit machine by private equity interests for a decade before then.
"I can't talk too much to the private equity period," says Longhurst.
"They shouldered the company with debt and did various things that, in my opinion, were not sound business practice for high value discretionary items."
"When I bought Riviera, my vision absolutely was to make it one of the great names in boating and to be outstanding in every aspect of boating lifestyle."
Riviera's workforce may have since expanded more than fourfold to 480, and the company may have added a fifth production line to its Coomera factory to cater for big sales of its new release 5400 Sport Yacht, but Longhurst plays down the impressive whirlpool of numbers.
"We are very mindful of being able to scale to suit the economy," he says.
"You can't just go in this business and think next year you will sell 20 per cent more and the same the year after.
"There are going to be ups and downs. So we have developed a model that can work with the economy in front of us. Outside of that we work very hard to improve our market share."
While Riviera doesn't reveal sales figures, it has given Business News Australia exclusive insight into the pace of growth within its markets over 2015.
Exports led the way during the year with gross export revenue surging 47 per cent as the total number of yachts sold to overseas buyers climbed 50 per cent.
Forward orders for export markets in 2015 surged 88 per cent in wholesale revenue terms, while the number of boats on order to foreign buyers jumped 91 per cent.
This year, Riviera expects to build 100 boats for foreign buyers, giving the company a total indicative production target of about 200 luxury boats.
While Longhurst says the lower dollar has helped Riviera export sales, he believes the net effect has not been that great.
"I don't think we're getting any free kicks," he says. "The team here is working pretty hard and earning every sale. In 2012, when we first came in, it was still pretty tough, and it's not that much easier today."
Longhurst says the focus on refining and improving product lines has been critical to sales numbers, along with a perception that the company has finally found its financial sea legs after three years of turmoil from 2009.
"We're also seeing the strength of the Riviera brand," he says.
"We've been doing a lot of customer feedback on how we can do things better. There's nearly 5200 Riviera boats around the world so we already have many boats out there and we've been able to grow on that."
The big success story of the year has been the release of the 5400 Sport Yacht, described by Longhurst as hitting the 'sweet spot' among buyers. It sells for between $1.5 million and $1.6 million, and Riviera has already taken orders for 30 units since late last year.
The new luxury yacht is reported to boast enough headroom to accommodate Longhurst's tall frame. However, Longhurst says Riviera is making the boats more spacious in all dimensions in response to feedback from clients.
Riviera will be hoping to build on its sales momentum this weekend at the Gold Coast International Marine Expo held annually at the Gold Coast Marine Precinct.
While the event competes directly with the Sanctuary Cove International Boat Show, which also kicks off on May 19, Longhurst decries the lack of unity within the Gold Coast marine industry on its biggest weekend of the year.
"It's not just big boats on one side of the river and small boats on the other," he says.
"There are different elements (within each event) and together the sum of the parts is much greater."
Longhurst says the Marine Expo brings buyers even closer to the art of boatbuilding through tours of the Riviera factory floor and workshops across the marine precinct.
"It would be better if there was a way for the boat shows to work together," says Longhurst. "If they did, without a doubt it would be the greatest boat show in the southern hemisphere."
Author: Nick Nichols