West Marine Restructures Debt

[GordMay]

West Marine Reaches Deal To Restructure Out of Court

West Marine has reached a deal to restructure its roughly $800 million of debt out of court.
The Fort Lauderdale, Fla.-based company will receive $125 million of new funds from L Catterton, its private-equity owner, as well as a group of existing lenders.
Approximately $660 million of West Marine’s debt will be converted into equity warrants as part of the deal.

➥ https://www.wsj.com/articles/boating...court-c16fc706

[Celestialsailor]

Amazing at the prices they charge that they would be in debt. Maybe because of online sales.

[sailingharry]

Their prices may have a lot of markup. But if you don't make sales, you don't make a profit. I have a West 3 miles from my house, but can't recall if I've ever bought anything there. Mail order, Wal Mart, or (my preferred choice), save up orders and buy at Fawcetts on my next trip to Annapolis (50 miles away). West is routinely 50% or more above the competition, even for small stuff I can't bring myself to shop there.

[George_SD]

People hate on WM a lot, but I honestly don't share that view, here is why

- they have nice stores with lots of gear - from rigging to fishing
- they have those odd pieces that I can't find anywhere else in town, only online.
- they have great return policy. I sometimes buy more than I need for a project or various sizes of something because I don't know what will work and then return things I didn't need.
- unlike many local small stores - they have a nice website where I can buy things that are not available in store and I can have it delivered to the store (So that I can look at it before actually paying for it).
- their prices are not outrageous, but are not low either. Some of our local "mom-and-pop" stores have higher prices on many items than WM does. But WM can't compete with online-only retailers on prices....
- they have good customer support. Their folks are nice, helpful and do try to make things right.
- their Advantage membership for $25 a year has some decent perks - 4% off on purchases, basic Boat US towing service, member only sales, etc.


I care about the quality of service, sometimes it's not always about the price. For example - i needed a part same day for a project I was working on. As I was driving to the marina, i called our local non-chain store to find out if they even had. At first the phone was ringing forever and no one would answer. Then someone picked up the phone and put it down ending the call. I was literally 3 minutes away from the store so I just walked into it to see 4 sales guys standing at the counter telling stories...they could care less about the customer who called, they were busy entertaining each other. That made me upset and I went to West Marine who had the part I needed and a lower price. Their staff was also very nice and friendly.

Lastly, I want to support all local stores and businesses. Variety and competition is good for consumers. If West Marine closed, we could have a lot less choice and I bet prices would go up in the remaining stores.

[Kettlewell]

You can find good prices at West Marine by shopping the sales. I often get bottom paint there during the winter or early spring, and the price is a lot lower than any comparable paint I can purchase at other local stores. OTOH for routine maintenance items often you can beat WM pricing at your local marina store, and I like to do that to support them. WM is absolutely ridiculous on some routine maintenance stuff, like Rotella oil for example. It is twice as expensive as Walmart for the exact same product. Similarly, WM batteries are hugely overpriced if not on sale, when they are only overpriced. Online pricing often beats WM, but when you need something that day it may be worth it to pay more and get it locally. Plus, WM stores vary greatly in what they stock, the quality of the staff, and how they handle things like price matches. I really miss the days when BoatUS competed head-to-head with WM on quality and price.

[Sailor Sailor]

Originally Posted by GordMay

West Marine Reaches Deal To Restructure Out of Court

West Marine has reached a deal to restructure its roughly $800 million of debt out of court.
The Fort Lauderdale, Fla.-based company will receive $125 million of new funds from L Catterton, its private-equity owner, as well as a group of existing lenders.
Approximately $660 million of West Marine’s debt will be converted into equity warrants as part of the deal.

➥ https://www.wsj.com/articles/boating...court-c16fc706

This could be a pre-packaged or pre-negotiated chapter 11 plan, popular these days, the debtor reaches agreements with its biggest creditors, then files chapter 11. It already satisfies the requirements for confirmation as far as the numbers and classes of claims. Usually, someone gets screwed in these deals - the smaller creditors, maybe landlords of nonperforming stores that will be closed.

BTW, I like WM and its price matching policy.

[wholybee]

Originally Posted by George_SD

People hate on WM a lot, but I honestly don't share that view, here is why

- they have nice stores with lots of gear - from rigging to fishing
- they have those odd pieces that I can't find anywhere else in town, only online.
- they have great return policy. I sometimes buy more than I need for a project or various sizes of something because I don't know what will work and then return things I didn't need.
- unlike many local small stores - they have a nice website where I can buy things that are not available in store and I can have it delivered to the store (So that I can look at it before actually paying for it).
- their prices are not outrageous, but are not low either. Some of our local "mom-and-pop" stores have higher prices on many items than WM does. But WM can't compete with online-only retailers on prices....
- they have good customer support. Their folks are nice, helpful and do try to make things right.
- their Advantage membership for $25 a year has some decent perks - 4% off on purchases, basic Boat US towing service, member only sales, etc.


I care about the quality of service, sometimes it's not always about the price. For example - i needed a part same day for a project I was working on. As I was driving to the marina, i called our local non-chain store to find out if they even had. At first the phone was ringing forever and no one would answer. Then someone picked up the phone and put it down ending the call. I was literally 3 minutes away from the store so I just walked into it to see 4 sales guys standing at the counter telling stories...they could care less about the customer who called, they were busy entertaining each other. That made me upset and I went to West Marine who had the part I needed and a lower price. Their staff was also very nice and friendly.

Lastly, I want to support all local stores and businesses. Variety and competition is good for consumers. If West Marine closed, we could have a lot less choice and I bet prices would go up in the remaining stores.

100% agree. The fact that there is a store locally that has what I need to finish the job today is a godsend. And I must not be shopping the same online stores as everyone else. West Marine is not 50% more than other retailers. Often, it's the exact same price, sometimes a bit more, but not 50%. And if you catch a sale, it might be cheaper.

Plus, as a gold or silver member, I get gift certificates back, which lowers the price overall of everything I buy there.

It's odd listening to retail conversations. "Shop local, don't buy online." and "This store is too expensive, shop online.", "Don't buy from Amazon, it's an evil company", and "I can get it cheaper on Amazon."

[Kettlewell]

Actually, my biggest complaint about WM is the lack of inventory in many stores. I can understand not carrying everything in every store, but I often run into the problem that something is out of stock that is supposed to be on the shelf next to its label. Or, they might only have one or two of something I need six of. Defeats the purpose of spending a bit more in order to get it today.

[sailingharry]

Originally Posted by Sailor Sailor

BTW, I like WM and its price matching policy.

Their price matching used to be good. The last time I checked, they would only match a brick and mortar store within a fairly small radius. Why would I go to the research to find a lower price and then go to West Marine when I could go to the guy who actually is selling it for that price?!

Maybe they've changed it again, but right now their price match is nearly worthless.

[Kettlewell]

From the WM website:

Price Match Guarantee
If you find a lower price on an identical product at a local retail store, West Marine will match that price within 30 days of purchase.

We will price match:

Local Stores within 50 miles
Amazon, direct from Amazon only
Sale and regular prices before shipping, handling and/or sales tax charges
Retail prices for wholesale Customers
What do I need to do to get a price matched?
Make sure that the product you are wishing to purchase qualifies for our Price Guarantee.
Visit your local West Marine store, chat with an associate online or call 1-800-BOATING (262-8464) and let a West Marine Associate know you have an item to price match.
Provide the name of the competitor, the item price and the advertisement, store or online location where you saw the price.
The West Marine Associate will confirm the price of the item and that it meets all requirements for our price match guarantee, and match it.

[JBP]

Originally Posted by George_SD

People hate on WM a lot, but I honestly don't share that view, here is why

- they have nice stores with lots of gear - from rigging to fishing
- they have those odd pieces that I can't find anywhere else in town, only online.
- they have great return policy. I sometimes buy more than I need for a project or various sizes of something because I don't know what will work and then return things I didn't need.
- unlike many local small stores - they have a nice website where I can buy things that are not available in store and I can have it delivered to the store (So that I can look at it before actually paying for it).
- their prices are not outrageous, but are not low either. Some of our local "mom-and-pop" stores have higher prices on many items than WM does. But WM can't compete with online-only retailers on prices....
- they have good customer support. Their folks are nice, helpful and do try to make things right.
- their Advantage membership for $25 a year has some decent perks - 4% off on purchases, basic Boat US towing service, member only sales, etc.


I care about the quality of service, sometimes it's not always about the price. For example - i needed a part same day for a project I was working on. As I was driving to the marina, i called our local non-chain store to find out if they even had. At first the phone was ringing forever and no one would answer. Then someone picked up the phone and put it down ending the call. I was literally 3 minutes away from the store so I just walked into it to see 4 sales guys standing at the counter telling stories...they could care less about the customer who called, they were busy entertaining each other. That made me upset and I went to West Marine who had the part I needed and a lower price. Their staff was also very nice and friendly.

Lastly, I want to support all local stores and businesses. Variety and competition is good for consumers. If West Marine closed, we could have a lot less choice and I bet prices would go up in the remaining stores.

Absolutely. I'd frequently buy stuff at my local West Marine because I could see it in person. The staff (OK, it was one person) was always helpful and reasonably knowledgeable. I was very sad when our Pittsburgh store closed several years ago.

[CarlF]

Another example of Private Equity raping a marine supplier. While I don’t know the details on West, the usual game is they make an investment and simultaneously have the company take out a huge loan. They then pay themselves a dividend out of the borrowed money to get their investment back within a year.

To pay the huge interest payments on the loan the company cuts costs by laying off staff and raising prices. This causes the business to go south. Eventually the company faces bankruptcy and the lender has to write off the loan. The only one who who comes out whole is the PE company who already got their investment back plus an annual management fee of several million for their trouble.

Now it appears the PE company is just going to repeat the scam. They are making a new investment and West is borrowing new money likely at a much higher interest rate. The previous borrower is getting nothing but some likely worthless stock warrants.

[Chotu]

Originally Posted by CarlF

Another example of Private Equity raping a marine supplier. While I don’t know the details on West, the usual game is they make an investment and simultaneously have the company take out a huge loan. They then pay themselves a dividend out of the borrowed money to get their investment back within a year.

To pay the huge interest payments on the loan the company cuts costs by laying off staff and raising prices. This causes the business to go south. Eventually the company faces bankruptcy and the lender has to write off the loan. The only one who who comes out whole is the PE company who already got their investment back plus an annual management fee of several million for their trouble.

Now it appears the PE company is just going to repeat the scam. They are making a new investment and West is borrowing new money likely at a much higher interest rate. The previous borrower is getting nothing but some likely worthless stock warrants.

Exactly!


Also, how is the following achieved from upthread?

"unlike many local small stores - they have a nice website where I can buy things that are not available in store and I can have it delivered to the store (So that I can look at it before actually paying for it"

^ I have tried this recently. I had to give my card number and pay by card to get the item at the store.

Also WM pricing is a lot like whole foods pricing. Severely misunderstood.

WM is equivalent to my commercial account at defender these days. Same price.

[Orion Jim]

Originally Posted by Chotu

Exactly!
WM is equivalent to my commercial account at defender these days. Same price.

Correct. For many years Defender got 90% of my business. Now that they have been bought out and dramatically increased prices and reduced selection I do 90% of my business with West Marine. The new Defender “showroom” is a joke.

[Madehn]

I find them overpriced and their staff not very knowledgeable. I literally stood for 1/2 an hour in the Kemah Tx west marine with my checkbook in hand trying to get someone to answer questions about a chartplotter and radar. Ended up going home totally aggravated and bought 13k worth of electronics on line. Their prices are quite high also. Basically I will only go there if the local chandler and local hardware don’t have it and I have to have it today. Otherwise just not worth dealing with their prices and staff. Incidentally this is supposed to be one of their larger flagship stores. Frankly I don’t see them in business much longer.