Welcome to The Dive Locker podcast, the podcast for dive professionals where we bring you the latest in diving industry resources that make you excellent at teaching techniques, risk management, and dive business.  I’m your host Tec Clark, and thank you everybody for being with me today. In today’s episode, we are going to go over two segments.

Segment one is diving industry statistics. Now if you’re like me, you hear the word statistics and you start to have a little bit of a seizure. Well, why do we need to have dive industry statistics? Why are they important? You’re going to learn that today. We’re going straight to Willie Cline with The Cline Group. He is responsible for compiling the diving industry’s most comprehensive survey and statistic results. Also, we’re going to go over performing FILO,F. I. L. O. Is this a European breakfast food? Is it a dance? No, it is a risk management technique that you should be doing for all of your confined water and open water dives.

But first, let’s thank our episode sponsor, the DEMA Show DEMA Show 2019 taking place this November 13 through 16 in Orlando, Florida is the world’s only international trade-only event for dive, travel and action water sports professionals. This year’s expo floor will feature more than 600 leading dive equipment manufacturers, travel destinations, apparel wholesalers and service providers. Register today to create stronger partnerships and uncover the latest and most innovative new products and services. Learn more at DEMAShow.com so let’s suit up and dive into this week’s episode.

Diving Industry Statistics

Alright everyone. Now let’s take a look at some dive industry statistics. We’re going to do this with The Cline Group report that comes out quarterly and I am just tickled to have Willie Cline here, good friend, industry legend and veteran who has been doing this report for dozens of years and I’m just so happy to have you on Willie. How are you doing today?

WILLIE CLINE: I’m great Tec. It’s so nice to be on your show. Thank you.

TEC: You’re welcome. Well, you know you’ve got a survey that comes out quarterly and myself and tons of dive pro’s look at this and we are studying it to see some trends. We look for comparisons from a previous quarter or from the previous year to see what the health is in our industry. Tell us about this. I think this is such a unique tool that we can use as dive professionals and tell us about that and tell us even how people can be a part of this as well.

WILLIE CLINE: Sure. Well, you know, first I’m going to digress a little and tell you a little about myself. For those that don’t really know me well in the industry. I’ve been doing this particular survey for 18 years, but I ran a consultancy in the diving industry out of the Dallas area since, 1990. So over 30 years. But you and I share common roots. We both, have, have gone through Pro Dive or have worked at, right. And so, I actually started my professional side of the industry in high school in Southern California where I ended up, at the ripe old age of 16 being a dive shop manager because the dive shop owner could go home early and put me on the insurance. So that was my first for it, trying to see the real sophisticated side of the diving industry.

And that from those simple beginnings that I went on to become a course director with Alex Brylske, in fact, I was actually the only instructor employed at Pro Dive in 1986, early 1987, I replaced a girl that had gotten bent and, and I was the only instructor and I looked at Greg McKay, I’m like, are you kidding me? I’m a brand new instructor and I’m, I’m the only guy here kind of thing. Of course, it went from that to being, you know, one of the world’s largest, instructor training facility.

TEC: Exactly. Oh my gosh, I didn’t know that.

WILLIE CLINE: Yeah, yeah. Alex. In fact, I was the first hire and then Alex was one of, I think like the second or third. And I had the, that’s really where we met. We became great friends and I had the wonderful joy of being able to just participate as he redesigned the entire IDC curriculum back then.

So I’ve kind of been involved in the roots level of our industry for a long time. I left there and set up a business in Dallas. Actually with the intention of thinking, diving was finally done with me and I was done with it because I had to go on and get a real career. And it followed me. And this is a really long story for probably a totally different interview how I got here. I got to this point, but needless to say for the last seven years, I have chaired DEMA’s research committee. I’ve also been vice chair of their board of directors, for two terms. And I’m running again, by the way, read this fall. But cause I think I’m not done. I think there’s more things we can do from the research side of things.

The problem in our industry has always been, we tend to be very coveted of our information. Most industries you can go out and you can buy lists, you can buy data, you can find information available on the activity level, the consumer, that professional side. Our industry is just never ever been that way. It’s been very, very closed. Part of the reason why dive publishing is so struggle, so difficult in this industry and has been, is that there’s just a very few people in new, in the industry that have the lists and we all,  it’s just the nature of the animal. So about 18 years ago, in all the research I’ve done in my company has done a lot of market research and consulting over the years in marketing for a variety of clients has always usually started when a client’s hired me with research.

And so out of pure necessity, we ended up doing and becoming probably the largest provider of private research in the dive industry over the last 30 years. One of the things I saw on many years ago was what we lack is basic forecasting tools and DEMA, bless them, does a fantastic job with reporting with what they can and what they have access to. But what we as an industry don’t have is the ability to forecast and say okay, what is going to happen the next quarter, the next year. So the very first attempt, which is the exact same survey that’s been done for 18 years, 72 I believe 72 or 77 quarters now, is the survey that I send out and it is a very simple survey and I ask people to identify where in the world they are, what time zone they’re in, if they’re in the Americas, what their business classification is.

Cause we want to know everything. We don’t just want to look at retailing and when to look at really the whole global picture of manufacturing to training and so on. And I’ve had an average of probably over the last 18 years, somewhere around 4,000 to 5,000 surveys had been completed. The way we look at as I tend to look at a quarter at a time. So I look at the industry to see how you people have reported and then we ask them the only question I’m aware of that’s ever been asked in the industry consistently is, “how do you think you’re going to do next quarter?” That type of survey is very subjective in nature, but when you ask it the same way, quarter after quarter after quarter to the same group, in theory, you end up with very accurate armchair estimations.

So that’s really essentially all forecasting is how is someone thinking what they’re, they believe they’re going to do. So, my survey is absolutely free. It’s available to anybody to participate. You don’t even have to even be in the industry, but if you’re not, you probably won’t understand a lot what’s in it.  And my website is WilliamCline.com. That’s W I L L I A M C L I N E dot com. You can go there. It’s really easy to find a subscription link. I don’t sell anything. I simply use that information to send out the newsletter. And the way it works is every quarter we send out this survey, it’s tabulated through a program called limesurvey, which resides on my servers. That’s not even a third party that does that. And then about a week to two weeks later after the collection period has expired, I’ll go ahead and send out the results in the second quarter survey is out right now.

But I would ask people, you go to my website, certainly subscribe to it, please participate. It’s the kind of survey that’s a crowdsourcing style survey. The more people participate, the more accurate it becomes. It’s just that simple. So I’ve had some months where I’ve had, or some quarters where I’ve had 300-400 people respond and other months, maybe it’s only a hundred or so, it varies depending upon kind of the publicity and the promotion that’s going on in the industry.

And I think people sometimes think, “Oh, it’s that survey again.” But if everybody would, and it takes only minutes to do, it’s literally eight or nine questions. It’s that quick. And anybody that has any kind of a basic accounting function within their op within their company can probably do this right off the top of their head. It’s helping the percentage of increase this quarter versus last quarter. So, that’s the kind of the 90 second overview of, of who I am and what the survey’s about.

TEC: That’s fantastic. And you know, I think that there’s other people that are sitting there going, “you know, I don’t want to give my information” like you said before, you know, but this is it’s not that, it’s not like something bad is going to happen at all. You know, this is more in the lines of sharing with the industry how you’re doing and how you feel. I love the part about that. It’s like that, almost the business confidence side and I’ve watched that at times, wane, and get stronger and it kinda does this ebb and flow, you know, when people are saying, “yeah, I feel good about the upcoming quarter” or  “I don’t know, I’m a little shaky” and we’ve seen that through recession periods and whatnot. So I think that that’s a really good tool to use.

And then to be able to see it kind of, regionally when you look at that, okay, if we’re doing hot down here, but maybe other places aren’t or vice versa because we’re getting hit with tropical storms and hurricanes like you and I were talking about earlier, what’s that doing for, for the business down here, you know? So I think that that’s a really good thing to, to do. And I do want to encourage everybody to be a part of this, to subscribe and also to put some of those data points and be a part of this because just as Willie says, the more people that are into this survey, the more accurate it becomes. And that’s fantastic. So we will put the link to the subscription for Willie and his web page so that you’ll be able to go right there and do that.

Now, I also want to say yes, I just saw the DEMA ballot come out, so I know that you’re on there and that’s gonna be awesome. You’ve done a fantastic job on DEMA and you continue to do that. So thank you for that. And thank you for that service to our industry. Willie, will you tell us what the last quarter results were and give us kind of a, a picture of what that looks like for people that have seen it, haven’t seen it. This is the first time they’re learning about it. Share some of those data points with everybody.

WILLIE CLINE: Absolutely. And if it’s okay, I’m gonna digress to a couple of points that the survey has been done for so long that we can go back and look at and look at different quarters in this case years and last year DEMA had produced a, the, the census data that they produce has been really struggling because it doesn’t report all of the training agencies it only reports a few. So, I went back and looked at our survey data that we pulled from the last 24 months up through June of last year for instance. And that’s the beauty of being able to have such histories. I can go back and pull and see specifically how dive retailers and independent structures, cause we actually surveyed them separately because I believe it’s a category that’s really largely overlooked is independent instructors, but they’re there combined with retailers and for the term of this tabulation and we had a two, a two and a half year average growth of 3.7% so that is really significant in new certifications.

And if a lot of instructors are out there listening or dive retailers, you know it’s, as I said from the very beginning, good, accurate data is really hard to come by and DEMA bless their heart is doing the best they can at trying to do the census. But it’s hard to do a census if you don’t have the entire picture represented in the census. So this survey crosses political lines, crosses training agency line certification lines. It has nothing to do with who you’re affiliated with. It’s just simply asking you was it so, but we are do have that ability. So that’s a really important number that the survey shows for last two and a half years. Contrary to kind of what’s out there, we actually have seen a very slow growth. Our industry’s rarely gone through dynamic growth. It did when introduced modular school program because all of a sudden anybody could teach it and there was an explosion.

On the consumer side, we saw a huge explosion, in the nineties you know, but at most average, our industry doesn’t tend to grow more than three to 5% a year and it’s been that way for 30 saw 40 years now. That’s called a slow growth industry. That’s how you build resorts on. That’s how you build million dollar liveaboards with cause you want an industry that has got that nice trend. So that’s a really important figure. The second thing I want to point out before I jump into the, to the last quarter survey, if you go to my website and you can see every single quarter going back several years, but the, the quarters are the fourth quarter of the year because what I do, and it started with the year before, but last year especially to have really excellent John, my opinion is I take the entire year and I total it up and I can tell you how we did for a year as a whole.

And it’s really, really, really important data. So the fourth quarter study, you know, you can see things like how we did in 2018 as a whole, like 4.6% of the, of the 4.6% growth in our industry globally. You know, we had a, what does that, I’m just looking at, I understand that 3.3% growth for retailers in 2018 those are critical numbers because that is the health of our industry. You know, you look at when you look at things on a granular basis such as in a quarter, you tend to see fluctuations and, and like you said, there’s waning and waning and there’s excitement. But we also are not impervious to the economic effects all around us and forget that sometimes.

And, and the guys that Dive Training, Mark Young and Gerry, they do a great job on their Insights and Betty Orr now of what the, how they publish their, cause he’s always, ever since he’s published DCB Dive Center Business Magazine, he’s always tied in the industry to the economic growth factors of our country. That’s really smart cause we do bottle those trends to some degree. The idea is to be resilient. We to see it’s economic resilience, but it doesn’t mean the retailers are not affected by the economic conditions. So they see that on a quarterly basis.

And sometimes you can even tie it to economics as a whole. But definitely when you have storm events like what occur with Dorian affects consumer confidence. Consumer confidence, as we know, affects their willingness to book. They may decide to go to Hawaii instead of Florida Keys this year. So we send a tendency though, so the fourth quarter is always a really important survey. It’s up on the website. The most recent one is the second quarter back to, we’re here about 10 days away from doing our third quarter.

And in the survey there’s two parts of the results. The first part is the reporting of what people said happened in the second quarter and then the second part of the survey as what they think is going to happen in the third quarter, which I personally find very intriguing because it’s just not in our industry. That gives us that kind of roadmap. And even though the sample size is relatively small, I always identify exactly what the sample size exactly where everybody’s from, exactly which countries and exactly who’s reporting. There’s a little tight table on every single survey. So you’re in the, in the research industry, you can take that with a grain of salt because if you know a little bit about statistics, excuse me, they tend to two, you have error rates. Error rates are affected by the number of people respond.

Just like how have the presidential poll, the 1,700 people, and it becomes very accurate usually to predict what happens. It doesn’t take very many, but it does have to be a random sample and there’s a lot of other factors there, but the lower the sample, the higher the error rate. It doesn’t mean that the data is incorrect, it’s the higher percentage chance it could be incorrect. So this data, all of my surveys tend to run between a seven and a 10% error rate because of the size of the sample. And what that means is if you repeated this survey 100 times between seven and 10 times, you would find in, you would find the numbers will be higher than seven or 10% of what’s reported. So just means that there’s a chance for a higher error rate. It doesn’t mean the survey itself as is inaccurate.

Our industry is a very small industry. We have a very small number of retailers. If you took the total global number of retailers, it’s probably less than 5,000 to 6,000. I’m not even sure if that’s right, you know, so when you’re looking at say the retailing base, it doesn’t take a very large sampling to have a good accurate number. We had a good, a good quarter. Most everybody in the second quarter in general, and I won’t go into a lot of detail, but in the second quarter everybody was pretty much up. Saw an increase in certification slightly. We saw an increase in, actually take it back. Certifications were slightly down, but overall business averages were up. We saw travel, did very well that quarter. The big change in the second quarter is that forecast from third quarter of the forecast from first quarter to second was very robust.

Everybody was very positive. They felt like things were rocking it. And then we did have a very strong summer. It wasn’t probably as strong as whatever they hoped it would be, but I do see a very much of a, a lackluster outlook for the third quarter.

TEC: Really?

WILLIE CLINE: Yeah. And it’s not bad, but it’s just for instance, 44% of dive retailers think they’re going to have more sales, than, than what they had last year for third quarter.

TEC: So only 44%.

WILLIE CLINE: Yeah. Right. You know, it’s not everybody and these numbers are always deceptive. You know, you can find bright spots in every single quarter in every single state and every single city of dive shops that are just blowing and going and they don’t follow anybody’s trends cause they’re just great marketers and they’re great. They got switched on, you know, but again, this is  ask enough people, you tend to get a consensus.

On my survey you do have the ability to drill down and look and see, as you mentioned, very regional. So I, I do tabulate, retailers and independent structures. Now I do have other data in there for manufacturers for if we have enough reporting live awards, we have enough reporting. The travel industry usually I combine into one big lump, which is dive resorts, liveaboards.  I include if you’re a charter boat, be reported in there. So we will sometimes have a, a combined a number in there and the travel cause I think that’s important to look at from an industry to how does our retailing base doing, which I include independent instructors in the retailing base. I do separate them in some cases to beat up on their numbers and reporting. But they do represent, like I can, I used to teach certify in a small town in Branson, Missouri.

I had a little dive shop and it was a ton of little independent instructors around there that were responsible for, you know, far more than say what the large shop in Springfield at the time was doing. So, you know, you have to look at all those factors. The survey tries to, but from a, from a regional area, we break it down into three broad regions. The United States, the Eastern time zone, central time zone. I usually combined at Atlantic actually in Eastern because that does open new fundamental little bit. And then you have, the Pacific, Hawaii and mountains are all reported usually in one big classification. It’s a very broad, big region, but it’s probably one of the hardest areas I get have getting participation from is shops in the West coast. So shops my California brothers, you know, or you instructors out there, please respond because we need you in the numbers.

You’re probably the lowest reporting area. And the more number we have, the more accurate I can break it out to look at that exemptions. But they were a little bit off. In the second quarter, the central time zone was about 4% increase in gross. The strongest was in the Eastern seaboard, the Atlantic with a 7.4% increases and the gross sales. So I asked, usually I ask very simple classifications. I asked your gross sales, what percentage did you do better or worse than last quarter? I don’t ask the numbers, we asked the certifications, what percentage did you do? And if you are a retailer or you’re anybody that teaches or certifies such as divers, what we do, ask me how many you actually certified. We figured that out, the fairly benign number. And that’s really important because then I can tell you exactly for instance, because of that, we had 70,000 certifications issued in the retail environment in the, in the United States for the second quarter.

So we began to build those numbers in to look at our yearly numbers. Again, the attempt here is to try to help the industry see really an accurate reporting on what’s happening on the certification since it’s like we all know our lifeblood of our industry as new divers coming on. That’s the lifeblood. However, the survival is keeping, of course, our existing divers diving cause that’s one thing that a lot cheaper than bringing on new divers, but it’s, we need look all those factors. So the, the majority of my responses usually are from the United States. and last quarter was 68%. I’d love to see that. 50, 50, let’s say 50% of the United States and 50% from the rest of the world. So if you’re out seeing from someplace in Europe or whatever, your numbers are important, we’d love to have them. And even if you don’t want to participate, if you’re on my mailing list, you still get the survey.

TEC: Nice. Nice. That’s fantastic. I love how you’ve broken that out. And you know, I think it’s interesting cause when we look at the quarters and you look at the months that are part of those quarters, I think your third quarter is going to see some spikes because that’s gonna be our latter summer. Right? And so now this is a big time for us, early summer, late summer for diving and dive numbers.

So I have a feeling that even though people might be a little leery going into a quarter, I think they’re going to be surprised, you know? So when they come back and look at the results, I have a feeling that, you know, as that changes now we look towards the fall and you look towards the sales that can happen with the holidays. So I love seeing those patterns and I think that’s something that we can all learn from too whether we’re owners or operators of dive centers or resorts or a dive boats or whatever that is, that this will help if you’re an independent instructor this information will help.

All of this I think is really valuable to our industry. And you just nailed it on the head when you talk about the size of our industry. When you talk about the amount of retailers that we have, in the United States and, globally, you know, there’s a lot of money out there, but we’re really not as big as many other industries, especially in recreation too. So it’s a unique bird that we’ve got in our industry that we’re all pros for. But I love that you are doing this and I love that survey.

And so yeah, as Willie said, yeah, kind of call to action for that West coast group, please be a part of this, but also international people. Please be a part of this. This podcast is going literally worldwide. Everybody should be a part of this. And in a, in not only giving data, but also collectively seeing it and seeing how we can improve, how we can change, how we can grow as an industry and then use other tips for that as well. But this data really helps with that measurement. That’s awesome. Willie, I love this. Thank you so much.

WILLIE CLINE: You’re very welcome bro. I think that from, from a, from an individual business standpoint, this data is not going to put more money in your bank account, but this data will help you if you’re analyzing your business and trying to compare and see how you are doing to other people. So you know, if you’re doing better than what I’m reporting, God bless you. You’re doing it, you’re doing everything right in the business, you know? And if your not, then it might be time to look and see if there’s something you could do to change things. Now, are you dealing with the regional issues such as weather events or whatever, or dealing with just maybe you need some basic marketing that needs to be changed. So that hopefully will be the motivator for, and there’s some other great resources on my website for, for all different kinds of companies visits. And so take, feel free to use, anything that’s on there. It’s all free of course.

TEC: That’s perfect. Well, thank you so much Willie. I greatly appreciate that. Again, we’re going to put all the information that we talked about here in the show notes page so that you can link in and subscribe right onto Willie’s website. Again, that’s WilliamCline.com. Right? And so we’ll put that in all those links will be there and then be a part of this, see what it’s all about and subscribe. Thanks so much. We look forward Willie to having you on every quarter to give us this overarching look at how we’re doing and, that measurement, is coming out in your report. I think it’d be great.

Everybody can see it, but it’s great to hear from you and I love that you bring some, a little bit greater sense than just the numbers. In college I had a statistics professor, as you were going into statistics there, I almost started twitching. But the deal is, is that I had a really good statistics professor who took the numbers and said, “but here’s why this matters” and that’s exactly what you’re doing for us. So we look forward to having you on the show for your quarterly results and in the client group report. So thank you so much Willie. Really appreciate you being here.

WILLIE CLINE: Hey, and if you all going out to DEMA this year, you know, everybody of course in the industry should go to the DEMA show if you can. It’s going to be in Orlando of course. Come find me. I’m usually in The Bahamas pavilion. I hang out, I’m easy to find. You can find me through my website. You can even text my business number, which goes to my phone too. So, I’d love to hook up and say hi and meet you if you’re out there at the Show.

TEC: That’s great. Well, thanks again Willie. I really appreciate it and we’ll see you next time. And I’ll see you at the DEMA show and so will others. Thanks a lot for that.

WILLIE CLINE: Thanks Tec.

Performing FILO

All right, so I know what you’re asking. What the heck is FILO F. I. L. O? Well, simply put, it stands for first in last out. You may have heard this in other sports or anything like that, but guess what? It has an absolute risk management application in professional diving services. Here’s why. When you adopt FILO as your operational procedure to conduct pool sessions and to conduct open water dives, you are stating that you are always first in the water and the last out of the water.

Now, here’s the reason why. Think of where is the greater threat to any human? In the land or boat or manmade environment or the water environment? The aquatic environment poses so many more risks that that is the greater threat area. So by you as a dive leader going into the pool, the Lake, the quarry, the ocean, wherever it is by you going in the water first, now you are prepared to deal with anything that arises when your students or your divers come in.

And the same goes for getting out. Once you are getting to the point of the exit, you want your individual divers to go out first. You want to remain in the water, the absolute last so that if anything goes awry, you’re the one that has the greatest skillsets in the water of anyone in the group. So because of that, FILO is an amazing principle. How does it actually benefit and work? Well, think about this. When individuals are jumping in the water, they’re doing a giant stride from a boat or whatever. Think of all the things that can go wrong. They lose gear, they get caught in current and they get off the downline or the tow line. They have equipment problems, they show immediate anxiety or there’s things within the water, like a colony of jellyfish or whatever the deal is, is that you are first in.

So now when they come in, you’re there to handle and help those issues if they present themselves. And the same thing takes place, getting out the exit. So this is the time when they’re taking off their, they’re getting on ladders, they drop things, they fall off the ladder, they get off of the tagline, you’re there in the water for them. Look, remember, it is our responsibility to give care to those that are in our charge. That is the legal term duty of care. We all have it for people that are in our charge that we have a responsibility to. So these individuals, we want to give them the greatest amount of attention that we can. So if you are getting out of the water first, are you not turning your back on those students or on the divers that have signed the releases to be with you?

Wait a minute, you are. And so by doing it the opposite way, by performing FILO, you are keeping your eyes on your divers, your students the entire time getting in and getting out. They’re always under your supervision. And when it comes to the threatening area of the water environment, you are the master of that domain and you’re there to help them. So there you go. That’s what FILO is all about. First in last out, do it yourself, teach all of your dive professionals to do it. Have everyone at your dive center do it and you will see that this is the best way to safely handle these type of entries and exits in a supervisory capacity.

Thanks for Listening!

Well, that’s it for today. Thanks again to the DEMA Show for being our sponsor of this episode and thanks for listening, my friends. Remember to subscribe to this podcast on iTunes, Google play or Stitcher. That way you’ll be notified of new episodes as soon as they go live and please leave a rating. Items talked about in this podcast can be found on the show notes page at scubaguru.com The Dive Locker and there you can also leave topic recommendations for future episodes. Thanks again. We’ll see you in the next episode. Safe diving and take good care of my friends.

Hey, this is Mehgan Heaney-Grier, free diver, ocean adventurer, Marine conservationist, and I just want to say congratulations Tec on this new podcast. I’m so excited for all the awesome stuff you’re doing. Keep up the good work.

Congratulations tech. This is Dave Ochs from Aqua Safari Adventures in West Palm Beach. I’m excited about your launch of The Dive Locker and wish you all the best. You are a true professional, and The Dive Locker will be a great resource for every dive pro looking to up their game.

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