The lack of reliable statistics in the dive industry makes it difficult to determine, precisely, the size of the scuba diving industry. We can estimate quite a few things, though.
We will focus on USA data to determine retail sales in local dive stores and wholesale revenues for dive manufacturers. And we will use the number of annual certifications in the USA and our estimate of revenues per new diver, to determine how much the local dive shop is dependent on training new divers.
We will then estimate some worldwide numbers by extrapolating, from the ratio of active American divers (a reasonably accurate number) vs. the estimated number of active divers in Europe and worldwide. And we’ll have a look at the information we have on Europe and China, one of the rare steadily growing markets in the scuba diving industry.
Finally, we’ll discuss whether these numbers are likely to be overestimated or underestimated, and, more importantly, we will have a look at the impact of the 2020 coronavirus pandemic on these dive industry statistics.
But first, let’s discuss the place of dive travel sales in our analysis.
1. Should we include dive travel in calculating the size of the scuba diving industry?
Some local dive shops sell dive trips while others do not. Either way, if we include dive travel in the local dive shop revenues, it would significantly skew the estimated size of the scuba diving industry. For instance, a $10K dive trip to the Galapagos sold to 30 divers, would boost your sales by $300K on that month. It’s a significant figure since we estimate that local dive shops in the USA have annual revenues of about $500K!
However, if we look at a charter boat operator in Key Largo with six dive boats, its revenues will be mainly for “trips” although it will be in the form of “day trip” fees.
Therefore, we should include in dive store revenues the fees collected for local scuba diving activities & day trips, but not include the receipts for fly-away dive travel.
A big part of the cost of fly-away dive travel is airfare and lodging. These fly-away travel numbers are useful for evaluating the economic impact of dive operations in a particular geographic region but do little in helping us understand the size of the dive industry for businesses we actually manage. Managing airlines or the local Hilton hotel is not a part of the ‘dive industry’.
2. Ratio USA vs. Europe VS. The World
To be able to estimate the size of the scuba diving industry in the USA, Europe, and worldwide, let’s first determine a ratio between these three different markets.
The Participation Rate Angle
From the 2019 SFIA Topline report, we can work with an estimated 2.8M active divers in the USA.
From an RSTC Europe report, we have an estimate of approximately 3.5M scuba divers in Europe. RSTC Europe claims this number is between 3M and 4M.
From a 2017 DEMA document titled “Fast Facts: Recreational Scuba Diving and Snorkeling,” we see an estimated 6M active divers worldwide, although we don’t know the source of this estimate. DEMA lists SFIA as the source. However, the relevant SFIA reports only cover the US market!
With 2.8M in the USA and 3.5M in Europe, the worldwide number of 6M is understated.
DEMA seems to have simply used a traditional ‘rule of thumb’ used in the American dive industry for decades and stating that the American market is about 50% of the world market. This was probably true when it was first used but doesn’t hold water anymore.
A more likely scenario nowadays is for the USA and Europe to be of equivalent market size, as seen in the RSTC Europe numbers, with another third of the market in the rest of the world.
The Estimates in PADI’s Business of Diving Book vs. RSTC Europe
In a book published in 1995, The Business of Diving, PADI quotes a 1994 DEMA estimate of worldwide dive sales at $3.5B compared to $1B, in the USA. Based on this ratio, American sales would be a bit less than one-third of worldwide sales.
In the same book, PADI estimates there are about 2000 dive centers in the USA and about 4000, worldwide. So… We are back to this American assumption that the US market is about half of the worldwide dive industry. Meanwhile, RSTC Europe claims having counted 3558 dive centers in Europe in 2015. This would peg the USA at only half of Europe’s size. It’s unlikely to be true. Europe dive centers do not operate under the same business model as in the USA. Europe, for instance, has numerous dive clubs where the teaching of scuba diving is performed while the sales of dive gear are done in a store that is a separate entity.
Otherwise, in the Business of Diving book, PADI goes on to state that about 1M new divers are certified annually, of which nearly half are in the USA. This number is quite weird! From the DEMA’s certification census, we estimate about 200K entry-level open water certifications per year while RSTC Europe reports about 225K. Once again, a 3-way split between the USA, Europe, and the rest of the world sounds plausible.
In the same section discussing the size of the dive industry in the book The Business of Diving, PADI estimates the number of snorkelers worldwide between 6 to 7M compared to 3 to 3.5M in the USA. Based on this estimate, the American market would also be about 50% of the worldwide market. Once again, we believe that one third is a more realistic estimate.
3. Size of the Scuba Diving Industry At Retail Sales
In The Business of Diving book, PADI estimates that average retail sales by dive centers are between $320K and $460K in 1992–1993. Meanwhile, William Cline, in his 2011 Dive Retailer Financial Study, estimates average retail sales per dive center at approximately $500K.
A recent estimate of dive centers in the USA by a dive magazine pegs the number of dive centers in the USA at 1500. If we use an average of $500K in retail sales, we get an overall market of $750M. If the USA represents one-third of the worldwide dive industry, it would mean about $2.25M in sales, at the retail level, worldwide.
An executive at a dive gear manufacturer told me they validated the number of dive centers in the USA by working with their sales representatives. Each one of their reps counted all dive centers listed on the various certification agencies in their territory. Then, they removed all the dive centers that were questionable (e.g., operating out of a garage at home) and all duplicates. They ended up with approximately 950 local dive shops in the USA. For our exercise, here, we’ll continue with the 1500 numbers. Even “semi-dive centers” operating out of questionable locations sell dive training and dive gear. And they are most likely included in the studies by William Cline and PADI.
The split in dive center revenues
From the PADI and William Cline studies, we get the estimated following split in revenues:
4. What is the size of the scuba diving gear market?
If equipment sales represent about 55% of the $500K in revenues collected by dive centers on average, with 1500 dive centers, we get gear sales of about $275K per dive center and $412M overall in the USA — that’s at retail price.
It means that dive gear manufacturer sales, at wholesale, are approximately $206M annually in the USA.
With the USA representing about one-third of the dive gear sales market, we have scuba diving equipment sales, worldwide, at wholesale, of approximately $600M, annually.
This number may be a bit on the high side. The number often mentioned by dive manufacturers is US$500M in sales, wholesale, worldwide.
The exact number is hard to pinpoint. For instance, sales of inexpensive snorkeling kits at mass retailers like Costco are superior to the sales of scuba diving gear per se. Yet, dive gear manufacturers sell both.
We could also try to estimate this number by looking at public records for these companies. But many of them are private. In fact, Scubapro and Beuchat are the only dive gear manufacturer for which it’s easy to get annual revenues. The following numbers represent worldwide figures, at wholesale.
- The diving division of Johnson Outdoors, Scubapro, reported sales of $76.7M for the year 2017.
- Mares’ numbers are no longer public, but last we checked, their annual revenues were also around $70M although that figure included the SSI certifying agency revenues.
- Aqua Lung’s numbers have always been hard to get as they were hidden inside the vast revenues of the parent’s company, Air Liquide. And now, Aqua Lung is owned by a private equity fund. However, the generally quoted figure is around $100M.
- Beuchat’s sales are publicly available in France. For 2018, Beuchat’s revenues were at 16.7M Euros (approx. $18.8M).
These four companies add up to about $250M in wholesale revenues annually. It makes sense to estimate that all other and smaller gear brands, together, could represent another $250M, for a total of $500M.
5. Determining The Size of the Dive Industry From The DEMA Certification Census
In DEMA’s US Certification Census, we see 152K open water diver certifications, annually, in the USA. You must be a DEMA Member to gain access to these quarterly reports.
However, it is not the actual number of new diver certifications in the USA. The DEMA certification census gives us an idea of trends but we cannot take the raw number of new diver certifications as is, because only three certifying agency reports their numbers to his DEMA census: PADI, SDI, and NAUI. A big one that is missing is SSI, as we discussed in The Lack of Data in the Dive Industry.
We estimate the number of new entry-level open water certifications in the USA to be approximately 200K.
If we estimate that a new diver spends around $1500 (for gear and training), we get retail sales of about $300M for these new divers. With overall dive retail sales estimated at $750M annually in the USA, it means that new divers are crucial to the current scuba diving industry business model.
With these sales numbers, new divers generate 40% of a local dive shop retail sales. We can see why the steady decline in new diver certifications over the last few years is a severe threat to the origin dive center and, by extension, to dive gear manufacturers.
Our financial dependance on new diver certifications is problematic. We need a new dive industry business model based on diving for repeat clients, not on training for new clients.
Decline in New Diver Certifications in 2018
In the 2018 DEMA certification census, we continue to see a significant decline in the number of entry-level certifications in the USA. Between 2017 and 2018:
- Jan-Mar: -12.1%
- Apr-June: -12.1%
- July-Sept: -2.8%
- Oct-Dec: -7.5%
- Annual: -8.2%
These are dramatic numbers! Sorry to say so. You can see the same trend in the DEMA certification census over the last few years. Whatever the size of the scuba diving industry, we are steadily going down.
Word of caution: Question every number presented to you. For instance, when you hear PADI saying they are issuing close to 1M certifications per year, it includes all levels of certification. A diver doing Open Water, Advanced Open Water, and five dive specialty courses is counted seven times. He is unlikely to buy seven regulators!
6. What About the Size of the Dive Industry In China?
You probably keep on hearing certifying agencies saying that their business is growing because scuba diving in China is doing quite well with the growth of the Chinese middle-class. It makes sense. However, we must be careful when believing these statements.
For instance, in “The Startup Business Plan for LeQian”, a university researcher states that from 2009 to 2013, the Chinese certification market grew by 457% for PADI, for an average annual growth rate of 55%. Impressive numbers! But it merely means that the number of entry-level scuba diving certifications increased from 3150 to 18225, as you can see below.
China is a different beast. For instance, it’s unlikely that American and European dive gear brands sell a lot of basic scuba and snorkeling gear in China. These dive manufacturers purchase their inexpensive equipment in China, like fins, masks, and snorkels. China doesn’t need international brands to sell them back these products! And we’ve heard China is the king of counterfeits, to start with.
Eventually, we can also expect China to produce regulators and BCDs. They already do, although the quality is questionable. It’s all inexpensive gear. For now, what we hear from dive gear manufacturers and wholesalers is that they only sell their high-end equipment to China. It makes sense. China already produces most of the low-end dive and snorkeling gear. And inside China, the middle-class is interested in high-end (prestigious) brands.
Therefore, the growth in new diver certifications in China will undoubtedly have a relatively small impact on revenues for the Aqua Lung, Mares, Beuchat, and Scubapro of this world — and it will be even harder to get sales data.
Case in point: In a study of the Chinese market a few years back, William Cline provided the following observations:
- The largest dive resort in the world is in Hainan Island, China. They conduct about 1M scuba tryouts annually, on their own.
- Under all accounts, the market is booming. Yet, the size of the Chinese scuba diving market was estimated at only $12.5M.
There are two things happening behind the scene to produce these numbers, as we’ve stated above:
- Getting accurate market data from China is extremely difficult and, therefore, we don’t know if that $12.5M is even close to being correct.
- Sales of dive gear by Chinese suppliers within China are unlikely to be included in this figure.
The growth and size of the scuba diving industry in China definitively warrant to be monitored closely and it may provide good opportunities for certifying agencies, but it’s unlikely to be a great opportunity for American and European scuba diving gear manufacturers.
7. Are These Estimates Overstated or Understated?
Let’s forget China for now and get back to our American, European, and Worldwide figures. Are they overstated? Or understated? Let’s think about it.
Surveys are generally targeted at standard ‘dive shops’. Therefore, it may not correctly include sales of dive gear by unique retailers like Leisure Pro, Divers Direct, Scuba.com, and, up to recently, Sports Chalet. If this is true, the total size of the dive industry would be understated.
Yet, surveys may be primarily answered by larger dive shops as they are more business-minded. This would skew the figures for average sales per dive center. If this is true, the average revenues per dive store would be overstated.
When we evaluate sales in the dive industry based on dive shop retail sales, we are missing the independent instructors’ revenues. Their gear sales may be marginal, but they sell scuba diving courses. Therefore, training sales may be understated.
And we could go on like this for a long time. There are many reasons why the figures above may be overstated and as many reasons why they may be understated. Therefore, we must take all of these estimates for what they are: Estimates. Proceed with caution.
8. Summary: The Size of The Scuba Diving Industry Pre-COVID-19
2020 has been marked by the coronavirus pandemic that badly hurt the scuba diving industry. We’ll get back to this in a minute. For now, here’s a quick summary of the estimates discussed above, pre-coronavirus:
- Average annual revenues per dive shop in the USA: $500K.
- Active divers: 9M worldwide including 2.8M in the USA and 3.5M in Europe.
- Number of dive centers: Between 950 and 1500 in the USA; unknown, worldwide.
- Total dive revenues at the retail level (all categories, excluding fly-away travel): $750M in the USA.
- Dive gear sales at wholesale: $500M worldwide.
- New diver certifications annually: 200K in the USA, 225K in Europe, unknown worldwide.
9. Impact of The 2020 COVID-19 Pandemic on The Dive Industry
The 2020 COVID-19 pandemic is having a significant impact on the dive industry because scuba diving is tightly linked to international travel. At the end of the pandemic, we estimate that approximately 20% of dive centers will have permanently closed.
We’ve prepared the following analysis for you: