Industry Articles - 2000
Marina Dock Age, November 2000
Marinas: An Endangered Species?
by Dennis P. Kissman
Marinas, once considered stepchildren of the recreational marine industry, are now recognized as an integral part of the industry. Unfortunately, as marinas come to the forefront, more groups outside the marine industry are beginning to take note of what we are doing. This awareness is creating additional pressures on marinas, and, as a result, marinas are caught in a riptide of changing times.
From within the industry, boat manufacturers are designing boats that are beamier, making many existing marinas obsolete. Marina customers are demanding more amenities. They no longer are satisfied with just a place to store their boats. From outside the industry, environmentalists have targeted marinas as polluters and killers of endangered marine life. Last, but not least, regulatory agencies have no clue as to the nature of the marina business and thus try to group marinas into non-related industries for regulation purposes.
Faced with these obstacles, marina expansion, development, and even ongoing operations are in for some rough weather as we devote ourselves to survival. Without the growth and updating of marinas, boat manufacturers will not have places for their customers to keep the boats they buy. Granted, not all boats require a marina, but with the current trend in boat design and customer demand, as many as 25 percent of the existing berths and storage racks in the United States cannot accommodate the boat market. To the marina owner, this means he or she is faced with large capital outlays just to remain competitive in business. Further compounding this problem, once the marina owner decides to update his marina, he now subjects the entire marina to current environmental and governmental regulations that could make upgrading the marina cost-prohibitive, if not impossible.
Fueling the demand for boat storage is the fact that boats do not disappear. They just have a new face at the helm. Boats have a very long life cycle, particularly those requiring marinas. Thus, as new boats are sold, the overall boat population increases. In the United States in 1970, the total number of recreational boats owned was 8,814,000. By 1999, that population had grown close to 17,000,000, an increase of 91 percent in less than thirty years, while the areas to use these boats have not changed and will not change in the future.
Enter the environmentalists. They see this increase in boats putting more pressure on the environment and have decided the easiest way to attack the industry is not to go after the boat manufacturer with its large capital resources, but to restrict access to the water. They are doing this by attacking an under-capitalized but key component of this industry, your marina. By limiting the expansion and new development of marinas, they are essentially limiting the ability of the entire marine industry to expand. This is the same as telling the golf industry that there can only be one golf course within a two-hundred-mile radius. Imagine what that would do to the golf club manufacturer. This is exactly what is happening to the recreational marina industry by restricting marina development and expansion.
To further compound this problem, the regulatory agencies are now focusing on marinas and imposing impractical rules and regulations. In the last couple of years, the marina industry has been transformed from a small, obscure industry to the forefront of the entire recreational marine industry, a position that most operators were not prepared for, and, as a result, has greatly impacted their ability to operate profitably.
It is not uncommon for a marina to be faced with dealing with more than 50 local, state, and federal governmental agencies to just remain open for business. And, for new marina construction, it can easily take as long as seven years and over half-a-million dollars to work through the governmental bureaucracy to get the necessary approvals. By the time construction can begin on a new marina, regulations that were in effect at the beginning of the development process have long since changed, thus further delaying the construction. More often than not, these changes put the project in jeopardy. Over the years, our experience has shown that less than two percent of the projects conceived are ever constructed. Of those that eventually are constructed, more than half must be modified—usually reduced in size—from their original design due to changes that have occurred in the regulations over the time it takes to develop the project.
In 1999, the National Marine Manufacturers Association (NMMA) estimated that the population of inboard cruisers, sterndrive boats and sailboats increased by approximately 120,000 units in the United States. As these boats continue to become too heavy to trailer over the highway, the majority will require that they be kept in some form of marina, whether in water or on land. It is estimated that in the United States there were less than 9,000 new or refurbished berths or racks added to the existing inventory in this same period. It is not difficult to see that if this trend continues, an acute shortage of boat storage will develop over time.
If the recreational marine industry is to remain vital, we cannot put our heads in the sand. Through a positive, aggressive approach and unification of all segments of our industry, including marinas, this industry has the knowledge and resources to resolve the obstacles that are limiting the growth and operation of marinas and eventually deciding the future of recreational boating.
Marina Dock Age, September/October 2000
At Your Service, 24 Hours a Day, 7 Days a Week
by Ron Brazda
What sets your property apart from other marinas? Chances are you’re not the only one in the area to choose from. Your product may be different in some ways, but very similar in others. To the average boater, all marinas are alike—a glorified parking garage, hotel, or self-storage facility. Why would customers decide to spend their money with you? Service, of course, is the key. From the smiling face that says good morning when a guest walks through the door, to the security guard on rounds at night, we should be there for our customers.
There are different types of service. There are the ones that cost you money and there are services that, with proper staffing, require no out-of-pocket expense.
NEWSPAPERS
A service we offer at our marina here in the Caribbean is a daily newspaper. Since stateside newspapers are not readily available, we subscribe to the Times Fax, a service provided by The New York Times. It is simply an eight-page version of the day’s news without all the ads. Each morning during season, we receive the fax, make copies, and distribute them to each vessel in the marina before eight o'clock. This simple and inexpensive service is a highlight for many of our boaters. They look forward to reading the paper and having their morning cup of coffee. From the cruising sailor who hasn’t seen a newspaper in a year to the mega-yacht owner who relies on it to see where his stocks closed, this has become a service our boaters are glad to have. Something as simple as an eight page version of The New York Times can make the difference. When people call to make reservations, we often get asked if we’re going to provide the newspaper that next year, as well.
DOCKING
Docking a boat can be frightening for some people. A way to ease your customers’ fears is to have someone available to assist with lines. Whether on your fuel dock or at each slip, make this service available. And don’t wait for them to ask for help.
Imagine the scenario: You are out showing off your new boat to your colleagues. You are trying to impress them, and fall in the water trying to jump off the boat to tie your lines on the dock. You will be amazed at how much it eases the minds of boaters to know that there is going to be someone there to handle their lines and help fend them off the dock.
This service can even be taken a step further. Once they’re in the slip, assist them with their power cords, water lines, cable, and telephone lines. It usually takes less than five minutes per boat, yet it’s a service boaters will remember, and may set you apart from the other marinas.
MONITOR VHF
If you have night security personnel, as most do, have them carry a handheld VHF This is a simple investment and gives your boaters a sense of security knowing that they are only a radio call away. Not only should you give your security staff a radio, teach them how to use it. Let your tenants and guests know that this service is available to assist them.
As marina operators, we tend to lose sight of what business we are in. We are a service industry. As previously mentioned, a transient marina may be likened to a hotel where all your guests are VIPs. A contract marina may be likened to an apartment complex, but should not be compared to a parking garage, where you come in, park your boat, and leave it.
In most marinas, boating is a family affair. Why not host a day just for the kids? Plan games, or take a trip to the movies for the day. Most parents will be willing to pay their child’s way. All you supply is the chaperone and the means of transportation. You might be amazed at what type of response you get.
It’s never a bad idea to ask your customers what they would like to see improved. Comment cards are nice, but make it a point to get out on the docks and talk to your customers. Many marina owners and operators don’t take the time to just walk around and see how the boaters are doing. This is a good way to find out about things people otherwise might forget to tell you. For instance, there could be a water leak on the dock and a guest would be more apt to show you when you’re there rather than come to the office to report it.
The best way to provide excellent service is to listen to your customers. They will tell you what they want, but it’s always nice to beat them to it and anticipate their needs. Next time you see them pulling into the dock, go out and give them a hand. And while you’re at it, call them “captain.”
Marina Dock Age, September/October 2000
Emergency Response Training Programs
by Gene Spinazola
The effectiveness of your safety training program is dependent on how your staff and your customers view management’s commitment to safety issues. Just because you have been conducting training programs for the past six months, doesn't mean that you have a safer marina. The actual training program is only part of marina safety, and perhaps a very small part at best.
If you’re going to have a training program about the care and use of fire extinguishers, they should be in good condition. That is, the extinguishers should have a current inspection tag, be clean, neat, and orderly, with the pressure gauge in the green area, the tamper seal intact, and the extinguisher well marked. Having a fire extinguisher training program when your own extinguishers are in disrepair, rusting, or missing from their proper location, places the whole program in jeopardy.
What are the key elements of an effective staff safety training program?
Staff involvement: An effective way to bring your staff on board the safety train is to give them some ownership in the safety process. Developing a Safety Committee Team composed of both staff and management can be very productive and give the staff some level of involvement in the decision-making process.
With this concept, however, you may open some doors that can cause you real grief. As an example, the Safety Committee may recommend that you add a fire standpipe system to the docks or a sprinkler system in the dry stack barn. While these are systems that you should have, they may not be affordable this week. But these are goals that can be addressed and financed as capital projects. Your staff knows that these are expensive systems, and while they may not expect a quick fix, they also don’t want a whitewash. If you sweep it under the rug, everyone, including you, will know.
Design: The training program will need to look at the long-term goals and objectives that you want to reach. The Safety Committee Team will need to map out a strategy that will meet these goals and objectives. Most importantly, a time frame and workable matrix needs to be developed that will allow the training program to succeed.
Need: Are you convinced that you need a safety program? If the answer is “no,” you’re dismissed. Don’t read any further. You have been doing it your way for years and that’s good enough. If the answer is “yes,” however, read on.
Commitment (Management and Staff): If you’re committed, your staff will know. If you are sincerely involved with the safety aspects of your marina, your staff will know.
Quality: A well-run training program is worth every penny. Many times there are “free” training programs available to you. They aren’t “free” though, are they? You still have to pay your employees. What you’re looking for in a program is quality in content and delivery. If you make a mistake and get a low-quality or inappropriate presentation, don’t allow that presenter back on campus. Find a presenter who will hit the mark, make the point, and get out of there.
Appropriate: The program must be appropriate for the students. For example, the sprinkler system is designed to provide protection coverage based on the number of sprinkler heads. The velocity of the water passing through the piping system to the sprinklers is part of the engineering design considerations. While that is of interest to me and I get excited about it, that probably won’t be of interest to your staff. Try to zero in on trainers who are good at what they do, have a real message, and can get in and out in a timely manner. Remember, the value of the program is not measured in time, it’s measured in quality.
Environment: The training area needs to match the topic. If it’s a sit-down talk with slides and video, then you need to provide a space for this presentation that is comfortable, can be darkened, and is away from the crowd. Nothing downgrades a training session more than interruptions. A cellular phone call in the middle of a presentation will destroy the continuity of thought and may completely disrupt the training session.
Follow-up: For example, if something in the training program points out a safety deficiency or fault in the marina, then the fault must be corrected. If not corrected (within a reasonable amount of time), your staff will see it as “not important” in the overall scheme of your program. Thus a chance to make a positive impact on the safety program is lost.
Example: Yes, leading by example does work. In fact, if you don’t set the level of safety you expect in your marina, then expect your employees to set the safety standards for you.
Gene Spinazola specializes in marina fire and safety issues, and he welcomes calls: (207) 326-9147. He is president of Gene Spinazola P.E. & Associates Inc., in Casane, Maine. www.marinafires.com
Marina Dock Age, September/October 2000
How Planning and Budgeting Can Improve Profitability
by Dennis Kissman
We are approaching the time of the year when marina owners should be seriously thinking about next year and what you expect to achieve. Most successful businesses use this time to reflect on past performance, both their successes and failures, and prepare a plan to capitalize on those successes and learn from their failures.
But for some reason, the majority of marina owners feel they are above this process. I have heard more than one marina owner tell me they don’t have time to plan and prepare a budget. They are too busy running their marina. If you are in this group, did you ever think that the reason you are so busy is because you didn’t take the time to plan? It is interesting to note that the marina owners who are too busy to plan for the future are usually the least profitable and the most stressed.
We often use the words "plan" and "budget" interchangeably, although they are two different processes. You can make a plan without preparing a budget, but you should never prepare a budget without making a plan. A plan is a program or method worked out beforehand for accomplishing an objective, whereas a budget is an itemized summary of estimated or intended income and expenditures for a given period to achieve the planned objective.
Many of you in this industry have the notion that if you make a budget it becomes the bible by which you must live or die. Therefore, you elect to ignore the process and continue to fumble along. A budget will not guarantee success, but it will focus you on your objective. A budget is nothing more than the road map you created to get from point "A" to point "B" with assumptions on how you are going to get there. The individual numbers in the budget are your benchmarks to measure your progress as you move from point "A" to point "B."
I have seen budgets where there absolutely no way to achieve what is expected, because the numbers were drawn out of thin air. I have often said that some marina budgets look as though they were created by doing a dock walk and copying registration numbers off boats. That makes about as much sense as the numbers in some budgets.
If you look at the planning and budget process simply as a method of managing your business on paper before it actually happens, you have mastered the whole concept of planning and budgeting. Besides, it is a lot cheaper to make mistakes on paper and correct them before they actually start having an impact on your checkbook.
Whether this is your first attempt at creating a plan and a budget, or you are an old salt at it, set yourself an overall objective for your marina. Since we are in business to be profitable, the end result should always be to improve profitability whether directly or indirectly. Your objective should be broad yet achievable within the coming year.
You should force yourself to stretch to achieve your objective, not just bet on a sure thing. When you are in business, marina or otherwise, you can never assume a neutral position. Your business is either growing or shrinking, but never standing still. That is why you should always push your objective beyond your comfort zone. Otherwise, you will be in a shrinking mode.
Most likely there will be more than one way to achieve your overall objective. Remember that one number usually affects other numbers, and not always favorably. For example, increasing rates does not guarantee that the total amount of the increase will drop to the bottom line. Most likely there are additional insurance costs and credit card and/or collection fees, not to mention a possible negative impact on your slip occupancy.
The following are some simple guidelines you should use when preparing and using a plan and a budget.
1. When setting your objectives, focus on no more than three. More than three will become confusing, and you will most likely not achieve any of the goals you set out to accomplish.
2. A budget should be no more complicated than your business, and be reported in the same format as your financial statements.
3. Use past performance as the starting point in preparing a budget. This does not mean that you just take last year’s operations and inflate the numbers. You should understand where these amounts came from, and determine ways to improve.
4. A budget is a living document to be used like a road map to measure how you are progressing.
5. When preparing the budget, support the numbers and document your assumptions as to how you arrived at the specific amount.
6. These assumptions are also the basis for achieving your plan’s objectives. I assure you that six months into the year you will not remember why you assumed the number you did. Your assumption may no longer apply, but you will then be able to adjust your thought process and take corrective measures for the new circumstances.
7. Get help. You may be the boss, but if you share your thoughts and assumptions with your employees, you may find that they have ways to improve on your ideas.
8. Refer to your budget often. This is not an exercise that should be done once a year and set on a shelf. One of the most useful tools I use during the course of the year is a forecast. A forecast is nothing more than taking your actual performance to date and adding it to the remaining budget on a month-by-month basis to project where you will end up at year end. One of the greatest benefits of preparing a forecast is that you can easily predict where you should be at the end of the year.
Due to the seasonality of the marina industry, another technique in the budget process that is helpful (although it takes much discipline), is to prepare next year’s budget by reviewing this year’s results as they occur. By preparing next year’s budget for the period just ended, you can critique the operating results and adjust for any anomalies while they are fresh in your mind. You can always go back later to adjust for any new objectives.
If you are not familiar with the budget process, it is never too late to begin. Even the simplest plan and budget are better than no plan or budget. So start simple and expand as you get more comfortable with the process. You may even learn things about your business that you did not know existed. Just remember, the more thought that goes into the process, the more rewarding the results.
Marina Dock Age, September/October 2000
The World of Marinas
by Ron Stone
AMERICAN MARINA OPERATORS AND THEIR COUNTERPARTS ABROAD NEED
TO EXCHANGE INFORMATION
The world is shrinking due to the globalization of the economy and, thanks to the Internet, the rapidly accelerating interdependence of countries for market information. This is very apparent in the world of marinas.
Marina operators the world over have become attuned to the fact that they have much more in common with one another than they have differences in native language and customs. Growing information exchanges, through international conferencing and use of the Internet, have unearthed a universality of problems and problem-solving.
For example, environmental restrictions that pose obstacles to marina development and expansion are by no means unique to the United States. In many countries, marina projects are continually challenged by costly, time-consuming permitting requirements for wetlands preservation, fish and wildlife habitat protection, and clean waters.
Also in other countries, it is fairly commonplace for marina developers to encounter intense competition from hotels, resorts, condominiums, and restaurants for precious waterfront property, often sadly losing out to the highest bidder. Where there is no comprehensive multiple-water-use management planning, there seems to be little regard for the fact that recreational boating cannot exist without well-planned and convenient access to water.
Another problem of global proportions is the resistance by private residential property owners to the construction of public or private sector marinas and boat ramps on public lakes and rivers. They erroneously assume that their title to land Iying adjacent to the water vests them with ownership of the water, or at least entitles them to first priority in its use. Never mind the public trust doctrine enshrined around the world that the state holds public waters in trust for the benefit of all her citizens, including transient boaters.
EXCHANGING INFORMATION WORLDWIDE
Marina operators worldwide truly need a strong unified voice to champion their interests. They also need universally accepted scientific data to prove that marinas are not a threat to the environment but, quite the contrary, are being consciously designed, built, and operated with a view to harmony with the environment.
Marina operators worldwide need solid economic data to substantiate that their facilities are an asset to the community in the creation of jobs, improvement of the tax base, waterfront regeneration, and business district revitalization. These are direct results of the ripple effect that boaters, and even non-boaters attracted to a marina, create by shopping at nearby retail stores and dining out.
That’s where the Boating Facilities Committee of the International Council of Marine Industry Associations (ICOMIA) enters the picture. Popularly referred to as the IBFC, this group of experts is the service arm for recreational boating facilities affairs of the organization representing marine equipment manufacturers in 24 countries. The National Marine Manufacturers Association (NMMA) is a charter member of ICOMIA. The Marina Operators Association of America (MOAA) and the International Marina Institute (IMI) are also affiliated and sit on the IBFC.
The committee is composed of marina consultants, publishers, educators, and component equipment manufacturers from Europe, North and South America, the Middle East, the Far East, and Oceania. Membership is open to anybody with bona fide credentials, i.e., the knowledge and experience for dealing with the complex questions of boating facilities, and the ability to actively participate in committee meetings held three times a year in various locations around the world. Whether a country has a recreational marine manufacturing base isn’t an issue, for the reason that there are many countries, particularly in developing boating market countries, that have strong marina and nautical tourism interests but no boat and associated equipment manufacturers. Over the years, the committee has prospered under the chairmanship of a Dutch and then an Italian spokesperson for marinas. Today, an American leads the group.
THE COMMITTEE’S MISSION AND GOALS
ICOMIA created its Boating Facilities Committee nine years ago with the express objective of enhancing the quality of recreational boating through guidance for the growth and improvement of marinas, yacht harbors, and small boat launching ramps.
Some of the primary objectives of the IBFC are:
1. To provide international leadership and a forum for the exchange of helpful technical, environmental, and marketing information that can facilitate successful development and operation of recreational boating facilities;
2. To forge partnerships between the recreational marine manufacturing industry and marina developers, builders, owners, operators, and users, for strength and unity in securing and keeping space for recreational boating and boating facilities;
3. To actively seek and enlist the cooperation of all levels of government in supporting the development, maintenance, and operation of marinas;
4. To reach out to and help educate marina interests in emerging boating markets around the world; and
5. To foster the image of marinas being sensitive to environmental impact issues, and a responsible partner in the universal campaign for clean waters.
Several strategies are pursued for the attainment of these goals.
Periodically, the IBFC conducts surveys to learn about the state of the marina business. This has helped to determine the number of marinas from country to country. Not surprisingly, the number is greatest in the United States (11,000 to 12,000), followed by Canada (more than 3,500), and the Netherlands (approximately 1,000). Looking for trends or patterns, surveys have been done to compare national government environmental restrictions on the development and operation of marinas, practices for setting slip rental and dry land storage fees, and employment in the marina industry.
The IBFC serves as an international clearinghouse of recreational boating facilities information. It publishes a regularly updated bibliography of authoritative references on a wide range of subjects, largely drawn from papers presented at international marina education conferences; also, an international directory of architects, engineers, and consultants who are qualified and experienced to assist marina developers anywhere in the world; a marina risk management check list for display dockside or in marina administration buildings; and a review of public-private partnerships for the creation of recreational boating facilities in various countries.
The committee networks with other organizations in the boating facilities field, pooling ideas and information for the greater education of marina operators seeking advice. There are ongoing liaisons with such U.S.-based organizations as the International Marina Institute (IMI) and the States Organization for Boating Access (SOBA), as well as the U.S. Environmental Protection Agency, the U.S. Fish and Wildlife Service, the U.S. Commerce Department’s International Trade Administration, and the U.S. Sector of the Permanent International Association of Navigation Congresses (PIANC). These liaisons have proved very fruitful.
In 1996, the IBFC achieved consensus on recommendations for universal uniform symbols for signage at marinas. This was a joint project with PIANC designed to assist boaters in visually identifying facilities and services available to them. The IBFC’s preferences among the wide array of symbols and pictograms in use around the world were largely accepted by the PIANC Working Group on the subject. EUROMARINA, a federation of marinas and yacht harbors in Mediterranean countries frequented by cruising yachtsmen, was also consulted in the process. The resulting joint ICOMIA/PIANC/EUROMARINA Pictogram Book has since been published and distributed worldwide. Individual copies can be purchased from ICOMIA. Contact ICOMIA Secretary General at: icomia@ msn.com.
In addition, the IBFC regularly consults with ICOMIA’s Environmental Support Committee on environmental laws and regulations and recommended environmental management practices for the recreational boating industry. Thus, the group has had some input, insofar as marinas are concerned, on an ICOMIA Code of Recommended Environmental Management Practices for the European Community.
The committee’s outreach efforts are notable. For example, they have met directly with government tourism agencies in the U.S. Virgin Islands, Israel, and Cyprus with the object of stimulating government support for marinas. Earlier this year, they met in Brazil with a similar objective, and provided several speakers for a Brazilian Waterfront Development Projects Conference. IBFC members have been featured speakers at other conferences underscoring the importance of marinas to nautical tourism development in China, Malaysia, Singapore, and South Korea.
ICOMIA’S INTERNATIONAL MARINA EDUCATION CONFERENCE PROGRAM
The IBFC has provided no greater service to marina operators universally than by conducting ICOMIA’s continuing marina education conference program. Under ICOMIA aegis, since 1993 the committee has produced three highly acclaimed international marina conferences (IMCs) — two in Europe and one, last year, in Ft. Lauderdale, Florida. IMC ‘99 drew marina operators, consultants, publishers, and equipment manufacturers from 22 countries around the world.
The next in the conference series is set for March 7-10, 2002, in Sydney, Australia. The conference is being organized in cooperation with the Australian Marine Industries Federation, representing more than 1400 recreational marine equipment manufacturers as well as marinas across Australia. The federation owns and operates five boat shows, in Sydney, Melbourne, Brisbane, Adelaide, and Perth.
The conference emphasis will be on the practical, answering questions marina operators commonly have on how to succeed in business. Case studies and panel discussions as well as an all-day field trip to area marinas are important features. In conjunction with IMC 2002, the International Marina Institute will conduct an additional all-day seminar on successful marina management practices. A two-for the-price-of-one package will be offered.
Inside Self-Storage, August 2000
Marina vs. Off-Water Storage
A primer on the differences between in-water and dry-land storage
by Dennis P. Kissman
There are approximately 13,000 marinas in the United States today with space to accommodate about 1.1 million boats according to a survey conducted by the National Marine Manufacturers Association. This represents about 8 percent of the total registered watercraft in the United States.
Now, before you rush out to get into the marina business, be aware that even though there appears to be an imbalance in the supply and demand, less than 6 percent of the registered watercraft is dependent on marinas for safekeeping. The balance can be kept elsewhere — often away from the water.
On the surface, it appears that anyone with space available could attract boats for storage. To a certain degree this is correct, particularly as the boat population continues to expand and waterfront property becomes too valuable to store boats. The relatively new concept of off-water storage facilities — often referred to as dry-land marinas — is becoming a hot commodity. Why? There are three reasons:
| • | Not enough in-water storage space. |
| • | Environmental concerns regarding the use of waterfront property. |
| • | Population density increases and restrictions being placed on trailer and boat storage in residential communities. |
If you are considering getting into thy dry-land marina business, recognize that these watercraft and boat owners do not require or expect the same levels of services that waterfront marinas typically provide. The questions now become, “How can I capture this market?” and “Is it compatible with my self-storage business?”
Recognizing the Difference, Knowing What to Expect
People often assume that a marina and boat storage are synonymous. This erroneous assumption has been the downfall of many owners of marinas over the years and could be for self-storage owners anticipating getting into the marina business. The definition of a marina is: “A harbor or basin providing berthing, supplies and services to pleasure craft.” By definition, a boat “stored” at a marina is in the care, custody and control of the marina owner while the boat is stored there. On the other hand, in the self-storage business, the owner rents out space for storage purposes to tenants and does not take control of the tenants’ property. This seemingly minor difference can open a Pandora’s box of liability issues if you are not careful.
To put it another way, you must realize the marina owner is in a service business, while the self-storage owner forms a landlord/tenant relationship with his customer. If you are a self-storage operator and you offer boat-retrieval services — using your own equipment and employees to transport the craft — then you are crossing the line from a storage business to the marina business. More importantly, your liability increases exponentially.
What does the dry-land marina customer expect from the facility? Although he won’t expect the convenience and waterfront marinas offer, he does expect security, detailing and repair services.
Other amenities, such as fuel or elaborate marina-retail stores are going to be site-specific, while restaurants, pool and tennis courts are not usually necessary. The customer is also indifferent to such things as boat brokerage or new boat sales. This means the dry-land marina owner must generate income from fewer profit centers than the typical waterfront marina. In the full-service marina it is not uncommon for the owner to generate half of his income services from other than storage fees.
Determining Costs
To get an idea of some of the major operating costs associated with a typical dry-stack marina — regardless of whether it is on or off the water — we need to establish the number of racks from which we can base our costs. From my operating and consulting experience, I believe a facility accommodating approximately 260 boats in racks is the most efficient to operate, considering the investment that must be made in fixed direct-operating labor and benefit costs, as well as the investment required in boat-handling equipment. A facility that can accommodate more than 260 racks will be more economical to operate, providing you have the market to fill them.
To give you some idea of the direct costs related to operating a dry-stack marina, let’s look at the largest group of costs and their relationship to the operation. This group includes direct labor and benefits, equipment-operating costs and marina operator’s liability insurance. Each of these costs has a relationship to some other aspect of the operation. Using the example of a 260 rack waterfront marina as our most efficient operation, let’s look as to how these costs relate.
The operating costs per rack for direct labor and benefits should range between $0.075 to $0.105 per hour of operation for an average 10 hours per day in a seven-day-a-week operation. Equipment operating costs, unlike labor costs that can be determined by the number of racks, are in direct relationship to the occupancy. Assuming the operation uses a forklift to handle boat launches directly into the water, the costs should approximate 28 cents to 35 cents per boat stored per month.
If you plan to launch boats from the rack directly onto a trailer, your labor and equipment-operating costs could be 20 percent to 50 percent higher due to the increased time required to properly position the boat. There are other launching methods to consider to reduce these increased costs associated with a dry-land marina, but the increased investment will have to be weighed against the ongoing operating costs on an individual location-by-location basis to determine economic impact.
The third significant cost to consider is marina-operator’s liability insurance, which is based on total revenues from all sources, plus payroll costs. Current rates are between .7 percent and 1.1 percent of these totals. Be aware that insurance rates are a function of the insurance industry’s overall loss-experience ratio in a geographic area. These rates can change frequently, so always check with your local insurance representative.
A dry-land marina can be a very profitable investment given the underlying land value for off-water sites. If you believe that a dry-land marina may be right for your location, make sure you develop a solid marketing plan that accomplishes the following:
| • | Focuses on the reasons your market exists. |
| • | Profiles your customer base. |
| • | Highlights your own areas of expertise. |
More importantly: Don’t try to compete with waterfront marinas; they are not your competition.
Operating a dry-land marina is not the same as operating a storage business, so don’t try to make it the same. Consult with professionals in the marina industry to determine the feasibility of your project before you begin. The time and money spent up-front will outweigh the cost to live with a poorly conceived project.
Marina Dock Age, July/August 2000
How to Price Fuel for Profit
by Dennis Kissman
With the price of fuel on our minds this summer, it’s a good time to analyze a break-even point on fuel sales. Profit-per-gallon usually refers to the difference between the sales price and the cost per gallon. In retailing circles this is referred to as mark-up—a concept that has put many retailers out of business, because they refer to mark-up as percentages rather than actual dollars.
In certain circumstances the concept of mark-up has merit, particularly when analyzing the profit on fuel sales. But this only applies to marina operators who take the time to see what their fuel costs with each delivery. Most marinas buy fuel based on market prices set by the distributor, who sets his prices based on what it costs him from the refinery. These prices fluctuate daily, and if you do not stay on top of them, you will not remain competitive.
How can you use mark-up to remain competitive and profitable? If you sell an average of 20,000 gallons of fuel per month at $0.30 per gallon over your cost, your gross profit is $6,000. After adding appropriate operating costs, the profit in actual dollars is acceptable. You have maintained this sales volume at $1.70 per gallon, the same price as your nearest competitor.
You just got a delivery and your cost went up $0.10 per gallon. You notice that your competitor is still selling his fuel for $1.70 per gallon. Now you are faced with a decision, do I raise my price to $1.80 to keep my $0.30 mark-up, or hold my price at $1.70 and make only $0.20?
You have three choices. First, if you raise the price, you could lose market share. Second, you can do nothing and hold your market share, but it will cost you $2,000 in gross profit. Third, you could lower your price below the competition to gain market share to offset the lower mark-up.
SCENARIO 1
Past experience has shown that as long as your pricing is the same as your competition, your market share remains the same. Using this thought process, you know that it will cost you $2,000 in gross profit. Not a pleasant thought, but a real possibility.
SCENARIO 2
If you raise your price by $0.10 per gallon and can still sell more than 13,334 ($4,000/$0.30) gallons, you are better off than keeping your price the same as the competition. There is also an added advantage. If your competitor is typical, he will raise his prices to match yours, getting you back to your existing market share and $6,000 gross profit.
SCENARIO 3
If you lower your price by $0.05 per gallon below the competition to gain larger market share, can you make your original $6,000 gross profit? You would have to come down from $1.70 to $1.65 per gallon. You made $0.30 per gallon when you sold your fuel at $1.70 before the recent price increase. Therefore your cost would have been $1.40 ($1.70-$0.30). Now your cost is $0.10 per gallon more, or $1.50. If you decide to lower your price to a nickel below the competition to $1.65, you will only be making $0.15 per gallon—half of what you need. This means you will have to sell twice as many gallons to make the same $6,000 gross profit ($6,000/$0.15= 40,000 gallons).
Assuming you and your competition had 100 percent of the market, you would have to get 100 percent of your competition’s business. This is unlikely. Do you think your competition will sit idly by and let you steal his business?
You may think that because your competition is buying from a different distributor, his cost is less. My experience has that the petroleum industry is very competitive and pricing to their distributors is always within a penny or two of their competition.
TAKE CONTROL
Any time you allow your competition to take control, as in the first scenario, you are saying that your competition is smarter than you. You are assuming that he is on top of his costs and is running a more efficient operation. In this industry, that is a big assumption that is usually wrong.
In the second scenario, we will lose some of the market share, but the chance of losing a third of it is less likely than capturing all of it, as you would have to do in the third scenario in order to break-even. Fuel is probably the most price-sensitive service you provide, but there are still other reasons why your customers will buy from you and not the competition, such as the ease of getting to your fuel dock.
We said in scenario three you need to capture 100 percent of your competition’s business just to break even. This is unlikely, and you could start a downward spiral on pricing that causes everyone to lose, including your customer, because you may be out of business.
If I were faced with these choices, I would raise my prices to maintain my mark-up. This way I know my downside risks and am comfortable that I will not lose a third of my sales volume. I can always make further small adjustments to my fuel sales program to promote sales.
There is another avenue that most marina owners and operators overlook. Try.to renegotiate your fuel supplier’s price. Remember, he is in the business of selling fuel. When your sales volume goes down, so does his, along with his profits.
Marina Dock Age, May/June 2000
So You’re Thinking About Renting Boats…
by Ron Brazda
Watching other marina owners make money from boat rentals may make you wonder if you should try it. On the surface, it looks fairly easy. How difficult can it be to buy some boats, rent them out for a few hundred dollars a day, and make a killing?
But, if this were the case, more marinas would be in the boat rental business. As with any business venture, proper research and planning will tell you whether boat rentals are for you.
IS THERE A MARKET FOR RENTALS?
Your first step is to determine the market demand for boat rentals. Are there other boat rentals within five miles? Can the population support your business? Will your clients be locals or will they come from a nearby city, hotel, or resort? How far do you think people would be willing to travel to spend $200 to rent a boat for the day?
Keep track of the number of phone calls you receive asking about rentals. If you are getting 20 calls a day from people just looking you up in the phone book, figure you can close on 10 percent of those calls, about two boats a day.
BASIC PLANNING
What type of boats are you going to offer? Where will you keep the boats? If you are in an area with extreme climatic changes, where are you going to keep the boats during the winter? What is going to set you apart from the competition-price, boat quality, cleanliness, or staff? How many boats do you want? How will you pay for the boats?
BUYING THE BOATS
Your first expense is the purchase of boats. Are you going to finance them, or do you have the capital on hand to purchase them outright? If you are a dealer, you will be able to buy them wholesale. You may even be able to set up a deal with the manufacturer, because they will get better exposure from the traffic that comes through a busy marina. If you are not a dealer, you may want to look for one who will give you a reasonable price for multiple boats in exchange for doing advertising for them.
ADVERTISING
In your first year, you will want to saturate the market with advertising. Place ads in the local “action weekly” or travel and leisure section. Set up rack cards in hotels, even if you are not in a vacation area. Invite the hotel concierge to go out on a boat, then give her free rental for every five she books for you.
Depending on the size of your ad, yellow page advertising can be expensive. Look in the phone book to see what your competitors are doing. Have your ad designed to stand out.
REPAIRS AND MAINTENANCE
Taking care of your boats properly can make or break you. Without regular maintenance, your boats will continually break down. A broken boat equals lost revenue.
If your employees are not trained to properly perform a checkout with a customer, it can add to the damages. By an employee disregarding a warning bell, you can blow an engine. Simple things like repairing a nicked or dinged prop can save you from long-term damages such as bent shafts.
The most often overlooked aspect of repairs and maintenance is who will do it. While it is great having a shop on site, chances are your busy rental season is also your busy shop season. You may want to dedicate one employee for repairs. You will need to figure out if that technician’s time is more profitable as a rental mechanic or as a shop mechanic. You can also bill the boat rentals your going labor rate, but that defeats the point of having an on-site mechanic.
DAMAGES AND LOST EQUIPMENT
Also overlooked are lost equipment and damages caused by the renter. If each and every rental is not properly checked in and out, customers often get away with damages going unnoticed. Even a security deposit does you no good when the damages are found after the deposit has been returned and the customers are gone. A well-written rental agreement can help you collect on some of these damages, but not all.
There is a misconception that renters have the right to get estimates for repairs. When you wait around for estimates, your boat is out of commission until the repairs are finished.
You may also have to chase after lost boats. When your boats do not return on time, you have to pay overtime to the employee looking for the boat or waiting for its return. Brian Smith, boat rental manager of 20-plus boats at Holiday Marina on Lake Lanier, says, “Last year I had to go out and look for about 30 people (nonrecurring boats) and had to go get another 25 or so who had broken down or damaged the boat. And only a month into this season I have had to go look for six.”
At what point do you send out the search parties? When I was renting boats, my rule of thumb was an hour and a half after closing. Tardy boats are not only a problem at night, but during the day when you have customers waiting for the boat to come back. This is taxing on employees as well, because they have to handle the customers waiting for the boat they reserved.
Renting boats is not for everyone. It can be a profitable venture, but it can also be a costly, headache-ridden undertaking. As with anything else, employee training is key. A properly trained employee will not only help sell your rentals, but take care of your investment.
Marina Dock Age, May/June 2000
What are Your Customers Thinking?
by Dennis P. Kissman
Do you ever survey your customers? If you are like most marina operators, you don’t. Too many take their customers for granted and assume they will never leave. That assumption does have some validity but usually for the wrong reason.
Boaters, like most people, are creatures of habit and don’t like a lot of change. As a result, your customer-base is probably pretty stable, unless there is some radical change in your operation, market area, or the economy. The next question is, are you satisfied with the status quo? If you are, it’s probably time to get out.
Surveying your customers should be as easy as any other one-on-one communication. Yet, when l talk to marina operators about what customers expect from them, I usually get a blank stare. It is as though they are afraid to find out. It seems most marina owners have been conditioned to believe that customer feedback is synonymous with bad news Ironically, when we are told something about our business or how we conduct it, we usually are well aware of the situation.
Let’s say you do listen to your customer. Now the question is, “How do I go about it, and what can I expect as an end result?” The second part of the question needs to be addressed first, as it becomes your report card.
The end result should affect your operation in three ways. First, your customer-base becomes more satisfied and become your spokespeople for that all-important “word-of-mouth advertising.” Second, you will attract new customers, even though you may not be able to accommodate them at the time. What you have done is create demand for your services, the key to future success. This leads to the third end-result: increased profitability, which I assume is the reason you are in the business.
Surveying should not be a one-time event, nor does it have to be formal. Every time you have contact with one of your customers, you should be in an information-gathering mode. Getting a good cross-section of input is not always easy. Usually, those with negative input or hidden agendas are the most vocal. You seldom hear from customers who are satisfied.
The trick to getting valid feedback is to listen very carefully. Do not interpret this input through an opinion you have already formed. If you already have your opinion formed, why waste your time and the customer’s. What you need to do is assess the merits of what the customer is telling you and view it purely from an economic basis, with the cost of acting on the suggestion in mind.
Don’t take the first feedback you get and assume that it holds for everyone. This is where you have to be careful of individuals with hidden agendas. Listen carefully, get as much input as possible from a variety of sources, weigh the alternatives, then act. Remember, making a conscious decision to do nothing is a form of acting on the issue.
If you decide to take a more formal approach in the form of a questionnaire, here are some things to keep in mind:
- Don’t make it too complicated.
- Don’t include leading questions that suggest the answer you want to hear.
- Don’t ask personal questions.
Learn from the U.S. Census Bureau’s mistake with their 38-page questionnaire. Remember, you have to analyze the information you get back, and if it is a hassle, it is a waste of time.
Personally, I like to stay away from formal surveys. There is nothing better than a face-to-face discussion. A person’s expression and body language can indicate more than any check mark on a piece of paper in response to a specific question. This approach may sound like it takes more time than a survey, and in fact it does, initially. But, in the end, you will draw a much faster and far better conclusion. Don’t lose sight of the reason you are gathering this information.
No matter how you get your input, remember these important tips (especially if you expect to get information from these customers in the future):
- Do acknowledge the feedback you get. Let customers know their input is important.
- Share the information through a general forum, such as your regular customer newsletter.
- Act on what you learn. Remember, making a conscious decision not to act is a form of acting on the issue.
Most marinas are coming into their prime boating season. The timing is right and, with these thoughts in mind, now is the best time to start interacting with your customers to gather information. The more consistent you are in communicating with customers, the more you will enjoy your business, and the more profitable it will become.
Marina Dock Age, March/April 2000
Marinas and Manufacturers are One Another’s Best Friends
by Ron Stone
An article by Dan Natchez, the distinguished international marina consultant, in last November’s Marina Dock Age, posited that marinas are the marine manufacturers’ best friends. No doubt about it! Marinas have the best vantage point for introducing people to the joys of boating. Providing a safe, secure, clean, and attractive environment for boat owners, newcomers, or seasoned skippers enhances the quality of the boating experience and is conducive to the sale of boats and associated equipment.
This article makes the point that it’s a two-way street because marinas have a staunch ally and champion in the recreational marine manufacturing industry. Manufacturers are very mindful that the future success of the industry depends, to a large extent, on there being enough quality boat slips, moorings, dryland storage, and launch ramps to take care of not just the present-day fleet of more than 13 million recreational watercraft throughout the country, but projected growth of millions more for the next 10 to 15 years. That is a primary reason why manufacturers are making a concerted effort to look out for marina interests.
Nowhere is this more evident than in the long-term strategic plan of the National Marine Manufacturers Association (NMMA) for the development, expansion, and preservation of recreational boating facilities.
In a plan approved by NMMA’s Marinas and Boat Access Committee, February 1998, the association pledged to assess the economic impact of marinas and other boating facilities, quantify supply and demand, press for enlightened policy at every level of government (including simplification of the permitting process), secure a national uniform policy for marina concessionaires on federally owned waters, and improve recognition that marinas are part of commerce and deserving of higher priority in the dredging of navigable waterways. The plan also envisions the establishment of recommended quality guidelines for marinas to ensure greater customer satisfaction and voluntary compliance with environmental best-management practices.
To these ends, NMMA maintains a fulltime Marinas and Boat Access Division in its Washington, D.C., branch office. It is headed by Jim Frye, the energetic executive director of the Marina Operators Association (MOAA), an integral part of NMMA.
The Division is located in the nation’s capital to closely monitor legislative activity regarding water use management as it affects marinas. By maintaining liaisons with national coalitions and industry alliances, NMMA can be relied on to be at the forefront of efforts to protect marinas from undue restrictions and to preserve and improve boat access to public waters. For example, in the 1990s, NMMA was a big player in the defeat of congressional action that would have imposed unwarranted, prohibitive financial responsibility on marinas for oil spills, and denied federal emergency relief to marinas in the event of natural disasters. In the Clean Vessel Act of 1992, NMMA won federal grant entitlements for marinas to install and maintain boat sewage pump-out stations. In 1998, when this grants program was about to be sunset, the association was instrumental in getting it extended for another five years. That same year, in hammering out legislation to tap the augmented Wallop-Breaux Trust Fund for federal aid to states for facilities uniquely benefiting transient, non-trailer boats over 26 feet long, NMMA held out for allowing private marinas to share grants to build and maintain transient dockage.
To drive the point home to marinas that clean waters are good for business, NMMA created a traveling educational exhibit called Walk the Dock for Profits. It has been used at several NMMA-sponsored boat shows and received critical acclaim for teaching marina operators to follow recommended environmental best management practices.
A recent U.S. Department of the Interior sponsored study finds that lack of knowledge of existing boating facilities is one of the most important constraints to boating and fishing today, and recommends making more information available to the public.
The marine manufacturers’ trade association came early to the recognition that the boating public needs more comprehensive information about marinas that provide easy, safe access to boatable waters. For more than 10 years, NMMA has maintained a national inventory of existing marinas, the most comprehensive of its kind anywhere in the world. Currently, it lists more than 12,000 marinas across the United States. Conceived as a marketing tool, this computerized database quickly informs the user how many marinas there are from state to state, on which bodies of water, how to get in touch with them, and how many wet slips and/or dryland storage spaces they have to offer. Up-to-date analyses of the comparative size and regional distribution of marinas is provided, as well.
The NMMA marina inventory is a superior way to make certain your marina is counted; it’s good, free advertising, too! Make sure your facility is included in the inventory. Call the NMMA Marinas and Boat Access Division at (202) 721-1630, or fax (202) 721-1645.
NMMA also keeps track of the number and location of boat launching ramps throughout the country. In cooperation with the States Organization for Boating Access (SOBA), the association maintains a national inventory of all public boat access sites built, renovated, or maintained by states with federal aid from the Wallop-Breaux Trust Fund. In addition, NMMA is at work bringing its database current with locations of private sector marinas that provide boat launching ramps so that trailered-boat operators have a wide array of options for getting out on the water.
Reasoning that new and improved boating facilities make it more convenient for people to go boating, and a positive inducement to buy boats and associated equipment, NMMA does a great deal to promote marina development and expansion.
The association publishes a portfolio of fact sheets as a marketing tool for marina owners and developers in presenting their building projects to government planning, zoning, and other permitting authorities. This publication emphasizes the point that marinas are economically significant, environmentally compatible, and an important asset to any community.
Other NMMA publications include a quarterly newsletter on boating facilities development chronicling marina and boat ramp construction and expansion in leading boating market states. Also included in the newsletter are: a national directory of marina architects, engineers, and consultants; and bibliographies citing books, conference papers, studies, and other resources pertaining to planning, designing, financing, building, operating, and maintaining private and public sector recreational boating facilities.
Although the United States has more marinas than any other country in the world, and other popular boating market countries commonly look to our experience for technical advice on how to build and operate successful marinas, NMMA is open to new ideas from overseas. The problems marinas face are fairly common around the world, and it is always possible that American marinas can learn from solutions found in other countries. For that reason, NMMA is a principal player in international councils concerned with marinas. Last year, at Fort Lauderdale, the association hosted the latest in a series of continuing marina education conferences under the aegis of the International Council of Marine Industry Associations (ICOMIA). The conference attracted marina operators, consultants, equipment manufacturers, architects, and engineers from 22 countries to learn more about what it takes to successfully operate a marina in today’s environment.
The bottom line: Clearly there is a symbiotic relationship between marinas and the recreational marine manufacturing industry. Each needs the other for growth and economic success. It is essential that they work together. There are collective bodies for doing this locally in state and regional marine trade associations. NMMA and MOAA admirably serve that function for broader issues at the national level. I encourage individual marinas to join MOAA and work with NMMA. Call the NMMA Member Services Department at: (312) 946-6200.
Ron Stone is a senior advisor with the National Marine Manufacturers Association and chairman of the ICOMIA Boating Facilities Committee. He served as NMMA’s director of facilities and government relations for more than four decades. He is the founder of the States Organization for Boating Access.
Marina Dock Age, March/April 2000
When Just Thinking About Software Gives You a Headache
by Dennis P. Kissman
I have this hang-up about software, and from time to time I’ve addressed it in this column. It would be easy to be critical of the packages being offered the marina industry, but that will serve no purpose to resolve an ongoing problem that will only get worse over time.
First, let’s look at the big picture. When we first started our business ten years ago, I was sure we were on the verge of seeing large national and international marina chains, followed by successful regional chains, and a few large independents in prime locations. Oh yes, we would still have a few small and successful owner/operators in locations that the other groups had written off as not worth pursuing. And then there would be those that would not have the wherewithal to make a go of it, and would flounder to one degree or another.
What actually happened is that the small owner/operators are healthier than ever and the regionals have prospered. From here it goes downhill fast. The big chains’ marketing hype outweighed their substance, and they never materialized to the point where they have had a positive influence on the marina industry. (I am sure there will be some criticism from my colleagues for my position, but when you get behind the marketing facade, there is not much substance to these groups. It often reminds me of visiting the back lot of a movie studio where there is a beautiful house, only to open the door and find it is propped up by two-by-fours.)
DISASTER WRITTEN ALL OVER IT
So what does this have to do with software? Everything. First, it takes lots of money to develop a software package that can accommodate the variety of operations you find at marinas. The nuances that are part of every marina, even those operated as a group, are impossible for a software developer to incorporate into a “standard” software package. The result is a vanilla “package” that you are expected to conform to, an approach that has disaster written all over it for your marina.
Many developers will say they will modify their programs to meet your needs Sounds good, but often you don’t know what you want to begin with. If you make changes down the road, you have to go back to the original developer and then are at his mercy for price and delivery. Compound that with the fact that if you’re like me, you don’t speak the same language as these software developers. The results are usually less than what I expected, and fixing it only adds more dollars to the bill, not to mention the frustration.
Another thing: Your marina is not the same as it was a few years ago. And if your software package hasn’t changed, then it is dictating how you operate your marina. This is a sure way to run your marina into the ground.
I recently visited a client’s marina that was using a software package that was developed more than five years ago for a dealership operation. It was “state of the art” at the time and worked great for what had been his primary source of business. But his business has changed and he is at a loss as to how to get meaningful information out of this system. I know this is not an isolated case. Many of you feel the same way and are asking yourselves what can you do about it?
NO RELIEF IN SIGHT
I am not against using computer software at marinas, but custom systems usually don’t make economic sense. This industry is just not big enough to allow a software developer to devote the time and money necessary to learn how marinas operate. It’s not that many of them would not spend the time and money to learn, but they have to face the economic reality as well as you do, especially when their whole U.S. market is less than 12,000 marinas. That's not much of a market potential when you think of Microsoft dealing with hundreds of millions as their customer base. Therefore, I do not see any affordable relief in good software packages on the horizon when the money has to come out of the marina owner’s own pockets.
Maybe you can benefit from my experience as to how to circumvent the software treadmill. Over the years we have provided management services for institutions that were faced with taking on marinas in foreclosure actions. We developed a management style that allows us to step in at a moment’s notice (often through a court order) and take control of a property, usually under adverse conditions and without any historical knowledge base.
Plus, we have to be prepared to report to an asset manager who often doesn’t know one end of a boat from another, and the only way he can relate to a marina is to report information in the typical “office building” format. More often than not they insist on a rent roll, but cannot understand why cash deposits do not match the rent roll. For whatever reason, advance dockage payments and income from other profit centers just does not compute in their world.
Another twist is that because these institutional owners cannot employ the on-site staff, we set up a labor-leasing company that consolidates all staff (with the added advantage of qualifying them for employment benefits).
CUSTOMIZED AND CENTRALIZED
We developed a management control and reporting system that incorporates a series of checks and balances using computer programs and hand-generated input control forms. The reporting output can be in whatever format the client wants, and the analytical reporting can be customized. Our system is highly centralized, usually requiring less than a full time accountant on-site. Information is transferred back and forth daily, so onsite and central office personnel is in sync at all times.
One of the keys to our system and why it works so well is that all cash is received at the location, eliminating the old saying, “The check is in the mail.” Disbursements are prepared and sent from our central office only after proper approval is received from the on-site management. Keep in mind this system isn’t for those who don’t believe in banks and like to operate out of a cigar box, like many of the situations we find when we take on a foreclosed marina.
This is not a new concept and is used in many industries to reduce operating costs, improve efficiency, and maintain control. “Outsource accounting” takes the place of the majority of on-site accounting personnel, the local bookkeeper, the outside payroll service, and the local CPA.
All of this is what we hope for with a tailor-made software program. Maybe outsourcing is an alternative that would work for you.
Marina Dock Age, January/February 2000
No Room at the Dock?
Facts are critical to assessing facilities needs
by Ron Stone
It appears there is a chronic shortage of recreational boating facilities in many parts of the country. How much is fact and how much is illusion is hard to say.
During the boating season, it is not uncommon to find trailer boaters waiting for hours to launch at the local boat ramp. Yet, that same facility may only be lightly used during the workweek. Similarly, boats may lie idle in their slips for much of the time, belying the fact that waiting lists for space are on the rise again.
A recent study by the U.S. Fish and Wildlife Service on why more people don’t take up fishing and boating discovered a widespread perception that there are not enough facilities to enjoy these activities. However, the study also found that there is not nearly enough information to assure the public that there are.
What is known from the latest Coast Guard statistics is, currently there are at least 12.6 million registered watercraft throughout the country, not to mention hundreds of thousands of documented pleasure yachts. What is relatively unknown is how many boat ramps and marinas there are to accommodate them.
The National Marine Manufacturers Association, which maintains a nationwide inventory of marinas, can identify approximately 12,000 marinas with 901,337 wet slips and moorings, and name the body of water on which they are located. The States Organization for Boating Access, which maintains a national site specific database for federally assisted public boat ramps built, improved and maintained with Wallop-Breaux money, is able to identify more than 25,000 access sites. These two sources provide the greatest body of recreational boating facilities information.
In addition, the U.S. Army Corps of Engineers, the Bureau of Reclamation, and other federal agencies publish pamphlets describing public recreation opportunities on their lakes. Typically, this literature indicates whether a specific body of water offers public boat access, but is not precise about the land routes to the access points and the amenities. Similarly, the navigation charts available from NOAA do a fine job of directing cruising yachts to marinas, but they make no attempt to quantify how many facilities there are along any given waterway nor what kind of services they offer. Boaters can purchase commercial waterway guides, but they are geographically limited to coastal, Great Lakes, and major inland waterway networks. They do not give a true sense of how many marinas or boat ramps there are relative to the total number of boats in operation across the United States.
In recent years, Sea Grant and 1-800 ASK FISH have made an effort to fill in the gaps by collecting and consolidating information. Both have web sites to locate marinas and boat ramps. Increasingly, state fish and game and tourism agencies are incorporating public boat access information in their web sites. And forward-thinking marina operators are advertising their facilities on the Internet.
While the Internet is the most rapidly growing communications medium in history, well over half the U.S. population is computer illiterate and does not know how to use the system. Thus, the findings of the Sport Fishing and Boating Partnership Council suggest that the perception that there are not enough facilities may be predicated to a significant degree on a lack of sufficient knowledge of the location of existing facilities. To date, no one in the public or private sectors has been successful at bringing together and distilling all of the existing information.
In view of this, the federal government has embarked on a major effort to create greater public awareness of recreational boating facilities. It is a salient part of the $36 million, five-year grant program to stimulate greater public participation in recreational boating and fishing, authorized by the Sport Fishing and Boat Safety Act of 1998.
At the same time, under the new Boating Infrastructure Grant Program of the 1998 federal legislation cited above, states are encouraged to conduct surveys to determine the adequacy, number, location, and quality of tie-up facilities for transient non-trailerable boats over 26 feet in length as well as sites providing access for all sizes of recreational boats. The surveys are not required. However, states that participate will have a competitive advantage in participating in the $32 million, three-year grants program. Surveys conceived and executed according to uniform guidelines of the Federal Aid Division of the U.S. Fish and Wildlife Service will produce information that is meaningful in comparing boating facilities needs. They are stepping stones to a comprehensive national assessment of facility and site locations.
The Recreational Boating and Fishing Foundation has been created to implement the recommendations of the Sport Fishing and Recreational Boating Partnership Council to remove the constraints on the enjoyment of fishing and boating. One of the Foundation’s task forces will focus on filling the boating facilities information gap. It is expected to expand on the site specific databases established by the recreational marine manufacturing industry and state government boat access coordinators. That, combined with the results of state boating infrastructure surveys, will go a long way toward helping boaters and anglers locate the facilities they want and to pinpoint areas where facilities are needed.
In the final analysis, filling the facilities information gap will help determine once and for all whether the long talked about boating facilities shortage is real or an illusion.
Ron Stone is a senior advisor with the National Marine Manufacturers Association and chairman of the ICOMIA Boating Facilities Committee. He served as NMMA’s director of facilities and government relations for more than four decades. He is the founder of the States Organization for Boating Access.
Marina Dock Age, January/February 2000
Think Before You Add an Amenity
by Dennis P. Kissman
Today we often hear that boaters want more out of their marina than just storage. This is particularly true as boating has evolved into a family activity. Many people advocate adding costly amenities such as swimming pools, playgrounds, tennis courts and picnic areas. They imply that adding such amenities could benefit the bottom line.
The dictionary defines “amenity” as: 1) the quality of being pleasant or attractive, agreeableness; 2) something that contributes to physical or material comfort, or 3) a feature that increases attractiveness or value of a property.
There is no mention that an amenity must be a physical improvement. The definitions don’t specify any costs associated with an amenity.
AMENITIES MAY NOT BE EXPENSIVE
Before you spend a lot of money on amenities, examine areas that may have the greatest financial impact with the least investment in both time and money. It could be as simple as adjusting your operating hours. Or, you might try negotiating a better price with your fuel supplier and pass the savings along to your customers. Could your marina be more hospitable to pets? Would a small laundry with washtubs and soap be useful? What about a simple shower facility? Or, how about the friendliest, most helpful staff within miles? These ideas could have a far greater impact on your profit than undertaking a major investment.
Let’s assume that you are considering adding a swimming pool. Now the question is, do the cost and risks justify the return? This is not an easy question to answer, nor should it be taken lightly.
Once you have come this far in your thought process there is another fatal assumption that one usually makes. That is, the greater the cost of the amenity the greater return that should be expected. The most important thing to understand is that the cost of an amenity has no direct relation to the return it can generate. Having said that, how does one evaluate the return on the added amenities?
HERE’S THE EQUATION
First, consider the ways amenities could increase profitability at your marina. One way is to increase occupancy, assuming you are not already full. Other ways include increasing dockage rates or selling more goods or services.
On the other side of the equation, an amenity may help you reduce costs. There are a few general points to consider when making your economic evaluation.
Today we often hear that boaters want more out of their marina than just storage. This is particularly true as boating has evolved into a family activity. Many people advocate adding costly amenities such as swimming pools, playgrounds, tennis courts and picnic areas. They imply that adding such amenities could benefit the bottom line.
The dictionary defines “amenity” as: 1) the quality of being pleasant or attractive, agreeableness; 2) something that contributes to physical or material comfort, or 3) a feature that increases attractiveness or value of a property.
There is no mention that an amenity must be a physical improvement. The definitions don’t specify any costs associated with an amenity.
AMENITIES MAY NOT BE EXPENSIVE
Before you spend a lot of money on amenities, examine areas that may have the greatest financial impact with the least investment in both time and money. It could be as simple as adjusting your operating hours. Or, you might try negotiating a better price with your fuel supplier and pass the savings along to your customers. Could your marina be more hospitable to pets? Would a small laundry with washtubs and soap be useful? What about a simple shower facility? Or, how about the friendliest, most helpful staff within miles? These ideas could have a far greater impact on your profit than undertaking a major investment.
Let’s assume that you are considering adding a swimming pool. Now the question is, do the cost and risks justify the return? This is not an easy question to answer, nor should it be taken lightly.
Once you have come this far in your thought process there is another fatal assumption that one usually makes. That is, the greater the cost of the amenity the greater return that should be expected. The most important thing to understand is that the cost of an amenity has no direct relation to the return it can generate. Having said that, how does one evaluate the return on the added amenities?
HERE’S THE EQUATION
First, consider the ways amenities could increase profitability at your marina. One way is to increase occupancy, assuming you are not already full. Other ways include increasing dockage rates or selling more goods or services.
On the other side of the equation, an amenity may help you reduce costs. There are a few general points to consider when making your economic evaluation.
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