What "Should" services cost?...

[pillingslock]

Here's a huge can of worms to be opened, but lets roll with it and have some fun...

 

What do you, the boating public, really think things like boatyard services, (pump-outs, hull repairs) and moorings should actually cost?

 

Lets bear some things in mind though too (get a calculator for this one!) - do you think it should be a proportion of what is cost to built and maintain? if so, what proportion should it be?

 

And also, what is your perception of what it costs to build & maintain say a dry-dock? or slipway and trolley?

 

Do you think there should be a wide variety of choices and prices or do you think everyone should charge the same?

 

I'm really keen to see what comes of this one...and anything else 'boaty' that you pay for...

[Machpoint005]

Services should cost:

 

1. the actual cost of materials to the supplier

2. A realistic proportion of his fixed overheads

3. The variable overhead for the job, including labour and employment costs

4. A reasonable profit.

 

It's for the supplier to determine how much profit is 'reasonable' given that he wants a viable business. Market forces will then dictate whether this comes to pass!

[Gary Peacock]

I think like all things in business you have to charge what it really costs plus some profit.

 

We all know many of "The good old so and so" types who charged little often lost money and then went out of business.

 

You have to look at what you are going to have to charge and if it is obvious customers will not pay it reduce your overheads or just forget it.

 

Now unfortunately boaters decisions more than others seem to be based on price, (It's their big weakness that is exploited by builders when parting them with their money) so trying to provide a good profitable service while competing with others offering a poorer but cheaper service is the big battle to win.

[magpie patrick]

I wasn't going to give an answer like that as was waiting with interest to see what values came up! Of course you're right that the cost has to reflect the cost of provision otherwise the provider goes out of business.

 

OK, my two pennorth. I don't know how much things should cost but here's my view on my actual costs for a 62 foot narrow boat.

 

Moorings: I was on an EOG near Marple (not my garden) until June, that cost £550 a year which was a bargain. Moving to a marina mooring at Saul Junction we now pay £2000. It's the biggest single cost of keeping the boat and I really could do without it going up substantially at the moment.

 

Licence (not in pilling locks control) £700, which is what my latest one cost, doesn't really worry me, but the more BW put on the licence the less I'll be able to absorb say an increase in mooring fees

 

Diesel: controlled by world oil prices and the exchequer. I've budgeted for next year at £1.50 a litre which has put a dint in my budget. Ripple seems to get through around 2 litres an hour so last years (2007) £400 on fuel would become next years £1200 if we use the boat as much: lifestyle changes suggest we won't but I'm still bracing myself for £800 plus

 

Pump out: we've two loos, pump out this year was typically £30 for both which was needed after about three weeks cruising. Negligible really

 

Visitor moorings: we left the boat at Arlen (Preston: lancs) who pumped out, redieseled and then charged us £25 per week to leave it there. BARGAIN. If moorings for a couple of weeks were more often that price we'd do more cruising! Arlen then reduced the bill to £200 (for all above plus three weeks moorings) because £215 "sounds too much"!

 

Gas: costs what it costs, central heating guzzles it so try and manage without (although the main compensation, scotch, is even more expensive!)

 

For many of the smaller bits of chandlery I wonder how these guys make any money. I bought a new tiller handle (the wooden bit) for £10 in middlewich: fine, except they hadn't one in stock and made an hour long round trip to get me one from another chandler!

 

I've got to get quotes for hull blacking and engine service (more like overhaul) in the next few days. Not sure what to expect except the engine will be expensive.

[pillingslock]

RE GARY's REPLY - Very true, I couldn't agree more.

 

But I also think the Boat Sales industry could be in for some better news with the property prices crashing though. Let's face it, Narrowboat prices aren't so vollatile and associated costs of boat ownership have risen, but not like house prices, utility and mortgage costs.

 

Already we have sold a boat & rented mooring to a very affluent proffessional relocating to this area as they didn't want to speculate on property, rent property or sell their existing flat at the wrong time.

 

With people's perception of what things should cost, housing wise, is the boating industry (with all the technology, improvements and new ideas) potentially on to a winner now with low-cost residential requirements that actually give a better quality of lifestyle?

 

Quite exciting I think...

Edited September 30, 2008 by pillingslock

[pillingslock]

I wasn't going to give an answer like that as was waiting with interest to see what values came up! Of course you're right that the cost has to reflect the cost of provision otherwise the provider goes out of business.

 

OK, my two pennorth. I don't know how much things should cost but here's my view on my actual costs for a 62 foot narrow boat.

 

Moorings: I was on an EOG near Marple (not my garden) until June, that cost £550 a year which was a bargain. Moving to a marina mooring at Saul Junction we now pay £2000. It's the biggest single cost of keeping the boat and I really could do without it going up substantially at the moment.

 

Licence (not in pilling locks control) £700, which is what my latest one cost, doesn't really worry me, but the more BW put on the licence the less I'll be able to absorb say an increase in mooring fees

 

Diesel: controlled by world oil prices and the exchequer. I've budgeted for next year at £1.50 a litre which has put a dint in my budget. Ripple seems to get through around 2 litres an hour so last years (2007) £400 on fuel would become next years £1200 if we use the boat as much: lifestyle changes suggest we won't but I'm still bracing myself for £800 plus

 

Pump out: we've two loos, pump out this year was typically £30 for both which was needed after about three weeks cruising. Negligible really

 

Visitor moorings: we left the boat at Arlen (Preston: lancs) who pumped out, redieseled and then charged us £25 per week to leave it there. BARGAIN. If moorings for a couple of weeks were more often that price we'd do more cruising! Arlen then reduced the bill to £200 (for all above plus three weeks moorings) because £215 "sounds too much"!

 

Gas: costs what it costs, central heating guzzles it so try and manage without (although the main compensation, scotch, is even more expensive!)

 

For many of the smaller bits of chandlery I wonder how these guys make any money. I bought a new tiller handle (the wooden bit) for £10 in middlewich: fine, except they hadn't one in stock and made an hour long round trip to get me one from another chandler!

 

I've got to get quotes for hull blacking and engine service (more like overhaul) in the next few days. Not sure what to expect except the engine will be expensive.

It would be interesting to see if an increasing number of boats on the network could reduce the license fee increases. But £700 per year is less than £2 per day - is that value for money? £2k per year seems about average for a 60ft-ish mooring - and don't forget the VAT man takes nearly 20% of that so if you cost it out to the providers cut, it's comparable to band C or D council tax in many areas and I think that's kind of what a marina does - act as the local authority in a mini way.

 

As for the diesel price increases, how could we save the extra money we're all going spend? Tricky one that.

 

PS! original question slightly avoided though...you own a 62ft boat, so what do you think it should cost you to run and use the services available? I'm really interested in this avenue of discussion.

 

Let's even think about it a different way...say you own a £50k motor car...what does it cost you to own this car? servicing, petrol, insurance, depreciation etc.

 

And then say you use your boat as a residence? should it cost you anything different? should your costs be linked to property costs? or what benefits should you have instead?

Edited September 30, 2008 by pillingslock

[magpie patrick]

PS! original question slightly avoided though...you own a 62ft boat, so what do you think it should cost you to run and use the services available? I'm really interested in this avenue of discussion.

 

I don't know what it SHOULD cost, I just know what it does and how affordable it is to me!

 

I haven't got a problem with 2k for moorings, and I understand that you get it with 20% lopped off for VAT (in business myself but most of my customers are also vat registered businesses).

 

Trying to avoid the easy and facile answer of more, cheaper, better! I think the licence fee represents reasonable value: the mooring fee is cheaper than being out on the canal round here and is very good value. The costs that are worrying me at the moment are likely major work on the engine and some internal refitting that is getting necessary. I can do the latter myself so it costs only materials (and me missing out on a social life while I do it) but the engine could be expensive.

 

As you asked: fixed costs of the boat are £3000 per annum: plus using it (which is the point of having it). If it appraches £4k (without allowing for inflation) we can cover that. £5k, getting a bit dodgy. £6k it has to go.

 

I've got to go out now so I'll give more thought to the cost of using services, although as you can see I think using the boat is the cheap bit!

[grahoom]

Let's even think about it a different way...say you own a £50k motor car...what does it cost you to own this car? servicing, petrol, insurance, depreciation etc.

 

And then say you use your boat as a residence? should it cost you anything different? should your costs be linked to property costs? or what benefits should you have instead?

 

so are you asking if living on a boat should cost the same as living in a house?

 

don't really understand your question, but, I own a boat and I'd prefer it to cost me £0 to moor it, and not to have to pay a licence etc etc. But seeing as licencing has nothing to do with your "business" I am presuming you are asking what people think they should be paying for services you provide (or might provide).

 

I pay £134 a month for the mooring I am on at the moment, this is on EA water, so not BW. It's on farmers land, so I have private access to the mooring. The Farmer doesn't provide water or waste disposal. So it's a very basic mooring. At present I can afford this, so I am guessing this is what I can pay.

 

I like the arrangement for the mooring that I have, as I get left alone pretty much, and the farmer seems a nice chap. I contacted the farmer directly, as i saw some other boats moored up, so he wasn't touting for business. I'd imagine to him it's an added bonus to have someone ask for a mooring, and not something (as far as I am aware) he is actively promoting.

Edited September 30, 2008 by grahoom

[sociable_hermit]

As a Pillings resident, am I allowed to comment here?!?

 

I think a 'fair price' can be assessed in many different ways.

 

For things which are essentially the same wherever you go, i.e. gas bottles, coal, fuel, pump out etc., then lowest price wins. The only exception might be on the grounds of convenience - no point in driving or boating for miles to save a couple of quid if it costs you more in time and petrol / diesel than the saving is worth. [Though having said that, an excuse to go boating is often a good thing!]. If the price is pretty much the same wherever you go, then it comes down to how well the job is done (e.g. do they flush out the tank when doing a pump out? If anyone spills diesel on your paint, do they clean it up?), and whether the people who do the job are friendly and helpful.

 

For bigger tasks it's more complicated, as it isn't always possible to compare like for like. The key thing is knowing what you'll be getting for your money, so you can make an informed choice. I don't mind paying small change for a quick-and-easy repair, or serious money for a top-quality job, but I'm less than keen on being charged serious money for a low quality job. Fair's fair.

 

For example, if I were quoted an above-average price for having the hull blacked, I might be more receptive to the price if I knew that the bottom plate would be blacked as part of the job: something many yards don't do. However I'd also ask for a price without, just so I could weigh up the choice. Is it worth it, given the funds that I have? If my restaurant meal were expensive then I might accept it if I knew that all of the ingredients were organic and sourced locally, and all of the food was cooked from fresh ingredients on site. But I'd still like the choice of something cheaper, too, just in case I didn't have enough money, or couldn't justify the extra expense. It's the same with most things. Take beer. I won't regularly pay Copper Dragon prices for London Pride, as Paul well knows!

 

Choice and value for money are the main considerations. What am I getting for my money? How does that compare with what's on offer elsewhere?

 

From a business point of view, the other thing to weigh up is whether you really want money up front and nothing more, or whether you want repeat business. Most English people are far too polite to complain (though I understand boaters are something of an exception to this rule ) but if they feel they're being ripped off, they simply won't come back. This doesn't always mean lowering your prices. Sometimes it just means explaining WHY the prices are higher (e.g. better materials, higher quality of workmanship), and being seen to make an effort and do a little bit more than the competitors do. I don't think anyone minds paying more for a better job, provided it IS a better job and they knew the price before they began.

Edited September 30, 2008 by sociable_hermit

[pillingslock]

I don't know what it SHOULD cost, I just know what it does and how affordable it is to me!

 

I haven't got a problem with 2k for moorings, and I understand that you get it with 20% lopped off for VAT (in business myself but most of my customers are also vat registered businesses).

 

Trying to avoid the easy and facile answer of more, cheaper, better! I think the licence fee represents reasonable value: the mooring fee is cheaper than being out on the canal round here and is very good value. The costs that are worrying me at the moment are likely major work on the engine and some internal refitting that is getting necessary. I can do the latter myself so it costs only materials (and me missing out on a social life while I do it) but the engine could be expensive.

 

As you asked: fixed costs of the boat are £3000 per annum: plus using it (which is the point of having it). If it appraches £4k (without allowing for inflation) we can cover that. £5k, getting a bit dodgy. £6k it has to go.

 

I've got to go out now so I'll give more thought to the cost of using services, although as you can see I think using the boat is the cheap bit!

Engine servicing does seem to be something we could all work towards reducing the costs of. Recent chats with Business Link and BMIF tell us that there is a skills shortage within parts of the industry that results in higher prices and not always a better quality of workmanship.

 

One avenue that has been continually mentioned is the "Train to Gain" scheme as a way of getting more skills into the industry - for example getting a skilled worker who has been made redundant in another area, re-trained as a skilled marine engineer using grants available. We're looking into this one ourselves.

 

It's a shame there's not a 'Kwik Fit' for boats, where economies of scale can be applied to components and labour to reduce costs to the customer and business. It's also a shame that more youngsters aren't getting into boating at an early age to forge a career, but I don't know what we can do to change this short-term.

 

What has been very nice to see in some instances recently is other boat owners helping each other and sharing skills on the DIY front. I hope this continues to happen as it's great for the boating community.

 

Just been told someting else though about rental/property. There is a formula of 144 that is used for housing i.e. 144 times the monthly rental value should be what the property is worth with current interest rates. This actually works for my terraced house I bought in March this year to live in. I have looked at the rental value already.

 

If you apply this upwards from a monthly mooring cost, £134 per month would mean a 100 berth marina would cost around £1.9m to buy the land, design and build it and this looks very realistic from a developers perspective (having just built one) and this average monthly fee is almost spot on for the sizes and variety of boats and fees.

 

It does make the farmers field look very expensive though! but I guess that if the customer is happy that is the only thing that matters.

Edited September 30, 2008 by pillingslock

[WJM]

"There is a formula of 144..."

 

I would be very careful with those formulas. Up until six months ago they probably held good. The availability and cost of money has changed beyond all expectations.

 

I would do a more transparent calculation; 100 moorings, £1.9m outlay, recovery of outlay in 10 years? Add about 25% for interest £197 per month. In an oversubscribed market that sounds achievable. It is almost half what I am paying now.

[steelaway]

Here's a huge can of worms to be opened, but lets roll with it and have some fun...

 

What do you, the boating public, really think things like boatyard services, (pump-outs, hull repairs) and moorings should actually cost?

 

Lets bear some things in mind though too (get a calculator for this one!) - do you think it should be a proportion of what is cost to built and maintain? if so, what proportion should it be?

 

And also, what is your perception of what it costs to build & maintain say a dry-dock? or slipway and trolley?

 

Do you think there should be a wide variety of choices and prices or do you think everyone should charge the same?

 

I'm really keen to see what comes of this one...and anything else 'boaty' that you pay for...

 

 

Hi There

 

My biggest bone of contention is the price of dry dock or pulling out the boat onto a ramp for blacking or below water service.

Every time, it seems to take one man (and maybe a tractor) 15 minutes in total to haul it out.

I have been charged between £90 and £180 for these 30 minutes

Could some one explain how they can justify it.

 

Alex

[Justme]

I would do a more transparent calculation; 100 moorings, £1.9m outlay, recovery of outlay in 10 years? Add about 25% for interest £197 per month. In an oversubscribed market that sounds achievable. It is almost half what I am paying now.

 

You need to look at your interest figure. Taking an average house loan you end up paying about 3 times the house value for it by the time you have paid it off after 25 years. I would guestimate that a 10 year break even on 1.9 million is pushing it. Think more like 20-30 years & a total paid of 6 million.

 

 

Justme

[Dr Bradley]

Hi There

 

My biggest bone of contention is the price of dry dock or pulling out the boat onto a ramp for blacking or below water service.

Every time, it seems to take one man (and maybe a tractor) 15 minutes in total to haul it out.

I have been charged between £90 and £180 for these 30 minutes

Could some one explain how they can justify it.

 

Alex

 

 

My recent launch was at Harrals in Northwich. The hoist is already there, it took abou 20 minutes - £350. A lorry moved it from Winsford. Probably a couple of hours, plus more fuel and probably greater capital costs - £125.

 

My local boat yard has to hire in a crane, yet get the costs to less than half of Harrals charge. Rip off?

[grahoom]

If you apply this upwards from a monthly mooring cost, £134 per month would mean a 100 berth marina would cost around £1.9m to buy the land, design and build it and this looks very realistic from a developers perspective (having just built one) and this average monthly fee is almost spot on for the sizes and variety of boats and fees.

 

It does make the farmers field look very expensive though! but I guess that if the customer is happy that is the only thing that matters.

 

as you're using the £134 per month here, I am presuming you are refering to my post, there is quite a difference from a private mooring I have and a mooring in a 100 berth marina.

Edited September 30, 2008 by grahoom

[Chertsey]

Hi There

 

My biggest bone of contention is the price of dry dock or pulling out the boat onto a ramp for blacking or below water service.

Every time, it seems to take one man (and maybe a tractor) 15 minutes in total to haul it out.

I have been charged between £90 and £180 for these 30 minutes

Could some one explain how they can justify it.

 

Alex

Well, I don't know how the actual numbers stack up, but the tractor has to be paid for. I don't imagine they come cheap.

[sociable_hermit]

Well, I don't know how the actual numbers stack up, but the tractor has to be paid for. I don't imagine they come cheap.

Certainly not, but many yards use a Loadall or something similar, and it's used for plenty of other stuff inbetween dragging boats out. And that spreads the cost. To be honest if it's going to sit around for most of the time depreciating, you'd be better off coming to an arrangement with the local farmer / hire firm, I'd have thought.

 

Personally if I were doing that kind of stuff I'd use an AEC Matador... or a Burrell But at that point it would cease to be simply a business arrangement, and I wouldn't expect anyone else to pay all of the costs...

 

Edited to say: on reflection, I'm lying about "many" yards using Loadalls. I've seen them in one or two places. But I have often wondered why more Marinas don't use something like that - they seem much more useful.

Edited September 30, 2008 by sociable_hermit

[steelaway]

My recent launch was at Harrals in Northwich. The hoist is already there, it took abou 20 minutes - £350. A lorry moved it from Winsford. Probably a couple of hours, plus more fuel and probably greater capital costs - £125.

 

My local boat yard has to hire in a crane, yet get the costs to less than half of Harrals charge. Rip off?

 

 

They seem to have organised a cartell - while ever we put up with it they will keep charging it

 

Alex

[alan_fincher]

Certainly not, but many yards use a Loadall or something similar, and it's used for plenty of other stuff inbetween dragging boats out. And that spreads the cost. To be honest if it's going to sit around for most of the time depreciating, you'd be better off coming to an arrangement with the local farmer / hire firm, I'd have thought.

 

Personally if I were doing that kind of stuff I'd use an AEC Matador... or a Burrell But at that point it would cease to be simply a business arrangement, and I wouldn't expect anyone else to pay all of the costs...

 

Edited to say: on reflection, I'm lying about "many" yards using Loadalls. I've seen them in one or two places. But I have often wondered why more Marinas don't use something like that - they seem much more useful.

Our local man uses an old airport tractor. I don't imagine it was expensive, by the look of it.

 

If you want an education, watch just how little time is spent on a professional blacking. Last time I knew, I think the charge around here, (where there aren't many choices, unfortunately), was in the £10 to £12 per foot range (2 coats basic blacking, rollered, no attention to baseplate, weedhatch, etc).

[steelaway]

Our local man uses an old airport tractor. I don't imagine it was expensive, by the look of it.

 

If you want an education, watch just how little time is spent on a professional blacking. Last time I knew, I think the charge around here, (where there aren't many choices, unfortunately), was in the £10 to £12 per foot range (2 coats basic blacking, rollered, no attention to baseplate, weedhatch, etc).

 

 

Dont get me started about the cost of blacking They should wear a mask then we might be able to recognise them

[Hairy-Neil]

My recent launch was at Harrals in Northwich. The hoist is already there, it took abou 20 minutes - £350. A lorry moved it from Winsford. Probably a couple of hours, plus more fuel and probably greater capital costs - £125.

 

My local boat yard has to hire in a crane, yet get the costs to less than half of Harrals charge. Rip off?

 

The lorry can be used for carrying a variety of cargos to a multitude of destinations for grateful businesses. The boat hoist is limited solely to hauling out boats on odd occasions for ungrateful boat owners....

 

An aquaintance of mine who runs a dry dock assures me it would be more profitable and a lot less hassle if the yard were to let it out as mooring space for three more full length boats.....

[sociable_hermit]

There's another way of looking at that, though. Should a winch, skate or dry dock pay for itself purely in terms of the fees for its use? Or should it be viewed as a way of bringing in further work i.e. hull repairs, painting, surveying? And then, in turn, should other sales be factored into this for the people who turn up to use this facility who otherwise would never have visited? Diesel, stern grease, fenders, engine oil, magazines, ice creams, postcards, Mars bars etc. It all counts. Most importantly, if you have boats moored in your yard, how many of them would have gone elsewhere for moorings if you couldn't look after their boat 'in house'??

 

Having the ability to take boats out of the water brings trade in, and I think the TOTAL benefits for the business should be considered.

 

What's annoying is when everything is expensive (so you'd think the cost of the high capital expenditure had been spread across ALL products in the Marina), but then you still get stung £150+ for taking a boat in or out, and another £200+ for blacking it. Given that these are relatively simple and speedy operations it just looks like a p1ss-take.

 

The other thing I find annoying is when facilities aren't advertised properly so the equipment lies idle for most of the time, and then the yard owners expect to split the cost amongst the few who do use it - i.e. a very high cost per head. Why should I be expected to pay for someone's inability to run their business properly??

[WJM]

This may come as a shock, but business are run to make a profit!

 

If I had a crane, I would rather lift one boat for £100 than lift ten for £10. Some may call that greedy, I call it business!

[Hairy-Neil]

Having the ability to take boats out of the water brings trade in, and I think the TOTAL benefits for the business should be considered.

 

And that's exactly the reason it is still used as a dry dock.....

[pillingslock]

Well, I don't know how the actual numbers stack up, but the tractor has to be paid for. I don't imagine they come cheap.

Very true, they don't come cheap.

 

I can tell you all about a slip-way and plant to run it. Cost of building a slipway capable of holding a trolley for narrowboats is just over £30,000. The trolley has cost almost £20,000 and a 2nd hand tractor capable of pulling it (4WD and heavy enough) also nearly £20,000 (Would have been over £60k new). Also cost in the salary of someone who has to look after it at least part-time of say £5,000 and a jet wash (self designed and made) £1,500. £76,500 total to get running. Bear in mind this doesn't include land purchased or use either.

(By the way, the first quotes we had for a trolley were £40k plus and a jetwash £7k!!! - needless to say we made our own instead)

 

Divide this £76,500 total cost by 252 working days per year and we have a daily cost of £304. Over 4 years with interest still costs out at over £100 per day to the business - plus we still haven't costed in land cost/rent or the admin lady's salary who sends and chases the bills - or any profit at all for the business who has built it!!!

 

So to me, £90 - £125 for half a day on a slipway sounds OK. But I'd be interested if that changes the perception of forum members?

 

 

 

There's another way of looking at that, though. Should a winch, skate or dry dock pay for itself purely in terms of the fees for its use? Or should it be viewed as a way of bringing in further work i.e. hull repairs, painting, surveying? And then, in turn, should other sales be factored into this for the people who turn up to use this facility who otherwise would never have visited? Diesel, stern grease, fenders, engine oil, magazines, ice creams, postcards, Mars bars etc. It all counts. Most importantly, if you have boats moored in your yard, how many of them would have gone elsewhere for moorings if you couldn't look after their boat 'in house'??

 

Having the ability to take boats out of the water brings trade in, and I think the TOTAL benefits for the business should be considered.

 

What's annoying is when everything is expensive (so you'd think the cost of the high capital expenditure had been spread across ALL products in the Marina), but then you still get stung £150+ for taking a boat in or out, and another £200+ for blacking it. Given that these are relatively simple and speedy operations it just looks like a p1ss-take.

 

The other thing I find annoying is when facilities aren't advertised properly so the equipment lies idle for most of the time, and then the yard owners expect to split the cost amongst the few who do use it - i.e. a very high cost per head. Why should I be expected to pay for someone's inability to run their business properly??

Have a little look at the costing above Tom... : - also, I'd value your comments on where you think businesses should advertise at the minute? as still to this day most of our expanding trade come in from word of mouth referral. We haven't had a single bite from monthly adverts in the industry's 'premier' magazine for over 6 months now! - that's over £400 for ad's that have driven no revenue at all.

Edited October 1, 2008 by pillingslock