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Setting up a new business


Cruising Mike

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Dear all,

 

If someone wanted to set up a hire boat business with both short term and long term hire. (day, mini-breaks and weekly) what are the things that would make it a bad move?

 

Aside from the initial capital sum needed to purchase 2 or 3 boats, what else is there to consider? Is it extremely difficult to get the business off the ground or is it doable?

 

It seems clear that the hire business is picking up year on year with more bookings happening, and it might be a good time to grab a share of the market.

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Hi Mike

Are you sure about the hire boat business boom? Travelling around the system to work, I've passed many hire boat bases with lots of moored boats in the height of what should be a busy season, though a friend who worked at a hire boat base on the southern Oxford last year told me that they had been busy all year, their proximity to London was part of the reason in his opinion.

 

I'm not qualified to offer definitive advice on the hire boat industry but my gut feeling is that the venture may not be the golden egg laying goose you may hope for. Others will offer a variety of opinions, I'm sure, I've worked with a few small venture hirers in the past, none are still in the business today. If you decide to give it a try, good luck.

 

Dave

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Dear all,

 

If someone wanted to set up a hire boat business with both short term and long term hire. (day, mini-breaks and weekly) what are the things that would make it a bad move?

 

Aside from the initial capital sum needed to purchase 2 or 3 boats, what else is there to consider? Is it extremely difficult to get the business off the ground or is it doable?

 

It seems clear that the hire business is picking up year on year with more bookings happening, and it might be a good time to grab a share of the market.

The hire boat business at Guildford on the Wey has closed - presumably WASN'T picking up year on year.....

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Thanks Mike.

 

To be honest, I've little interest in the hire boat side of things and I'd never contemplate involvement personally. The logistics - finding a base, ensuring that the boats reach hire boat safety standards, jumping through all of the CRT business hoops - are only a start. The day to day issues - turning boats around on change over days, endless call outs, a thousand small details needing constant attention, would deter many. I have some hands on experience with all of this when I was involved with Brummagem Boats in the 80s. Would you want to operate a small fleet personally, or employ others? You say that there are plenty of vacancies in established fleets at the moment. I'd expect this so early in the season, it would be interesting to see whether they fill over time. I suspect that not all will maximise their income potential this year. Another option could be to act as a sponsor to a boat for an existing hire company.

 

I'm a grumpy old cynic, I know, but Rabbie Burns words echo my sentiments:

 

 

"...and leave us naught but grief and pain, for promised joy "

 

Dave

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24 hours a day, 7 days a week.wink.png

 

Yup and just like running a pub everyone thinks they can do it until they try. I would think a small fleet would definately be unprofitable as a new venture.

 

Tim

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Hi Mike

Are you sure about the hire boat business boom? Travelling around the system to work, I've passed many hire boat bases with lots of moored boats in the height of what should be a busy season, though a friend who worked at a hire boat base on the southern Oxford last year told me that they had been busy all year, their proximity to London was part of the reason in his opinion.

 

I'm not qualified to offer definitive advice on the hire boat industry but my gut feeling is that the venture may not be the golden egg laying goose you may hope for. Others will offer a variety of opinions, I'm sure, I've worked with a few small venture hirers in the past, none are still in the business today. If you decide to give it a try, good luck.

 

Dave

 

I get the feeling that the reason you see a lot of boats hanging around their bases at the height of the season could be due to the changing nature of hiring itself. We go past the Wyvern Shipping Co quite a bit & we've noticed that the days of the place being empty of boats midweek are long gone & after talking to the hirers we meet, it seems that quite a few are hiring for long weekends these days, I imagine they might even be hiring midweek to midweek.

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I've no experience of holiday hires but I operate a single day boat myself.

 

My motivation was to fill some of my time with something I enjoy; I'm semi retired. And hopefully have a few quid over at the end of the year.

 

So far it's worked OK. There are occasional issues with day boats but they aren't daily. It's been profitable so far but if I tell you that it's almost impossible to make an amount equivalent to the minimum wage from a day boat, that's an indication.

 

2 things you should consider very carefully:

 

1/ Where you're based is crucial. I bought an existing business with a mooring. Had I wanted to start from scratch I can't think of a single suitable place in this area. Actually there is one option, if you had £200,000.00 spare.

 

2/ Have a think, do you really want to tie yourself up almost every weekend for 6 months or more? I'm single, doesn't bother me, but I'm sure that wouldn't suit many.

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Thanks for all the feedback guys. Naturally it's not something i would venture into without any consideration.

 

As someone who has grown up holidaying on boats, i am very attached to the lifestyle and can imagine myself being happy working around this lifestyle. I've worked in warehouses and desk jobs for over 10 years now and i definitely don't enjoy it. I'm an outdoors person and would love doing something like this as well as being self-employed.

 

Perhaps a first port of call would be to work for someone else in the hire business to learn the ropes. However im not sure how someone can 'look' for such jobs in the usual manner one would look for work. Also, im not sure it would be a well paid job either especially if it's a seasonal job

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Mike, apologies, I mis read your post re bookings, though that doesn't alter the opinions offered. Enjoying hire boats and operating them are not the same thing, but I applaud your enthusiasm. I can put you in touch with a friend with first hand experience of the industry ( not immediately, he's abroad at the moment ) who can share informed comment, or you could PM Keith M of this forum, mentioning me - he ran a small fleet years ago.

 

Dave

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Hire boat business. You'll be employing a few full time staff to do bookings, overwinter maintenance and breakdown engineering. On top of that, you'll need to employ seasonal staff to clean and turn around boats. On top of that you will be dealing with the general public and how they use your boats. It's a very people centred business

 

On top of that, you'll need a yard with parking and rubbish disposal to turn around boats and do planned and emergency maintenance.

 

Richard

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We did it!

 

The level of negativity towards the potential is quite surprising - the forum is quite quick to criticise the hire industry but if we didn't have one then how would people begin their addiction to the waterways?

 

Mike, I wrote a paper for BW several years ago on exactly the question you have posed - pm me with an email and I will send you it.

 

There is absolutely no doubt that the industry is picking up after some particularly tough years - a mix of the economy and Tim & Prunella

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Dear all,

 

If someone wanted to set up a hire boat business with both short term and long term hire. (day, mini-breaks and weekly) what are the things that would make it a bad move?

 

Aside from the initial capital sum needed to purchase 2 or 3 boats, what else is there to consider? Is it extremely difficult to get the business off the ground or is it doable?

 

It seems clear that the hire business is picking up year on year with more bookings happening, and it might be a good time to grab a share of the market.

 

I was once told by a very successful hire boat operator that many people start in the business because they think they will spend all day "playing with boats". The reality is that you either don't see your boats at all because they are away on hire, or you spend your time fixing and fettling them ready for the next hirers. In other words, you get all the downsides of boat owning and very few of the up sides. And that is before you take into account the small margins and long hours involved.

 

It's not an easy way to make a reasonable living.

 

 

 

Howard

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It can be done, I keep watching a local small company go from strength to strength, but they have a niche market and do things thoughtfully. A good supply of local liveaboards able to provide casual labour combined with boat expertise probably helps enormously.

 

However for many companies any growth is probably related to in a trend away from "nice families" and towards drunken stag and hen parties, so a small part of your job may be repossessing boats in stressful l circumstances, sometimes even with police protection!, cleaning up a lot of mess, and if you are really unlucky dealing with your boat sunk in a lock.

 

.............Dave

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We did it!

 

The level of negativity towards the potential is quite surprising - the forum is quite quick to criticise the hire industry but if we didn't have one then how would people begin their addiction to the waterways?

 

 

But the OP did ask "what are the things that would make it a bad move?" smile.png

 

Hire boating requires considerable investment in a base and boats, plus infrastructure for day-to-day running and back-up. I'm sure it is still possible to start in a small way and gradually build up, but most hire boat operators rely on some other waterway business to even out their cashflow - you are an RYA school, others have boat repair, moorings, chandlery, brokerage etc. It's not impossible, but OP's own suggestion of working for at least a short time in an existing hire boat business could give him a much better understanding of what he would be getting into and pointers towards being successful.

 

Tam

Edited by Tam & Di
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Going self employed is not for some. Some folk are just not self employed material and need to be employed. You need bombs of self discipline, its so easy to become complacent thinking you can't fail, so easy to think I can please myself now that I'm the boss, so easy to have lie ins and let things slide, no one to answer to or to sack you if you mess up. No one to pay you 3 or 4 weeks holiday money a year, no compensation if you decide to out. You'll be the one that has to deal with the ruckers, not your boss. You don't go home at the end of the day and forget it all until the morrow like you probably would if employed. You'll have sleepless nights worrying. At first at least you will be putting in double the time you did when employed. Plus keeping on top of NI contributions, income tax, insurances, possible VAT and all the rest. I've been self employed for about nearly 50 years, ok, I've been fairly successful, but it's been bloomin hard and at times when I have wished I was employed.

Hope I've not put you off. smile.png

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Gotta agree with bizzard. I worked in / ran the family business for 27 years, obviously in many ways it was easier when Dad as there. Having said that I did have a pretty good run for a few years after he left, for the first few years I actually made quite a bit more money...... Unfortunately It probably made me a little more complacent than I should have been, getting a good team together is one thing, keeping it together is even harder! One of the replacements turned out to be a tea-leaf, another was very disruptive, I didn't see the end of boom and bust in quite the same rose tinted light as Broon, when Dad got ill I decided to pull the plug and care for him instead.

 

Best of luck if you do decide to go ahead though but I think you are going to have some graft on your hands!

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We have hired boats 3 times over the last four years. The first was from a " conventional " hire company with a fleet of boats and it was great. A very good week where all went as planed. It was our first hire ever and was what we expected it should be. It was obvious that the hire firm had all their ducks in a row a d knew what they were doing. I have heard the firm spoken about on here. The boat we hired was Juniper so if you know Juniper you will know the firm.

The next 2 boats that we rented were from what I think is fair to call them privateers. They were people that had two boats. One for their own use and one to rent out. The first of these was on the Llangollen and the other on the Lancaster. We had big problems with both of these boats and were forced to cut one holiday very short by one breakdown and greatly inconvenienced by the other although we did finish our holiday on that one.

Neither of the " privateers" seemed to have mechanical/ technical skills of their own and relied on other people to assist with our breakdowns. The costs of hiring from these two was slightly cheaper but not much. Maybe they were victims of their own success in that the boats were in demand and therefore not maintained to a good standard due to constant hiring and a lack of skill by the owners.

I think if you have the skills and are able to maintain your boat/fleet to a good standard then you have half a chance of doing well. If you don't have the skills then walk away and don't get involved.

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Burgiesburnin certainly does highlight a significant element. Once you are well established you can afford to employ people to do most things while you yourslef concentrate on running the company. At the outset, unless you have wealthy backers, you must be able to turn your hand to most aspects of keeping the boats running yourself. This will invove all the more mundane aspects such as pump outs, refueling, topping water tanks and cleaning them for the turn around, to simple mechanical things like refueling and engine oil changes, through to regular repainting and paint touch up to call-out re engine breakdowns and full scale engine maintenance. All of this while keeping your customers happy and getting them in the first place.

 

You would eventually build up a network of people to rely on in an emergency, but that is not something you would have when you first come in from outside. The buck stops with you.

Edited by Tam & Di
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You'll have to be prepared for call-outs 24 hours a day, to sort out overflowing toilets, empty watertanks (sometimes with burned-out waterpumps because of running dry for too long) non working heatingn due to low battery power, and lots of other problem of which you'd expected (and hoped) they would never happen.

 

If your clients would be only people that are familiar with the running of a narrowboat, and know the limits to the unboard resources, it would be much easier, but many clients will be first-timers.

 

Several friends of mine, have worked for hireboat companies, and they said their jobs to be "paid-slavery".

 

Good luck with your project anyway, but think at least twice before you jump in.

 

Peter.

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There are three vital aspects to running a business:

 

(1) Getting the work

(2) Doing the work

(3) Getting paid.

 

Cruising Mike has obviously looked at item (1). Item (2) has been given a lot of consideration by previous posters. Item (3) shouldn't be a problem because he'll presumably get paid upfront.

 

BUT he still has to do all three or the business will fail, and the three are inter-dependent. So:

 

Can he get the work (the hire-outs) at a rate where he will (3) be paid at a profitable rate, having allowed for the paid labour and his own time in item (2)? If he doesn't make a profit (or at least, plan to do so within a certain time) he might as well not bother.


Lots of research and a cash-flow forecast are needed urgently!

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Hi Cruising Mike

 

Just opened this months Towpath Talk, there's a day boat business for sale on the Montgomery. There's only 12 mile cruising available, but it may be worth you getting in touch.

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Having to replenish the boats inventory after hirers have nicked cutlery, bog roll holders and what ever else takes their fancy. Yes it does happen. A lady I know involved in the hire boat business now puts cheap tat cutlery and fittings in their boats.

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