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Old 30-04-2018, 20:09   #1
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Dumb idea? ferrying passengers for money

I've recently started a travel site for adventure sea travel in Australia and I'd like to organise and sell yacht holidays. Initially I would sell just one trip in order to get the business started.

Ideally I would do the marketing and find tourists who would like to travel by yacht from Sydney to Lord Howe island (4-5 day sail). I don't know enough about sailing to know if this is a bad idea or if its even possible. But the people I'm selling to would want to be actively involved in the sailing of the yacht (and be in good health) - would this be a nice source of income to someone who wanted to spend more time at sea? or is it unworkable because a 4-5 day trip is too long with novices etc.

Would anyone want to make about 20 of the same trip a year, ferrying passengers in their own sailing boat? I would handle the insurance, billing and paperwork.

All criticism and feedback is welcome! (I have joined a sailing meetup so hopefully I'll soon learn a lot more about everything!)

Cheers,
Kim
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Old 30-04-2018, 20:27   #2
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Re: Dumb idea? ferrying passengers for money

I think you would have difficult competition against the seaplanes. Those tickets can be had for under $350 USD one way, and the flight is only 2 hours.

Though on the topic, once upon a time I contemplated "environmentally friendly ferries" for the Puget Sound. Use some kind of massive sailing catamaran, carry pedestrians only, and sail the ferry routes. With all the hippy yuppies up there it might actually work! It would also need significant electric propulsion and batteries, and a way to charge very quickly during the unload/load process.
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Old 30-04-2018, 20:39   #3
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Re: Dumb idea? ferrying passengers for money

I would expect that the skipper would have to be licensed and there would have to be another crew onboard so there was 24/7 experienced person on watch. Probably make it to expensive.
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Old 30-04-2018, 20:56   #4
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Re: Dumb idea? ferrying passengers for money

You'll need more seed money than you probably are thinking. You will need two licensed skippers aboard, plus a vessel that is "in charter"--if you carry passengers, there are many standards for the vessel to meet.

IMO, the short answer is "no". But you'll need to look at all the lawful requirements, and the competition before you decide whether or not it is something in which you want to invest $$, time, energy.

As to market, it is not an easy sail out there, thought it is lovely once there, but the depth of the lagoon eliminates deep draft boats; weather can make the anchorage untenable; you'll also need a rigorous maintenance campaign, because failures at sea will give your business a bad name. Sailboats are not as trouble free as automobiles.

Most of the people we know would consider it an adventure to sail their own boat there, but not one owned by someone else; others take the airplane.

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Old 30-04-2018, 21:27   #5
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Re: Dumb idea? ferrying passengers for money

Welcome aboard CF Kbed.

Quite possibly some of your passengers will decide to fly home rather than go back by yacht...
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Old 30-04-2018, 21:30   #6
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Re: Dumb idea? ferrying passengers for money

Would not do it without insurance to cover me. Not going to get insurance for paid customers unless meeting all requirements of charter vessel. Insurance will be much more than you are used to (assuming you are insured now).
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Old 30-04-2018, 21:32   #7
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Re: Dumb idea? ferrying passengers for money

Thank you for your replies!
That goes a long way to explain why there currently isn't a similar service being offered. The laws/regulations/maintenance required make it an expensive undertaking.

I'm still interested in making it happen, but I guess I have to find out how much people are willing to pay versus how much it will cost. But it's good to know that there doesn't seem to be any issue with the distance or the novice passengers.
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Old 30-04-2018, 21:36   #8
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Re: Dumb idea? ferrying passengers for money

Quote:
Originally Posted by kbed5275 View Post
Thank you for your replies!
That goes a long way to explain why there currently isn't a similar service being offered. The laws/regulations/maintenance required make it an expensive undertaking.

I'm still interested in making it happen, but I guess I have to find out how much people are willing to pay versus how much it will cost. But it's good to know that there doesn't seem to be any issue with the distance or the novice passengers.
The vessel used would have to be in Survey for Offshore operations, not cheap and almost impossible to get post the build these days.
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Old 30-04-2018, 21:45   #9
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Re: Dumb idea? ferrying passengers for money

What you're describing is a yacht charter - or possibly a sailing school although legal requirement would be about the same regardless of name. It sounds like you have no intention of owning or operating the yacht, but instead arranging the rental of the yacht for your clients. That's what's known as a "charter broker." You'd make arrangements with various yachts to do the actual sailing, etc., you're just finding the clients (and the money). But, as noted above, actually running a charter yacht is an expensive and complicated undertaking. The trick will be finding a yacht that is already properly licensed and fitted out, and then seeing if they would like to work with a (new) broker.
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Old 30-04-2018, 22:12   #10
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Re: Dumb idea? ferrying passengers for money

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Originally Posted by kbed5275 View Post
I'm still interested in making it happen, but I guess I have to find out how much people are willing to pay versus how much it will cost. But it's good to know that there doesn't seem to be any issue with the distance or the novice passengers.
I'd suggest working out out how much it will cost per annum and the number of potential trips / passengers to cover that cost first. Then you can decide whether it is feasible that people would be willing to pay at least that much.

Nothing wrong with the distance or the novice passengers in a suitable "in survey" commercial vessel with a suitable qualified crew in SUITABLE WEATHER. (But it would be a lot more than a 4-5 day round trip most of the time)

as I see it, the biggest problem with coming up with a business plan is the unpredictable weather - you can't take bookings for say a trip "10-20 September 2018." and have any expectation of having suitable weather to make the trip at that time.

It may be OK for large cruise ships to plan a schedule, but even they get caught out at times. No way would any reasonable sized sailing vessel be able to maintain any sort of schedule for a 400+ mile each way trip out into the Tasman Sea.
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Old 01-05-2018, 01:07   #11
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Re: Dumb idea? ferrying passengers for money

Running it as a money making business without lots of prior offshore experience...I have better odds of winning the lottery today (and I didn't buy a ticket).

If you have the boat, have the experience, licensing, insurance and will be making the runs anyway...possibly you can defray some of the costs...but even then it might not work out financially in your favor.

Items needed:
- Boat large enough for at least 4 people for multiple days (paying guests are going to have higher expectations regardless of your assumptions. likely they will expect a cabin of their own). A good quality boat in excellent condition is going to cost a lot. If you buy a $500k boat, you are going to need at least $50k per year generated just to justify the initial investment (this is beyond all the other operating costs and any profit margin you expect).
- Not sure of the Aussie rules but at least one licensed captain and a least one other paid crew. If you find a cheap captain and you play the part of the paid crew, that's likely another $100k/yr once you add in the overhead costs of a crew.
- Commercial insurance...likely quite expensive and difficult to obtain...particularly with minimal experience. No idea what this would run.
- Is it a seasonal destination? That could cut your potential trips by half or more.
- You will need a backup plan in case of breakdown. There doesn't appear to be much in the way of marine services on the island. If you blow out the mainsail, are you on the hook for last minute air tickets to get the guests home plus a refund of the trip price?
- You need a bit maintenance budget. This is a lot of hard miles on the boat. This could easily run $20-30k per year if you need to hire a lot of it out.
- How will you handle inexperienced or problem guests once you are 24hr out and the weather turns to crap? Most cruisers do serious vetting of crew before offshore trips. Paying guests make that an awkward situation (still necessary but awkward).

Running a charter operation is challenging even for experienced boaters and you aren't picking an easy charter operation. 2 hr sunset cruises or leisurely week charters at an easy destination is a much more viable option.

I won't go so far as to say it's impossible but don't for a second think this plan would be easy or a big money maker. The only way I can see this working is if you fly under the radar, claiming the guests are friends...but keep in mind when the poo hits the fan, expect the "friends" to turn on you, expect the insurance company to turn on you and anyone else who has the slightest advantage in turning on you.
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Old 01-05-2018, 01:23   #12
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Re: Dumb idea? ferrying passengers for money

I toyed with the idea of getting a commercial registration for my boat when I got her a few months ago. Actually did get commercial insurance for a grand more a year, which was fine. But the registration (through belgium, which is one of the least rigorous ones around) required a ton of conditions to be met, both in terms of boat equipment and demonstrations of its use to a guy who would fly out to the boat and inspect it both at the dock and under sail/power. Licensed captain requirements of course, but then also miles logged at sea. It was all enough that I just kept private registration and forgot the idea. Way too much hassle to make way too little cash.

Between you, me and the lamppost, I'm pinning my hopes for earning cash money on a Vlog later in the year when we cut the lines and get going around.... Between having two cute wives who love nudity and 3 even cuter sailing kittens (who are always nude, though furry), I think we got a shot at Youtube fame
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Old 01-05-2018, 03:21   #13
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Re: Dumb idea? ferrying passengers for money

Greetings and welcome aboard the CF, Kim.
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Old 01-05-2018, 04:03   #14
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Re: Dumb idea? ferrying passengers for money

I don't see much financial sense for a destination, which is served by regular flights/boats and its only 300M open sea between you and the target. I am not familiar with the aussie regulations but 100% sure, they got set rules for running a business, involving certifications (you, first mate(!) and the boat), surveys, taxes, insurances. Insurance costs are also in a completely different ballpark if you carry half a dozen teenagers as a business than bringing your own family in private.

If you are an instructor, you can advertise the trips as "mile builders". However, it's not an ideal mile builder either: too long for a YM offshore (60M) too short for the YM Ocean (600M).

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Between having two cute wives who love nudity and 3 even cuter sailing kittens (who are always nude, though furry), I think we got a shot at Youtube fame
Sounds like a blockbuster, for the Yt adult section
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Old 01-05-2018, 05:21   #15
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Re: Dumb idea? ferrying passengers for money

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I think you would have difficult competition against the seaplanes. Those tickets can be had for under $350 USD one way, and the flight is only 2 hours.

Though on the topic, once upon a time I contemplated "environmentally friendly ferries" for the Puget Sound. Use some kind of massive sailing catamaran, carry pedestrians only, and sail the ferry routes. With all the hippy yuppies up there it might actually work! It would also need significant electric propulsion and batteries, and a way to charge very quickly during the unload/load process.
There is a similar market running back packers between Panama and Colombia. Flights can be had inexpensively, we flew last year for $125 PP round trip! But, the back packer boats charge around $500! They spend a few days in the San Blas and then onto Cartegena. Most are illegal, substandard, over crowded boats (guests sleeping on deck and in salon), serving rice and beans, crossing a potentially very nasty area of ocean....and they are jam pack busy! Go figure. I think its the draw of a big adventure vs another ho hum plane flight.

Its all in the marketing...make it a big adventure/learning experience, charge high rates to cover your substantial costs, target affluent guests who can afford to pay, and it just might work.

Also look to the trekking market for an example of how to market this trip. I have a few friends who are pro guides and I am amazed what people will pay to slog up a trail. Example, Im going on a trek to Everest Base Camp in October with a pro guide friend of mine. We worked out an exchange of my sailing services for this trek, but other guests are paying about $6K!
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