Is the Liveaboard Life Still Free and Easy?

[denverd0n]

Originally Posted by hellosailor

5000% profit is a bit absurd, don't you think?

Nope, I don't. It's called "what the market will bear," and it is the very best way to allocate scarce resources. And I'd bet that if you could make a 5000% profit when selling your boat (your car, your house, whatever) you would do so gladly, in a heartbeat, and without the least bit of remorse.

Oh, I know. You're probably going to claim that you would never do that. Sorry. Don't believe you. Not at all. Not for a second. Don't even waste your breath trying to convince me.

[valhalla360]

Originally Posted by hellosailor

"Making a buisness profitable is not evil. "
I'd rephrase that as "Making a business profitable is not necessarily evil."

Suppose there was a cluster of marinas, and they only rented slips by the day. And changed prices daily. Seasonal discount? OK, we'll negotiate a percent to be applied to the daily rate. Or perhaps, we'll hold an auction for slips, every day at 8AM. Or 4PM. Or there is a cluster of marinas, on the only good anchorage within a three hour sail. And they all reset their prices every day.

Like the four gas stations at an intersection, who are prohibited (in the US) from discussing pricing with each other, to prevent collusion. Now, THAT'S a famous situation in game strategy. (And a prime work by the mathematician who was the subject of the book & movie A Beautiful Mind, incidentally.)

Evil? Hmmm....When my cell company charges a 5-10,000% profit on text messaging "because everyone else can do it" I call that evil, yes. 5000% profit is a bit absurd, don't you think? Inspires the customers to say "What can I steal back?"

Make more money than you can get by sticking it in the bank, by all means. Get piggy about it...not so much. And the trend in American business for years has been to outright steal for their profits, going way beyond reasonable. Like the insurers who deny claims some random number, simply because they know a certain percent of the customers will not challenge the denial, right or wrong, and they'll have fewer claims to pay that way. That's been documented, too.

Collusion/anti-trust/monoplies (pick a name) are all illegal so not really relevant to the discussion. No one was suggesting illegal activity.

Reality is the market corrects if too prices get too far out of wack. Your text messaging example is perfect. You will be hard pressed to find a plan that doesn't just include text messges for free (it's actually baked into the monthly rate). Why? because the competition forced them to start including texts.

Then again was there really a 5000% markup? It gets fuzzy because they had to spend a lot of money building towers and putting in fiberoptic lines to make the system operational. How much of that startup cost do you assign to text, voice or data communicaitons? Apparently, you are assigning less then the owner assigned to texting.

As far as your slip auction goes, the market would punish them quickly as they drive people to surrounding areas where prices are more predictable. The market will accept some variability but when you take it to absurd levels, the market reacts.

[hellosailor]

valhalla-
Yes, a minimum 5000% markup, as estimated by anyone vaguely related to the business, repeatedly, by scandalmongers like the NYTimes and WSJournal and their ilk. That number is based on some very simple and conservative math and allows for including all the capital and infrastructure costs.
It is arrived at by very simple math. One SMS message (ooh, let's change the name to "text" it sells better) consists of one data packet on the largely idle command channel in a digital phone network. One packet, 256 bytes of data, sent on a channel that has to sit idle and unused most of the time.
In contrast, since all cell service in the US is digital now, one minute of voice traffic may occupy 10,000 packets of data as the signal is digitized and streamed. Ten thousand being a very low-side number for a low quality signal.
Now, if the cell company says they need a dollar (old rates) or fifty cents (newer rates) or whatever for a on-e minute voice call to be profitable, and that call takes up 10,000 times as much traffic as one SMS message...Do the math. The price for one SMS message used to be about the same as one minute of call time. The actual cost to the carrier? Ergh, one packet versus 10,000 packets. Or way more than that, since that information is company confidential.

There are actually trade magazines and investment houses that analyze this kind of data in order to figure out how profitable a business may be, and the most conservative estimates are that even with the new "unlimited" plans, SMS is way more profitable than voice. Obscenely so. It is one way the cellcos get "revenge" over being regulated voice carriers.

And then of course there's inkjet ink, if you simply read the contents on one cartridge, in milliliters of ink, and multiply out, you'll find that ink usually sells around $4000 per gallon. Oh yes, sure, there's overhead with that too. But...a thousand times more expensive than high-test gasoline?

d0n-
I actually had someone ask me about a price I gave them on a very obscure item once. He said "Are you sure? Because we paid more than 10x more last time this was ordered." I said yes, I was quite sure. I needed a certain profit and overhead and that was how I based the price, and this was it. Yuh think that's why I don't own a Deerfoot 60 on each ocean by now?! Oh, DUH!

[denverd0n]

Originally Posted by hellosailor

d0n- I actually had someone...

Yeah, I knew you'd have some story like this.

Next time you want to give something away for a fraction of its market value, let me know. I'd be glad to take it off your hands and then resell it for a profit. See, I don't think "profit" is a dirty word. (But I won't be holding my breath, waiting to hear from you.)

[valhalla360]

Originally Posted by hellosailor

valhalla-
Yes, a minimum 5000% markup, as estimated by anyone vaguely related to the business, repeatedly, by scandalmongers like the NYTimes and WSJournal and their ilk. That number is based on some very simple and conservative math and allows for including all the capital and infrastructure costs.
It is arrived at by very simple math. One SMS message (ooh, let's change the name to "text" it sells better) consists of one data packet on the largely idle command channel in a digital phone network. One packet, 256 bytes of data, sent on a channel that has to sit idle and unused most of the time.
In contrast, since all cell service in the US is digital now, one minute of voice traffic may occupy 10,000 packets of data as the signal is digitized and streamed. Ten thousand being a very low-side number for a low quality signal.
Now, if the cell company says they need a dollar (old rates) or fifty cents (newer rates) or whatever for a on-e minute voice call to be profitable, and that call takes up 10,000 times as much traffic as one SMS message...Do the math. The price for one SMS message used to be about the same as one minute of call time. The actual cost to the carrier? Ergh, one packet versus 10,000 packets. Or way more than that, since that information is company confidential.

There are actually trade magazines and investment houses that analyze this kind of data in order to figure out how profitable a business may be, and the most conservative estimates are that even with the new "unlimited" plans, SMS is way more profitable than voice. Obscenely so. It is one way the cellcos get "revenge" over being regulated voice carriers.

And then of course there's inkjet ink, if you simply read the contents on one cartridge, in milliliters of ink, and multiply out, you'll find that ink usually sells around $4000 per gallon. Oh yes, sure, there's overhead with that too. But...a thousand times more expensive than high-test gasoline?

d0n-
I actually had someone ask me about a price I gave them on a very obscure item once. He said "Are you sure? Because we paid more than 10x more last time this was ordered." I said yes, I was quite sure. I needed a certain profit and overhead and that was how I based the price, and this was it. Yuh think that's why I don't own a Deerfoot 60 on each ocean by now?! Oh, DUH!

You analysis only works if all pricing is purely based on data packets. Obviously, the cell companies don't use that as thier basis. If you equate a text with 1 minute of talk time, the text is a bargain for customers who just want to let the wife know they are on the way home.

[Certeza]

This business debate needs to shift away from the term "mark-up" which is a very deceiving term, and use the more correct and measurable term "margin". Mark-up is better used as a reference for a re-sold good. e.g. I buy jeans wholesale for $5 and retail them for $20 at a 300% mark-up. It doesn't work well for service based companies because it is hard to determine initial cost. i.e. if my lawyer bills me $200 for an hour of his time, what is the markup?

On the face of it, the wireless companies typically have around a 55% gross margin meaning that only $45 of every $100 in revenue is directly attributed to cost of goods sold. But telecom is typically high debt and high infrastructure. Operating margin for the industry is only about 15% and for the most efficient companies like Verizon and AT&T it is roughly 25%. This accounts for things like capital depreciation and amortization, R&D, and sometimes certain aspects of customer acquisition. After taxes and everything is considered, they have net margins of about 12-15%.

So as a business, if you calculate their mark-up based on total costs, then they would only have a mark-up of about 16-18%. Hardly the 5,000% that is suggested. In reality, it is a very competitive industry with tight margins.

[hellosailor]

Valhalla, it isn't "my" analysis. It is simply the most conservative analysis that anyone who has been asked to comment on the industry has made. Any other basis for analysis actually swings the percentages higher. Every time.

Every data packet, in every call, requires the same amount of routing and overhead as the single data packet in an SMS message. Same reliance on infrastructure, greater need for unused capacity and other expenses. 5000% is simply the most conservative analysis you'll find from any source, or damned close to it.

Considering that the cellcos used to give away incoming SMS messages for free and just charge the sender, while they now charge BOTH the sender and recipient...5000% may be way too conservative at that. Or perhaps, you'd like your phone carrier (landline or whatever) to charge you for both incoming and outgoing calls? Reasonable, isn't it?

The cellcos also are clever about never delivering a busy signal. Even if the tower is busy, they never provide a busy signal on a cell line. They switch the incoming call to voice mail (and that's billable air time for most subscribers) and then charge the subscriber a second time for the airtime retrieving the voicemail (most of the time) and then they charge a third time, when the carrier has to return that call. As opposed to the old Bell system, where no one paid for the busy signal, and your caller was left to just try calling again later. One billable call, versus three. Clever, isn't it?

[hogHunter]

I'm not that familiar with liveaboard conditions in other areas besides Florida and the Caribbean but, to comment on the Florida liveaboard situation, Palm Beach County is by far the worst place to try to live aboard. There are only 2 (last I checked) marinas that allow liveabaords and there is a very long wait for a slip. Living aboard in Palm Beach County can be nearly impossible.

The west coast of Florida, on the other hand, is very liveaboard-friendly with much fewer restrictions, more free dinghy landings, etc.

The Caribbean, specifically the Virgin Islands, can be very liveaboard friendly. HOWEVER, it is a very tight-knit community. Go armed knowing mooring field etiquette. Don't drop anchor where there is already ground tackle. No generators late at night. Invite your neighbors frequently for rum & cokes.... etc.

Below is a map where I've highlighted in green the "good liveaboard areas" and in red the zones of "higher resistance".

[model 10]

Originally Posted by barnakiel

Do not expect to get great job offers if you will walk around in your clothes washed in the bucket.
b.

Well, you have never had your ass kicked by a bad assed drill instructor for your poorly done hand laundry. My clothes looked better then than now. Don't they give you uniforms at Big Mac?

[Dulls]

Originally Posted by 4arch

I agree although I have noticed that more and more marinas would rather be half full at $500 a month than 95% full at $260 a month.

Less people paying more is better business then more paying less. Your infrastructure lasts better. Eg half the amount of people use your toilets....

[boatman61]

Originally Posted by 4arch

I agree although I have noticed that more and more marinas would rather be half full at $500 a month than 95% full at $260 a month.

One has to maintain some standards..
and pricing works..

[Hudson Force]

Originally Posted by hogHunter

...............
Below is a map where I've highlighted in green the "good liveaboard areas" and in red the zones of "higher resistance".

I would add that all those areas of Florida that are not marked as green or red are "good" liveaboard areas too. In addition, within this "red" zone there are places such as Stuart, Ft. Pierce, Vero Beaach, Ft. Lauderdale, Hollywood and Miami that have liveaboard opportunities.

[valhalla360]

Originally Posted by hellosailor

Valhalla, it isn't "my" analysis. It is simply the most conservative analysis that anyone who has been asked to comment on the industry has made. Any other basis for analysis actually swings the percentages higher. Every time.

Every data packet, in every call, requires the same amount of routing and overhead as the single data packet in an SMS message. Same reliance on infrastructure, greater need for unused capacity and other expenses. 5000% is simply the most conservative analysis you'll find from any source, or damned close to it.

Considering that the cellcos used to give away incoming SMS messages for free and just charge the sender, while they now charge BOTH the sender and recipient...5000% may be way too conservative at that. Or perhaps, you'd like your phone carrier (landline or whatever) to charge you for both incoming and outgoing calls? Reasonable, isn't it?

The cellcos also are clever about never delivering a busy signal. Even if the tower is busy, they never provide a busy signal on a cell line. They switch the incoming call to voice mail (and that's billable air time for most subscribers) and then charge the subscriber a second time for the airtime retrieving the voicemail (most of the time) and then they charge a third time, when the carrier has to return that call. As opposed to the old Bell system, where no one paid for the busy signal, and your caller was left to just try calling again later. One billable call, versus three. Clever, isn't it?

The 5000% numbers come from groups trying to slam the cell companies. Of course their numbers support the result they want. Anyone with decent math and stats skills can prove they are losing money on texts or making a bundle.

Like them, you totally ignored the point that the market responded and texts are no longer charged separately, so the market works. If you overcharge someone will come in and undercut you.