Advice for starting a delivery boat business

[katoema]

Captain Graham, just to let you know that I turn 71 shortly, so while I get to have medicals annually, to continue like this will probably last another 5 years at most!

US agents often ask me to quote $350-400 per day.

Resting now as I'm off in a couple of weeks from northern Europe to the Red Sea and then 8 weeks of passage and tutoring for a client preparing for a global circumnavigation.

[Captain Graham]

Originally Posted by katoema

Captain Graham, just to let you know that I turn 71 shortly, so while I get to have medicals annually, to continue like this will probably last another 5 years at most!

US agents often ask me to quote $350-400 per day.

Resting now as I'm off in a couple of weeks from northern Europe to the Red Sea and then 8 weeks of passage and tutoring for a client preparing for a global circumnavigation.

Thanks for the info.

I have talked with a few Delivery Captains up and down the east coast of the US.

They all said the same thing
1. A Captain gets paid about $300 per day.
2. A Mate gets paid about $150 per day.

If you read through this thread you will see that some have said this is high.

In my case I already have an arrangement with one delivery Captain to be his mate for $150 per day.

[Uricanejack]

100 bucks a day for 14 days.
Less than minimum wage. Which is about what I used to make as an instructor.

Admittedly quite a long time ago. The early 90s.
I found other aspects of life got in the way and I stopped. Not consciously I just found I wasn’t doing enough Jobs to make keeping my accreditation valid worth the time and trouble.

Part of the problem is availability. When life requires other commitments. Which have higher priority. Getting this to work is very difficult if not impossible.
Using it as a learning opertunty to test the waters? Yes so long as you still have your day job. It remains a hobby or a pastime.

Some people obviously do make a go of it. One critical part of success is to be free to take the jobs which do come up.
I do think your training plan is possible. Again you really need to have the availability to get it going.

[Captain Graham]

Originally Posted by Uricanejack

100 bucks a day for 14 days.
Less than minimum wage. Which is about what I used to make as an instructor.

Admittedly quite a long time ago. The early 90s.
I found other aspects of life got in the way and I stopped. Not consciously I just found I wasn’t doing enough Jobs to make keeping my accreditation valid worth the time and trouble.

Part of the problem is availability. When life requires other commitments. Which have higher priority. Getting this to work is very difficult if not impossible.
Using it as a learning opertunty to test the waters? Yes so long as you still have your day job. It remains a hobby or a pastime.

Some people obviously do make a go of it. One critical part of success is to be free to take the jobs which do come up.
I do think your training plan is possible. Again you really need to have the availability to get it going.

Thanks for the advice.

Yes availability is a very big part of the delivery boat business and a big risk to my business.

Doing this only 4 weeks per year will limit my availability and I do not want to get a reputation of someone who is not available.

So even thou I have been asked by a few Delivery boat Captains about being on their list of mates, I have only made an arrangement with one Captain.

I am very lucky with my regular job.
I work from home when I am not traveling and have the flexibility to stop work and do a delivery on short notice.

My wife is also accustomed to my telling her I have to head out on a trip on short notice.

[Captain Graham]

Originally Posted by Captain Graham

Just wanted to share some general P&L statements number for those who are interested.

2018 total costs were about $3,000.
1. Licenses classes and fees about $2,000
2. Setting up an LLC about $700
3. Other costs about $300

2018 Income about $1,500.
1 training class and 1 boat delivery for 2 days.

So I have a net loss of about $1,500

2019 will be the first full year and I still expect to have a net profit of about $4,000 to $8,000.

Just a little update after the first 3 months of 2019
The business is doing well.
I have earned $4,000
I have spent $1,000
For a net profit of $3,000.

I should easily make my goal of $4,000 to $8,000 this year.

[Captain Graham]

Here is a very good book on starting a boating business.
Focused on charter boats but many of the concepts apply to the delivery boat business.

Title: GOLD BARS - Chartering your boat for Money.
Author: Captain Conrad N Brown Jr.
Shipyard Press

You can find it on amazon.
https://www.amazon.com/Gold-Bars-Cap...s=books&sr=1-2

[keepondancin]

This is not to do any bashing. With no ocean time, and it sounds like you are still in the learning stage, (which really never ends), what kind and size vessels did you get your sea time on, and how much sea time, to get a 100 ton masters license?

[Captain Graham]

Originally Posted by keepondancin

This is not to do any bashing. With no ocean time, and it sounds like you are still in the learning stage, (which really never ends), what kind and size vessels did you get your sea time on, and how much sea time, to get a 100 ton masters license?

Thanks for asking.
I have lots of Lake Erie sea time but very little ocean sea time.
All Masters licenses require the same amount of sea time.
Basically 360 days with 90 days in the last 3 years.
The size vessel you get your 360 days on determines the tonnage rating you will get.
Most of my students qualify for a 50 Ton license because they get their sea time on their own boats.
Below is a copy of the OP.

Originally Posted by Captain Graham

Hello All,
I am starting up a small boat service business, focused on training and boat deliveries.

For the next few years I will be using my vacation time for the business until I retire.
My short term goal (before Retirement) is to earn $4,000 to $8,000 per year.
My long term goal (after Retirement) is to earn $20,000 to $30,000 per year.

So far I have gotten my USCG Masters License, became a USCG Qualified Instructor and set up a LLC for taxes.
My business/marketing plan is to develop contacts in the New York City area by doing 2-4 USGC 100 Ton training classes per year.
I do these training classes at Yacht Clubs where I will meet people active in boating.

I should add that for the first few years I will be a mate and not take on the responsibilities as the Captain during deliveries.
This is mostly because I have been sailing the past 30 years on Lake Erie where there are no tides or currents and with no electronics.
I did sail for 10 years in the NYC area when I was a kid but I do not consider that experience to be enough.

Can anyone who is in the business give me some advice.

Thanks in advance.

[Captain Graham]

Originally Posted by Captain Graham

Just wanted to share some general P&L statements number for those who are interested.

2018 total costs were about $3,000.
1. Licenses classes and fees about $2,000
2. Setting up an LLC about $700
3. Other costs about $300

2018 Income about $1,500.
1 training class and 1 boat delivery for 2 days.

So I have a net loss of about $1,500

2019 will be the first full year and I still expect to have a net profit of about $4,000 to $8,000.

A final update for 2019
My net income was $6,000.
20 days working and 10 days managing the business.

So 2018 was a loss of $1,500
2019 was a profit of $6,000

This is right on target with my business plan and goals.
Remember I am still working full time and just doing this part time for a few years until I retire with a goal of $4,000 to $8,000.
Once I retire my goal is have a net profit of $20,000 to $30,000

[Captain Anthony]

Cap. Graham, Good afternoon. I have been pondering a delivery business now that I'm in the process of retiring from the law. I'm years old and have a 50 Ton near coastal T boat certification with radar and toeing certification. Additionally I have ASA 101 through 106 through plus docking endorsement. I have been crew on one delivery from Conn. to Key Largo on an 85 foot motor vessel and on a second trip I was second Capt. I live on Long Island and I'm very interested in talking to you. My name is Anthony and my cell number is 516.978.0072. Could you call me tomorrow, Monday, late morning? Aj Addeo

[Captain Anthony]

I also have completed third grade spelling, LOL, "towing"

[Auspicious]

Originally Posted by Captain Graham

2. I have talked with 6 Delivery Captains in the past few years.
They were located in Florida, NC, Maine and SC.
They all said about the same thing
Expect about $150 per day as a mate and about $300 per day as the Captain.
Plus a one way ticket home.

You have a different circle of acquaintance than I do. My colleagues and I bill much more than that. On the other hand paid gigs as mate or other crew are very hard to come by. Different markets perhaps?

Originally Posted by Captain Graham

I say part time but I will be spending time finding the delivery work. You know hanging out at yacht clubs and bars doing marketing.

In my experience that isn't where the work comes from.

Originally Posted by Snore

Hey go for it. FWIW, $150/ day is high for a mate. As other posted there are guys who will “captain” a delivery for $200!

We all had to start somewhere. My recovery rate on being underbid is about 40% - the owner calls back when s/he realizes the "low bid" is not such good value for money.

Originally Posted by jmschmidt

Some of misinformation and incomplete information here.

^^ This. I just don't see the value of an LLC in the delivery market. For US citizens schedule C is fine. Piercing the corporate veil of a closely held LLC or sub-S is trivial and happens all the time. Tax benefits are a fantasy. You add cost without benefit.

Originally Posted by Captain Graham

When you start a delivery, assume 1 week along the US east coast on a sailboat, how much time to you spend checking the condition of the boat, sails, engine etc?

You're focusing on the wrong things. Yes you have to check the boat. What difference does four or eight hours make. What about travel planning, routing, initial weather forecast, timing, crew recruitment, crew communication, setting expectations, meal planning, provisioning, provisions and personal gear stowage, and the myriad of other logistics necessary to get off the dock. Do you take deposits are get a credit card from the owner? How will you be paid? Did you read that last email from your credit card processor that changed the swipe rates but not the invoice rates?

This is a business and you have to treat it like a business or it's just a hobby.

Once we step on the boat my job is mostly management by exception. Delegate tasks to crew and fill in the gaps. Reports are on the systems with backup and spot checks.

There are conflicting drivers for me. In the first place I feel strongly that you don't need two (or three!) people to do a one person job. On the other hand part of my obligation to crew is training. If I'm busy 'doing' then their opportunity to learn is diminished. Your business model for managing crew may be different than mine.

One of my proud moments was crew saying "sailing with Dave is graduate school for cruising."

There are things you don't and won't have time to do. Those things will bite you. You still don't have time. *sigh* I don't go up the mast. I don't pull valve covers. I check the windlass but I don't run the chain all the way out. I like to see a recent survey but I've sailed without one. I sure know what surveyors are bad at finding and look there.

The autopilot has to work. The fridge has to work or we have an alternative plan. We have to be able to cook (don't giggle - on brand new boats the broker may insist the cooker not be used so you need a plan). I'm not feeding crew sandwiches and cold beans.

Originally Posted by Snore

While I am yet to exercise the clause, my contract allows me to walk away from a vessel that is unsafe for the intended passage.

I've walked away from two. One had generators (two) and pumps (three) on deck to keep the boat from sinking. The second had an owner who wanted me to front money for fuel. I have liens on only one boat.

Originally Posted by Snore

Hold it right there! My crews NEVER eat crappy food. Any delivery guy worth his salt can cook a decent meal. Good food=happy crew=efficient crew= easier passage

Absolutely. I've sailed with some pretty good people who provisioned entirely in the frozen food aisle. That isn't okay. The OP hasn't talked at all about learning to cook underway.

Anyone else seen a boat loading two dozen delivery pizzas on board in Norfolk?

Originally Posted by Uricanejack

Delivery Skipper essentials?
Chewing gum, duct tape, ball of string, pair of old ladies tights, a handful of paper clips and a leatherman

Expedients are part of the tool kit. Fixing things right so they stay fixed is better. Many failures can be fixed so they stay fixed, or fixed on arrival so the owner doesn't have to deal with them.

"Dave's magic yellow bag" has a lot in it. No chewing gum, no tights.

Originally Posted by boatpoker

Any captain worthy of the name should be capable of changing impellers. oil filters, fuel filters, replacing a faulty fuel pump (spare shoud be onboad), diagnosing alternator failure, delaing with minor electrical issues, fixing a bilge pump float or the host of other things that routinely go wrong on boats.

I agree. Delivery work is a lot more than steering the boat from A to B and not hitting anything.

Why is it always 3 am, why is it always raining, and why am I always in my underwear?

Originally Posted by Captain Graham

I am sure I could do it without training, but I want to learn a little more about diesel engines before I tell customers that I can do the work.

If you are a degreed engineer you don't need training. You need a book and practice.

Originally Posted by Captain Graham

In my case I already have an arrangement with one delivery Captain to be his mate for $150 per day.

I'm starting to worry about what you think adequate crew is.

Originally Posted by Captain Graham

Here is a very good book on starting a boating business. Focused on charter boats but many of the concepts apply to the delivery boat business.

Based only on the "Look Inside" on Amazon (I'm sure not going to buy it) I'm not very impressed. Since you are early on your learning curve what makes your assessment of "a very good book" credible? The book may attempt to cover subjects with which you are not familiar, but does it do so well? Is the advice good?

Personally I find use of the title "Captain" to be pretentious. I'm a delivery skipper; "Master" on paperwork. I've sailed with fine captains on commercial and military platforms. That just isn't the recreational market.

[Auspicious]

Here is a delivery story with morals on finding work, keeping work, useful skills, and delivering work.

A broker friend of mine called to vent a bit. They'd sold a brand new 32' express cruiser two years before and the owner had never been able to plane the boat. A slew of local mechanics, the boat manufacturer, and the engine manufacturer had been on the boat. The consensus was that there was a problem with the starboard engine. They'd flashed new software been over the poor thing with a fine-tooth comb. Everyone involved was frustrated. The broker had found a well-regarded mechanic across the Bay and the delivery skipper they'd engaged (cheap) to move the boat had been a no-show three times.

I'm a little expensive for this sort of thing but I offered to do the run for my friend, regular rates. He agreed to come pick me up at the other end. The plan was about a four hour trip. He picked me up, we went over the boat, talked to the owner by phone, and off I went. My friend departed to take his wife to breakfast.

Even with no autopilot, five knots on middle Chesapeake Bay is not very fast on a weekday morning. No meaningful traffic. So I start fiddling with the electronic gauges. Hmm. Port engine tilt/trim is cycling from full up to full down over about 12 seconds. Over and over. More fiddling. A little time on my phone to look up marketing materials (manuals were too hard to find). There is auto-trim. *sigh* Figure out how to override that and set port outdrive to -2°. Repeat on starboard. Push the throttles forward. Boat pops right up. Push. 42 knots. That scared the bejeepers out of me. Pull back and land the boat. I don't trust anyone, including myself. I got up on plane and landed half a dozen times.

Back up on plane at a comfortable 25 kts and the boat is just purring. Drop down at the no wake zone, call the yard to tell them I'll be early and have some thoughts. Call my friend to tell him the same. Call the owner. Yard was great. Timing better lucky than smart - the guys were just finishing up their morning meeting as I turned the last corner and I drove right into the slings.

The mechanics with a hint found the port outdrive angle indicator to the computer was bad. While they were waiting for the part (on-island but not in the shop) "unfixed" all the things that had been tried and rebaselined the ECU firmware. New part showed up and I called my friend to tell him not to come get me as I'd be bringing the boat back - fixed. I rarely travel without my laptop so I found a quiet place to sit and work while the mechanics worked on the boat.

Shortly after lunch I was back in the water and running home. Again, up-down-up-down-up-down and everything seems to work.Drifting off the river mouth I'm to run up for home I called the owner and told him his boat was fixed. He took the afternoon off and we went back out for a boat ride.

In my experience work comes best from brokers who trust you. Some want to sail with you. Some want you to crew for someone they trust. Some work comes from social media. I've never gotten work from a yacht club bar. You have to keep your eye on the customer's priorities. That might be a destination or as in this case something else. Communication is key.

That evening sitting in the broker's office filling in my friend's boss the other skipper walked in and asked when they wanted the boat moved. The laughter from my friend and his boss probably haunts him to this day.

42 knots in a small boat is really fast.

[MV Wanderlust]

Originally Posted by Auspicious

42 knots in a small boat is really fast.

LOL I can just about picture the look in your eyes.

[Captain Graham]

Originally Posted by Auspicious

You have a different circle of acquaintance than I do. My colleagues and I bill much more than that. On the other hand paid gigs as mate or other crew are very hard to come by. Different markets perhaps?

Thank you for all of your advice and thoughts.

Some questions
1. What are your average rates?
2. Do your rates chance based on length of travel?
3. In 2019 how may deliveries did you make and many days did you work?
4. I am not sure I understand why it is hard to find work as a mate, can you explain?
The Captains I have talked with all have a list of mates they use for delivers and they pay about $150 per day.

Thanks again for your post.