Rules For Super Yacht Owners – Or May We Humbly Suggest...

Posted Dec. 2, 2011, 10:01 a.m.
I was asked recently if there were any organisations that had published a set of rules for superyacht Owners in order that they could better understand how ‘they’ should operate their vessel, and also the regulations that they should be aware of. In fact there isn’t a set of rules available, although their yacht employs a professional Captain who should be able to provide guidance if asked. Having spoken to our erstwhile publisher he agreed that maybe we ought to produce a short article setting out at least some rules for Owners. What follows is only a guide and will vary in its worth from Owner to Owner. If you are an experienced Owner reading this then there may just be something listed that you may wish to take note of. But of course, if you have now had your yacht for 10 years, still have the same Captain and crew, including the chef and engineer and have a full charter book please turn to the next page. So what do Owners want from crew? They tell me they want loyalty, commitment, honesty, team work, flexibility and of course professionalism. How can this be achieved? Maybe our ‘Yacht Owners Rules’ may help especially for those Owners who have never thought it necessary to develop rules of their own. I’m sure that most Owners have business rules that govern their professional lives as otherwise their companies wouldn’t be profitable. In the real world, not yachting of course, any business would find their staff moving to the competition in droves if they were not looked after and compensated adequately for their endeavours. So you have your ‘own’ rules that your employees follow in respect of your businesses, most entrepreneurs do, that’s what makes them special. A superyacht is a business, have no doubt about that, it has employees that need to be cared for, it possibly charters, maybe for profit, maybe not. But accounts have to be produced and invoices have to be settled and international rules have to be obeyed. For that reason you need to look at your yacht, not as something you visit every now and again for a bit of R&R and you simply pick up the bills, but as a business, and as a business you need a set of rules. Believe me when invoices are not settled quickly, or an Owner orders his yacht to leave the dock unannounced leaving outstanding bills local suppliers are soon on the bush telegraph with obvious consequences. You certainly do not want a yacht with a bad reputation; the repercussions will follow that vessel around like a bad smell for many years. Logically operating a superyacht may well cost you between about 10% - 20% of its value when new. The actual amount will depend upon whether you charter your yacht and the standard you wish it be kept to, but even so you will be contributing a considerable amount of money in operational costs. Having your set of ‘Rules for Owners’ may help you in reducing the operating costs by cutting down on crew turn-over, spend waste and of course most importantly ensuring that when you and your family arrive on-board there are familiar faces to greet you and that you have a great time. Ensuring continuity of service of your crew, and thus knowledge of your desires and needs, ensures that all on-board have a fabulous holiday cruise. Consider the rules below as the starting block to assist you in developing your own set of rules. ##Rule 1 - Enjoy Your Superyacht Irrespective of the size of your yacht, and whether its power or sail, you have made a significant personal investment and to justify this you have to enjoy its use. To help you enjoy your time on board careful planning will be required. Whether the planning is about when and where you wish to cruise or just planning for operational cost doesn’t matter. As long as there are sound plans in place you, your guests and yes, your crew, are guaranteed to have a great cruise, and keep in close communication with your Captain. ##Rule 2 - Operate your Superyacht as a Business Unit I am amazed that many yacht Owners don’t in fact have any idea what it costs to operate their multi-million dollar yacht. Some Owners really don’t care about the cost, they are the lucky ones, but others worry about how much they are spending each month on the vessels upkeep and all of its associated expenses. Many yachts don’t have a pre-planned budget and so when we get to the annual, or worse still, five year surveys, which may also include a re-coating of the yacht, the Captains request for a large sum of money comes, quite understandably, as a huge shock. Just a thought for you, if you own a 40m motor yacht then you should be thinking of a figure of about $3m to undertake the five year survey, including its associated major servicing and re-coating costs. I’m sure that, as a business person, you have a financial officer delivering a budget to you for each of your businesses, and I’m also sure that you will be receiving monthly profit and loss accounts. You will also have a method to check the spending so that you can ensure that the necessary finance is always in place to keep the business operating. So why I ask myself, don’t many Owners operate a similar system for their yacht, which is in fact another business unit within the whole stable of businesses that they operate? Maybe it’s because it’s not seen as a business but as a holiday home? ##Rule 3 - Crew Crew are a critical part of the safe and effective operation of your yacht and so ensuring that they are looked after properly will significantly enhance the enjoyment you get from its use. Treat crew well and they will deliver the service you would expect on board your five star floating hotel. Crew turnover is costly, time consuming and unnecessary and can seriously affect the service you receive onboard. It can take a great deal of time for a crew member to get used to your whims and fancies. Also crew training when the yacht is in a quiet period is no bad thing. Knowing that an Owner cares can be shown in many ways, and spending money on training crew is one of them. It benefits the yacht and helps keep the crew in place as they see the owner as a caring person, somebody they feel happy serving. If the 1st officer has to leave to run his own command it is often far better to promote within the ranks than to bring in an unknown person to a position of responsibility who may not fit in. You don’t need to mollycoddle crew, however they do have do undertake a range of repairs, servicing and storing prior to every trip and so try to avoid back-to-back cruising. Having only a few hours, or even a full day, is really insufficient time between trips to satisfactorily complete all the necessary work and provide crew with some time off. A plea from my heart is for you to remember that, once you and your guests have left the yacht, it has to be deep cleaned and made ready for the next occupants. Deep cleaning can take a day for a small yacht or even two or three days for a large yacht. Crew hate not being able to present your yacht to you, your guests or charter guests in anything but tip top condition. In addition to deep cleaning and running repairs the engineers will have a range of servicing that has to be undertaken which may include the water makers, generators, main engines, the AV and onboard communications systems. If the engines and other machinery aren’t serviced as required then all warrantees are lost which may well lead to large costs later in the season. ##Rule 4 - Planning Advance planning is essential especially if you wish to operate your yacht as a charter vessel as well as use it yourself. One vessel I have worked with has its Owners schedule planned for the next two years. This enables the charter brokers to book charters well in advance. At the last check they have charters booked into 2014! Out of interest this yacht has been awarded Charter Yacht of the Year, Charter Captain of the Year and Charter Crew of the Year over the past five years. They, in fact, have a four day gap between all trips. ##Rule 5 - Parties A good party is enjoyed by all the guests on board, and also the crew, who are there to provide service. Parties are all part of the enjoyment of owning your yacht. There is nothing better than having pre-dinner drinks on the upper deck and then sitting down to a Michelin Star dinner with friends and family in some beautifully secluded bay or small quaint marina. Owners and their guests are usually on holiday when on board, although I do accept there are now more and more Owners who live on board their yachts for extended periods of time. When people are on holiday they, quite rightly, expect a high level of service from crew. Interestingly this is also what crew expect when they go on leave so their desires are very similar to your own. Where the difference lies is that Owners live and party on board their own yacht whilst crew on leave will move from place to place to live and party. The former means that the crew are required to be available over a range of extended hours, but in the latter case venues close, at least for a period of time, over a 24 hour period. Be respectful of your crew when you feel the need to party and remember, if your crew have been working all night they may not be around when you need them in the morning! ##Rule 6 - Safety aspects One issue which does amaze me is that many yachts still don’t undertake safety briefings, drills and musters with their guests, which is I’m afraid, illegal. Just like aircraft, Captains are required to deliver safety training to guests and I would really like Owners to insist that these are carried out. I have been asked the question by a guest, ‘If this yacht is so safe why do you do drills and musters with the crew, and also brief the guests when they board?’ My response was very short, ‘This yacht is safe because we train crew to respond to fire, Man over Board, Abandon Ship and many other emergency situations that can occur on board any vessel.’ I asked if they had household insurance and whether they insured their business and their answer was ‘Of course!’ after a short discussion they realised that yachts need emergency plans and that these must be practiced by the crew in order that the yacht continues to be safe, even if there is some sort of an emergency. ##Rule 7 - Paying Suppliers and Crew One way to destroy the good name of a yacht and its Owner is not to pay the bills and wages at the appropriate time. Many Owners don’t seem to understand that many suppliers, me included, make supplies to yachts based upon who is the Captain as we have no idea who the beneficial Owner is (why should we?). Whenever industry finds a poor or reluctant payer they won’t deal with the yacht again and sometimes they will also put the Captain onto the same list. When this happens you’ll probably be looking for a new Captain which may well not suit your plans. ##Rule 8 - Legislation and Regulation One area that some Owners seem to misunderstand is that all superyachts operate under legislation and regulation. I’m afraid that this is something that can’t be avoided irrespective of what you may have been told by other interested parties. Many superyachts are now built to the MCA Large Yacht Code and whether they operate privately or commercially they are required to comply with all the regulations and legislation including Minimum Safe Manning, SOLAS and the whole raft of both Flag and Class certification necessary for a vessel of its size. This is why you may find your Captain being a little withdrawn when you ask to do something as it’s the Captains legal responsibility to ensure that the vessel operates within the law. This year there are more Port State Inspections of superyachts. A Port State Inspection is carried out to ensure that the vessel is operating in accordance with the Flag State and International Regulations and Legislation and without writing another long article what they will be looking for is that the vessel has and is complying otherwise they may well detain the yacht until it complies. This has in fact happened already this season and some Owner and charter voyages have had to be suspended whilst the vessel is brought up to standard. This is a waste of your time and that of any other guests that may be on board. Also of course the charter party may well be looking for the return of some of their charter fee. ##Rule 10 - Tipping Crew Many charter agreements include a section on tipping and in fact the suggestion is that the tip should be based around 20% of the charter fee. In my experience crew will always deliver the highest level of service to every guest on board the yacht but there is always the thought in the back of a crewmembers mind that there will be a tip at the end of the charter. This of course is not necessarily the case with Owner trips which is understandable as the owner is paying for the upkeep of the yacht including the crew wages. Perhaps, as an Owner, you could put the ‘tip’ that could be expected if it were a charter voyage, into creating a crew training fund which can be accessed through the Captains authority for developmental courses. You may wish to put an employment period requirement into the rule so that new crew would not necessarily become eligible on appointment and you may also wish to put a post training course employment period, say six months, so that crew don’t leave having just completed their training course. This would in fact help to fund the suggestion in our previous rule. I do hope that these rules are seen as informative rather than a lesson to Owners but your thoughts on them would be welcomed. And finally, may I, my crew at Hoylake and of course the Publisher and his staff wish you all a very happy cruising summer season and we hope that the winter season is all that you have planned for. _By Captain John Percival MRIN MNI_