22 minute read
YACHT MANAGEMENT COMES OF AGE
The world of yachting is seeing more technology and more legislation which is of course a good thing, but with superyachts getting larger, more external expert advice is required Words: Captain Michael Howorth
Superyachts represent, even to the richest of owners, a significant investment. Whatever their size, superyachts are valuable assets and require careful management, from rigorous financial management to employing a trusted crew and running a well-orchestrated diary.
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Specialist superyacht management services ensure that a yacht is being well maintained, operated and administered, leaving owners free to enjoy their time on board with family and friends.
Good superyacht managers provide seamless and exceptional shore-side support to ensure all aspects of yacht management are dealt with efficiently.
Most of the better yacht management teams have skills, knowledge and superyacht experience across a comprehensive range of services. From cost control for the operation and maintenance of a superyacht, to every aspect of operating it, enabling them to operate with efficiency, transparency and, of course, accountability.
Owners considering commissioning the construction of a new build or refitting an existing yacht, should consider yacht management companies that specialise in providing project management services and have been successfully involved in the new construction and refitting of yachts. They would do well to choose managers who have extensive relationships with the better shipyards, designers and naval architects around the world.
The business of yacht management has, over the last decade or so, developed from being a simple, add-on service offered by superyacht brokerage companies, into a big business. It has become so for a number of reasons including: increased legislation, more sophisticated vessels, a more competitive manning market and the introduction of mandatory ISM, requiring increased shore support.
Yacht owners are becoming more discerning and wanting to limit their various liabilities in an increasingly litigious environment. The advantage of yacht management to the owner, is one of protection, reliability, compliance, reduced liability, improved residual value and financial accountability.
As time goes by superyacht management is becoming more competitive and securing good manning by employing competent crew is becoming even more difficult. Otherwise, it is like any other kind of management and should improve and embrace change. The evidence is that over the past two decades, this has happened.
There was a time when yacht management was nothing more than a tool used by the yacht broker to stay very much in touch with the owner during that tricky period between taking delivery of his yacht until such time as he decides that he wants to upgrade to a larger yacht, or otherwise dispose of his current vessel. By managing the yacht for the owner, the broker was sure to be on hand when he was needed, to become involved in yet further commission earning revenue. Today that is no longer the case. Over time, the process of looking after the yacht as a financial investment has become so great that specialist advice is a requirement of the owner, in much the same way he calls upon his stockbroker to manage his share portfolio. In recent years many insurance companies now make it a provision of cover to have a recognised management company involved and this often pushes an owner towards yacht management.
Yet, no two kinds of yacht management are the same. Each service offered to an owner should be (and in most cases is) tailored to meet their needs and expectations. The range of yacht management services offers by companies ranges from ISM support to full management, including chartering and crew employment. Having a yacht management contract in place can affect the sales value of a yacht. It should set a standard for maintenance and operation of the yacht.
Having spent the last 23 years in the superyacht industry covering all aspects of sales, charter, new construction and management, Nicholas Dean could be said to have been round the block once or twice. Together with his great friend and professional associate, Peter Hürzeler, Nicholas formed Ocean Independence, and became its joint managing partner. The company flourished and now benefits from 15 offices and over 120 team members, representing full coverage of all aspects in the large yacht industry. The company’s yacht management division is an important fee earner and contributes towards its ongoing financial success.
Dean contends that most superyacht owners buy their yachts for their own enjoyment and doing so, is often the culmination of a lifestyle dream. He says, “Perhaps the most important factor in quality yacht management is saving that owner time. It is up to the manager to resolve the day-to-day issues, to work in tandem with the captain and crew to create the very best possible experience for the owner and / or the charterer.”
Knowing that your major asset is run efficiently, within budget, with monthly reporting and financial analysis is all there to create piece of mind and to protect the investment made. In recent years, the bureaucracy surrounding ship management, crew employment and financial transparency, is such that a management company already structured to handle all these issues, offers a time and cost-efficient option to the yacht owner.
Now the Yacht Management Director at Bluewater, Phillip Holden, spent time serving in the Royal Navy before joining the yachting fraternity. In 1991, together with John Wyborn and
BLUEWATER YACHTING
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Peter Bennett he co-founded Bluewater. Each Director focuses on different areas of yachting and are very hands-on with their teams. Holden heads up the Yacht Management Dvision and is proud of what it has achieved. He says, “We built Bluewater to be the complete package for yacht owners; we have a charter division, a brokerage team and our management department all working hand in hand with our crew training and recruitment experts. He adds, “We understand both sides of the yachting industry, from the crew perspective and from the owners and are able to offer our management yachts additional services that others can’t, without having to outsource.” Included in the company’s bespoke yacht management packages is access to the company crew database for hiring crew. Added to which, the company has brokers an owner can call upon when needed for advice on charters and sales. Holden says, “Having experts in all these divisions under one roof ensures a streamlined service, round the clock, 7-days a week.”
MAIN ADVANTAGES When it comes to managing a vessel, Holden believes there are two fundamentals that if you get right everything else will flow. “These areas are the finance of the vessel and the crew of the vessel.” As an example, he says, “If you manage the maintenance of the vessel correctly and pay what you need to pay, it will be successful, if you manage it incorrectly it will end up costing you more in the long run. If you were to supply the wrong chief engineer to the vessel it would impact the maintenance of the vessel going forward and thus reduce the enjoyment that the owner could have.”
Taking the stress of ownership away and problem solving with regards to the general operations of the vessel is what yacht managers do best. They should ensure legality, promote continuity and co-ordinate Flag and Class requirements so as not to interfere with the yacht’s programme. “Good yacht managers,” says Holden, “should keep control of the finance and ensure the owner gets the best deal. They should supply, vet and manage the crew properly to ensure the correct selection of captains and heads of departments.”
Nick Irving started delivering yachts as a skipper in the 1980s. He worked for various charter companies and completed 30 Transatlantic and 3 Pacific crossings, and innumerable trips up the US east coast, around the Mediterranean and the North Sea. It was that experience that led him to set up Reliance Yacht Management nearly 25 years ago, with a focus on providing logistical solutions to the leisure marine market. The company continues to grow, adding more charter fleets and private owners to its portfolio. He says, “We concentrate on the logistics and movements of boats worldwide, with a network of captains, crew and local coordinators supporting us throughout the world. While our origins lie in crewed delivery, over the past few years we have expanded into shipping services in order to meet customer demands. This has led to a new exclusive service agreement with UK shipping company, Peters and May. We continue to grow by listening to what our clients want and responding accordingly. We are proud of the fact that so many of our clients are loyal to us, some of whom have been with us for over 20 years.”
Irving believes that employing a superyacht manager provides the owner with a single point of contact for all matters relating
WRIGHT MARITIME GROUP
Wright Maritime Group is a specialist in new yacht construction and large yacht management, operating globally as a world leader in yacht operations. Wright’s core values and their strive for exceptional excellence is fundamental to WMG’s success. WMG Headquarters received its name ‘The Academy’ because, while a place of accountable action, it is also a place of learning to do great things for their clients, their crew and the businesses serving them. Informed owners and their representatives call Wright Maritime for advice and support in ensuring that their yachting experience is the best it can be, while protecting their nancial interests and improving time spent on board. Wright Maritime supports all elds of the large yacht industry with initiatives and encouragement. For more details Tel: +1 954 523 0300 or visit www.wrightmaritime.com
to the yacht, from catering to crew, from engine servicing to navigation. He says, “Not only does this drastically simplify the work that owning a superyacht entails but, provides peace of mind that the yacht is being run with professionalism, care and experience. The manager can also act as a sounding board for the owner regarding ideas and future plans for the yacht; the owner has nothing to gain but the manager’s industry experience and knowledge with a specific focus on oversight and coordination.”
Captain A J Anderson heads up the Wright Maritime Group. Based in Fort Lauderdale, the superyacht management company came into being when AJ passed the command of Rassalas to others and took on the role of managing the yacht. Today, some twenty years later, there are forty dedicated multi-national professionals working at The Academy its HQ so named because, while a place of accountable action, it is, they say, also a place of learning to do great things for our clients, their crew and the businesses serving them. Anderson believes that his WMG is different to others involved in professional yacht management because those in operational management still keep and use their Master’s certificates and take command of yachts for periods between 4-10 weeks every year.
“That time in command,” says AJ, “keeps their perspective more closely aligned with the crew, which they feed back to the staff on the floor. There are so many dedicated professionals working in yacht management, that it is less about competition and more about collaboration. One of the joys of this business is to be able to share ideas with other companies doing what we do.”
“The success behind the WMG revolves,” insists AJ, “because an experienced management firm has years of policy and process development across a number of yacht operational profiles. When a licensed and insured firm is involved in the financial and business controls on board, there is naturally a higher level of surety. Having a professional firm with regulatory experience related to crew employment that can serve as employer is a key advantage as well.” FOR THE CAPTAIN The advantage of yacht management to the yacht’s captain is not dissimilar to those of the owner, in that they need this to be time efficient, so they can deliver the onboard experience that they are employed to do. Efficient ISM / ISPS management systems, financial management systems all save the captain an incredible amount of time compared to where we were some years ago.
Nicholas Dean of Ocean Independence says, “What is perhaps crucial here, is that the captain and management work as a team in the best interests of their owner. This requires respect on both sides and excellent communication. To have a full back up team behind the captain on technical, financial and compliance is crucial to the safe running of the ship.”
Nick Irving concurs saying, “A manager can provide a single point of contact relating to all boat matters, as well as act as a professional mediator between the captain and the client, protecting the captain’s interests while conveying the owner’s requests. The manager can also provide neutral and safe ground for the captain to discuss confidential matters without compromising their relationship with the owner or crew.”
DO CAPTAINS AGREE? Not all superyacht captains agree. One confidentially told us in response to our request for his views on management, “In my experience, management companies fall into three categories: the micro managers, the hands-off variety and the middle of the road, easy to get on with ones. I have worked with all three and I know which type I prefer!”
One company I started off with began by being hands-off, but frightened they would lose their client, allowed the owner’s representatives to push them into becoming micro managers. They wanted paperwork backing every single decision anyone made and then pushed it up the line for approval by the owner’s representatives. This created a very slow system and made it almost impossible to get anything done and frustrated the hell
OCEAN INDEPENDENCE
Ocean Independence is a full-service superyacht brokerage company, specialising in yacht sales, charter, new build and management. Founded in 2005, Ocean Independence now has approximately 115 employees, operating from 13 o ces around the world, speaking 23 di erent languages. Delivering a comprehensive range of yacht management services, the dedicated team of technical supervisors and yacht managers o er a unique combination of skills, knowledge and experience to ensure peace of mind, every step of the way. The management services ensure that your yacht is being maintained, operated and administered to the highest possible standards, leaving you free to enjoy time on board with family and friends. If you are considering commissioning a new build construction or re tting an existing yacht, Ocean Independence specialise in providing project management services. They have excellent relationships with the best shipyards, designers and naval architects globally. For more details visit www.oceanindependence.com
out of the onboard heads of departments that they just quit. That act then upset the owner.
He continues, “Then there are the hands-off variety who just do the bare minimum. Usually these are the managers who sell just an ISM package to the owner and undertake only that management function leaving everything else to the yacht. I found that this was fine when I was running smaller vessels but now as the commander of a much larger yacht with a significant number of crew on board, I feel that would lead to a very stressed out captain. That style of management tends to overlook many onboard issues leaving the heads of departments to manage them with all the inherent problems that then ensue.”
“My favourite are the middle of the road managers who act as a buffer between owners’ representatives and the vessel deflecting the difficult matters which would take up too much of the captain’s time to try and resolve. Sensibly they would leave the yacht to decide how the vessel is actually run. This includes, deciding how and when to get from A to B and who they hire and fire. Managers like this have a framework in place for budgeting, accounting and crew payroll. As a Captain I know where I stand, and I can get on with the job at hand which is satisfying the owner’s wishes.”
“When I was sailing full time, as the Captain of Rassalas,” says Captain A J Anderson, “We would joke that the twelve most terrifying words a captain will hear: “I am from yacht management and I am here to help you”. Today as a manager himself, he has a somewhat different approach and says, “We all have jobs to do. Sometimes they overlap so collaboration matters. The best managers are there to support the captains while all being required to fulfil the owner and family office requirements. Today he adds, “The captain benefits from the experience and current knowledge of a specialist yacht manager. Having that support in helping the captain explain circumstances to the owner can make the difference in their understanding. Additionally, captains are always representing the crew’s interest, but often are not able to represent their own interest. Having a third party in a yacht manager to support a captain’s terms of employment is important.”
HELP OR HINDRANCE? When offering yacht management services, there is always the possibility of managers being seen as ‘treading on the feet of the captain and senior crew. “We overcome getting under the feet of the yacht’s crew by offering valuable support in many different areas”, says Phillip Holden at Bluewater. He adds, “This can prove to be invaluable when the vessel has guests on and there may not be enough hours in the day for the captain or senior crew. A management company is there to help and ensure the smooth running of your vessel, not there to pick at problems or point fingers! We take the headache out of running a yacht.”
At Reliance Yacht Management, Nick Irving has never really come across this problem when managing yachts. “In reality,” he says, “The owners approach us first and we are their main point of reference and contact for the yacht. Likewise, we have extensive networks of captains that we assign to yachts. We aim to build good relationships with both parties and are often key to developing the relationship between owner and captain. Management is not ad hoc to the running of a yacht but central to its success.”
“Such comments are now outdated and certainly not a reflection the new captains coming through the industry,” says Nick Dean of Ocean Independence. “Captains such as these fully realise that each party has an important role to play and neither should tread on each other’s toes. In the end we are tasked by an owner to do the best possible job for him, whether on board or ashore.”
TECHNICALLY COMPLICATED With superyachts becoming larger and more technically complicated, yacht managers can bring other major benefits to the table. “The bigger the yacht the more crew there is and with that comes more crew management,” says Phillip Holden at Bluewater. He adds, “Our technical management backing up the yacht’s engineers and ETOs, help co-ordinate contractors, shipyards, technical support companies and ensure they in turn back up the engineers and ETOs. This allows the onboard team to get on with their jobs. Often as managers we are able to help the owner with negotiating better rates when dealing with technical and audio-visual and information technology issues.”
“That is so true,” agrees Nick Irving who adds, “Yacht management can provide what all the technology in the world can never quite provide – people. We have an extensive network of captains and crew, relationships with industry experts and technical providers worldwide, built through decades of good business and loyalty.”
KNOX HOUSE MARINE & AVIATION
An ever-changing landscape means that yacht owners are faced with numerous considerations, and that’s prior to the addition of a global pandemic. This means that working with people who understand the challenges and have the requisite superyacht knowledge and industry experience is a must. KHMA o er expertise that reduces the administrative burden while maximising the bene ts of yacht ownership. Whether the vessel is operated privately or commercially, their services are tailored to the exact needs of owners. Their award-winning services include: multi-jurisdictional ownership structuring, VAT importations, international registrations, crew payroll and crew recruitment, technical services and much more. For more details Tel: +44 (0)1624 631710 or visit www.knoxhousetrust.com
MASTER YACHTS
Master Yachts o ers supervision services in new build, re t and operations. They are dedicated to providing a diligent and exceptionally reliable service for both sail and power yachts. Each member of the team holds a high level of industry knowledge and expertise, handling requirements with the utmost professionalism and integrity. Master Yachts deliberately stay away from brokerage, in order to keep an independent approach in the company’s actions and decisions. With this nononsense and pragmatic approach to yacht management, the brand is well trusted by owners, captains and industry partners. For more details Tel: +34 971 220 562 or visit www.masteryachts.com
“Yacht Managers by the nature of their business become problems solvers and have an extensive pool of contacts for problem resolutions,“ says Nicholas Dean of Ocean Independence. He adds, “The main benefits come from the main management companies having the skill set behind an owner and captain, to always be up on the latest technology and as yachts have become much larger, the overall compliance is a very specialised service.”
“It is less the technical complexity and more than the regulatory complexity,” says AJ Anderson. He expands further by asking, “How do you comply with cyber rules or other rules often rushed and untested before implementation? Having a fleet of trials, errors and successes provides the management firm the data and tools to inform the yachts in the fleet with the latest information.”
STILL A MAN’S WORLD? Pleasingly, what was once just the domain of the macho male, yacht management is becoming much more gender balanced with more and more women joining and running management teams. The Wight Maritime Group is even named after an early female pioneer! Patricia Wright served in the United States Marine Corps during WW2. And the gender balance continues apace as the years pass. With 19 years under her belt in the yachting industry – and many years before that working in shipping and maritime insurances – Sylvie Bredy comes to superyacht management with a wealth of experience. Now working for Edmiston, her first foray into the industry was more accidental than deliberate. She says, “It started with a temping mission for one of the leading yacht repair shipyards in Marseille,” she says. “I was the Office Manager/Technical and Sales assistant there. I was supposed to stay for two months and stayed for 13 years in the end.”
Bredy’s years in the shipyard prepared her well for a future in the industry. “When you are working in a shipyard, you are bound to be confronted by gender stereotypes, whatever your background or your experience is,” she says.
“In my early shipping career, a lady who was running her own business in Tunis told me: ‘In a man’s world, you need to be the best, otherwise you are nothing’. This is like a mantra to me. Not that I pretend to be the best at what I am doing but I am surely thriving at being a better yacht manager and a better person every day.” Bredy clearly loves her job: “My best achievement so far is to sit in the position I have today with Edmiston. I feel extremely lucky about my job and about having the opportunity to look after some amazing assets.”
“There is no routine in the Yacht Manager’s job, no day is the same as the one before, and every day is a school day. That is what keeps me going.” And while she has proven herself well in her chosen career, Bredy is aware that it can still be a tricky industry for some: “Although I have seen a slow evolution over the last 19 years, I think that yachting is still an industry where it is difficult for a woman to demonstrate her leadership,” she says.
“Mentalities are slowly changing. There are more women on yachts in positions that used to be for males only. And look at the management department at Edmiston, it is only women!” She adds, “We need to stop admitting that there are gender stereotypes is the first step to beating gender stereotypes. I would encourage young women to learn and progress. Keep learning because knowledge is power. People will come to you because you are knowledgeable and reliable, never mind whether you are a man or a woman.”
MORE REGULATIONS COMING What is fast becoming apparent is the fact that there are more regulations coming into our industry. Managers we spoke to suggest that these will focus on compliance, transparent financial management and safety. As these come into force so the role of the yacht manager will begin to play an even more important role in superyacht operations. Rules and regulations for Flag and Class, Fiscal and the coastal states are complex. How and where to operate and idiosyncrasy of different states will need to be fully understood and owners and captains will need professional advice. Compliance with Flag and Class and the Port State will become issues that only dedicated teams of experts can handle. With fiscal rules compliance, charter licences of different countries, registration, reporting and VAT returns all becoming more important, the yacht manager will in the next few years become indispensable and the profession will have morphed into an essential service. The list is almost endless with environmental issues such as air, oil, waste, ballast water, all employing a raft of new and complex regulations across the world. You could say that, after 20 years the job of and the need for the yacht manager has finally been fully understood and accepted.
