Starting a Boat Business

[Boat-a-holic]

Sorry if I am in the wrong section, I was wondering if anyone could give me advise on Starting up a retail boat store, selling boats, doing repairs and selling accessories etc etc, obviously I will need to start small and take it from there, I am based in Cape Town South Africa, we don't have boat junkyards in this country believe it or not, I think if there were there would be a market for re-building and selling accident damaged boats, I have a fair bit of knowledge about boats, fibrglassing, electrics, motors etc, Regards Craig

[Butch .H]

Craig I have the same idea PM me your email adress maybe we can hook up

[Fanie]

You guys mind keeping me informed also.

Thanks

[Westfield 11]

Do you think this is a good time to be investing your own money in a business specializing in a leisure activity that requires large amounts of disposable income? Is South Africa immune to the global recession, if so then lucky you!!

[Butch .H]

Hey Westfield no we are not immune but conditioned we have had a crap economic outlook for ever.

[Fanie]

Nobody is immune, but one can do it anyway, it probably won't ever be better than right now. Mindset pending

I guess one don't want to be put off by everything that is not in favour of. One would end up never doing anything.

[Boat-a-holic]

No-one is immune, however having said that, there are still a great number of people who wisely invested there money and are living debt free so why not be able to target that market, I know of a
couple mates who heve recently bought boats and are not feeling the pinch, take a look at a company like Broderick Sports in the Vaal, their range is from boats and yachts to power cruisers, and with the amount of people having visited both the Gauteng and Cape Town boat shows I think it is safe to say that should you do the correct homework and not over capatilize on the business venture then I see no reason why such a business cannot work. The boatyard in Pretoria makes there money on selling old used boat with old motors as entry level boats to the begginers, where as they also have a range to suite the wealthier pocket and thats what I plan to do, cater for the wealthy and the not so wealthy, these days you do not need 200 000 to get a decent boat, granted the motor needs to be in an excellent condition, you can get away with a nice schimatar with a 90 or 115hp for around 45-55 000, there is a great market for boat refurbishing as well.

I personally would rather give it a go, than sit back and not try and always wonder what if I had, I like taking chances, thats the only way to get ahead in life.

[Manie B]

Craig

my 2 cents

its not a bad idea at all

South Africa has been in the doldrums for the last 14 years

so a world recession just pushes us slightly deeper in the dwang - no difference really

i like your ideas of refurbishing - its has got great merit, i have been to all the boat shops you mention and a lot more, and i feel that their service and attention to customers is not anywhere near what it could be. If you walk into any of them and enquire about used boats and/or equipment you get treated like a second class citizen. They are only interested in selling new bayliners and 250 hp outboards. When i bought my new 5hp Mercury i could not believe the indifference that i got.

The economy is way down yes, but there are still customers out there that expect a little service with a smile and not the standard "eish i doesnt unnerstood"

advertising in the junkmail doesnt work, i have tried over and over and over. Your best bet is to target boat clubs and hand deliver brochures of your stock. Buy a small runabout + 85/115hp and fix it at home and then sell it
build up slowly

Butch Fanie and myself are all in the market for some salvaged stuff - and i am sure there could be many more down your way - because you have more of a boating culture than Gauteng

anyway go for it

[Nordic Cat]

If you try an analyse the boat market in SA, I think you will find that the biggest market is trailerable boats, both in value as well as number of units.

Maybe concentrate on this segment, and have a section for used boat kit like engines, winches sails etc.

As a business case for the boats, I would suggest doing a mixture.

1.) Buy, fix and resell.
2.) Offer brokerage services.

The brokerage service with a good website, and a nice lot where people can come and look the boats over will offer many business advantages.

It will increase the number of people you reach out to, give you first offer on the used boats, let you earn money on upgrades on the second-hand boats, and keep your liquidity in good shape.

Maybe offer a "do-it-yourself" brokerage service, via the website for people further away.

Maybe add an auction service a few times per year?

There are many ways to do this, but key is a good easy to use website IMO.

One neat feature I saw was a sit where you can make an offer on-line, this is a great help in starting the sales process, as people feel it is a bit more anonymous, and are more forthcoming.

Good Luck with the venture. Let us know how it goes.

Alan

[Butch .H]

Alan you naild it good points there thanks

[eponodyne]

Given that SA has like 3 of the worlds 10 most dangerous cities, I'm kind of in awe of you blokes for living your lives and plugging ahead with your dreams, regardless of outcome. Fair play to all of you, and best of luck.
Have you considered buying knackered boats in Florida USA--maybe "well-used" rather than "truly knackered"-- and getting them to SA to sell? At the right time of year it's pretty much downhill sailing all the way.

You could fit two 20-footers in a standard container with just a little planning; Mind you I have no idea what shipping costs per standard container, FOB Miami to Cape Town, would be. As of this writing, exchange was about R 11 to 1 USD. Shop around, you can get a lot of boat in Florida for R50000 these days.

[Butch .H]

eponodyne what you doing in the "upper midwest" how you going to find boats for us .We have considered buying old boats from the US.But as of now the Caribean seems to be the place for sail away condition yachts. I pearsonaly would like to buy old wooden boats for restoration. Some of them will fit in a few paper bags SA is probebly one of the most dangerous places to live and work probebly becaus it is in your face day in and day out also we have the worts coast for crusing unless you like to ride a train on a Rollercoaster once in a while .

[Wynand N]

Originally Posted by Nordic Cat

If you try an analyse the boat market in SA, I think you will find that the biggest market is trailerable boats, both in value as well as number of units.

Exactly why I designed my fast and affordable 6 meter trailer sailor production boat in GRP and in fact, the lofting is completed and the first plug frames cut today by the apprentice...by Friday the hull frames will be up and the skin mostly fitted

Already have an interesting party in Cape Town who think he can sell about 10 units monthly if she is a good as I predicted. In Gauteng there are a couple of interested brokers as well awaiting my units to sell - have to show some deposits away in the meantime from prospective customers - I will only commit myself monetery with clients when the moulds are finished and production about to begin....

As for your proposed business, perhaps this will be helpful:

The problems with second hand boats to sell are as follows according to a friend of mine running a broker firm at his boat club on the Vaal;
Most of the boats around the R120,000 downwards price tag attracts buyers that needs financing and this is where the paw paw hits the fan with the banks.

1. First of all, as a dealer you need to be a VAT vendor with a fixed address of business before a bank will touch your finance application.

2. Ownership - and this is where most financing comes apart. Banks wants absolute proof of ownership of the secondhand boat to be financed and with most hulls built by owners, this proves to be problematic as it was built over time and parts, materials obtained from all over.

3. Backup - can you stand by your product if any problems arises, say for instance, boat to be replaced under guarantee.

[Butch .H]

Yup second hand boat are problematic at best but example. A boat sank at its moorings last year. The salver did not charge for recovering the boat(wooden hull).They broke it up and sold the bits and pices.R1700 per winch x 4no.The cost to the salver was about R10,000.00.Motor(hadz) newly repaird prior to the sinking.Rigging reasonable condition,mast and spars all relativly ok.Brass portlights 200mm 6 of at R750 each and so on and so on.Some of the stuff was sold on Ebay that = US dollar or GB Pounds?

Member of a yacht club busy with rebuild defalted with subs for two years.Yacht Club attached boat (big multy chine sleel job) auctioned it off for R19,000.00 including every thing in lockup garage on site.Other than the tools and materials the boat was broken up for spares.Wind gennys,radios,motor(Volvo) and so on and so on, Through hull fitting brass 30mm R350 new second hand at no cost except labour to remove it good condition R200 ,reasonable condition R180.Not to mention the electronics on board and the auto helm and the binicle compass.

No you dont need milions and you dont need to repair second hand boats for resale(maybe a few) If you are going to sell modern boats go brand new.

I wish I could find a boat scrapyard in this country,half my costs will evaporate.I did get lucky I found a 6 man life raft in origional packaging for R3000 quote to bring it to current R6000.00 not bad hey!. It all out there some one just needs to bring it all together.

[messabout]

For a real time assesment of your idea, do your homework well. Work up a business plan and then consult your banker, or several bankers. While they are not my favorite people, I respect their ability to make or break your business. They will hold your ultimate destiny in their hands. You may very well need financing and your customers will certainly need financial help. Conversation with money lenders may help you more than our forum members. We are boat people who tend to be optimistic about things that float. Not so bankers.