Nekton boats may come back!!

[cappyjon431]

Thank you all for your thoughtful responses to my questions about whether or not a boat should go out even if it was a given that the charter was going to lose money.

What I have seen a lot of in regards to these responses is that most people embraced Nekton's (or any other liveaboard for that matter) policy of going out with 4, 5, 6 guests even though charters with so few passengers are doomed to lose thousands of dollars in the process. From a consumer's perspective, I wholeheartedly agree.

From a business perspective (and I am a relatively new business owner in the dive industry, although I am not in the liveaboard industry) I am not sure if it makes sense financially. Dive industry businesses run on notoriously slim profit margins and running charters that lose tens of thousands of dollars a year (working on Nekton over the years I went out on literally dozens of charters with extremely low occupancy rates) seem to be an exercise in shooting oneself in the foot. While I would never be foolish enough to suggest that running such small charters was responsible for Nekton's demise (there were obviously plenty of other factors which contributed), I can't help wondering if this might have contributed to their failure in some way. Tens of thousands of dollars lost every year would have gone a long way towards maintenance, crew payroll, etc. Of course this assumes that management would have utilized the "saved" money for the right purposes, something that we cannot assume.

Once again thanks for all of your input. As a relatively new business owner, your posts have helped me get a better understanding of what divers expect and how to manage similar issues with my business.

 

[Code Monkey]

Cap'nJon,

I had assumed that you meant 'should a dive boat go out if it occasionally has too few customers.' If it's a regular occurrence, I'm thinking that the company needs to rethink its schedule, itinerary, or both. Any consistently, even if not continuously, money-losing venture clearly needs to be reworked.

 

[cappyjon431]

Cap'nJon,

I had assumed that you meant 'should a dive boat go out if it occasionally has too few customers.' If it's a regular occurrence, I'm thinking that the company needs to rethink its schedule, itinerary, or both. Any consistently, even if not continuously, money-losing venture clearly needs to be reworked.

After 911 we went out consistently with very small charters. When I say small charters, I mean trips with 5, 6, 7 guests. We did these in both the Bahamas and Belize. Part of it was 911 (increased travel restrictions, increased security costs, etc.), part of it was the introduction of the Rorqual (splitting the Nekton "faithful" among two boats). Obviously this was almost ten years ago and the company managed to stay afloat (no pun intended), but in my honest opinion, that is when Nekton began going downhill. They started cutting back on services (airport pick ups, free day tours in belize, etc.), nickel and diming guests with increased fees and surcharges, etc. I am wondering what the correlation was between the regular departure of money losing charters and the eventual demise of the company. I get the feeling (purely speculation on my behalf, but based on being on the boat pre- and post-911) that Nekton dug itself into a financial hole from which it was never able to fully recover.

 

[diverdoug1]

I agree with Code Monkey. If a boat is CONSISTENTLY underbooked, the owner needs to make an adjustment. If it is underbooked on rare occasion, I would hope he would take the loss in the name of customer service and good will for potential return customers.

 

[tarponchik]

You would have a hard time entering into a contract with a large corporation if you insisted upon equality.

Large corporation who? Nekton or even Aggressor? Give me a break.

Hilton and Mariott are large corporations but you can get a full refund on a 24 hr notice. This is not the question of size, my friend.

 

[Scubatooth]

LEVIATHAN11 - I hope your ranting and raving made you feel better. Your right the dive industry is small, and word gets around real quick about those whose attitudes and actions are unprofessional (like your comments here), which will make trying to get employment in the dive industry a little hard in the future.

Im not going to stoop to your level and put your name on this board, but considering what i know you and some of your actions on the Rorqual in the closing months of Nekton, you have no room to talk.

As for your claim about being out $5K, if you had done your research or even asked how you could go about recovering it. You could have gotten your money already, as there are many ways to skin a bankrupt cat. Instead of doing something you decided to moan and belly ache about it, and most likely now is a case of to little to late. Here is a free piece of advice for you in the future..... Small Claims Court.

 

[tarponchik]

While I would never be foolish enough to suggest that running such small charters was responsible for Nekton's demise (there were obviously plenty of other factors which contributed), I can't help wondering if this might have contributed to their failure in some way. Tens of thousands of dollars lost every year would have gone a long way towards maintenance, crew payroll, etc. Of course this assumes that management would have utilized the "saved" money for the right purposes, something that we cannot assume.

Though IMHO most failures are caused by bad decisions, some are caused by the environmental changes.

My understanding is, Nekton was the child of the 90s; that is, the world of after-recession economy boom and cheap fuel. Its custumers were middle-class mostly, and maybe even some low middle-class. The upperty would go to the fancier Aggressor. In the post-9-11 world, both fixed and variable costs went up, and Nekton's customer base was erased by poor economy and massive jobs/savings losses. The upper-end liveaboards did not loose as much (albeit, they also lost) since the rich are still rich; it is the middle- and low- middle class who bear the brunt of the recession. So your best bet would be to make the boat fancier, charge more, and go where Aggressor does not operate. However, you will be competing with Aggressor for the same potential customers. If you plan to charge less and attract the old Nekton crowd, then you may consider Fort Lauderdale, since these folks will definetely try to save bucks on tickets and maybe even drive.

 

[Damselfish]

Large corporation who? Nekton or even Aggressor? Give me a break.

Hilton and Mariott are large corporations but you can get a full refund on a 24 hr notice. This is not the question of size, my friend.

It is partly a question of size. The smaller the resort and the more remote the location, the more likely they are to have a strict cancellation/refund policy. But I've never heard of one telling you can't come because they don't have enough guests. Of course one big difference is they don't have the fuel cost of a liveaboard.

 

[Wookie]

Though IMHO most failures are caused by bad decisions, some are caused by the environmental changes.

My understanding is, Nekton was the child of the 90s; that is, the world of after-recession economy boom and cheap fuel. Its custumers were middle-class mostly, and maybe even some low middle-class. The upperty would go to the fancier Aggressor. In the post-9-11 world, both fixed and variable costs went up, and Nekton's customer base was erased by poor economy and massive jobs/savings losses. The upper-end liveaboards did not loose as much (albeit, they also lost) since the rich are still rich; it is the middle- and low- middle class who bear the brunt of the recession. So your best bet would be to make the boat fancier, charge more, and go where Aggressor does not operate. However, you will be competing with Aggressor for the same potential customers. If you plan to charge less and attract the old Nekton crowd, then you may consider Fort Lauderdale, since these folks will definetely try to save bucks on tickets and maybe even drive.

The rich that are still rich enough to not be effected by the economy are not Aggressor's customers. They charter a yacht to go wherever they like. The folks who want to drive to Ft. Lauderdale to get on the boat are not saving a few bucks on plane tickets, they want to bring more gear than they can fit on an airplane. With the drastic demise in the quality of air service, I think that there will be a resurgence of the customers that a boat leaving for the Bahamas from Ft. Lauderdale would attract. The avid photographers/vidoegraphers, and rebreather divers. We've seen a big increase in rebreather divers coming to Key West because they can ship their rebreather in ahead of time ($40, UPS ground each way). Photographers are a little fussier about who they ship their cameras with, but they tend to ship their dive gear and carry their cameras on the plane. Don't discount the low- and middle- middle class as a customer base. They may not have the purchasing power they had in the 90's, but they still want an "exotic" vacation.

 

[Shasta_man]

What's an "upperty"?