Working With A Boatyard - PassageMaker

Working With A Boatyard

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Working with Boatyard

As a boat owner, you have the power to insist that boatyards do the right thing and you have the option of going elsewhere if they can’t or won’t live up to your expectations.

I’ve worked in the marine industry for nearly 25 years, as a mechanic, electrician, boatyard manager, and now a consultant for boat buyers and owners. Being exposed to the inner workings of this somewhat enigmatic business I’ve learned a few lessons. Chief among these is that when it comes to maintenance, repair, and other boatyard work, vessel owners should leave as little to chance as possible. Because the cost of boat ownership isn’t likely to go down and because a properly built and maintained vessel is one that’s likely to bring you back to the dock at the end of the day, it pays to become and remain as involved as possible in refit , service, and repair projects.

As a boat owner and boatyard customer, you have a right and a responsibility to insist that boatyards do the right thing—that they live up to your (reasonable) expectations. You are the consumer, and just as consumers have used their buying power, and their walking power, to transform other industries, you can use yours to transform the boatbuilding and marine repair industries. While still far from perfect, many would argue that the U.S. auto industry was transformed as a result of foreign competition and consumers walking away from manufacturers that failed to deliver on their expectations and into the arms of those who did.

My objective in sharing what follows is to assist you in becoming an educated consumer, one who will be knowledgeable enough to require that boatyards and marine industry contractors meet the high standards you deserve (hereafter I’ll use the term “boatyards” to describe all marine industry service providers). I will provide you with the tools you need to begin evaluating a boatyard from the very first moment of contact, for example: Is the facility neat, clean, and squared away? Are the buildings well maintained or are there piles of trash and unused equipment lying around? Are windows broken and is the paint peeling, both literally and figuratively? Is the staff attentive? Do they look you in the eye and greet you as you walk by? Is their appearance professional? Does the facility seem overstaffed? (One of my greatest pet peeves, and I have many where boatyards are concerned, is the sight of two or more people carrying out a task that requires but one individual. This practice speaks volumes about the management structure and efficiency of the organization as a whole.) Is the equipment, such as the Travelift, forklift, and vehicles, well maintained or is it streaked with rust and frayed?

There is, however, more to evaluating a yard’s or contractor’s capabilities than assessing outright appearance, of course. The next step involves evaluating the quality of the workmanship and business practices of the organization. This includes knowing how to get a clear understanding of the work that will be performed, what to expect in the way of progress reports, and of course, the cost and billing practices. Until you have a clear understanding of what you can and should expect from a boatyard that you are considering entrusting with your baby, and until you have clearly conveyed your expectations, you can’t expect more from your boatyard experience. If the yard is unable or unwilling to deliver on your expectations, then you must be prepared to go elsewhere.

THE NUTS AND BOLTS OF TECHNICAL PROFICIENCY

When it comes to the service and repair of a vessel, few subjects are as important as technical proficiency, industry knowledge, and attention to detail and experience. Technical proficiency must be at the top of your yard evaluation list.

I’m routinely asked by readers, lecture attendees, and clients, “Can you recommend a yard/contractor for this work?” or “How do I know if a yard is any good?” The bottom line is that the answers to these and other boatyard proficiency related questions aren’t easily obtained. There are, however, standards by which boatyards and the folks completing marine repair, refit, and service work can be judged. The American Boat and Yacht Council, or ABYC, provides a clear framework for many, but not all, of the tasks that are carried out in boatbuilding and repair, and these are clearly defined in their voluminous Standards and Technical Information Reports for Small Craft, a telephone book-like tome that includes everything from guidance on AC and DC electrical systems to propeller shaft installation. Additionally, ABYC offers certifications in a variety of disciplines, including composites/fiberglass; diesel and gasoline engines and support systems; marine corrosion; refrigeration and air conditioning; and marine systems and standards accreditation. Rest assured, this is no rubber stamp program, certifications are only given to those who successfully pass rigorous 200-question exams (I know, I’m certified and I’ve helped write the systems exam). Those who obtain three or more certifications become Master Technicians.

The value of the certification is clear. You can be reasonably certain that the folks who are certified know at least the basics of a particular discipline and likely much more. When I work with an ABYC certified electrician I’m not wondering if, for instance, he or she knows how to calculate the ampere-carrying capacity of a particular gauge of wire. I also know that when I work with an ABYC-certified composite technician there’s no question about his or her ability to properly catalyze resin or close out cored structures.

While it’s no guarantee of competence, you get the point—it’s a valuable baseline and the more certified folks a yard has on staff, the more confident you can be in their skill set and commitment to their own professional development. Having made the case for ABYC certification and its undeniable value, the absence of a certification doesn’t mean these folks are unqualified; on the contrary, there are many savvy industry professionals who haven’t gone through the trouble of obtaining an ABYC certification, although I would argue strenuously that they should obtain this valuable credential. As a bare minimum, anyone to whom you entrust technical work should be a member of ABYC and therefore have access to the standards. They should agree to follow the standards whenever and wherever applicable.

There are other standards by which you can measure a yard’s competency. For those carrying out marine electronics work for instance, membership in the National Marine Electronics Association, or NMEA, means they have access to yet another standard, this organization’s own 230-page Installation Standards for Marine Electronic Equipment. If you enjoy serious technical prose, as I do, this manual is well written; I keep a copy on my iPad for airport and in-flight reading. Not only does this organization and its accompanying guideline spell out, chapter and verse, an impressive variety of requirements for ensuring reliable marine electronics and electrical installations, it also offers a Certified Marine Electronics Technician credential. Once again, while a certification is no guarantee of competence, it’s certainly a good indicator of the individual’s commitment to excellence and professionalism. And, once again, those designing and installing electronic packages should, at the very least, belong to this organization and they should be willing to carry out installations that comply with NMEA’s standards. Ask these questions pointedly and preferably in writing: “Will your installations comply with all applicable ABYC/NMEA guidelines, and if not, will you let me know in advance where and why this may be the case?”

The final standard you can and should expect a yard to uphold is the most self-evident and yet it’s the most often violated: a clear agreement to follow all equipment manufacturer-supplied instructions. In the vessel inspections I carry out I routinely cite this violation above all others. Today, even for older gear where the printed manual may not be available, virtually every installation and operation manual is available online, making failures to follow these instructions inexcusable. When I point out such “installation instructions violations” to boatbuilders, yards, and contractors they often respond by saying, “That’s the way we’ve always done it and it’s never been a problem.” While that may be true, I (and you should, too) point out that this approach means they, rather than the equipment manufacturer, are accepting responsibility for any failure related to the manner in which they’ve installed the equipment, in perpetuity, because the manufacturer’s warranty will likely be void. Ultimately, while it may seem superfluous, you should insist that all manufacturer installation instructions and recommendations be followed to the letter.

DO YOUR HOMEWORK

The next time you sit down with your boatyard manager or marine contractor to discuss a repair, maintenance, refit, or installation, be prepared with a few questions.

  • Do you quote work and if so what are the terms of the quote and what’s the yard’s definition of a quote? Is the price fixed or is it an estimate?
  • For T&M (time and materials) projects, what’s the material markup protocol?
  • Is the yard’s workmanship guaranteed and if so what happens if I’m far away and someone else has to undertake repairs?
  • Will the work be carried out to ABYC/NMEA (or another) standard? If so, are the folks doing the work ABYC/NMEA certified in the appropriate discipline or supervised by those who are? Does the yard have a valid membership in this organization?
  • If the work is quoted, is it billed in segments as the work is carried out?
  • Do I need to provide a deposit for work before it begins and if so what’s the typical percentage amount?

Timely invoicing is important, particularly for T&M work, which I’ll explain in more detail later. Being slammed with a huge invoice after the work is completed or nearly completed should be avoided. Toward that end, ask how often invoices are sent out and if you can get an up-to-the-minute (or at least through the previous workday) progress report on the amount of work that’s been completed or invoiced.

Ask to see a sample invoice. Having wrestled with the equation of providing enough information, but not too much, I’m sensitive to how detailed invoices are. I once had a client describe the invoicing from a yard, in which he had nearly $100,000 worth of work completed as “less than useless.” Ideally, it would be beneficial to see an example of what you can expect to receive before committing to any project, especially a costly and/or lengthy one.

COST CONTROL

When I converse with boat owners on the subject of their interaction with boatyards the discussion invariably turns to cost, or more precisely, the unpredictability of the cost of maintenance or repairs. I’ve heard, on many occasions, boat owners say, “I take whatever the yard tells me [about the cost] and I triple it, then I know what the job will really cost” or words to this effect. Having said that, I’m convinced that most boatyards aim to please and they want their customers to return. While there are a variety of reasons why they may not actually succeed, the unpredictability of cost is one of the most common causes of customer disaffection.

It’s clear to me that the solution to this problem is to emulate other industries in providing boat owners with fixed price quotes or at the very least meaningful estimates with clearly defined margins of error. About a year ago I wrote a column for a marine industry trade publication on this very subject, imploring marine professionals to get savvy on the subject of quoting, as it’s likely that more and more owners will, or should in my opinion, shun yards that can’t offer this level of cost predictability. I strongly believe that this process, when adopted, will provide a sea change in the way the industry is perceived by consumers. Admittedly, it’s not an easy leap to make; however, the rewards are, in my experience, undeniable.

T&M AND QUOTE DEFINED

I routinely hear the terms “T&M” and “quote” used within the industry and I often suggest to my clients that they request from those who may carry out work clear definitions from that specific contractor. My definitions, while typical, are by no means codified within the industry, which is why you must ask for clarification, in writing, before committing to any work.

In most cases, when you cruise into a boatyard or work with a marine contractor (this person may be anyone from an engine mechanic and electronic tech to an electrician or varnisher/painter) you may have a choice as to how the work will be invoiced. A common approach involves charging for the time the project takes as well as for the cost of the material, plus a reasonable markup for every pump, foot of wire, screw, pair of disposable gloves, quart of primer, sheet of sand paper, etc. When the T&M approach is taken I would argue strenuously that the material markup should be based on the service provider’s cost plus a percentage, rather than an arbitrary list price for the product, which can often be based on a highly unrealistic manufacturer’s suggested retail price, that no one is actually expected to pay. Let’s be honest, those “list” prices are there to make “your price” look more desirable. Using the former approach, if the yard gets a discount on materials because they bought in bulk or got a deal, or the price of a product went down, the savings is passed on to you, yet the yard still makes its percentage. That’s fair for all parties involved.

When I managed boatyards, customers would occasionally ask what I paid for materials or what my “markup” was. While some yard personnel are reticent about sharing this information, I was unabashed in my explanation. The markup on materials is part of the yard’s overall profit plan, along with the markup on labor. Remember, the yard’s goal is, understandably, to make a profit and that’s their incentive to work harder and smarter. Expect to pay the markup provided it’s not exorbitant. It typically ranges from 10 to 40 percent, depending upon the product or part.

This concept of carrying out work and being paid for how long it takes, however long that may be, often referred to simply as T&M, is well entrenched in the marine industry. Many boatyards prefer to work using this approach. When I discuss this concept with managers and yard owners the refrains are familiar: “T&M is safe,” “We can’t get burned because you can never tell how long a repair or project is going to take,” “Every boat is different so you have no idea how long it’s going to take,” and so on. The notion is that most undertakings of the marine service and repair variety are such an incredible shot in the dark that no boatyard would dream of any billing approach other than T&M. With this approach risk is minimized, to the boatyard. The boat owner has no idea how much the project is going to cost and in many cases the boatyard doesn’t either, or at least that’s what they believe. Those who have read my columns and attended my lectures on this subject of what’s expected of marine industry professionals know my thoughts—it’s balderdash. Thankfully, there is an alternative, fixed price quotes or fixed margin estimates.

Quoting is just that, a quotation for a specific project, repair, refit, or upgrade and it’s a game changer, offering clear advantages to both you and the boatyard. For you, the consumer, it affords you the opportunity to consider the proposal as well as comparing it to those provided by others. You can also plan and budget for the project secure in the knowledge that the price is fixed.

Those who work in boatyards that do not offer quotes are no doubt thinking at this point, “What’s in it for me? Sounds like a lot of risk and no benefit.” Rest assured there are a number of strong incentives for a boatyard to adopt the quoting process. I’ll detail just a few here.

First and foremost, when a boatyard provides you with a quote they virtually eliminate the possibility of incurring a billing dispute, which always improves customer relations and loyalty. There’s nothing less pleasant for both boat owners and boatyards alike than dealing with a dispute over how much a project has cost or should have cost. With a quote you know the price before you agree to proceed, so there’s little to argue about.

Second, when a boatyard takes the time to quote a project for you they are forced to think through every foreseeable, and perhaps some unforeseeable, steps in advance. This equates to better planning, better efficiency, and by default it establishes a timetable, which improves the yard’s scheduling and allows you to make plans based on a completion date. This planning nearly always benefits the yard as it enables more effective scheduling, which translates to satisfied customers, which in turn will generate more customers.

Finally, because it’s a quote rather than T&M or a not-to-exceed protocol (“not to exceed” means the cost of the project cannot go beyond an agreed upon figure—it places all of the risk on the boatyard with none of the reward and I would argue that while it’s bad business for them, it’s not harmful to the customer), the primary benefit to the boatyard is that the profit margin is not only fixed, there’s also an incentive to work more efficiently and more intelligently. The yard is rewarded for its experience, homework, and good management of the project. If the project is completed more quickly than anticipated the yard is, once again, rewarded with higher profit margin. If, on the other hand, the project takes longer than anticipated, the yard absorbs the loss, so there is risk, but so too is there reward. This is in stark contrast to T&M work, wherein the longer the job takes, irrespective of efficiency, the higher the bill. I eschew this approach in that it is inherently flawed; the longer the job takes, the more money the yard makes (albeit at a fixed margin and while taking up space and resources that could be dedicated to more profitable work), thereby rewarding inefficiency.

When I hear that a boatyard won’t quote a clearly quotable job I have two thoughts. The first is, there’s always a fear of the unknown and most boatyards, when they do undertake quoting, are much better at it than they believed they would be. It takes some practice, implementation of a quoting program, and employee education; however, it’s clearly doable. As mentioned earlier, other industries use this format with great success. The marine industry should be no exception. The second is, these folks do this work every day, day in and day out, for years and the collective wisdom of some yards is often vast and spans many decades. If they can’t tell you how long it will take and how much it will cost to carry out routine projects, I’d question their ability to undertake the work altogether.

Based on my experience, when the folks carrying out the project know it’s quoted, they tend to work with a greater sense of urgency, particularly if the management invests them in the quoting process, as they should. If you know what to look for, you can often spot yards and individuals who rely on the quoted project approach—there’s significantly less idle chatter, less standing around, and, my personal pet peeve, no waiting by the time clock to punch out.

Having made the case for quoted rather than T&M projects, it should be made clear that not every job can be quoted. Mechanical and electrical troubleshooting, for instance, is not the type of task that any experienced professional would or should quote; however, it does pay dividends for you to ensure that the folks carrying out the troubleshooting are experienced, well trained, and ABYC or NMEA certified where applicable. In this case, efficiency rather than a fixed price is the goal. Small projects are also typically not quote-worthy. Remember, the yard has to spend time researching and preparing a quote and it makes little sense for this to be done on a job that’s anticipated to take just a few hours.

Projects that do lend themselves to quoting are, among others, hull and deck painting, varnish, electrical upgrades, hardware and equipment installations such as windlasses, generators, and particularly, complete vessel refits. Expect a reasonable amount of caveats with any quote. (When I wrote quotes as a boatyard manager I was careful not to include too many exclusions, doing so negates the value of a quote). If a boatyard drills into your deck to install a radar mast or winch and the bit pulls up sodden, rotten balsa core, expect the quote to be amended. Every eventuality can’t be anticipated. My expectation is that those that can be anticipated, should be.

MAINTAIN A HEALTHY RELATIONSHIP WITH YOUR BOATYARD

There’s an easy way to avoid misunderstandings and disputes and it involves the simple act of placing all of your thoughts and communication with a yard in writing. Avoid stopping yard employees midstride and dictating work requests or modifications to current projects verbally. You should only be making these requests to those that are authorized to take them, managers and service writers for instance, rather than those carrying out the work. They’ll simply have to relay your request, maybe, to a manager, where it may get lost in translation. Be sure to follow up requests with an email or written document reiterating your thoughts.

If your vessel is in the midst of a refit or major undertaking, engine replacement, re-wiring, paint job, etc., it’s reasonable to expect weekly updates. Smaller projects may require you to request an update. All reports and updates should be received in writing. You should also be welcome to visit the yard during any repair, refit, or service work; however, remember that whether the project is quoted or T&M, time is money and if you stop in and chat with the folks doing the work you are costing either them or yourself money. It’s best to keep your time speaking with hourly workers to a minimum. Managers, on the other hand, should give you as much time as you need without incurring charges.

If scheduling is important to you, and it should be because projects without schedules often languish, then you should have this discussion with a manager before making a commitment to proceed. Part of that discussion should include the yard’s protocol for dealing with projects that fall behind schedule. When dealing with a boatyard, there are few things worse than finding out your boat won’t be launched and commissioned the day before the scheduled departure date. Depending upon the size of the project, the yard should be able to give you ample warning should it appear that work will not be completed on time, and the larger the project the more notice you should be given. Make this expectation clear; that bad news about a blown completion date will be much more readily accepted if it’s provided well in advance. In my opinion, most projects should operate on a schedule and every project should have a clearly defined anticipated completion date. I routinely implore my clients to avoid ever using the words “there’s no rush” or “work on it when you have time, between other projects.” Simply put, projects without schedules frequently fall by the wayside.

Finally, for especially complex or large projects, you may wish to call on the consulting services of an outside, independent expert who has no affiliation with the yard, a surveyor, naval architect, equipment vendor, or manufacturer for example. Squared away yards that are confident in their work should have no problem discussing a proposed project or having another professional inspect their work. Again, if you have any intention of doing this, it’s worthy of discussion before the project or repairs begin.

Remember, you are the customer; you have the power to effect change, to transform your yard and contractor. The questions you ask will very likely catch them off guard; however, those that are savvy and willing to work to earn your business will take them to heart and respond positively. Those who fail to do so don’t deserve your business. On more than one occasion I’ve advised my clients to halt a large project in the early stages and move the vessel to another yard. The signs were clear: poor communication, incorrect invoices, an unwillingness to quote quotable projects, and an inability to carry out work in a professional manner to accepted standards and/or in accordance with equipment manufacturer’s instructions. In my experience, such scenarios rarely progress from bad to good, so don’t ignore the warning signs. By asking the right questions up front, you’ll avoid ever having to move to another yard mid-project.

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