Marina Fees Offer - September 2020 payment for 2021/2 . What is driving this?

RIBW

Member
Joined
20 Jun 2005
Messages
744
Location
South West
Visit site
I have received an interesting offer. If I pay my 2021/2 marina fees before 30th September they will be at this year's rate.

What is behind this ?

Is it to secure customer numbers, because of an imminent price war as a result of Covid, which would cause people to leave and berth elsewhere?
Is it to put cash in the bank (effectively a loan) to secure retention of their workers through the worst of Covid ? [A 'good thing' - the staff are all excellent].
Is it something totally different?

(Unless the accounting rules have changed since I was concerned with these things, they can't legally recognise any of this money as revenue because it is not revenue until it is 'earned' which can't be before April 2021.)

I was asked in another recent PBO post "What is my concern". My reply here would be the same - my concern is my ignorance.

Are there any insiders with insight?
Cheers
Bob
 

BabySharkDooDooDooDooDoo

Well-known member
Joined
9 Jun 2009
Messages
8,302
Visit site
I have received an interesting offer. If I pay my 2021/2 marina fees before 30th September they will be at this year's rate.

What is behind this ?

Is it to secure customer numbers, because of an imminent price war as a result of Covid, which would cause people to leave and berth elsewhere?
Is it to put cash in the bank (effectively a loan) to secure retention of their workers through the worst of Covid ? [A 'good thing' - the staff are all excellent].
Is it something totally different?

(Unless the accounting rules have changed since I was concerned with these things, they can't legally recognise any of this money as revenue because it is not revenue until it is 'earned' which can't be before April 2021.)

I was asked in another recent PBO post "What is my concern". My reply here would be the same - my concern is my ignorance.

Are there any insiders with insight?
Cheers
Bob

Is you marina part of the 'boatfolk' group?

Assuming it is then they have been offering this arrangement for at least 5 years. In the past they have also offered to freeze the price for two years but it seems this year one would get a meal out instead.
 

Sandy

Well-known member
Joined
31 Aug 2011
Messages
20,805
Location
On the Celtic Fringe
Visit site
Accounting rules are accounting rules, my wife is a member of two accounting institutions, and are there to give accountants things to do.

Its a simple marketing ploy. Give us your cash now and you might save a few % or keep it in the bank at almost 0%.

2021 will see me being pretty mobile, COVID allowing, and I'm about to write to my current marina to discuss options.
 

BabySharkDooDooDooDooDoo

Well-known member
Joined
9 Jun 2009
Messages
8,302
Visit site
What would be your saving be if you agree?

Assuming I have correctly guessed the OP's marina group then I would assume somewhere between 3 and 5 percent.

Next year's rates (April 2021 onwards) are not usually announced until the New year but in the last couple of years there has been a very modest discount for settling up by the end of January
 

newtothis

Well-known member
Joined
28 May 2012
Messages
1,480
Visit site
Assuming you have to pay £5-6k that you would otherwise pay next March? But you pay it six months early. You lose the opportunity cost on £6k for six months. At current interest rates, no big deal. If you pay later, you pay anyway, plus whatever inflation they've added in, probably well above what you could have done in the intervening opportunity.
But otherwise, yes, they transfering their cash flow issue to your cash flow issues.
 

MoodySabre

Well-known member
Joined
24 Oct 2006
Messages
16,824
Location
Bradwell and Leigh-on-Sea
Visit site
A friend who has a business was offered an unsecured loan from Lloyds of £50k interest free for six months. He took it but hasn't had to use it. Perhaps the marina has taken a loan but used it and now has to repay. Borrowing from berth holders to repay the bank?

(Not actually borrowing from berth holders but getting receipts in advance).
 
Last edited:

RIBW

Member
Joined
20 Jun 2005
Messages
744
Location
South West
Visit site
Yes, it is Boatfolk - I didn't mention their name because my question was totally founded on my curiosity: Why September not January as previously? (I've always taken the 'End of January' type of offer previously anyway).
Thanks for all your thoughts
Bob
 

RIBW

Member
Joined
20 Jun 2005
Messages
744
Location
South West
Visit site
If you're tempted by it, be sure to pay by credit card so that, in the event that the marina goes bust, you'll have some redress.
Good point!

However, and I should rein in my curiosity, what happens if any marina goes bust? Has it happened?
Bob
 

newtothis

Well-known member
Joined
28 May 2012
Messages
1,480
Visit site
I suppose that in a worst-case scenario a new owner would take it over and could ask you to pay again as you don't have a contract with the new owner. You would then be an unsecured creditor of the bankrupt previous owner. I can't imagine either situation happening. A new owner wouldn't want to piss off its entire customer base and potentially have to replace them all.
It is more likely it would be sold as a going concern, with contracts transfered.
 

BabySharkDooDooDooDooDoo

Well-known member
Joined
9 Jun 2009
Messages
8,302
Visit site
Yes, it is Boatfolk - I didn't mention their name because my question was totally founded on my curiosity: Why September not January as previously? (I've always taken the 'End of January' type of offer previously anyway).
Thanks for all your thoughts
Bob

There had been similar questions on the MOBO forum where members were resident to marinas new the larger group 'boatfolk' group but I assumed the September offer was a regular thing for the original D&R marinas - it was usually mentioned in the blurb relating to their stand at the boat show.
 

SimonFa

Well-known member
Joined
25 Feb 2013
Messages
6,434
Location
Me North Dorset. Venezia in Portland.
Visit site
Yes, it is Boatfolk - I didn't mention their name because my question was totally founded on my curiosity: Why September not January as previously? (I've always taken the 'End of January' type of offer previously anyway).
Thanks for all your thoughts
Bob
Boatfolk has always linked it to the boat show that’s just been cancelled. The deal used to be pay at the show and get this year’s rate (they never announce next years first) and as Little Grebe said above, pay 2 years and get 5% discount.

My guess is it’s churn avoidance, we aren’t sitting around all winter wondering if we should move elsewhere. Cash flow is also a a big incentive over winter when visitor fees dry up.
 

wizard

Well-known member
Joined
24 Jan 2003
Messages
1,673
Location
Portland
Visit site
Well I have used this deal every year when offfered for as long as I have been with D&R and now Boatfolk. It saves me money - whats not to like!
 

Quiddle

Well-known member
Joined
26 May 2003
Messages
4,132
Location
Eastern Atlantic seaboard
Visit site
I suppose that in a worst-case scenario a new owner would take it over and could ask you to pay again as you don't have a contract with the new owner.


That's exactly what happened at San Adrian marina in Ria de Vigo, leading to all sorts of unpleasantness by disgruntled berth holders turfed out by the new owners. No way I'd be paying upfront for any service in the current climate where purportedly reputable companies simply ignore the law when it comes to the crunch. Just look at the flight refund debacle.
 

cpedw

Well-known member
Joined
1 Jun 2001
Messages
1,254
Location
Oban
Visit site
Yes but, under the rules I had to go by, it would effectively be a loan (see above) until it was earned starting in 6+ months time.
Bob
What difference would it make to how the marina can spend it if it's called a loan (interest free) or something else?
 

Bluetack42

Member
Joined
7 Apr 2020
Messages
43
Visit site
The primary reason looks pretty clear to me, its the same explanation as to why any company does what it does, the incentive arrangements of the top Executive team & especially the CEO.
I am the Chair of the Remuneration committee of a FTSE PLC and see at first hand how the bonus & long term incentives (LTIPs) we put in place drive the behaviour & decisions the Exec team make, hopefully but not always for the good of shareholders.

Private companies, especially those owned by private equity funds have a stronger interest in cash flow & less interest in reported profit than listed companies, so it would be quite normal for the CEO to have such an incentive, for either annual bonus or LTIP.

For example he could be looking at the last year of a 3 year LTIP which required a cumulative cash delivery of X by 31st Dec, if he hits the target he gets a payment of 4x salary, miss it........Bringing forward annual fees will help a lot, of course doing so will hinder the next 3 year cycle but he may have already determined that due to Covid/forthcoming recession this is so far under water that it will never payout so he’s abandoning it, brushing off that CV for his next move.
 
Top