The Buyer Journey: The true cost of ownership
Greater transparency about the ongoing costs of yacht ownership could optimise more buyer journeys from the outset…
It is often said that new entrants to the superyacht market should be made more aware of how much running, maintaining and operating their new yacht will cost. It is not that sums are exorbitant (relatively speaking), but that the subsequent running expenses may be interpreted as ‘hidden’ costs by owners who were not fully educated on the realities of ownership at the beginning of their buyer journey.
Educating owners on the true cost of ownership is the superyacht industry’s perennial ‘hot potato’. The industry remains frustrated by the disparity between the number of individuals that can afford to buy a superyacht and the number who actually do. And the chief source of blame for this situation is that too many potential advocates are not being given reliable information at the point of sale, regarding what the subsequent months and years will look like from an operational expenditure point of view.
The significant maintenance expenses of a superyacht can perhaps be one of the most surprising costs for inexperienced owners. “What I try to make a part of the Lürssen journey for our potential clients is to put them in a position to understand that, once you have acquired the right yacht, you have to be willing to spend your money wisely and properly in order to enhance the yachting experience,” explains Michael Breman, sales director at Lürssen. “At the same time, this will extend the longevity of your asset.”
“Once you have acquired the right yacht, you have to be willing to spend your money wisely and properly in order to enhance the yachting experience...”
The ownership structure – influenced by the location of the yacht, whether it will be operated commercially or privately, and its area of operation – will also impact ongoing ownership costs. “The choice of ownership structure and the funding of the corporate entity should be planned early, and documentation drafted,” adds Alasdair Milroy, CEO and founder of Breaking the Mould Accounting Limited. “This all needs input from the owner’s advisors, who understand their financial affairs and legislation in their country, their residence and their domicile. Some countries have wealth taxes and benefits in kind, which need to be considered in addition to the yacht registration and VAT payable on the purchase of the yacht.”
The recently-published The Superyacht Buyer Report provides a comprehensive reference tool for any client and their advisory team throughout the buyer’s journey. The report features 16 sequential chapters that outline this journey, with respected experts from every sector advising on best practice at each stage of the ownership process. The eighth chapter – ‘The true cost of ownership’ – provides commentary from respected industry stakeholders who outline the topic in the name of transparency.
To read a complimentary version of the ‘The true cost of ownership chapter in full, please click here.
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