Superyachts

Ahead of Quaynote`s Opportunities in Superyachts and Opportunities in Business Jets online conferences next week, we wanted to know what business leaders really think the future holds.

What do Industry CEOs Think the Future Holds for their Businesses

When over a hundred industry leaders gathered virtually for Quaynote`s online conference, The Future for Superyachts, Business Aviation and Luxury Property, the impact of COVID was, not surprisingly, the hot topic for discussion. The conference took place on the last Friday in September, when many of us would have, under normal circumstances, been juggling party invitations at the Monaco Yacht Show.

The impact of the pandemic on live gatherings such as MYS has been quite stark, especially in industries where face-to-face networking is seen as all-important. But behind the scenes of suspended travel plans and canceled shows, what is the reality that superyacht, business jet and luxury property companies are now facing, during and post-COVID? And what does the future hold for them?

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Future of Superyachts

As the COVID-19 pandemic started sweeping around the globe earlier this year, many of us in the events business feared that we’d have to postpone our conferences and shows until the autumn of 2020. Knowing what we know now, that view seems almost naïve as one by one, the annual shows that for many of us form a big part of our working lives have been cancelled or “postponed”, leaving event planners staring at gaping holes in their 2020 calendars.

The Monaco Yacht Show, METS, the Cannes Yachting Festival, EBACE and NBAA have all been cancelled this year. Despite the speculation and, at times, controversy that has surrounded these decisions, the prevailing sense is that the organizers had no real choice but to pull the plug. At the time of writing, the Fort Lauderdale International Boat Show (FLIBS) is due to go ahead on 28th October to 1st November, with the show`s website stating that “Social distancing of 6 ft will be maintained at all times” with exhibitors required to practice “increased sanitation throughout the day with deep cleaning and disinfection”.

The wisdom of going ahead with a large-scale event in the midst of a pandemic is one thing. However, with the virtual world stepping up to fill the voids created by COVID-19, many are questioning the future for the plethora of yacht shows, air shows, conferences and other events that make demands on our marketing budgets and travel schedules year-round.

Will the pandemic do irreparable damage to industry shows and events, forcing some to scale back or even vanish completely? Or does the impact of COVID serve to highlight underlying problems that may already existed, with even the most popular shows?

There is undoubtedly a groundswell of opinion that views boat shows as too expensive, especially when compared to the returns they may offer visitors and exhibitors. The mounting prices for visitors to the Monaco Yacht Show has led to a kind of black market for tickets, with potential visitors seeking free tickets from exhibitors. Many make the decision to stay outside the show perimeter and arrange meetings in the many pleasant cafes and bars that surround the port.

Show organisers may reasonably point out that decisions to raise the ticket prices are in response to exhibitor pressure to make events more exclusive. The desire to ensure that visitor profiles match exhibitor requirements is keenly felt. “One of the key issues is that the objectives of most boat show organisers are not aligned with the objectives of their exhibitors.” explains Patrick Coote, Chief Marketing Officer and Head of Northrop & Johnson Europe “Whilst exhibitors want to create the optimum buying environment and buyer experience in order to facilitate yacht purchases, show organisers are often focused on selling more space to more companies and more tickets to more visitors. There is a complete disconnect.”

For brokers at least, it is all about creating the optimum environment for the prospective Owner. What should an ideal day at a show look like for the billionaire who interested in buying a yacht? As one leading broker told me, a day that starts with finding nowhere to park and continues with being jostled by crowds at a packed show, is not conducive to making a large, luxury purchase.

The mismatch between the needs of exhibitors and show organizers has prompted some to create their own solutions. In 2018, the Leading Yacht Brokers Association (LYBRA), launched The Superyacht Show at Port Vell, Barcelona as an “alternative to the traditional trade show”. This event focuses on showcasing a high-end fleet of yachts available for sale and charter with just a smattering of hand-picked luxury lifestyle brands such Boeing Business Jets, Credit Suisse, Pommery Champagne, Triton Submarines, Bulgari Jewellery, Mandarin Oriental and Aston Martin.

The desire for exclusivity, however, is not the only driver in determining the transformation of events and shows. Along with moves to launch smaller, more segmented events with higher barriers to entry, there is also a bigger factor at work.

In industries that rely heavily on personal contact and networking to develop business, the internet has nonetheless filled some of the void created by the cancellation of superyacht and business jet events. The pandemic era has seen many industry conferences cross over to virtual format, not to mention the slew of webinars organised by trade journals cropping up with impressive alacrity, barely days it seemed after lockdowns were announced.

As technology platforms like Zoom have entered the popular lexicon, they have enabled event organizers to provide attendees with an experience that looks very similar to a live conference – at least on paper. Panel discussions, audience questions, recorded and live presentations, break-out rooms, polling, sponsorships and even virtual exhibitions can all be done convincingly online.

In the straitened times that many of us now face, the cost saving made in eliminating travel and accommodation costs represents a big plus for online events. Even so, when the pandemic is behind us at some point in the future, will the accelerating growth of the internet replace the need for travelling to international events?

“The COVID-19 pandemic has stress tested every area of life as we knew it, and, where industry shows in particular are concerned, questions have been raised about when and how we return to business as usual, or whether there is any future for them at all,” says Dominic Bulfin, Associate Director at superyacht and luxury asset law firm Bargate Murray. “In my view there is no doubt that industry shows provide a valuable space for commerce, marketing, and building relationships with colleagues and contacts from all over the globe.”

Nevertheless, as specialist VR technology enables multi-million dollar yachts to be sold “sight unseen” to buyers whose only viewing of their purchase is via a virtual showing, might future Owners decide increasingly to buy from the comfort of their homes? What’s more, with companies who have hitherto invested heavily in industry events now reporting an increasing spend on digital marketing, might show organisers start feeling the pinch, as marketing budgets are diverted elsewhere?

For many years, it seemed that yacht shows, despite the impact of the internet on other industries, continued to flourish in this luxury sector where face-to-face networking is seen to be of paramount importance. It seems unlikely that this way of doing business will change completely, at least in the immediate future. What does seem clear, however, is that the number and type of shows appearing every year must and will change.

“This is certainly not the end of industry shows, but an opportunity to reassess what is important,” sums up Dominic Bulfin. “How they should be organised, and how many we really need in the calendar for the model to remain viable.”

Wine and food provisioning do not receive a lot of airtime at superyacht industry conferences or in editorials. Yet, it’s an area which, for the owner or charterer, can make a significant difference to their enjoyment of the entire superyacht cruising experience.

Of course, employing top chefs to cater for guests’ culinary needs goes a long way towards ensuring that food and wine served on board are well-received. But what else should you know about successfully provisioning a superyacht? And how does yacht provisioning differ from other environments?

For yacht provisioners, a grasp of complicated logistics, minute forward planning and a far-reaching network of suppliers are their key concerns, especially when supplying yachts bound for remote locations.

Some, like specialists Provide and Supply, use key cities such as Amsterdam, Paris, London, Brussels, Frankfurt, Hong Kong, Santiago, New York and Miami as primary hubs for consolidating expediting complex requests.

“We can supply you with blue lobster from Normandy in Antarctica, Patagonian toothfish (Chilean Sea Bass) in the Maldives or simply 100 kilos of potatoes for a crew of 50” states Greg Mikusinski, the Founder of Provide and Supply, a company dedicated to yacht provisioning. “There is no ingredient we cannot find or any destination we can’t reach between our network of Michelin starred chefs, suppliers and logistics partners around the world.”

In addition to a steady and consistent supply chain, provisioners need an understanding of trade agreements, international air transport conditions and unique customs procedures for foreign flagged vessels. Not being aware of the kinks in the logistics chain can disrupt a fast and safe delivery. For example, if your overseas provisions arrive on Friday they are likely to languish in the port of entry until Monday, as customs generally don’t work at weekends. Perishable provisions sent via courier to remoter areas may suffer a worse fate, as most international couriers do not serve these regions or they don`t have the cold storage facilities required.

For Carlos Miquel of South American Superyacht Support (SASYSS), the complicated logistics involved in ensuring that supplies arrive at the yacht on time and in good condition can be onerous. “It can be a very long way from farm to yacht table!” he points out. The solution can be to encourage chefs to consider serving local and possibly less well-known foods. Miquel recommends hiring a local guest chef or taking a leaf out of his company’s book by complementing regional foods with local high-end Chilean wines.

SASYSS sometimes arranges for chefs to visit central markets and stores in cities such as Patagonia or Santiago to see what is locally available and to check that these supplies meet the right standards. The difference in quality between locally sourced foods and those that have been through an extended transportation and cold storage process is easily discernible. What’s more, the benefits in terms of supporting domestic suppliers are gaining importance as the yacht industry seeks to reduce its carbon footprint.

Of course, chefs must be mindful of not upsetting guests who prefer to stay within their culinary comfort zones and whose default position is to go with dishes they know. Researching well in advance the dietary needs and preferences of guests avoids these kinds of gaffs and means that the right provisions can be planned and purchased.

This is especially important in more remote areas, like Antarctica, where weather conditions can delay itineraries. In these challenging circumstances, Carlos Miquel tells us that it is down to the chef who needs to “plan for extra provisions, so the guests don’t end up eating frozen dinners or peanut butter sandwiches!”

So, what makes provisioning for yachts so different to other land-based environments? The specific nature of yachts means that planning food and wine supplies can be a daunting task. For explorer yachts heading off to remoter destinations, the need to plan for a long period ahead can pose a considerable challenge to chefs and provisioners alike.

There will almost certainly be no or limited opportunities to shop locally en route. “They need to plan well to have at least 10-14 days of provisions for guests and maybe even longer for crews, depending on arrival/departure points,” explains Miquel. “Chefs don’t have the luxury to go shopping if they run out of an ingredient, or change their mind on what to serve,” he concludes.

Furthermore, with many yachts having limited space on board for cold/freezing storage, chefs have to pull off a skillful juggling act between using foods that are perishable, cold or frozen and non-perishable foods. As yachts go further afield in the quest for novelty and adventure, the prevailing view is that provisioners must learn to adapt to the changing demands of owners, charterers and, by extension, of crew. Greg Mikusinski points to the necessity for greater storage on board yachts bound for remote destinations or “a consistent supply chain to areas lacking cold chain options.” An enhanced emphasis on freshness during the selection process also eliminates the need for regular “top-ups”.

With so many moving parts, successful provisioning requires an eye for detail. The provisioner will often need to co-ordinate the timing of a shipment to exactly the right day – or even the hour – that the provisions need to be delivered.

And as you might expect, the business of supplying a superyacht with food, wine and of course, fuel is also expensive. Is cost a key component of provisioning? “Depending on the complexity of the logistics, there is also a cost aspect involved,” remarks Carlos Miquel. “But for some yachts for certain things, cost is not an issue!”

Although price is important, provisioners emphasize that the level of service, expertise and quality are what counts in building their reputations. “Of course, price is important and we therefore source our products through our multinational partners who have big purchasing power,” explains Andrew Azzopardi, General Manager at No.12 Fine Wines & Provisioning. The key to sourcing fine wines, however, is authenticity. “It is our job to take the provenance of each and every wine seriously,” he states.

Based in Mallorca and Malta, both significant yacht hubs, the company has recently added gourmet foods to its repertoire. When asked what is important in his business, Azzopardi was clear. “Our people are available all times and… we go the extra mile to help out with any problems, even when not wine/food related. It is the passion for work that has made the team successful.”