Why does a yacht need a management company?
This is a usual question from potential clients. What does a management company do, why are they needed and what value do they add?
Factually speaking, any commercially registered yacht of 500 gross tonnes or above, requires an International Safety Management Code (ISM) compliant ‘Company’ holding a Flag State issued ‘Document of Compliance’ certificate to be contracted as the management company in charge of ensuring compliance with the ISM and ISPS Codes and Maritime Labour Convention. A sub-500GT commercially registered, or private yacht of any size, do not require this.
However, management is not only the management of compliance. It is also providing emergency support, guidance on local and international regulations, running accounts and finances, creating technical proposals and laising with third parties…..but we would say that, we’re yacht managers!
Therefore, we include below the quotes from some of the Captains and Engineers we have worked with, who are happy to state why it is that they like working with management companies such as West Nautical:
Giles Sangster – Master 3000GT
As the industry matures a strong management is ever more valuable. Most yachts don’t have internet, others that do, have limited access. By definition, yachts are frequently in the remotest parts of the world. The management company is a great means to access important information and refine it for the yacht. Fleet circulars, discussions, incidents, suppliers and itineraries, a great way to obtain the wealth of knowledge, a lifeline to other yachts and the real world .
You have to keep ahead of the ever changing regulations. MLC, ISM, STCW, Class etc., not to mention the owners requirements. The goal posts continue to change, and you can’t afford to fall behind.
You rely on the management to watch your back, pick up on the details, to send a reminder, find a temp crew.
A well-structured yacht needs well-established management team.
Björn J. Guðmundsson – Class 1 Chief Engineer
Working with a good management company gives me confidence in knowing that the vessel is operating safely and legally on all fronts as they reduce risks of any oversights. Having worked with both bad and good management companies, it is a great difference in the feeling of confidence when you know the management is actively monitoring the safety and the legality of the ship.
Management companies give us access to people who are often more knowledgeable than yourself on the rules and regulations, have has proven to be essential in the past. It is very useful when the management companies can share experiences from their other vessels, such as PSC visits and audit findings etc through fleet circulars.
It is also good being able to get second opinions on any challenges, ideas and procedures we may be experiencing onboard.
Jim Aladin – Master 3000GT
Working with a management company needs to be transparent and in conjunction with the Owner or Owners representative. If the three parties of Captain, Owner and Manager positively communicate, accurate and beneficial decisions can be made to the mutual benefit of all who are working towards the same goal, which is for the owner to enjoy the yacht as much as possible, safely, at the highest standard and at an acceptable cost / within budget.
An advantage of working with a management company is that the Owners often do not know yachting operations as well as a yacht manager or Captain, so management support to Captain’s requests often provides Owners with required assurances, supporting decisions.
Sometime Owners do not reply to requests or are not reachable when a decision needs to be made. At that time it is the Captain and yacht manager who can make it collectively, and the responsibility of this is not on a single person. The same situation goes for operational decisions which are minor, ensuring an agreeable decision being made, not having to affect the Owner, with the yacht and management sharing the responsibility.
Sometimes as a Captain there are topics you ca not discuss with your crew and it is good to have a yacht manager to discuss various options and ‘brain storm’ with in order to find the best solution to an issue or situation, before agreeing on a solution or recommendation to the Owner.
It is not possible to please all 3 parties 100%, but if they all work together, these moments should occur rarely.
Lee Douglas – Master 3000GT
The key advantages of working with a management company as I see them to my role as Captain are:
– Back up in financial matters especially safety concerns
– Guidance in budgeting and accounts
– Technical assistance when needed
– An extra person of contact when seeking urgent response
– Crew matters with hiring firing and discipline
– MCA and Lloyds guidance especially in major surveys