Wednesday, May 27, 2015

What flats skiffs cost to build and sell

This post is not a tell all expose of the behind the scenes scheming of flats boat builders trying to get rich. It's just my way of trying to show you what things cost and how and why some skiffs cost what they do. With my basic information presented here you can go and look at your skiff or any other and add up the numbers to get a good idea of what it's original cost was, is and where all your hard earned money is going.

To save you the time of reading the rest of this I will give you in site right now as to why so many skiffs cost what they do, it's very simple, "because the market will bear it". 

The first thing you have to know is what the materials cost the builder. If you build lots of boats then you can get a slightly better discount on goods bought wholesale from either the manufacturer or the vendors that buy in bulk and resell to you. Most flats skiff builders are building a small amount of boats a year. Less than 200 is the norm. Small shops maybe 30-40 a year. The difference between these two shops will differ in buying power by very little between the two. The smaller shop will have smaller over head verse the big shop with employees and all that goes with size. So if a small time builder is producing 20 skiffs a year with low overhead but is charging the same or more than the big shops the potential for profit by a per skiff basis is way more than the bigger shop. But that profit is limited to 20 skiffs so the bigger shop can be way more profitable in the long run. 
I will be describing here a materials list that will fit any of the top end skiffs I built in 2000-2001 from 16'-18'.The only real difference in cost will be the slight added amount of fiberglass materials for the slightly longer hull and the added length of the rub rail. All the hardware is the same for most all skiffs. The time difference to add this hardware to a 16' skiff verese an 18'er is nothing.
The fiberglass labor to build the bigger skiff comes to about 12% more.
All poling towers have the same amount of welds, bends, feet. That's where the labor comes in. Aluminum sells by the pound so you are only buying as a builder onces more. 
It's these little details that save the builder money.

The prices here are from 2001. Sorry but I'am not in the business anymore so you will have to add inflation to these past real costs. Anyone with time to spare can look up these costs today. I leave that up to you. This is easy, but the sad thing you will see Is the increase in skiff prices from then to now but your wages and buying power is not in line with this increase. That's just my opinion.

I will show a basic break down of one of my skiffs. I was going to print every last part down to the last screw and oz. of resin. Too long a list. But you will have to trust my list and numbers to get an idea of what's up.

PARTS AND HARDWARE
This is all the hardware, rub rails, electric wires connectors, cushions, battery's everything needed to put the skiff together.
$1,627.00

HYDRAULIC STEERING
This is what the whole setup costs including an Edson wheel.
$1,114.00

GELCOAT AND RESIN 
- 14 gals. For hull average
- 10 gals. deck , hatches
- 2 gals stringer
- 4 gals. Bulkheads
- 4 gals cockpit floor
- 4 misc, for tabbing in parts
38 gal total but will vary a bit between hull lengths by about 10-12%
$15.00 a gal. For vynelester resin= $570.00
GELCOAT 7 gals. For entire skiff about 5% difference between lengths.
$120.00

FOAM CORE
There are at least 10 excellent core brands out there to choose from. I always used either Dyvinycell, Kledgecell, or to me the best core, Corecell.
You have to add up the sq. ft. This is easy, just draw out the skiff as shown and add up the sq. ft.
- 180 sq. ft. Hull.       3/4"
- 108  deck.               3/4" 
- 42 floor                    3/4"
- 48 bulkheads.          3/4" and 1/2"
- 12 stern        3/4"   And  3/4" hard foam
- 4.5 tower lid.                  1/2"
- 3 misc. Deck supports. 1/2" 
- 6 rod racks                   1" hard foam
403.5 sq. ft. Core in varying thicknesses , densities.
- 7 gals bonding putty 
- 3 gals bonding resin used
$ 1,516.00 to bond core in skiff.

FIBERGLASS CLOTH, KEVLAR , CARBON FIBER CLOTH
Following is the layup schedule that I have used on most of the skiffs built during this time period. 
There have been variations due to the customer or what was going into the skiff but this Is my standard layup. It's very low tech and simple but becomes very high tech through the enginerring of how it's put together. Works very well building by hand layup all the way through resin spray out guns and using a Vacume bag to hold the core In place. But I feel you and I can build a superior boat by hand with a brush, roller, and bucket if that's all that's available. All the rest diffinitly enhances the skiff build but just go for a ride in one of my 32 year old skiffs. Still cooking along.

HULL LAYUP
- gelcoat.                           Let cure
- 3/4 oz. skin out Matt.      Let cure
- 1-1/2 oz Matt. 
- 10 oz. layer Kevlar cloth
- 1-1/2 oz. Matt.                  Above three all at once, let cure
- fill in strakes with putty, let cure , agitate hull skin for core bonding
- bond core. Let cure
- fair core , fill voids
- 3/4 oz. Matt.
- 7 oz. layer eglass cloth laid up with Matt all at once.

DECK, HATCHES, COCKPIT LAYUP
- gelcoat                          Let cure
- 1-1/2 oz. Matt.              Let cure
- bond core.                     Let cure
- fair , fill voids
- 3/4 oz. Matt
- 7 oz. eglass cloth, all at onces with Matt.

BULKHEADS
- one layer 7 oz. eglass cloth on bare core.

STRINGERS 
Depending on floor size, stringers vary a bit. Described here is a simple hat stringer. Some I use are shaped like an H. The core is doing all the work, the stringer is just to support the floor. If the deck and the entire skiff is bonded as a whole then you do not need lots of thickness. In skiffs that have their decks riveted on or screwed on then it's a whole other story.

- 2 - layers 1-1/2 oz. Matt with a 12" strip of Carbon unidirectional laid down the middle all at once.

- 40 yds 3/4 oz. Matt.
- 40 yds 1-1/2 oz Matt.
- 14 yds 10 oz. Kevlar cloth
- 32 yds 7 oz. eglass cloth 
- 12' Carbon unidirectional cloth 
 Material Costs total $ 615.00

TRAILERS 
Trailers vary in cost but have a very high markup from whole sale.
- $750.00 standard trailer
- $ 1,300.00 top of the line

ENGINES
All boat builders that have boat dealers can buy their engines from the manufactures if they can afford to be affiliated with them. That means you have to be able to have enough boats going out the door to be able to sell to dealers at a discount so that they can resell at a profit. 
If you can buy $100,000.00 dollars worth of engines up front then you get them for a great price. The deal is they go on the boat and boat dealer sells the boat and only he gets to do the warranty work or future maintence on it. As a builder once out the door it's out of your hands. Now as a boat dealer engine sales shop you can buy engines from the manufacturer but at not as great a savings. What the manufacturers do is give them rebates for every engine sold. Sell a lot of engines and you make your profit from this. 
What does all this BS mean, if you are a small shop what you do is find a motor dealer and get him to sell to you at just above his cost with him getting the rebate and you maybe passing the savings onto the customer. What you are really after is the boat sale with lots of options to install.
A Big foot Mercury 60 hp cost whole sale $ 3,544.00 with the prop costing $210.00 more.

Ok we now have some numbers to add up;
- $1,627.00 parts 
- $ 1,114.00 steering
- $ 570.00 resin
- $ 120.00 gelcoat
- $ 1,516.00 core and bonding putty
- $ 615.00 fiberglass cloths
- $ 750.00 trailer
- $ 3,754.00 60 hp Merc 

Total... $ 10,066.00 for the total boat cost in materials wholesale to get it out the door in 2000-2001.
Today if you mark it up by inflation standards my guess is that most every thing has gone up quite a lot.
I would mark this up 30% today. I still do boat projects so I see the costs rising. 
The thing you need to look at, ask yourself at this stage is, why is that boat that has no hatches, very little hardware, weighs so very little with a tiller steering cost so much?
You can see what the materials I have used. These same ones you can use today to build your own skiff. 
I will try and sess out this dilemma next.

You have all the materials you need to build a skiff in a pile on the shop floor. Now you need to build the dream skiff. Skiffs need a shop to be built in, people to do the building and all the stuff that goes with trying to sell your skiffs to the public some where out there.
This takes start up money. You will need cash to get your shop and build your plugs and molds and then your first hull. If you can do all the design work yourshelf, all the plug and mold work on your own and then build the skiffs on your own you will save a ton of cash. But you will only build a few skiffs a year. This I did in my early years making a living but could always see that if I could just build five times the amount I could then make a good profit. Thus in come the employees the added costs and so on.
By the time I sold out my share of Hells Bay Boatworks to my partners we were a well oiled machine with many boat models, a very low overhead as we owned everything built to date and only had the mortgage to pay and the standard cost of having employees. But as I've  already explained I wanted to go sailing with my family so I sold out. Best thing I did for lots of reasons.
The break downs of the rest of the skiffs costs are based on that time. Today they could be the same , way more or very little. Depends on how much your start up costs were-are and your current overhead. Buying a company and pouring tons of advertising money at it with all the start up costs can be earned back in the long run if done well and you have deep pockets or investors that have them to.
Everybody that I have ever worked for wanted a good return on their investment so have always been under pressure to get it right the first time.
Once you have your skiff built and know it's costs you can then set its price. With lots of similar skiffs about all claiming to be the greatest thing invented in the last few years you will have to decide where you will fit in this market. Having very high priced skiffs can make it very easy to get more for your skiff as the others have set the bar. There's nothing better than having a very well built, designed and known skiff that really performs with a great reputation to keep the hype flowing and the market value up. It's called marketing. But some might say it's also profiteering too. Well we'er talking about skiffs here not oil or food.

LABOR , EMPLOYEES, ugh
This is a break down of what I think your average hired fiberglass workers, riggers should take to build a skiff. I always think of the skiffs built to my designs and engineering at HBBWs as low tech - high tech. By this I mean that the employees building the skiffs were mostly people that wanted steady employment but had no knowledge of boats or boating or could care either. Just a job. But with the proper training and motivation you can get a great crew together to build a high tech boat. The high tech part of the building comes from the engineering of putting it all together. Today my guess is there are a bunch of younger people out there that want to be part of this industry so there's a better chance of getting people to move to the next level and be more well rounded so as to be able to do it all.
In rigging you have to get the crew to care for the boats so they will treat them like a favorite posseion.
Once you get them to see it your way and understand the value of what they are working on then your screw ups go away.
I have worked at every level of building boats hands on so I'am very familiar with all aspects of building from the drawings through sea trials. This has helped me tremendously in my career. The hours I show here can vary a bit but not widely unless you have very new, or very slow workers. If you are infusioning a skiff with high tech epoxy resin the labor is about the same or less with a crew that understands the process. The rise in cost is in resin only. But you want to put in all these new fancy cloth weaves that sound so great on paper. Not for me ! Waste of money. I feel all the hybrid Biaxells take up more resin, and are prone to high impact shattering because of the way they lay. An infused epoxy hull with these cloths having to be pulled and compressed over many tight lifting strake angles is a pain in the butt. As soon as your hull has been lifted out of the mold go and look at it to see all the little air bubbles and resin pockets in the cloth and Chines. But oh ! When we go to paint over all this you can fix it then. Not for me.
Ask your builder why a hull that is so light with so little resin used and so little cloth needed costs so much. Do the math, a 375 lb skiff can't have too many gallons of resin and cloth. The cores the same pretty much for all skiffs. 

TO BUILD A SKIFF -  THE HOURS
- sell skiff.                                                                 ? Lots 
- wax molds.                                                             2 days
- spray gelcoat all parts.                                            1 day
- skin all parts, layup all parts                                     2-3 days
- core boat - by hand , Vacume bagging, or infusion. 3-5 days 
-finish glass all parts.                                                  2-3 days                                                                                      
- remove parts, cut , trim parts.                                  2-3 days
- assemble boats from all parts.                                  7-10 days
- rig skiff, carpet, tower all hardware.                          3-4 days
- rig skiff electrical.                                                      2-4 days
- install motor, steering                                                2-3 days
- finish details, fix dings etc.                                        1 day

27 days x 8 hours a day = 216 hours to build, rig an average skiff as described without options.
39 days max worst case scenario. If this is happening you need to see what's up to get the hours down.
Let's split the difference on the two and end up with 280 hours to finish.
280 hrs. X  $ 20.00 US average wage cost back then = $5,600.00
Workers costs back then were from $11.00 an hour to $ 18.00 with most in the $ 13.00 an hour area.
The two shop foremans wages were more. The wages of the owners are included in my estimate. We had a health plan for all employees. We gave out bonuses every year to all employees.

Now take the two costs ;
$ 10,066.00 materials
$ 5,600.00 labor
= $ 15,666.00 
Now we have to add in the mortgage, building insurances, advertizing, extra employees like the secretary, alarm company, electric, waste disposal of acetone, lawyers, company trucks, inventory,
Future plug and mold building, tools needed, dinning out smoozing clients,and so much more. 
Yikes ! I'am so glad to be anchored here in the Leewards remembering why I'am here.

This is where in today's Internet world you can do very well advertizing through facebook, instagrame, and other venues for very little. You still will have to get someone to deal with this though. You won't have time as you'll be building and selling. Starting with a small shop building a very good designed and built skiff with a well controlled overhead with good employees should keep the costs of your skiff low. But with more models you need more room and more people.

To wrap this thought process up the average cost for a top end skiff out the door in 2000-2001 cost about $18,900.00 to $20,000.00.
For the simple bottom line skiffs they cost about $12,000.00 + -
When I started HBBWs with Hal and Flip the overhead was low, not many employees, very little advertizing costs, wages were low. As we got bigger so did the costs.
Now some of you will say " wow I paid way less". Yes but what I'am showing is for a wheel steered skiff with a rigged bait well. Tiller boats were less, side consoles a bit less than a center console and so on. 

The place where real profit lay was in the options list. This is stuff you don't want to give away with a standard boat so you put this stuff on the options list. The markup here is mostly profit. To builders this is where you get ahead in sales profit. This is where you hear all the crazy prices coming from.
I had many clients that wanted to see the sales ticket for the most expensive skiff built to date so they could figure out what else to order. These were always the worst skiffs as too much going on. But yes there was good profit there.

Simple open skiffs today with no floors and hatches that drain into the cockpit and tiller steered are very cost effective to build. Less parts and labor. Not much in materials for the hull and deck.
Building a one off top line skiff on your own today will take an amature about 600-700 hours to build and rig. A simple tiller skiff 250 hours less.
The material costs will be about $9,000.00 more or less without an engine for a top line skiff.
To build an all epoxy skiff one off will cost about $2,800.00 more in resin costs.
A 17' tiller home built skiff will cost in materials about $4,500.00
 I'am now back to what I said in the beginning of this , people buy these skiffs because they can afford them, because they have no time or skill to build their own or they make to much to stop and build their own. Because they like the idea of a well crafted product and the process of having their own boat built. They buy them because they can be way better at getting near fish than in the wrong skiff.
Lots of reasons. 

I have worked all over the place on many different projects for a days wages. The only times I made any real money were when I owned my own business, made a profit and then sold that business or land. 
Yes these skiffs can cost and some do a lot and can be worth it. Others are riding on the others backs and picking up sales by being a bit less in price. So look at what you are buying or lusting after.
I think for lots of guys out there it's time to clean out the garage and save a pile of dough and build your own skiff.
I would love to own a Finnish built Swan 42' sloop but the price tag is way out of my range, so I built my own boat and have been using it now pretty much non stop since 1999. 
  
Hope this helps















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