The REAL Worth of a Scuba Dive Business

I have been in the tropical destination scuba diving business for 20 years now, and have been involved in owning, running and finally selling scuba dive centres, liveaboards and resorts.

I am writing this because it seems to be a recurring theme throughout discussions with new investors/entrepreneurs and business buyers into the Destination Scuba Diving Business. Many of these people have long diving history, thousands of dives, and are VERY successful business people in their “real lives’

It’s a mistake to base ANY company on only its tangible assets, scuba diving businesses especially. The size and success of a scuba business and the real profit comes in the high quality and ease of the lifestyle of its owners.

That is why 99% of all scuba business owners in tropical destinations are there.

They want to live the lifestyle on the island and dive whenever they want to.

I don’t know ANY liveaboard or dive resort or dive centre owner in any tropical destination who decided to start the business (or buy it) because it would give them the best ROI financially on their investment. (none of them have been THAT stupid, to put it bluntly). The diving business is not filled with MBA’s and business degrees, the people who are driven to those courses and degrees have other things that make them happy (I hope!).

Now that’s not to say scuba businesses don’t make good money. That would also be erroneous. Just that a high financial ROI of other businesses is not the deciding factor in choosing to join the scuba dive business.

The REAL profit from owning a scuba dive centre in a tropical destination (I can’t believe that I have had to persuade people of this!), is the life in the tropical destination itself. The second factor is the freedom to dive everyday if you want. (that last bit is VERY important!).

Location, location, location!

Most dive businesses consist of little more than a couple of compressors, a few boats, and few sets of scuba gear in the Asset Register. Maybe a building (that has been substantially adapted to the specialist business, and would require significant investment to convert to anything else!), maybe a vehicle or 2, maybe a wharf or dock on the ocean. Point being, if you add all these up on paper, it doesn’t add up to much at all in dollar amounts.

I see dive centres for sale listing all their “equipment” all the time on forums and websites, right down from having “2 dive boats” to having “16 pink snorkels”. Really? Does anyone really actually think that this kind of list in anyway values the dive business? Anyone in the dive industry just laughs at listing o-rings, snorkels, masks etc. We know how much we buy rental gear for, especially disposable items like masks and snorkels…

The value of the business is the BUSINESS itself and the lifestyle it will give the owners, and not a sum of its tangible assets. Or indeed of its financial balance Sheet or P&L. Now, to ignore the financials would be folly of course, but they cannot be the PRIMARY reason to buy any Small/Medium Scuba Business on a tropical island.

I also hear a lot about ‘growth potential’ in these discussions and sales negotiations. This has its pros, but also some major cons. To re-iterate why we all come to live in Paradise, we did not come hear to work like a work-mad entrepreneur, 7 days for years… We come to live “the life”. Therefore expanding the company to have 5 dive centres, may indeed not be a worthwhile goal, especially if requires more work from you (and lets face it, it WILL!).

You do not move to live in Fiji to work 7am-6pm, 7 days, 365 days a year in a job!

The dive centre will have many contracts and relationships with the resorts and hotels around it that will have taken years to establish. This is not do-able in a short period.

The real strength of the company comes in intangible assets that really cannot be bought any other way. Seriously REGARDLESS how much money you think you can throw at it…

The bottom line of the tropical dive business is the high quality and ease of life of the owners to live, work, dive and enjoy themselves on a tropical island.

The best dive businesses have long-term staff that do all the heavy lifting and grunt work, and leave the owners to manage as and when they choose. You do not want to need to be in ‘the office’ daily, regardless of how much fun it is the first few months. It is YOUR business, to supply YOUR lifestyle, Not a job you got in the tropics.

(side note if you do just want a job in the tropics, that’s doable of course. Head over to the PADI Employment Boards and see lots of jobs on offer. Again lifestyle being the driving factor, not earnings!)

Most of the tropical dive business unfortunately don’t ever achieve this level. The owners have effectively bought themselves or built themselves from scratch a “JOB”. And not an easy job by any reckoning. They are up at 6am in the morning, 7 days a week, 365 days a year. Days off? Ah yes they remember them in the “real world” they came from.

Even some of the ‘so called’ tangible assets such as the online assets and customer database are in reality a time-earned asset. You really can’t just throw a lot of money at a struggling or brand new dive business and VOILA there you go! These things take years to build up momentum, followers, trusted status.

To set up a new dive business from scratch is relatively easy if you have a wee pile of cash… Walk into BAUER or COLTRI, buy a compressor, find a boat owner, get a contract to use the boat for scuba diving, buy 20 or 30 scuba cylinders from Cramer Decker, and a few sets of gear from Scubapro. Et voila, instant dive centre? Not really huh? Now you have got yourself a small business with no history, no customer base, no hotel contracts. Then you have to work out all the places to source better (or more cost-effective) gear, work out the best way to maintain/repair the compressors when they need it (oh yes and where to get cylinders fixed in the meantime…)

SO for the next 5-10 years you will be working DAMNED hard to establish it, with all the struggles and set-backs of any SME except with the added risk and dangers of doing it in a foreign country. EEEK!. Mostly not what people are looking for in their “dream life on an island”. All too common though…

Now this “dive centre from scratch” sounds fun to some. And in Sydney or San Diego, I would probably have a blast at it myself. However we’re talking about a tropical island here, a foreign country, not our own country. Do you speak the language of this island? Do you understand the law (ALWAYS different from your own, believe me). Have you ever done business in, lets face it more than likely, a 3rd world country.

Face Facts

So the analytical way to look at this is to face facts.

You will be buying a dive centre in a tropical destination for 2 real reasons:

to live a high quality and relatively easy lifestyle in the tropics

to dive everyday, or indeed as often as wanted

Other reasons, that support the 2 primary ones above are:

to have a higher standard of living with the lower cost of living

to have more quality time with kids

do less housework and laundry

live the life, take some risks, and live free in the tropics!

Summary

So what IS the REAL worth of a scuba dive business… Same with every product, effectively it’s worth whatever the market is willing to pay for it.

But do not be fooled by thinking that any Seller is going to be shanghai’d with analysis of their Asset Register, Balance Sheet or P&L for the last year into making the business worth only a couple of thousand dollars for the “2 dive boats” and “16 pink snorkels”.

That analysis works when buying a run of mill business in the real world, but just doesn’t add up to the life on offer in the tropics.

Location, location, location!

Bottom line: the Buyer and Seller need to sit down over a bottle of wine or a cup of coffee outside the dive center (on location) and have an honest face-to-face discussion about the LIFESTYLE that is being sold. Without being on site, it is IMPOSSIBLE for anyone to judge the value of this.

(then you can do an analysis of the finances to see if the business can indeed support that lifestyle… another story all together)

And then negotiation on the price can begin.

How Do I Make My Holistic Business Pay?

There are far too many holistic practitioners doing amazing work yet still struggling to make a decent living and in this article I would like to help redress that balance.

More than anything at the moment the world needs skilled people with wonderful gifts who can help us heal and release all our baggage that no longer serves us sadly mainstream business is not set up to support such wonderful souls.

Firstly let’s set one thing straight, there are lots of people looking for the help and assistance that YOU offer.

The holistic world of coaching, therapy, healing and spiritual work has been very much a ‘cottage industry’ type of affair for the vast majority of those in the ‘industry for a long, long time. When operated in such a way it is difficult to connect with enough of the right kinds of people who desperately need your services and so many practitioners in this line of work just bounce along the bottom with far too few clients and little financial reward.

How do I know this you may ask?

It’s simple, I was one of them for quite a long time, Hypnotherapist, Theta Healer, Coach and barely making it work in any of them despite being good at what I did, getting great results and being liked by the few clients I did have.

The trouble was something was missing and I didn’t know what. I tried all kinds of thing and most of them cost me money sometimes an awful lot of money (advertising) and still I didn’t find it. Recognise any of this?

I loved what I did (helping people) and that’s why I became involved in this line of work after 20 or so years in the emergency services environment. However when you are running your own business the desire to help people and being good at what you do is simply not enough to make it pay.

Fast forward a few years now and frustrated I started to attend networking meetings hoping to pick up a few more clients, maybe even corporate ones and grow my business. Boy was I in for a shock! Although these events were civilised and the people were pleasant, I just did not fit in to this traditional business world and all attempts floundered amidst apathy and misunderstanding. At these type of events you do not have the time to educate others who are not on the same page as you, to what you do and how you do it.

It felt uncomfortable, awkward and like a fish out of water, the energy was different than in the ‘holistic industry’ and people seemed to take more than give.

This was at odds with what I had been used to where fellow therapists, healers and coaches would often give freely, or trade sessions simply to help a fellow practitioner.

This got me thinking, on one side you have often people following hard nosed business practices and getting results but in a way that felt totally at odds with everything I believed in energetically and spiritually. On the other side you have amazingly kind and gifted people effectively giving themselves away and struggling to make money. Surely there must be some balance to be had in the middle here where a Holistic Practitioner can have an effective business model, make money and still feel wonderful about it all.

Straight away I knew that this was what I was seeking, a way to make it pay yet maintain my values and integrity.

I had spent a lot of time in holistic / spiritual / coaching circles and I knew that I needed to see how ‘real’ businesses were run at a good profit, what strategies they used and what systems they had in place.

To this end I attended numerous business growth seminars, mastermind groups and boardroom strategy meetings, still feeling like a fish out of water yet now armed with my pencil and pad, with a mission to find what was missing.

I found it alright! after one boardroom strategy session with some business high flyers I felt lie I had been kicked and punched all day. They almost systematically disassembled my business piece by piece to show me in no uncertain terms that I in fact I did not have a business at all,I had a hobby with a business front on it.

Was that ever a shock and a huge hole in my pride, but get up and dust my self off I did and vowed to use the valuable insights gained to grow my business into a real business that paid me well, and yes in the ‘helping industry’ in these economically challenging times and with my values and integrity intact.

Fast forward again, I now have a holistic coaching / speaking business that I love, one that provides me with multiple streams of income, many of which I do not even need to be there to get paid and much of it runs on autopilot. Trust me on this, it is possible but it will not happen by accident, you will need to make the changes and in the remainder of this article I will give you the pointers, there is not room to give the full detail and if you want more detail just follow my links at the foot of the article.

  1. Firstly realise that there are two sides to the holistic business coin, the skills and attributes you bring to the business and then there is the business structure, strategies and systems themselves. (To be successful you need both).
  2. Assuming you are good at what you do and people get value from you, then turning it into a well paying business is a matter of following some simple tried and tested strategies (ones that work in the helping industry and feel good too)
  3. Sit down and write out your strategy for finding and connecting with your potential clients, this is a lead generation strategy.
  4. Consider how people see you in your field, or even if recognise you apart from what you offer?
  5. Do the same thing for how you can convert them to actual clients, a conversion strategy.
  6. Consider what you offer as your product or service, this is your value added proposition strategy
  7. Consider your customer retention strategy, how often do they buy from you?
  8. Think about how you manage your client database ( hopefully you have one) Customer Relationship Strategy CRM.
  9. How do you earn money in your business, do you simply sell your skills by the hour or do you have multiple streams of income through your business that allow you to make money when you’re not there and even while you sleep?
  10. Do you have an automatic referral system in place that generates clients for you like clockwork?

By taking the time to consider these ten points carefully and then measuring them against what you are currently doing I am sure you will be able to start making some huge shift in your business bottom line.

These are the factors I was encouraged into really thinking about, and when I did things began to change.

If you like what you have read here pop over to my sites listed below and help yourself to more great content there.

I wish you every success and remember the world needs your unique skills and abilities, it’s your job to let them see you!

Mark

Tools to Market Your Business Online Locally

Local search is an inexpensive way to get your business found by prospective customers. In the world of the online business, traffic to your website is the most valuable of assets. And in today’s tight economy, business owners are constantly looking for more efficient ways to market their products or services without breaking the bank. One of the most effective ways to market your business online is locally. People tend to trust local businesses more than they do, for example, one on the other side of the globe. Local marketing online is one of the most cost-efficient yet easy methods of which to market on the Internet. And because most companies already have a web site and a blog, local marketing is easier than ever.

Top 10 Tips for Marketing your Business Locally:

1. Merchant Circle – Claim Your Profile on Merchant Circle. If your business is not already listed on Merchant Circle, sign up and within 5 minutes, you can get your business more exposure on the Internet. Be sure to include correct and relevant information such as your legal business name, street address, hours of operation, and business categories. Categories are important because they help ensure your listing is found easier by searching customers. Add deals and promotions to your Merchant Circle listing. Deals include coupons, sales and offers and are a fantastic way to encourage browsing customers to visit your website.

2. Google Places – Claim your business on Google Local Business Center. In a previous blog entry, we outlined the steps necessary to get your business listed on Google Places for free. 97% of consumers search for local businesses online and because the power of Google, many of your potential customers could be looking for the products and services that you offer online at Google Places. Be there when they’re looking for you with Google Places for business. Again, this is a free local platform from Google.

Help your business stand out by adding photos, videos, and offers to show customers why they’ll want to choose you. Display special promotions, post live updates, and respond to reviews from your Places for business account.

3. Yahoo Local – Claim your business on Yahoo Local. Potential customers from your area visit Yahoo! Local every day and could be searching for your products and services. Yahoo Local is easy to setup and gives you the ability to add descriptive information about your business and upload images from your computer. It is simple to manage. You do not have to bid on keywords and you can edit your listing at your convenience, twenty-four hours a day.

These are the building blocks of getting your business found online. These top three sources of website traffic are easy to use and- best of all – they are free.

Next, we will detail some other strategies for building visibility to your business online. Some of them are free, and some of them require an initial deposit to get started. But all of these sources are excellent ways of which to build website traffic, which as we all know equates to more sales!

4. City Search – Add a Business Listing. If you cannot find your business and your business isn’t listed on CitySearch, you can add your business to their directory by completing this form. You need a CitySearch account to submit a new business to them.

5. Local.com – Add a Local.com Business Listing. Setting up your free Local.com business listing is quick and easy and takes just a few simple steps. Get started by entering your business information, preview your listing and edit it with details and special offers to enhance your visibility.

6. MapQuest – Promote your business with MapQuest. The MapQuest Local Business Center listing is free. You can add your business listing within minutes to MapQuest.com by creating a MapQuest Merchant Account. MapQuest powers local search for all AOL properties. You can also buy advertising on MapQuest that gets seen on Yahoo, Yelp and SuperPages business directories.

7. SuperPages – Also called SuperMedia – and is an excellent resource for business owners looking to gain instant access to the millions of potential customers that view the SuperPages business listings each month.

8. YellowBook360 – With a YellowBook360 listing, you are adding your business to one of the top 50 Internet properties on the web. Put your business in more places and reach more customers with YellowBook360.

9. YellowPages.com – The tried and true method of adding your business to the YellowPages is still a strong business strategy. YellowPages has re-branded their business and is now called YP.com, but make no mistake, this directory is still as solid a business investment as ever. Your business can advertise with premium ads and if you are just getting started or are on a strict marketing budget, YP.com offers free business listings.

10. Yelp.com – This website has grown into one of the fastest expanding user communities for reviewing and researching local businesses. Businesses can advertise on Yelp.com with any size budget. Yelp is an excellent website for advertisers to reach an actively engaged audience.

By incorporating each of these steps into your local marketing strategy, you can build a more successful business. Look at these steps and follow through with each one, as your budget allows, and in time you will see more traffic to your website, which will result in more business and sales.

Starting to get the picture? Yeah, you can build traffic, visibility and sales! Give yourself every advantage. Give yourself a better chance to achieve success on-line.

Oh, and don’t forget – go green with green website hosting.