Everything you always wanted to know about yachting, but were too afraid to ask

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CNBC 22 July, 2021 - 11:57pm 51 views

Who owns Ben and Jerry's?

The CEO of Ben & Jerry's parent company Unilever sought to distance it from the ice cream maker's decision to stop its sales in occupied Palestinian territories. Unilever's CEO said Ben & Jerry's and its independent board had reached the decision on its own, which is in line with its 20-year-old acquisition agreement. CNBCUnilever CEO 'fully committed' to Israel business after Ben & Jerry's stops selling in occupied territories

Even with boat sales and charters booming, yachting remains an enigma for most people.

CNBC spoke with several yacht owners who agreed to answer all questions — with no topics off limits — about the yachting lifestyle and perhaps more importantly, how much it costs.   

Nim and Fabiola Hirschhorn are in the U.S. Virgin Islands aboard Luna, their 45-foot, 2019 Lagoon 450S catamaran. The couple operates all-inclusive crewed charters in the Caribbean.

Sophie Darsy and Ryan Ellison are in the Azores on Polar Seal, a 2007 Beneteau Oceanis 40 outfitted for ocean sailing. Several years ago, the couple learned to sail, quit their corporate jobs and now chronicle their life at sea.

N. Hirschhorn: It depends on a few basic parameters. Is the boat secondhand or new, what year was it built, is it a monohull or catamaran, is it an ex-charter yacht or has it always been privately owned … do you want to simply coastal cruise or do you want to cross oceans?

Luna was purchased new for $650,000; however, we know plenty of people who live on boats that were purchased for $30,000-$80,000.

On average, you can purchase a seaworthy mid-range 45-foot monohull that can sail around the world for $100,000 to $150,000 and a catamaran of the same size for around $250,000 to $500,000. Of course, there are boats at both ends of the spectrum and at every price point in between.

Darsy: The purchase price is only a portion of the budget you need to acquire a yacht. Once we took delivery of our boat, costs came faster than we knew! 

In the first three years that we owned Polar Seal, we spent at least $40,000 to equip her for cruising and ocean sailing, including:

If you want to buy a boat, keep at least 30% of your budget for maintenance, repairs and upgrades.

We also have annual costs for boat insurance (between $1,000 and $4,000, depending on location) and travel and health-care insurance when we are out of Europe ($1,500) as well as plane tickets to visit our families (around $2,000 per year).

N. Hirschhorn: Think about what it costs to live on land — what kind of lifestyle do you live? Do you like to eat out at fancy restaurants and buy nice things? Chances are you will do the same when living on a boat, which means that your lifestyle will often cost the same. Will you anchor — which is free — or stay in marinas? Will you be on a sabbatical living off savings or do you work along the way? Are you a family or a couple?

We have friends who lived aboard a 1984 47-foot monohull for two years with three kids. The boat cost $90,000 and they lived off $50,000 a year cruising the Caribbean and anchoring the entire time.

Personally, we live on about $100,000 a year. I know couples living on $1,000 a month, and families living on $3,000-$6,000 a month. It's not unusual in our community to hear that living on a boat and traveling the world costs less than living on land.

Darsy: In 2019, we spent the winter at a marina in Spain where we could benefit from an advantageous rate ($300 a month). But food was very inexpensive ($300 a month). We took advantage of our time at the dock to undertake some major boat projects and our maintenance budget went way up — $15,000 of upgrades over six months.

But we rented a car at virtually no cost thanks to a local deal, and our "fun activities" budget went almost down to zero, as we enjoyed inexpensive restaurants and bars with friends all over southern Spain.

In comparison, when we made a three-week detour to Bermuda, groceries and restaurants were very expensive. But, we spent those weeks on anchor and did not have to pay for a marina. We spent nothing on maintenance or repair. We spent the remaining weeks of that month at sea, and since we spent no money during those two weeks, we made our budget.

N. Hirschhorn: It is more complicated … some countries have their seaports closed for visiting yachts, and some ask for entry protocol that might include preapproval and quarantine for up to two weeks on board.

Some countries do not accept all nationalities and travelers from specific origins, which makes it difficult when we may have three to four nationalities on board. Other countries are welcoming only vaccinated travelers.

Darsy: The pandemic has made sailing between countries a little more difficult, but while our options were extremely limited in 2020, we have had much better luck in 2021.

Like the housing market, the boat market exploded in 2020 and 2021. It seems like everyone and their neighbor wants to buy a yacht … the prices have also increased in a way never seen before. Our boat has increased in value to the point that if we sold it today, we would not lose any of the capital we put in it.

F. Hirschhorn: There is no reason why children of all ages can't live on a yacht. There are many families living on boats on the water and they are usually very confident, intelligent and worldly kids who thrive in this lifestyle. In the Caribbean especially, there are hundreds of "kid boats" [boats with families living on them].

N. Hirschhorn: Yes, we have a few layers of service. We have cellular data service that can pick up a signal up to 20 nautical miles offshore. Since we usually sail between the Caribbean islands, we are usually always connected. We also have two other satellite-based systems with limited Wi-Fi, but coverage all over the globe.

Darsy: Nope! We only have Wi-Fi at port or on anchor, when we have a data plan for the country that we are currently sailing in. Out on the open sea, we have satellite internet that enables us to download weather forecasts and basic emails, but definitely not watch Netflix or listen to Spotify! 

Darsy: A lot of sailors suffer from seasickness, and I am particularly prone to it. The trick is to prevent it. Once the nausea settles, you can't get rid of it. 

N. Hirschhorn: No, we need to abide by local laws and customs; however, in the Mediterranean nudity is far more common.

Darsy: It isn't rare for us to be alone on anchor, off a desert island. No one is watching, so … 

N. Hirschhorn: Many ask us if we have a home on land. We love seeing the surprise on their faces when we explain that Luna is our home.

Darsy: All my friends have asked me if I am ever scared of encountering a storm or big seas that would capsize our boat, and honestly before we left, I was! 

But now I know we always leave port when we have a good weather window. In three years, 13,000 nautical miles and two ocean crossings, we've only sailed through gale-force winds once, and we did perfectly well.

N. Hirschhorn: Some people think that a yacht owner is a millionaire. We know many boat owners who are not wealthy at all. It's just a different lifestyle that comes with many bonuses, but also many sacrifices.

Darsy: People believe that we are very rich, that we come from wealthy families or that we make a lot of money. None of this is true. We saved a lot of money, made some sacrifices, and continue to do so … and we stay on budget. 

When we were employed full-time, Ryan and I brought home comfortable salaries, and we lived the "two income, no kids" dream. We now make less than half of what we earned then and live with half our old budget … but our lives are a lot richer.

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Unilever Chief Expresses ‘Full Commitment’ to Israel as States, Supermarkets Consider Action Over Ben & Jerry’s West Bank Boycott

Algemeiner 22 July, 2021 - 11:00pm

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The CEO of Unilever reiterated that the consumer goods giant remains “fully committed” to doing business in Israel following Ben…

Tubs of ice-cream are seen as a laborer works at Ben & Jerry’s factory in Be’er Tuvia, Israel July 20, 2021. REUTERS/Ronen Zvulun

The CEO of Unilever reiterated that the consumer goods giant remains “fully committed” to doing business in Israel following Ben & Jerry’s West Bank boycott, as US states and supermarket chains continued on Thursday to weigh actions to blacklist the brand.

The comments come three days after Ben & Jerry’s, which is owned by Unilever, announced that the ice-cream maker would not renew its license agreement with its current Israeli partner, saying that it was “inconsistent” with its values to sell products in “the Occupied Palestinian Territory.”

“This was a decision that was taken by Ben & Jerry’s and its independent board in line with an acquisition agreement that we signed 20 years ago, we have always recognized the importance of that agreement,” Unilever chief Alan Jope said during an earnings conference with investors. “Obviously, it’s a complex and sensitive matter that elicits very strong feelings. If there’s one message I want to underscore … it is that Unilever remains fully committed to our business in Israel.”

Jope said that Unilever has invested 1 billion shekels in Israel over the past 10 years and employs 2,000 workers in the country. The multinational corporation operates four factories in Israel, including a recent 35-million-euro investment into a new razor factory for Dollar Shave Club.

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“We are very active on the startup community and social programs in Israel” Jope added. “I can assure you it is not our intent to regularly visit matters of this level of sensitivity, it’s been a long-standing issue for Ben & Jerry’s. We were aware of this decision by the brand and its independent board, but certainly not our intention that every quarter we will have one quite as fiery as this one.”

Since the decision, a number of US supermarket chains have threatened to reduce their Ben & Jerry’s purchases or stop carrying the brand altogether. Texas State Comptroller Glenn Hegar began a process to investigate whether Ben & Jerry’s or Unilever could be added to a list of companies with which the state is prohibited to doing business, due to state legislation aimed at countering the Boycott, Divestment, and Sanctions (BDS) movement.

Israeli officials have said they would ask more than 30 US states to pursue application of their own anti-BDS laws against the ice-cream maker, including some that restrict state pension funds from investing in companies that boycott Israel.

Hegar today ordered his office to determine whether “any specific action has been taken by Ben & Jerry’s or Unilever that would trigger a listing under Chapter 808 of the Texas Government Code.”

The Texas Government Code 808 defines “boycott Israel” as “refusing to deal with, terminating business activities with, or otherwise taking any action that is intended to penalize, inflict economic harm on or limit commercial relations specifically with Israel or with a person or entity doing business in Israel or an Israeli-controlled territory.”

“Texans have made it very clear that they stand with Israel and its people. We oppose actions that could undermine Israel’s economy and its people,” Hegar stated. “I would also note that Texans have better options for a sweet treat this summer. Blue Bell was founded in Brenham, Texas, and, for my money, tastes much better than the stuck-up stuff made by a foreign-owned company started in Vermont.”

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Unilever looks to calm Ben & Jerry's row as it ramps up marketing spend

Marketing Week 22 July, 2021 - 08:28am

On an investor call today (22 July) detailing Unilever’s 2021 H1 results, the company said it had ramped up brand and marketing (BMI) spend by 80 basis points to the tune of €400m (£342m), after conserving spend in the first half of 2020 due to Covid.

“[We] lapped the conservation of BMI in the first half of last year, in response to the pandemic. We will see an unwind of this effect in the second half of the year, as we lap the period of strong brand and marketing investment in H2 of last year,” said chief executive Alan Jope.

The “lion’s share” of marketing budget went to media spend over ad production, and 40% of this was on digital, which chief financial officer Graeme Pitkethly said enabled Unilever to show “more of our wonderful creative to consumers, which is what really matters at the end of the day”.

If there’s one message I want to underscore on this call, it’s that Unilever remains fully committed to our business in Israel.

Unilever is in the process of doing a full media review of buying, something it carries out regularly to ensure it remains competitive.

“We think we buy very competitively and with these reviews of our media buying, which we do every three years or so, are to test that assertion by putting a competitive element into our media buying operation,” added Jope.

Following the move by Unilever-owned Ben & Jerry’s to stop selling the brand in Israel earlier this week, Jope was asked if having an active political agenda was the next step of its purpose-driven strategy.

But he stressed the decision to pull out of those territories was made by Ben & Jerry’s independent board and not by the FMCG giant. A condition of Unilever’s acquisition of the global ice cream brand in 2000 was that it kept its own board and certain powers.

“We’ve always recognised the importance of that agreement,” said Jope. “Obviously, it’s a complex and sensitive matter that elicits very strong feelings. I think if there’s one message I want to underscore on this call, it’s that Unilever remains fully committed to our business in Israel.”

Unilever has four factories in Israel and recently invested €35m into a new razor factory for its Dollar Shave Club brand. It has 2,000 employees in the country and has pumped billions of shekels into the Israeli economy over the past decade, he said.

Ben & Jerry’s said it would stop selling its products in the Israel-occupied West Bank and East Jerusalem in protest against Israeli policies of evicting Palestinians to make way for Jewish-only settlements, which the brand said was “inconsistent with our values”.

On the move, Jope added: “I can assure you it is not our intent to regularly visit matters of this level of sensitivity, it’s been a long-standing issue for Ben & Jerry’s.

“We were aware of this decision by the brand and its independent board, but it’s certainly not our intention that every quarter we’ll have one quite as fiery as this one.”

Unilever hailed its focus on “operational excellence” for driving a 5.4% increase in underlying sales during the first half of 2021, as group turnover hit €25.8bn (£22.3bn).

Turnover rose across all the company’s divisions during the first half of the year, with underlying sales growth up 8.1% in the food and refreshments portfolio and a turnover of €10.2bn (£8.8bn).

Sales growth rose by 4.5% in the homecare division, which achieved a turnover of €5.2bn (£4.5bn). It was a similar case in the beauty and personal care segment, which notched up underlying sales growth of 3.3% to reach a turnover of €10.4bn (£9bn).

In addition, Unilever’s ecommerce business grew 50% in the first half and now represents 11% of sales.

Chief executive Alan Jope says ecommerce will “clearly remain a key channel” after the pandemic, and is keen to bolster Unilever’s digital operations further in response to changing consumer habits.

Unilever cut brand and marketing spend in the first half as coronavirus restrictions hit, but as lockdowns ease it is planning to “invest heavily” behind its brands and innovations.

The FMCG giant revealed ecommerce sales surged last year, accounting for 9% of total sales as consumers were stuck at home.

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