Creating & using comparable data for marinas

This article, by Dennis Kissman, was published  in Marina Dock Age - January 1995

Anyone who has tried to obtain statistical operating information on the marina industry realizes it is almost an impossible task. The marina industry is fragmented and usually suspicious of sharing any information.  Through the years, marina organizations and other groups have attempted to compile and publish comparable data, but have struggled to identify meaningful, accurate results.

As marina operators, MMS recognizes the importance of using comparative information as a means of measuring a marina’s performance.  Since there are no "industry standards" to compare results to, we establish our own historical data or goals to compare current results.  This article explores several of those strategies.

First, comparing raw numbers does not always provide accurate comparisons because there may be extraordinary factors that increase or decrease the amount recorded in a given period from year to year. Second, marina activity is heavily weighted to weekend boating activity.  For example, July may have five weekends to record income and expenses one year versus the next.  Third, weather has a big impact on marina activity.

You may be saying to yourself that the gathering of information is one reason we have computers.  We expect our computers to provide us with all the answers and we are quick to blame the computer when there is a problem with the results.  Unfortunately, a computer is no smarter than the person who operates it.  You must first understand what you are doing and why you are doing it.

First, set up a spreadsheet with 13-columns. List your account descriptions in the first column. Place the prior years numbers as reported in the second column. Review those numbers for any extraordinary items. For example, no utilities were recorded because the bill got buried in the stack of papers on your desk and by the time you realized there were no utilities charged to expenses for the month, your reports were already published. Insert this amount in column three and add or subtract this information from column two (in this example it needs to be added) and insert the results in column four.

In columns five, six and seven repeat the same steps as you did in columns two through four for the current year. Subtract column two from column seven and place the difference in column eight. This gives you the amount of change from the previous year. In column nine divide column eight by column four to give you the percent change from last year and place the answer in column 10. Now your numbers are comparable and have meaning, providing you have already addressed the second key item-timing.

The best way to eliminate differences due to timing is to establish your accounting on a 4-4-5 fiscal calendar.  Identify each quarter of the year with the first two months having four weeks and the third month five weeks each, regardless of the day of the week the month actually begins. For example, August may begin on a Tuesday but in this system your accounting period begins on Monday, July 31.  It’s best to start your workweek on Monday and end on Sunday.

Keep an accurate daily weather log.  It is not acceptable to say, “Oh, we had six days of heavy rain in July last year, which is why the numbers are different.”  It could make a big difference if those six days were a Monday, Tuesday or Wednesday vs. Over the Fourth of July holiday.  After you determine the impact of weather on your business, you may want to incorporate this factor into your spreadsheet to include current and prior year’s weather as an additional adjustment column.

These are only three items that need to be taken into account when establishing meaningful numbers to be used for internal comparable analysis.  Do not be afraid to start out simple and add on more complexity as you become accustomed to the process.

Dennis P. Kissman, president of Marina Management Services Inc. in Boca Raton, FL can be reached by phone at 561-338-5800 or via e-mail: dennis@marinamanagement.com.