In October the management company emails every HOD the same line: "Please submit your departmental budget for next year by the 15th." The bosun sends a number he made up in the bar. You are going to send a defensible interior budget with a line for every category, built from what actually happened this year, because in six months' time one of those two numbers is going to be held against its author.
The Shape of an Annual Operating Budget
A yacht's annual budget is built department by department and consolidated by the management company. An illustrative 50 m motor yacht might look like this:
| Department | Annual budget (EUR) |
|---|---|
| Crew (wages, travel, training) | 1,150,000 |
| Maintenance and shipyard | 320,000 |
| Fuel and lubricants | 240,000 |
| Insurance, admin, communications | 185,000 |
| Dockage and port charges | 175,000 |
| Engineering | 95,000 |
| Interior (including food and beverage) | 80,000 |
| Deck | 55,000 |
| Total | 2,300,000 |
Figures are illustrative only: a yacht's real budget depends on size, programme, flag and cruising area. What does not change is the structure — every euro belongs to a department and a cost code.
The Interior Budget, Line by Line
This is the number you own and must defend:
| Interior line | Annual (EUR) |
|---|---|
| Cellar and beverage | 20,000 |
| Guest supplies and amenities | 18,000 |
| Flowers and decor | 12,000 |
| Laundry and dry cleaning | 9,000 |
| Uniform | 8,000 |
| Interior consumables and cleaning | 7,500 |
| Interior equipment and soft goods | 5,500 |
| Total | 80,000 |
20,000 + 18,000 + 12,000 + 9,000 + 8,000 + 7,500 + 5,500 = 80,000. Provisioning for crew and guests may sit in this budget or in a separate galley budget — know which, before you build it.
How to Build It
- Start from last year's actuals by cost code, not from a guess.
- Adjust for the programme: more owner weeks, a longer yard period, a new cruising ground with higher prices.
- Adjust for known changes: a price increase from your laundry, a new uniform supplier, an extra stewardess.
- Add a stated contingency (commonly around 5–10%), shown as a line, not hidden inside other lines.
- Show your workings and assumptions. A budget with the reasoning attached survives scrutiny; a bare number does not.
Onboard Notes
- Padding a budget "so there is room" is discovered the first time actuals come in far below budget, and it costs you credibility for years.
- Under-budgeting to look efficient is worse: you spend the year explaining overspends you created on purpose.
- Capital items (new machinery, a full linen re-set) do not belong in the operating budget. They go through the capital approval route.