Yo,
I hope everyone had a great weekend!
Summer is the most popular time for vacations; the weather is nice (unless you’re talking about Florida…too humid), kids are out of school, and work slows down a bit in lieu of those summer Fridays I mentioned last week.
By far one of the best vacations I’ve been on was a 7 day trip whitewater rafting down the Grand Canyon from Marble Canyon to Lake Meade. No cell service, no contact with the outside world, no tents, no toilets, just great weather, and a lot of time with your thoughts, which were obviously riveting back when I was 12.
Just you, a guide, and an inflatable raft.
And as hot as you think it would be, you’re shaded by the walls of the canyon most of the day and the water is a crisp 45 degrees from the snowmelt.
Here’s a video of these trips
If I sold you on the trip, great but you can’t go this year and probably not next year either because all of the outfitters are booked out years in advance.
There are 16 different outfitters, and almost all of them are booked solid. Just goes to show the demand.
I mean, the Grand Canyon is one of the Seven Natural Wonders of the World and gets nearly 5 million visitors annually. So, the idea that 0.01% of visitors would want to go on this trip isn’t that farfetched.
In fact, I’m actually here to argue that there should be more of these rafting outfitters and after going through the numbers I think you’ll agree with me.
Think of outfitters as a tour guide company.
They’re essentially the group that owns the fleet of motorized rafts (by fleet I mean like 10), the lifejackets, buys the food, and pays the guides.
All customers have to do is show up.
They cook the meals, plan the side hikes, and steer the boat.
Summer is the most popular time for vacations; the weather is nice (unless you’re talking about Florida…too humid), kids are out of school, and work slows down a bit in lieu of those summer Fridays I mentioned last week.
By far one of the best vacations I’ve been on was a 7 day trip whitewater rafting down the Grand Canyon from Marble Canyon to Lake Meade. No cell service, no contact with the outside world, no tents, no toilets, just great weather, and a lot of time with your thoughts, which were obviously riveting back when I was 12.
Just you, a guide, and an inflatable raft.
And as hot as you think it would be, you’re shaded by the walls of the canyon most of the day and the water is a crisp 45 degrees from the snowmelt.
Here’s a video of these trips
But The Waitlist Is Years Long
If I sold you on the trip, great but you can’t go this year and probably not next year either because all of the outfitters are booked out years in advance.
There are 16 different outfitters, and almost all of them are booked solid. Just goes to show the demand.
I mean, the Grand Canyon is one of the Seven Natural Wonders of the World and gets nearly 5 million visitors annually. So, the idea that 0.01% of visitors would want to go on this trip isn’t that farfetched.
In fact, I’m actually here to argue that there should be more of these rafting outfitters and after going through the numbers I think you’ll agree with me.
What’s An Outfitter?
Think of outfitters as a tour guide company.
They’re essentially the group that owns the fleet of motorized rafts (by fleet I mean like 10), the lifejackets, buys the food, and pays the guides.
All customers have to do is show up.
They cook the meals, plan the side hikes, and steer the boat.
How To Become One
Obviously, when you’re taking strangers down one of the biggest rivers in America there are going to be some regulations.
The National Park Service (NPS) manages and issues the commercial rafting permits, which are what’s needed to start one of these things. These are awarded to outfitters based on expertise, safety protocols, and environmental stewardship.
Now, these permits are extremely sought after, but believe it or not hardly ever sell out.
The last piece to starting one of these up are the river guides. These guides will make or break the trip.
In addition to hiring someone fun to be around and good at engaging people, they’ll also need a few certifications like the Wilderness First Responder certificate, Food Handler permit, CPR certificate, and some of that other good stuff.
The Numbers
So why am I even bringing this up? These things are cash cows. Money doesn’t grow on trees, but it does float on guided rafts down the Colorado River.
The tickets for these trips start at around 3k per person, and no it’s not cheaper for kids or seniors.
Each raft holds at least 12 paying passengers and we’ve already seen that they sell every single one of them out. That’s $39,600 per raft, and they send all 10 rafts down the river each week. So, each outfitter is making just shy of $400,000 a week.
The season is usually 20 weeks, so the annual revenue can be anywhere north of $7.9 million.
And the costs?
Well, each boat traditionally has 2 guides making about $50k/year. For 10 rafts that comes out to be about $1 million going to payroll.
If you can’t find qualified guides? Just pay them 1.5x what they’re making elsewhere.
The rafts go for about $10k each, but that’s a one-time up-front cost. Let’s call it $100k all in.
And then you could assume another $100k for operating costs. Things like insurance, transportation, maintenance, food, etc.
Which leaves you with about $6 million/year in profit. It’s kinda stunning. Even if we lowballed some of those numbers you have incredible margin.
The best part is, it’s all pretty hands off once you get up and running. Sure, it’ll be difficult to get started with all the red tape, but once you take off the training wheels, I can’t think of anything more passive.
Besides the occasional accident, of which I’m sure you have passengers sign something assuming liability, you have nothing to worry about.
The overhead for these trips is super low, but when packaged well with a good set of tour guides can be priced at a premium.
If you think starting from the ground up is too difficult, find the cash and buy one, or roll a few up.
Forget the multi-billion-dollar wall street merger, a multi-dozen raft merger sounds better to me.
The season is usually 20 weeks, so the annual revenue can be anywhere north of $7.9 million.
And the costs?
Well, each boat traditionally has 2 guides making about $50k/year. For 10 rafts that comes out to be about $1 million going to payroll.
If you can’t find qualified guides? Just pay them 1.5x what they’re making elsewhere.
The rafts go for about $10k each, but that’s a one-time up-front cost. Let’s call it $100k all in.
And then you could assume another $100k for operating costs. Things like insurance, transportation, maintenance, food, etc.
Which leaves you with about $6 million/year in profit. It’s kinda stunning. Even if we lowballed some of those numbers you have incredible margin.
The best part is, it’s all pretty hands off once you get up and running. Sure, it’ll be difficult to get started with all the red tape, but once you take off the training wheels, I can’t think of anything more passive.
Besides the occasional accident, of which I’m sure you have passengers sign something assuming liability, you have nothing to worry about.
The overhead for these trips is super low, but when packaged well with a good set of tour guides can be priced at a premium.
If you think starting from the ground up is too difficult, find the cash and buy one, or roll a few up.
Forget the multi-billion-dollar wall street merger, a multi-dozen raft merger sounds better to me.
Canyoneers
I told y’all this was the best trip of my life, and a big part of that is because I went with the Canyoneers. They’ve been doing these trips since 1938, back before you even knew what missing your cell phone was, so no wonder they curate the perfect trips. Heck, they’ve been doing it for so long they probably had Lewis, Clark, and Sacagawea on one of their rafts. Their guides are world class and make every moment fun. If you want to go hit me up by responding to this email and I’ll give you a special referral code.
The Grand Canyon Isn’t the Only Cool Place To Visit
The Grand Canyon was the perfect example, but it’s definitely not the only place suited for this kind of expedition.
It could be a catamaran trip among the islands of Hawaii, a multiday hiking or mining trip through the Appalachians or Rockies, or even an age specific trip up the entire Pacific Crest Trail.
Bottom line is that people love things that are convenient and structured. These Grand Canyon rafting trips have proven that a well packaged adventure sells like paper products in 2020, so if you like nature and can pull it off, you might as well try it.
Also, hit me up with any vacations you have planned for the summer, I’d love to hear about them…or tag along if you have an extra bed.
‘Til Friday.
from, matt
