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How To Start A Fishing Charter Business

How To Start A Fishing Charter Business

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How To Start A Fishing Charter Business

How To Start A Fishing Charter Business

Starting a fishing charter business is an opportunity filled with adventure, passion, and the potential for profit. If open waters call to you and you have the skills and enthusiasm to guide others on their fishing expeditions, this venture might be the right path for you. In this guide, we’ll walk you through the essentials of starting a fishing charter, including insights into the industry, steps to get started, and answers to common questions. Let’s dive in!

Business Overview

A fishing charter business provides its customers with guided fishing experiences they would otherwise not have access to. Services may range from half-day to full-day fishing trips and even overnight deep-sea excursions. Some charters specialize in specific types of fishing, like saltwater, freshwater, fly-fishing, or sportfishing for specific species.

Industry Summary

The fishing charter industry is a significant part of the broader recreational fishing sector. In their latest report, the American Sportfishing Association estimates there are more than 49 million Americans who participate in recreational fishing each year.

This industry is driven by factors such as tourism, disposable income, and the popularity of recreational fishing.

According to Statista, since 2010, the fishing charter industry has been steady or growing, and projects the industry to increase by another 1.9% in 2023, reaching $371.9 million in revenues.

The industry is vulnerable to economic trends because fishing charter excursions are somewhat of a luxury purchase for tourists and locals, so the industry suffers when consumers have less disposable income.

Several trends are currently shaping the fishing charter industry.

Sustainable fishing practices have become increasingly important to consumers, and some fishing charter companies are responding by adopting catch-and-release policies and educating customers about conservation.

Technological advancements, such as online booking systems and advanced fishing equipment, are also transforming the industry.

Additionally, personalized and niche experiences, like family-friendly trips or tours focused on specific species, are growing in popularity.

Target Market

The target market for a fishing charter business can be quite diverse, as it encompasses a broad range of individuals and groups who enjoy fishing and outdoor activities. Here are some potential target customers:

  1. Tourists: Although local residents do book fishing charters, the largest target market is tourists. Many tourists look for unique and memorable experiences like taking a fishing trip during their vacation. They may range from families looking for a fun day out to individuals seeking adventure.
  2. Fishing enthusiasts: Individuals who enjoy fishing but don’t own a boat or lack the knowledge to fish in specific waters can be a significant part of your target market.
  3. Corporate groups: Companies may book fishing charters for team-building events or to entertain clients.
  4. Families: A fishing charter can be a great family activity, especially during vacations.
  5. Retirees: Older adults, particularly those who are retired, often have more leisure time and may enjoy fishing as a hobby.

It’s important to note that the specific target market may vary based on factors like your location, the type of fishing you offer (e.g., deep-sea, freshwater, fly-fishing, etc.), and the amenities you provide.

Checklist To Start A Fishing Charter Business

Starting a fishing charter business requires more than just technical skills and a love for fishing. This guide is here to help you be better equipped to navigate the waters of this exciting industry and sail your business toward success.

Step 1: Assess the Market

In the business world, as in fishing, you don’t cast your line without knowing where the fish are. Researching whether there’s a market for your fishing charter boat business is not just a good idea; it’s essential to charting a course toward success. It helps assess the demand for your services, understand your target audience, identify competitors, and gauge market trends. Through market research, you can make informed decisions about your business strategy and reduce the risks associated with starting a new business.

While there isn’t a perfect way to know for sure whether your business will be a success, there are a few ways to get a better idea.

  • Competitor research: Google search terms like “fishing charters [your city]” to analyze existing competition. Visit competitors’ websites and social media to see what they offer, reviews, prices, and their paid advertising strategy.
  • Talk with fishing charter customers: Casually talking with people after they finish an excursion can be a great way to learn why they chose their charter and their experience.
  • Analyze local tourism trends: Look into local tourism boards, websites, and statistics to see how many people visit your area and what they do.
  • Connect with local businesses: Talk to hotels, travel agencies, bait shops, marinas, and other related businesses. Partnerships might not only bring insights but also future collaboration opportunities.
  • Explore social media: Search online forums and social media groups related to fishing and place local groups in your area to gauge interest and see what people are saying.

Step 2: Write a Business Plan

After you get a better understanding of your market and have more information that there is an opportunity, it’s time to start writing a business plan. Just like a seasoned captain knows the waters, a business plan helps you understand your business landscape. It sets clear goals, outlines strategies, and helps you navigate potential obstacles.

Also, if you’re seeking funding from investors or financial institutions, they’ll want to see a comprehensive business plan to understand your business and assess its viability. A few sections that I would recommend spending extra time on when going after funding include:

  1. Market analysis: This section should include any specific insights gathered from your market research and detail your understanding of your target market, competition, and why your fishing charter will succeed.
  2. Services: Clearly describe the services you’ll offer. Will you provide gear and bait? Will you offer different types of fishing trips based on the season, fish species, or skill level?
  3. Marketing strategy: Explain how you plan to attract and retain customers. Are you partnering with local hotels, offering special packages, or employing social media?
  4. Management team: The people behind the business play a significant role in its success. Detail the qualifications, experience, and roles of your management team. For a fishing charter, this might include your captain, crew members, and any administrative staff.
  5. Financial projections: Provide a clear picture of your expected income, expenses, and profitability. This section is particularly important if you’re seeking funding.

Related: How to write a business plan

Step 3: Secure Funding

Starting a fishing charter requires not only passion and planning but also capital and funding, which can be one of the more challenging aspects of getting your fishing charter off the ground. There are various sources of funding, and each comes with its own considerations and benefits.

Many fishing charter owners start by investing at least some of their own savings. The significant benefit here is that you don’t have any loan payments to worry about, giving you more flexibility in the early stages of your business. Given the high cost of a boat, outside funding is often needed. Let’s navigate through these options:

Friends and family: Turning to friends and family for funding can be an effective way to raise capital. It’s essential, however, to treat these agreements with the same seriousness as any business deal. Put all agreements in writing, clearly outlining terms, to avoid misunderstandings that could strain relationships.

Traditional lenders: Banks and credit unions typically require borrowers to invest around 15% – 25% of their own funds into the business. They also look for a good credit score and sufficient collateral. If a bank feels the loan is too risky, they might be more willing to lend with an SBA loan guarantee, which assures the bank that a portion of the loan will be repaid even if the borrower defaults.

Microloans: If your funding needs are relatively low or traditional credit isn’t available, microloans could be a good option. These are small loans typically offered by economic development organizations. Some of these organizations also provide business training alongside funding, helping you navigate the early stages of your business.

Angel investors: While not as common as other sources, angel investors could be a potential source of funding. These are typically local individuals with a higher net worth and a genuine interest in your type of business. However, securing investment from angel investors can be challenging, as they often seek high-growth, scalable businesses. While fishing charters may not typically fall into this category, if your business plan has a unique angle, offers a specialized niche, or believes in your success, you may attract an investor’s interest.

From personal savings to angel investment, each option has its unique characteristics and requirements. It’s essential to assess the needs and goals of your business,

Related: Finding the money to start a business

Step 4: Register the Business

Starting a fishing charter business involves a number of legal steps to ensure your business is properly registered and compliant with all relevant laws and regulations. Every state has different rules, but here is a general overview:

Choose a business structure: The four primary types of business structures are sole proprietorship, partnership, Corporation, and Limited Liability Company (LLC). Each has its own advantages and potential drawbacks.

  • Sole proprietorship is the simplest structure to set up, often involving lower costs and less paperwork. However, it does not offer liability protection – meaning your personal assets could be at risk if your business runs into financial trouble.
  • Partnerships are similar to sole proprietorships but involve two or more people. They’re relatively easy to establish, but like sole proprietorships, they don’t provide personal liability protection.
  • Limited Liability Companies combine the liability protection of a corporation with the tax benefits and simplicity of a partnership. Most charters are LLCs for the mix of ease and protection.
  • Corporations offer strong liability protection but are more complex and expensive to set up. They’re usually considered for larger businesses or those seeking outside investment.

Related: Comparison of business structures

Forming an LLC sounds complicated and expensive, but using an entity formation service guides you through the process so you know it was done right.

Some popular LLC formation services include:

IncFile - $0 plus state fees & free registered agent for 1 year!

ZenBusiness - Best for beginners. $0 plus state fees & free registered agent for 1 year!

Northwest - Best privacy protection. $39 plus state fees & free registered agent for 1 year!

Business name registration: After registering the business structure, you may need to register your business name. This process will vary depending on what business structure you pick. Sole proprietors and partnerships will often be required to register a “Doing Business As” (DBA), while corporations and LLCs register with the state during the formation process.

Related: Tips & ideas for naming a fishing charter business

During this time, it’s also a good idea to check if the name you want is available as a web domain, even if you’re not ready to set up a website yet.

Related: Finding a domain name for your business

Obtain business licenses and permits: Licensing is typically needed in order to offer fishing charters with paying passengers, and regulations will vary depending on whether you offer freshwater or saltwater excursions.

For the most part, each state’s Department of Natural Resources will list the procedures to obtain licensing on their website. A state fishing charter license will normally require current first aid and CPR certification, random drug tests, and proof of commercial liability insurance.

If operating in federal waters, the United States Coast Guard (USCG) requires a Captain’s License, charter vessel license, and following a number of rules and regulations.

In addition to fishing charter-related requirements, there will also be general business licensing needed. Each state is different, but a few to look out for include a local business license, a sales tax license, and an Employer Identification Number if you will have employees.

Related: State guides for general business licensing

Step 5: Purchase a Boat & Equipment

With funding in hand and the business registration process moving forward, the next task is perhaps the most fun – purchasing the boat and equipment!

First, you’ll want to define the specific needs of your fishing charter. Consider the types of fishing you’ll offer, the typical size of your groups, the waters you’ll navigate, and any other unique aspects of your business. These factors will determine the size, type, and equipment of the boat you’ll need.

Before purchasing a used boat, it’s advisable to have it inspected by a marine surveyor to ensure it’s in good condition.

Once you have the boat, you’ll need to outfit it with fishing equipment, safety gear, and possibly amenities for guests.

Step 6: Hire the Crew

Depending on the needs of the business, you may need to bring on a crew to help with the charter. When considering hiring help, it’s important to know there are several legal requirements employers must follow.

As an employer, you must:

  • Obtain an EIN: The Employer Identification Number is provided by the IRS and is used for tax reporting.
  • Maintain proper records: Keep accurate records of employee information, including their Social Security numbers and contact details.
  • Comply with labor laws: Follow federal and state labor laws, which cover minimum wage regulations, overtime pay, and workplace safety standards.
  • Provide workers’ compensation insurance: In most states, employers are required to provide this insurance.

Alternatively, you might consider bringing on independent contractors. Having contractors means less regulation and typically no requirements for workers’ compensation or benefits. Contractors handle their own taxes and often have more autonomy in how they complete their work. Clear and detailed contracts are necessary with contractors, but there are potential legal risks if you misclassify an employee as a contractor.

RelatedState guides for hiring your first employee

Step 7: Create a Marketing Plan

With the business being close to open, it’s time to let the world know that your charter is open for business. Even if you are the best captain and know all the best places to fish, if people don’t know about your business or how to book a charter, they will book with the competition.

To successfully market your fishing charter, the first step is creating an attractive, user-friendly website. This serves as the digital storefront of your business, showcasing your services, rates, and customer testimonials. Consider giving customers the convenience of booking their charter online. People are used to having the opportunity to do so and are generally less likely to call to book a trip. Also, investing in Search Engine Optimization (SEO) and Pay-Per-Click (PPC) advertising can significantly increase your website’s visibility, attracting more potential customers.

Additionally, claiming your business on relevant online directories is essential. This includes Google Business, which allows your charter to appear on Google Maps and increases your local search visibility. Other platforms, such as Yelp and TripAdvisor, can also prove beneficial. In addition, charter listing sites such as DiscoverBoating.com, FishingBooker, and GetMyBoat will help expand your reach.

Social media platforms like Facebook, Instagram, and Twitter offer another avenue for promotion. Posting regular updates, sharing photos of successful fishing trips, and engaging with followers can help build your brand’s community and reach.

Networking with other businesses, such as local hotels, restaurants, marinas, bait shops, and other tourist attractions, can form relationships that encourage mutual referrals. Ask about leaving brochures to get your brand in front of potential customers.

Related: Low-cost ideas to market a new business

Step 8: Prepare to Launch!

Starting a fishing charter business is indeed a thrilling venture, but it’s one that requires attention to detail and meticulous planning. As you prepare to set sail on this business journey, there are some common loose ends you’ll want to tie up. While the needs of everyone will be different, these essential steps should not be overlooked: Starting a fishing charter is more than just a passion for the open sea; it’s about weaving together various strands of a complex business tapestry. From legal matters to customer engagement, each step is a building block toward a successful and fulfilling venture. While the specifics may vary based on your location, target audience, and unique offerings, these foundational steps remain consistent.

Business insurance: Given the expense of boats and the potential for injury while on a charter, insurance is important to protect you and your business from potential risks. You’ll need to consider several types of insurance, including commercial boat insurance, liability insurance, and workers’ compensation insurance, if you plan to hire employees.

We recommend getting at least three insurance quotes, including local insurance agents and online providers like Coverwallet or Hiscox to get the best coverage and price.

Bookkeeping: Proper bookkeeping is essential for tracking income, expenses, and overall business performance. You might want to consider hiring a certified accountant or using accounting software like Wave Accounting (FREE) or Quickbooks to make this task easier.

Contracts: Have customers sign liability waivers, terms of service contracts covering things like payment/refund policies, and fishing licenses if needed.

RocketLawyer and Law Depot have free and inexpensive templates that may be helpful.

Bank account: A separate business bank account can help you keep your personal and business finances separate, making bookkeeping and tax preparation easier.

Selecting a home port:  This is where you’ll dock, fuel up, conduct repairs, store gear, etc. Consider ramps, parking, and amenities. Choosing the right home port is critical. It should be easily accessible, have the necessary facilities, and be located in an area with good fishing prospects.

Set pricing: Factor in costs plus desired profit. You may offer half-day, full-day, overnight trips, etc. Discounts for multiple bookings.

Accepting credit cards: Being able to accept credit card payments can make it easier for customers to pay and may boost your bookings. Some popular mobile options include Square or Stripe.

Greg’s Tip: While it can be tempting, to have a business that survives over the long-term, resist the temptation to pay crew under the table. Do payroll properly including tax withholding to avoid IRS issues.

Greg's Business Tip

Common Questions When Starting A Fishing Charter Business

How much does it cost to start a fishing charter business?

Starting a fishing charter business is a substantial investment, and total costs can typically range from $100,000 to $500,000. These costs can vary greatly based on several factors, including the type and size of the boat, its equipment, and the location of your operation.

Here’s a detailed breakdown of the various expenses involved to help you better understand the financial requirements:

Boat purchase: One of the largest expenses is the boat itself. A fishing charter boat can range from $50,000 for a simple inshore boat to $500,000 or more for a decked-out large offshore boat.

Fishing equipment and supplies: Initial investment in rods, reels, bait, and other essential equipment might range between $3,000 to $10,000.

Insurance: Initial insurance premiums for liability, hull, and machinery coverage can range from $2,000 to $10,000.

Marketing and advertising: Setting up a website, social media profiles, and initial advertising campaigns could cost around $1,000 to $5,000.

Licenses and permits: The costs for necessary fishing licenses, business registration, and maritime permits may add up to $1,000 to $3,000.

Docking fees: Renting or purchasing a docking space for the boat might cost from $10,000 to $30,000.

Business formation and licensing: Incorporating your business or forming an LLC will incur legal fees and state filing charges. In addition, there will be general business licensing and specific licenses such as a U.S. Coast Guard license and, in some cases, a guide’s license for your state. These costs can range between $500 and $2,000.

Office space and supplies: If you need a physical office, initial setup costs, including furniture and technology, might range from $2,000 to $10,000.

Safety equipment: Investing in safety gear such as life jackets, flares, and first aid kits may cost around $1,000 to $3,000.

Employee training and certification: If you hire crew members, there may be initial training and certification costs, which can range from $500 to $2,000.

While these figures provide an overall estimation, it’s essential to conduct a detailed analysis tailored to your specific location, goals, and business model.

How profitable is a fishing charter business?

The profit of a fishing charter business can vary widely based on various factors, such as the location, size of the boat, number of trips, and pricing structure.

Typically, a fishing charter will charge anywhere from $500 to $1,500 per trip, depending on the length and type of excursion. Assuming an average rate of $1,000 per trip and three trips per week, the revenue would be $3,000 weekly or approximately $156,000 annually.

Expenses for a fishing charter business can include boat maintenance, fuel, insurance, licenses, equipment, marketing, and more. According to various sources, these costs can account for around 50-60% of the revenue. So, in our example, if expenses account for 55% of the revenue, the total expenses would be $156,000 * 55% = $85,800.

Here’s a simple calculation of the profit:
Revenue: $156,000 (Annual)
Expenses: $$85,800 (Annual)
Profit: $156,000 – $85,800 = $70,200 (Annual)

Of course, this example relies on assumptions, and the real numbers will depend on the charter’s actual costs, pricing, booking rates, and more. Many factors like weather, competition, and fuel prices can also impact the profitability of the business. Following this basic formula can provide a ballpark estimate to gauge the earning potential of a charter fishing business.

Also, it’s important to budget for slow periods as demand for many fishing charter businesses will be somewhat seasonal, depending on where you are located. You will also be very weather dependent, so there will be a lot of days that you can’t work.

What skills are needed to run a fishing charter business?

Diverse fishing experience: You probably can’t just be a casual fisherperson to start a successful fishing charter business. You need to be an expert in many types of fishing and have a detailed knowledge of the water where you will operate. A good charter captain should be passionate about fishing and willing to make each trip a teaching experience for the customers. They should be knowledgeable about fishing equipment and able to equip customers based on their specific needs.

Business knowledge and experience: Basic knowledge of marketing, contracts, and finance/accounting is beneficial for managing the business aspect of a fishing charter.

Knowledge of boats and maintenance. Being able to maintain and repair boats is also vital. This includes understanding the workings of the boat and being able to troubleshoot any issues that may occur.

Customer service: As a fishing charter is a customer-oriented business, having patience, an agreeable personality, and the ability to communicate effectively with customers can significantly enhance their experience.

What is the NAICS code for a fishing charter business?

The NAICS code for a fishing charter business is 487210

The NAICS code (North American Industry Classification System) is a federal system to classify different types of businesses for the collection and reporting of statistical data.

Related: What is a NAICS code?

How To Start A Fishing Charter Business

How To Start A Fishing Charter Business

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