A charter boat service is a company that puts up boats for charter. Please note that a charter boat is a boat that can be hired for use for different purposes. Full-service charters include the use of the boat along with a crew and supplies like provisions, while bareboat charters include just the boat, with the customers crewing and supplying the boat themselves.
Statistics have it that the market size of the boat charter sector in the United States reached 411.9 million U.S. dollars in 2020. The sector saw a 1.7 percent growth over the previous year’s size of 405.2 million U.S dollars. Please note that the global yacht charter market size was estimated at USD 6.5 billion in 2019 and is expected to reach USD 6.8 billion in 2020.
Steps on How to Write a Charter Boat Business Plan
Mike Honey® Charter Boat Company, Inc. is a standard charter boat company that will be located in Virginia Beach, Virginia; the city with the longest beach in the United States. We have been able to secure all the necessary permits for our facility.
Mike Honey® Charter Boat Company, Inc. will ensure that all our yachts, fishing, and cruise boats meet international standards. We have CRM software that will enable us to manage a one-on-one relationship with our customers no matter how large our customer base may grow.
Mike Honey is the founder and CEO of Mike Honey® Charter Boat Company, Inc.
a. Our Products and Services
Mike Honey® Charter Boat Company, Inc. will provide different sizes and brands of boats for bareboat charter, cabin charter, and full-service charter including small rowboats for urban lakes, sailboats, and larger motorized yachts and other watercraft.
b. Nature of the Business
Our charter boat service company will operate essentially as a club where patrons can pick up membership and pay their subscription monthly, quarterly, or annually.
c. The Industry
Mike Honey® Charter Boat Company, Inc. will operate under the charter boat services industry.
d. Mission Statement
Our mission is to establish a world-class charter boat service that will make available all kinds of boats for charter.
e. Vision Statement
Our vision is to be among the top 3 charter boat companies in the United States of America.
f. Our Tagline (Slogan)
Mike Honey® Charter Boat Company, Inc. – Charter Boat Our Forte!
g. Legal Structure of the Business (LLC, C Corp, S Corp, LLP)
Mike Honey® Charter Boat Company, Inc. will be formed as a Limited Liability Company (LLC). The reason why we are forming an LLC is to protect our assets by limiting the liability to the resources of the business itself. The LLC will protect our CEOs’ assets from claims against the business, including lawsuits.
h. Our Organizational Structure
- Chief Executive Officer (Owner)
- Marketing and Sales Officer
- Attendants (Skipper and other Boat Staff like Cook and Hostess) (5)
- Security Officers
i. Ownership/Shareholder Structure and Board Members
- Mike Honey (Owner and Chairman/Chief Executive Officer) 56 Percent Shares
- Dalley Millard (Board Member) 14 Percent Shares
- Leo Veron (Board Member) 10 Percent Shares
- Vincent Oscar (Board Member) 10 Percent Shares
- Ruth Obed (Board Member and Sectary) 10 Percent Shares.
- Ideal Location for charter boat service company
- Highly Experienced and Qualified Employees and Management
- Availability of all kinds of boats for charter
- Excellent membership package
- Budget limitations
- Inability to properly manage off-peak season such as bad winter
- A new business that will be competing with our company
- Inability to retain our highly experienced and qualified employees longer than we want
- Excellent location – Virginia Beach, Virginia is a thriving market for charter boat service.
- Increase in recreational fishing and water-related activities in our location
i. How Big is the Industry?
The charter boat services industry is pretty big. It is worth over $411.9 million in the United States.
ii. Is the Industry Growing or Declining?
The charter boat services industry is growing. Available data shows that the sector saw a 1.7 percent growth over the previous year’s size of 405.2 million U.S dollars.
iii. What are the Future Trends in the Industry?
The charter boat services industry is changing, and players in the industry are improvising. No doubt, technology, and social media will change the landscape of the charter boat industry going forward.
iv. Are There Existing Niches in the Industry?
Yes, there are niche ideas in the charter boat service business and some of them are;
- Fishing Boats Charter Services
- Yacht Charter Services
- Rowboats Charter Services.
v. Can You Sell a Franchise of your Business in the Future?
Mike Honey® Charter Boat Company, Inc. has plans to sell franchises in the nearest future and we will target the United Kingdom, Canada, and Australia.
- High maintenance cost
- Government regulations
- Liability problems
- Continuously changing consumer demands
i. Who are the Major Competitors?
- Dream Yacht Charters
- Horizon Yacht Charter
- TMM Yacht Charters
- BVI Yacht Charters
- Catamaran Company
- Pro Valor
- American Yacht
- Acadia Charter Company
- Miami Yachting Company
- Golden Yacht Charters
- Nyack Boat Charter
- Los Angeles Yacht Charter
- Miami Boat Charters
- Prestige Yacht Charters
- Tropicalboat Luxury Yacht Charters & Rentals
- Blue Ocean Yacht Charters.
ii. Is There a Franchise for Charter Boat Business?
- Freedom Boat Club
- Nautical Boat
- Carefree Boat
- Cruisin’ Tikis
- Sea Tow.
iii. Are There Policies, Regulations, or Zoning Laws Affecting Charter Boat Business?
Yes, and zoning laws require charter boat service company operators to follow specific rules and regulations, including some that apply only to players in the charter boat services industry. Please note that in many communities, zoning laws require charter boat service companies to apply for a permit from the city.
This application process allows the city’s zoning department to determine whether the charter boat company meets the zoning rules of the community. Permits also ensure that all charter boat service companies are properly licensed with the county or state agencies.
a. Who Is Your Target Audience?
i. Age Range
Our target market age range covers people that are 18 years and above.
ii. Level of Educational
We don’t have any basic educational qualifications for those who we are targeting; everyone is welcome to rent our boats.
iii. Income Level
Anyone who can afford our rental fee or membership fee will be welcome to charter our boats.
There is no restriction when it comes to the ethnicity of the people that will patronize our charter boat service.
There is no restriction when it comes to the language spoken by the people that will patronize our charter boat service.
vi. Geographical Location
Anybody from any geographical location will be welcomed in our charter boat service company.
Mike Honey® Charter Boat Company, Inc. will not restrict any customer based on their lifestyle, culture, or race.
b. Advertising and Promotion Strategies
- Host Themed Events That Catch Attention.
- Tap Into Text Marketing.
- Use FOMO to Run Photo Promotions.
- Share Your Events in Local Groups and Pages.
- Turn Your Social Media Channels into a Resource
- Develop Your Business Directory Profiles
- Build Relationships with Other Businesses in Your Area
i. Traditional Marketing Strategies
- Marketing through Direct Mail.
- Print Media Marketing – Newspapers & Magazines.
- Broadcast Marketing -Television & Radio Channels.
- OOH, Marketing – Public Transits like Buses and Trains, Billboards, Street Furniture, and Cabs.
- Including direct sales, direct mail (postcards, brochures, letters, fliers), print advertising (magazines, newspapers, coupon books, billboards), referral (also known as word-of-mouth marketing), radio, and television.
ii. Digital Marketing Strategies
- Social Media Marketing Platforms.
- Influencer Marketing.
- Email Marketing.
- Content Marketing.
- Search Engine Optimization (SEO) Marketing.
- Pay-per-click (PPC).
- Affiliate Marketing
- Mobile Marketing.
iii. Social Media Marketing Plan
- Start using chatbots.
- Create a personalized experience for our customers.
- Create an efficient content marketing strategy.
- Create a community for our target demography.
- Gear up our profiles with a diverse content strategy.
- Use brand advocates.
- Create profiles on the relevant social media channels.
- Run cross-channel campaigns.
c. Pricing Strategy
When working out our pricing strategy, Mike Honey® Charter Boat Company, Inc. will make sure it covers premium, skimming, economy or value, and penetration. In all our pricing strategy will reflect;
- Cost-Based Pricing
- Value-Based Pricing
- Competition-Based Pricing.
Sales and Distribution Plan
a. Sales Channels
Our channel sales strategy will involve using partners and third parties—such as referral partners, affiliate partners, managed service providers, marketplaces, or value-added resellers—to market our charter boat company.
Mike Honey® Charter Boat Company, Inc. will also leverage the 4 Ps of marketing which are place, price, product, and promotion. By carefully integrating all these marketing strategies into a marketing mix, so we can have a visible, in-demand product or service that is competitively priced for our customers.
b. Inventory Strategy
Mike Honey® Charter Boat Company, Inc. will operate an inventory strategy that is based on a day-to-day methodology for ordering, maintaining, and processing items in our warehouse. We will develop our strategy with the same thoroughness and attention to detail as we would if we were creating an overall strategy for the business.
c. Payment Options for Customers
Here are the payment options that Mike Honey® Charter Boat Company, Inc. will make available to her clients;
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
d. Return Policy, Incentives, and Guarantees
Mike Honey® Charter Boat Company, Inc. will operate a no refund policy hence we will not provide compensation for services (membership fees inclusive) that customers paid for in our charter boat company. Please note that we will make sure that any boat we put out for charter meets the required safety standard.
e. Customer Support Strategy
Our customer support strategy will involve seeking customer feedback. This will help us to continue to put our boats in great shape and also to provide excellent customer service to all our patrons, it will help us to first understand their needs, experiences, and pain points.
Regularly, we will work towards strengthening our Customer Service Team and also Leverage Multi-Channel Servicing as part of our customer support strategy.
We plan to expand our revenue by 50 percent in the second year and the plan will include a marketing, sales, and operations component.
The operations component of the plan would include organizing regular campers’ competitions at the local and state levels, providing lodging and electric vehicle charging amenities, and attracting recreational vehicle owners and campers. These strategies will enable us to boost our service offerings and support revenue growth.
a. What Happens During a Typical Day at a Charter Boat Service Company Business?
- The business is open for the day
- Administrative work is done concurrently
- The boats are cleaned, fueled and other inventories et al are arranged to welcome clients who want to charter our boats
- Maintenance of the boats are carried out
- The facility is administratively closed for the day.
b. Production Process
There is no production process when it comes to the charter boat business.
c. Service Procedure
When a charter boat service is opened and everything is in place, they will either choose to welcome patrons based on membership or open their doors to people in the city where the charter boat service company is located.
d. The Supply Chain
Mike Honey® Charter Boat Company, Inc. will rely on trusted agents to supply some of the needed supplies in our city and we have been able to establish business relationships with wholesale supplies of all these merchandise.
e. Sources of Income
- Income from the charter of our boats and yacht.
- Membership fee.
Our Membership fee will cost $20,000 for the start and then a $15,000 annual fee from the subsequent year (VAT inclusive and subject to change).
a. Amount Needed to Start your Charter Boat Service?
Mike Honey® Charter Boat Company, Inc. would need an estimate of $550,000 to successfully set up our charter boat service in the United States of America. Please note that we will start with only three boats.
b. What are the Cost Involved?
- Business Registration Fees – $750.
- Legal expenses for obtaining licenses and permits – $7,300.
- Marketing, Branding and Promotions – $5,000.
- Business Consultant Fee – $2,500.
- Insurance – $5,400.
- Rent/Lease – $120,000.
- Other start-up expenses include commercial satellite TV subscriptions, stationery ($500), and phone and utility deposits ($2,800).
- Operational Cost (salaries of employees, payments of bills et al) – $60,000
- start-up inventory – $25,000
- Counter area equipment (countertop, sink, ice machine, etc.) – $9,500
- Store Equipment (cash register, security, ventilation, signage) – $4,750
- Boats – $350,000
- Website: $600
- Opening party: $3,000
- Miscellaneous: $2,000
c. Do You Need to Build a Facility? If YES, How Much Will it Cost?
Mike Honey® Charter Boat Company, Inc. will build a new facility for our charter boat service (a facility that will accommodate our fleet) and it will cost us $200,000.
d. What are the Ongoing Expenses for Running a Charter Boat Service?
- Cost of stocking up supplies such as toiletries
- Cost of regular surveillances
- Utility bills (gas, internet, phone bills, signage and sewage et al)
- Maintenance of facility
- Salaries of employees
e. What is the Average Salary of your Staff?
- Chief Executive Officer (Owner) – $55,000 per year
- Manager – $38,000 per year
- Accountant/Cashier – $35,0000
- Marketing and Sales Officer – $35,000 per year
- Attendants (5) – $35,000 per year
- Cleaners – $18,000 per year
- Security Officers – $21,150 per year.
f. How Do You Get Funding to Start a Charter Boat Business?
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from family members and friends.
a. How Much Should You Charge for your Service?
Aside from our membership fee, Mike Honey® Charter Boat Company, Inc. will charge patrons based on the industry standards in the United States. There are several factors that affect charter yacht pricing. However, on average, a week-long private yacht charter costs anywhere from $10,000 on luxurious sailing yachts and catamarans, and up to $150,000 for superyachts.
b. Sales Forecast?
- First Fiscal Year (FY1): $550,000
- Second Fiscal Year (FY2): $750,000
- Third Fiscal Year (FY3): $1.2 million
c. Estimated Profit You Will Make a Year?
Mike Honey® Charter Boat Company, Inc. are projecting to make;
- First Fiscal Year (FY1): $175,000 (50% of revenue generated)
- Second Fiscal Year (FY2): $337,000 (45% of revenue generated)
- Third Fiscal Year (FY3): $540,000 (45% of revenue generated)
d. Profit Margin of a Charter Boat Service Company Business Product/Service
The profit margin of a charter boat service company business is not fixed. It could range from 25 percent to 35 percent depending on some unique factors.
a. How do you intend to grow and expand? By opening more retail outlets/offices or selling a Franchise?
Mike Honey® Charter Boat Company, Inc. will grow our charter boat service company by first opening other outlets in key coastal cities in the United States of America, the United Kingdom, and Australia within the first five years of establishing the business and then will start selling franchise from the sixth year.
b. Where Do You Intend to Expand to and Why?
Mike Honey® Charter Boat Company, Inc. plan to expand to:
- Los Angeles, California
- Long Beach, Washington
- Newport, Rhode Island
- Chicago, Illinois
- Clearwater, Florida
- Portland, Maine
- Orange Beach, Alabama
- Ocracoke, North Carolina
- Block Island, Rhode Island
- Carmel-by-the-Sea, California.
The reason we intend to expand to these locations is the fact that the cities have the largest beaches in the United States and residents in these cities are known to patronize charter boat companies. Internationally, we plan to expand to Canada, the United Kingdom, and Australia.
Mike Honey® Charter Boat Company, Inc. intends to build a family business hence our exit plan will be family succession. For that reason, the founder Mike Honey is already grooming his son Mack Honey to take over from him. Mack Honey is at the moment being groomed to go through the company’s employment process without any bias.