How Does Charter Boat Ownership Work?

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Charter Boat Ownership

  • The charter company pays the charter owner 7-9% of the total boat value each year for 5 years. This income covers the mortgage. The charter company pays for all expenses including insurance, fees, and maintenance.

Charter Boat Operations and Income

  • Charter boats make money through the fees they charge for renting out their vessels and providing services to customers. The primary sources of income for charter boats include:
    • Charter Fees: Customers pay a fee to rent the boat for a specific duration, which can vary depending on the type of charter and the boat’s size and amenities.

Cost and Revenue Analysis

  • Use Case A: Owner wants to reduce charter costs. Boat is sold at end of 5-year contract. For frequent charters not wanting boat ownership.
  • Use Case B: Owner wants reduced ownership cost while still chartering. Boat is purchased at end of contract. For frequent charters wanting boat ownership. Charter ownership reduces both charter and ownership costs.

Other Information

  • Charter company represents yacht owners, lists, advertises, books charters, provides cleaning and maintenance crews, takes a percentage of the charter fee, and charges owners for repairs. Charterers are responsible for damages beyond normal wear and tear.
  • Bareboat charter: Renter provisions, navigates, anchors, cares for the boat, making the renter the captain.

Starting a Charter Business

  • The startup costs for a charter boat business range from $5,500 to $12,000, with the largest expense being a down payment on a boat. Discover the best ways to start a boat charter business in 2023! Explore business ideas from party boats to eco tours.

Charter Brokerage

  • Charter brokers work with a network of charter companies to find the best boat for clients. They can provide valuable expertise and guidance, especially for first-time charterers. Popular charter brokerages include Fraser Yachts, Northrop & Johnson, and Burgess. Consider factors like reputation, customer service, and pricing when choosing a charter company or broker.

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