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Using my oupv

Discussion in 'Yacht Captains' started by MysticDolphin, Aug 23, 2013.

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  1. MysticDolphin

    MysticDolphin Member

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    Location:
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    Not really sure where to post this, read other post and decided to try here... I am very new (never have done it) to the charter business and am looking for information from the experience I have seen on this Forum. If you want to help I really appreciate it.. if you want to scould please just dont comment.. I have an inland oupv for Lake Texoma.. it is a very large lake with alot of individual fishing charters and one charter company. I am planning on using my 4207 Carver for pleasure charter.. mostly "for hire"... my concerns are, what is the best way to set up my operation.. I do not want to have set hours as not to restrict possible clients schedules.. only being allowed 6 passengers I think this would be better. I have considered forming a LLC and having the (Company) lease the vessel. I guess I am just asking for opinions in the best way to go about this.. Also, I have been asked to drive boats for sale and have thought about operating other peoples boats on the Lake as a hired Capt. How do you insure yourself or protect yourself from liability. Do you incorporate yourself or act as a proprietor. Any insight would be appreciated. I have alot of experience on the water, I just have not ever hired out myself or my boat.
  2. NYCAP123

    NYCAP123 Senior Member

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    First thing is to watch your expenses. This will be a low profit business. The cost of insuring your vessel for charter and advertising may put you in the red, Then there's whether you choose to insure yourself. Also, if there is only one charter company I'd try to allign myself with them. I strongly recommend that you charter "for the day" and not by the hour as everyone will want your boat from noon until 3PM, and always make it "plus fuel". If you include fuel you won't get repeat business from the guy who putts around the lake because you'll be too expensive, and the guy who wants to blast around will bankrupt you.

    Another thing to watch is the number of passengers. Invariably it'll be groups of 8 or 10 that want to charter and you'll be looking at no charter or breaking the rules. There is a 12 pax situation, but I've never been able to find clear info on that. Also, if you're tempted to bareboat to get around the 6 pax rule, you're not allowed to be the captain (although many violate that rule). (BTW, overnight charters would be rare with that boat. Not enough staterooms for most charter, plus crew.)

    The big thing is insurance. Not all policies allow charter. Make sure yours does. (They will probably regulate the number of charters you're allowed to do).

    Finally, understand that most of those fishing charters are part-time operations, and many of the larger boats are simply looking for write-offs and maybe cover some of their boating expenses. It's hard to make a go of a "for profit" operation.

    One last thing, know your area so you can know exactly where to take people based on their personalities and interests. Good luck.
  3. Pascal

    Pascal Senior Member

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    Most Policies do allow some part time chartering, usually with maximum number of days per year which you will have a hard time reaching at least for a while.

    You can't run your own boat with 6 to 12 pax under bareboat contracts, only if a separate crew runs it and obviously the captain need a master, not a six pack.

    I don't know anything about your lake and the market there... You need to do some basic market research to see how charters are booked. Thru brokers? Search online, ask around.

    If partying is the key word, you re not going to get much business limited to 6 passengers.most groups are 10 to 12' at least down here

    Down here, the typical day charter is pretty much the same... People don't charter a boat to run around, they want to go a nice spot where they can swim, run the jet ski, got to the beach or sandbar in the tender and then do a sightseeing tour, in our case around south beach and downtown, pretty standard and predictable allowing us to offer an all inclusive price (incl, fuel, food, drinks)

    But again, your market is likely to be different.

    A to liability protection, the best protection is not to screw up. :)
  4. Capt Ralph

    Capt Ralph Senior Member

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    Your incorporation attorney and you insurance agent may make more money than your charters.
    Remember, after expenses, you boat get paid as crew also before you make a profit.
    Deliveries and hired captain may make more (safer) money.

    Get tight with the in place captains, even if it means your a deck hand. If your going to work the lake, you need to know how and how the existing captains are doing it.

    Good luck and keep us up on your progress.
    ,rc
  5. NYCAP123

    NYCAP123 Senior Member

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    So true. When I first got my ticket my dream was to pick up about a 50' and do charters. Then I saw all the 50'-70' ers sitting on the docks waiting to charter. It's hard to make the numbers work and still be affordable.
  6. MysticDolphin

    MysticDolphin Member

    Joined:
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    Location:
    Lake Texoma
    where I luck out.. I own the vessel, 4207 Carver outright, I know its a Carver, but very roomy for this environment and very practical for a lake, I plan to do day trips to islands for swimming and so on, I know this lake very well and it is very large, 89,000 acres. If I hire out (not the boat), do you rely on the insurance the owner of the vessel carries? or do you insure yourself and who would you insure yourself through.. are there specific companies for this.. right now I use a basic insurance company .. but to charter I will need more comprehensive coverage.. guess I need to research this part.. I do plan to upgrade to the Masters inland ... again this is a lake and some of the rules are a little different than the coastal license.. I will not be doing any fishing intentionally but will offer if that is what the customer wants.. but I have no experience in fishing.. lol I do appreciate your comments..
  7. Capt Ralph

    Capt Ralph Senior Member

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    You will become a company, INC. A corporate liability policy will cover you while your doing the captain thing.
    Your company INC will also lease the the Carver from you. So now the Carver is a leased company asset and expense. The asset and asset inventory will be a part of the new you INC.
    A second corporate insurance policy will cover the Carver, inventory, and charter coverage. The charter coverage gets wild so consult a insurance guy who knows the stuff for real.
    Also you personal, will have to pitch in with you INC for another total loss policy to protect the leased out Carver's value.
    Your book-keepers work just tripled (You have a Book-keeper and Accountant rite?)
    Your insurance businesses, (both you & INC) just quadrupled.
    You may need to start dating the attorneys daughter, your gonna to be talking to him allot.
    You & You INC must stay separate on legal paper. God forbid anything happens; Customers brat kid stubs his toe on a cleat, and you INC gets sued. Personally your protected from any action (Your home and dawg are safe), You INC will go to court, settle with/without the insurance company's help and hopefully survive while that brat kid drives away with you INCs Carver (Remember you & you INC total loss insurance policy?).

    So, 5 months later, all the agents, brokers, lawyers, accountants and the marina made money, that dam brat ran out of gas in the middle of the lake (OH GAS Boat? ABO.) and is calling his lawyers up who will call you in for not leaving the Carver full of gas (GAS?).
    Oh the brats dad stopped payment on his charter check and the bank hit you for fees and overdraft.

    This is getting near soap opera quality ya think??

    Remember the attorneys daughter, she leaves with the dawg because you have no money and would file bankruptcy (you & you INC) but no lawyer will help (you broke).

    If your really sure you want this abuse, FOR REAL, call your attorney and have him start it up.
  8. NYCAP123

    NYCAP123 Senior Member

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    Rcraps had a bit of tongue in cheek there, but a lot of truth. With the exception that an incorporation would be walked through like the paper wall it is. From what I'm seeing with insurance companies lately I wouldn't count on them to protect you from claims either. When running someone else's boat most of us count on the boat's insurance, but that's no guaranty plus some people carry big deductables. There are policies available. (There's have been some extensive discussions on the the subject here. Start with this: http://www.yachtforums.com/forums/g...ssion/20289-captains-liability-insurance.html) To truly cover yourself you could well spend all you earn on insurance premiums. Also don't forget to get your TWIC and arrange for random drug testing.

    Long story short, the key to operating what you want to do is to keep expenses low and be perfect. I've said before that I would not be in this business if I knew 25 years ago what I know today.
  9. weto

    weto Senior Member

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    Is it REALLY that bad ? How do all these guys in the San Fran. Bay survive ? Ive chartered a lot of different boats in the bay for in bay fishing and outside to 60 miles. If the biz environment is so harsh how can it be there are so many charter outfits down there ? California is the law suit capital of the world and has not affected the charter outfits here from what I can see.
  10. NYCAP123

    NYCAP123 Senior Member

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    Do they or are there a few who've been there forever and then a bunch that come and go in the business, and a bunch of part-timers. For those who make it I think you're talking a lot of hustle combined with perfection and luck. Most are also people who retired from other professions and already owned their boats. Imagine what return you would look for in starting up a small business with a $400K to $1M investment. How many jobs would you expect to create and what kind of return would you expect. Now compare that to the income of the average fishing charter captain. When I set up operations in Ft. Lauderdale ("the yachting capital of the world") I remember one mate telling me that he survived on hot dogs bought 20 lbs. at a time from the Sabrette outlet. He said he had more recipes for hot dogs than you could ever imagine. Breakfast, lunch and dinner. Now consider the hours you'll put in. Working mostly weekends and holidays, after a 10 or 15 hour day (if you're successful) then you get to do your vessel maintenance, bookkeeping and referral schmoozing.
    There's an old saying on the water: 'The quickest way to have a million dollars in the marine trades is to start with 3 million'.
    It's a hard business, dependent on the economy, the weather, the health of your boat and yourself, with zero security. People generally get into the business because it's in their blood. I know that I'd go postal if I ever tried to work in an office or retail store. A friend has a business where he counts on making 3 cents on this and 5 cents on that. I'd go insane. I can do $20,000 or even a million dollars in damage and end lives with one wrong move. I need that pressure. Boat captains are not nearly so laid back as they seem.
  11. Pascal

    Pascal Senior Member

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    It is true that strictly as a business, it is rarely viable because of the capital needed (the boat)

    That said it can be a good way to cover most if not all of the annual and operating expenses. But like every business, it takes time to build and many will fail.

    Personally, as a captain, I like doing charters... More than deliveries. I like the business side of it, certainly a lot more than chaufering an owner no matter how nice he/she is.

    I think the easiest set up is to have the boat owned by a corporation, have a decent insurance policy which allows occasional charters with reasonable liability and see where it goes. Keep it simple... Elaborate set up will only make the lawyers make more money and may not shield you much more.

    Whether or not it will work for you depends on your local mArket, your boat and your business skills. No surprise there... These are the keys to any business

    Again I m talking cruising charters, not fishing. Fishing charters are a very different market which I know nothing about :)
  12. MysticDolphin

    MysticDolphin Member

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    Location:
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    very insightful guys and I appreciate the straight forwardness... I do have the twic card... my attorney friend gave me some good advice as well... I may reconsider what I want to do.. I own the boat and took most of my life to get it.. so don't want to just give it away to the first idiot that hurts themselves.... will do a lot more reading...years ago I was advised against the cattle business.. already training quarter horses at the time so I thought why not.. sold everything in Calif. and went to Texas.. bought a ranch and had a lot of cows.... didn't work out.. I should of listened to those who were older and wiser.. I respect your alls opinions as you are seasoned vets of this business... will still pursue my Masters and see where it leads me...
  13. Capt Ralph

    Capt Ralph Senior Member

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    Interesting, a TWIC for a land-locked inland OUPV with no endorsements.
    Go figure.

    MysticDolphin, I'm not putting you down, just confused how a TWIC card is required your way. Did you have to drive to Houston for the interview?
    I've not realized there were trade/ports in Lake Texoma.

    This may further reinforce my original thoughts as the TWIC was just another register/revenue plot.

    Nobody at JaxPort will honor it, (I'm not union). Not a help at the airport when I serviced POS & ATM equipment (probably still a non-union issue). Never been asked for it during any work or assist activities on the water.

    So What can a TWIC do on Lake Texoma? Free coffee?
  14. Pascal

    Pascal Senior Member

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    Twic card is necessary for any license, whether first issue or renewal

    Actually, if you do not operate a vessel that requires a twic, it is not required, but you are required to have applied for it. Makes little sense but that s the rules...
  15. NYCAP123

    NYCAP123 Senior Member

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    rcrapps had it exactly right: "the TWIC was just another register/revenue plot".
  16. MysticDolphin

    MysticDolphin Member

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    Coast Guard made me do it, twic, had to drive 8 hours to get it...lol we do border Oklahoma..lol
  17. olderboater

    olderboater Senior Member

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    Talking to your lawyer has been mentioned as well as you insurance agent. Make sure to include an accountant. They type set up of your company will vary based on states.

    Now you have one huge advantage toward getting a decent start and that is a paid for boat, no interest and no payments. For many businesses it's the debt surface that makes their cash flow negative.

    Certain things I suggest if you're serious to distinguish yourself from those others sitting on the bench waiting. First I'd proceed and get at least a Master 100 License. Second I'd get my business organized professionally with cards, flyers, brochures and most of all an excellent internet presence.

    Do a few jobs, find your strengths and weaknesses. Once you've worked through that then do some aggressive marketing. First, get with the hotels, managers and concierge. Work out agreements. Second use gimmicks, coupons and discounts to fill empty time. Groupon and Amazon can be used. Especially use them off season.Arrange your scheduling to get the most possible runs per week. You spoke of being flexible. I don't disagree but have a set schedule from which you flex. For instance if you do half days till noon and afternoons starting at 1 bit someone wants a boat from 10 to 2, you accept based on your estimate of whether anyone else would rent it the remainder of the day. If it would have otherwise been unusued, oc course free it up and take the booking.

    Sell multiple ticket pacs. Someone gets a discount for three tickets. Hopefully they use all three and rare thrilled. If they don't, then they either give them to someone with interest or nothing happens. In that case you got paid for three times but only had to deliver twice. Selling books and packages always helps as it builds cash flow in advance of the expense being incurred.