The boat rental market fosters a community of infrequent boat users and boat owners whose boats can be rented based on location, type, feature, and duration.
Boat owners and rental businesses either provide boats with a captain and crew or hand the boat over to the renter. Before renting a boat in the latter situation, renter businesses and the boat owners will first check the renter's previous experience, boating competence, and availability of certifications.
At a CAGR of 5.53%, the global boat rental market is predicted to increase from $19.38 billion in 2021 to $26.87 billion by the end of 2027. This is exciting news for entrepreneurs in this field and those considering buying a boat hire business.
Similarly, boat rental business development is predicted to be fueled by the potential economic rebound in Canada. Let’s explore different dynamics and patterns to distinguish your boat rental business from others and to apply current changing aspects to add value to your offerings.
Avenues to Increase Your Profits
These are just a handful of the most successful methods we've identified for lowering running costs while growing income streams.
Peer-to-peer boat rentals
Boat sharing and peer-to-peer rental services are perhaps the quickest, easiest, and most pragmatic ways to make some money with your boats. Peer-to-peer services (like Airbnb) are systems where you engage via an app or website, where you can sign up to lend your boat to a fellow mariner who doesn’t have a boat.
If you or your team know how to angle, apply for a Pleasure Craft Operator Card Captain's license. This is one of the ways you can extend the offerings of your boat rental business. Specific varieties of fishing have their nuances, and many tips and techniques are exclusive to one type of fish or method of fishing over another.
Organizing tours of sights
This is another venture for which you'll need a captain's license. Because locals are already familiar with the sites, this type of operation is only viable in tourist cities of Canada. However, if you reside in a popular tourist destination in Canada like Tofino on Vancouver Island, this could be an enormous opportunity to make more money.
Revisit Your Target Market Strategy
Approximately 15 million individuals indulge in boating or associated activities each year in Canada. Being around, on, or in water, and participating in water activities such as boating, has emotional, behavioral, and psychological benefits.
Boating may take you to locations you've never imagined, thanks to Canada's infinite supply of lakes, rivers, and waterways. There are 250,000 lakes and rivers in Ontario alone, providing some of the best freshwater cruising in the world. But it’s noteworthy to consider that such an offering may vary according to seasons, holidays, and most importantly, the ebbs and flows of tourism.
Factors That Might Be a Threat
Tourism's impact is highly dependent on the type of boat rental business and its location. Rentals and charters, as well as marinas, are the industry’s most likely to be affected.
Of course, seasons will always be a factor that you need consider, ensuring that you have other ways to generate income in the colder months.
Water access and moorage issues are isolated, but they are substantial enough to affect boat clubs, schools, and marinas. Water levels are a challenge when it comes to water access. Again, this will vary from city to city, but it is particularly prevalent in the Great Lakes. A similar access issue has arisen on the Trent-Severn Waterway due to Park Canada's restriction in operational hours.
Obtain the Essential Permits
Boaters can get their boating license by passing a Transport Canada-accredited Boating Safety Test with a score of at least 75%. After finishing the online boating safety course, you can take the test with BOATsmart.
The Canadian Coast Guard legislated the Competency of Operators Pleasure Craft Regulations, which require boat operators to get a PCOC to limit the amount of boating-related fatal accidents on Canada's waterways.
Consider Market Research
The core recreational boat rental business in Canada generates almost $5 billion in annual revenue. Around 45,000 Canadians earned their bread & butter from this profession, where the yacht category is expected to have the greatest shares in the market.
As per the Recreational Boat Market, the recreational boat market in North America is predicted to be the most significant and fastest-growing globally because of the sufficient interest in recreational boating and water activities in this region.
Recreational boating is a renowned sport in Canada; therefore, there's a growing consumer preference.
As a result of the planned economic recovery, the industry will likely grow rapidly. However, it should be mentioned that your business might be running from a low point due to the COVID-19 (coronavirus) pandemic. There's a chance that international competition will put negative pressure on sales growth in the business.
In 2020, boat rental businesses experienced an overall volume increase of 17%. The year 2019 marked a remarkable 26% increase in Ontario’s boat rental usage, whereas consumers of British Columbia boosted with a growth of 51%.
Interesting Industry Facts
- About 4,400 businesses make up the boat rental industry, which caters to the 35% of Canadians who enjoy boating.
- Canadians spent around $7.4 billion on their recreational boating tours. Foreign visitors spend $2,750 each trip on average, compared to $400 for Canadians.
- The core recreational boating business has a significant impact on the Canadian economy.
Innovative Ideas to Create Differentiation
Increase your online visibility
A website is the backbone of any company's marketing activities in today's business world. Launching a website is relatively inexpensive, and it will deliver a wealth of information about your boat rentals, boat excursions, and services.
Generate long-term collaborations
Because of the present market disruptions, you'll need to collaborate with other businesses in your field. You may, for example, look for firms in your area that provide diving courses and form a partnership with them. Conversely, if you want to give your consumers more comprehensive packages, you might hunt for experienced photographers who are willing to lend you their services.
Invest in paid advertising
Consider using paid advertising such as Google ads or SEM to promote your business once you've built a social media presence.
Financing Your Expansion and Growth
Funding is a great way to cover costs that you might not have capital for. There are multiple forms of assistance available to help you expand, purchase tools and equipment, pay wages and cover other costs.
There are several alternatives for government funding programs, including:
- Grants and loans by Canada Startups
- Tax discounts and credits by Canada Small Business Financing Program
- Government funding through Supercluster
Local, provincial, and federal governments all offer these programs across Canada.
Preparing to Exit Your Business
Although this article provides guidance on how to run your boat rental business, it is worth mentioning the selling journey.
You should have an exit strategy before starting a business, because it has a substantial impact on the business’s development decisions. An entrepreneur's exit strategy is determined by the role they wish to play in the company's future. For example, if you wish to sell the company in its entirety, you’ll relinquish your ownership and the obligations that come with that.
If you still want to have a say in the business’s development and growth, you can choose to maintain some form of decision-making, but relinquish management roles.
Regardless of your circumstance, it’s crucial to familiarize yourself with the selling process. If or when the time comes, you’ll know what to expect and where to seek support.