You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your boat winterization business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a boat winterization business?
The startup costs for a boat winterization business are minimal. Business owners need:
- Basic tools
- A power washer
- Fuel stabilizers, antifreeze, and similar fluids
- Shrink wrap
- Specialized shrink-wrapping tools
Business owners who have little initial capital can begin by borrowing tools if they don’t have the required ones already, and a power washer can be borrowed or rented as needed. The required fluids don’t cost much. Boating places the cost of taking care of fluids between $50 and $110.
The largest expense is usually the cost of shrink wrap and the specialized tools needed to apply it. Michael Enos spend $2,000 on shrink wrap and tools when winterizing his first boat (which was his personal airboat).
Business owners can save on building expenses by going to a client’s site rather than purchasing or leasing a work area. The tools and equipment will fit in any car, truck, or SUV, so it’s easy to offer services on-site.
What are the ongoing expenses for a boat winterization business?
The ongoing expenses for a boat winterization business are low. Business owners need to purchase supplies as they use fluids and shrink wrap. Those that have employees must pay salaries and any commercial space that’s used must be paid for.
Who is the target market?
Boat owners are the target market for a boat winterization business. Anyone who has a boat that’s larger than a dinghy, canoe, or kayak may need their boat winterized.
How does a boat winterization business make money?
A boat winterization business makes money by charging customers for winterizing their boats. Whether boat owners do any of the above-listed work themselves can affect how much is charged.
How much can you charge customers?
The average amount charged to winterize a boat is $300. Smaller outboards can be as little as $100, while cabin cruisers can run $600 or more.
The fees charged by Sportsman's Boat Storage shows how the cost to winterize different boats can vary. The storage center offers winterization starting at $250. Additional fees are charged for extra services, such as:
- Changing oil ($75 to $110)
- Winterizing a freshwater or porta potty system (cost varies)
- Winterizing a ballast system ($50 per pump)
- Adding a fuel stabilizer ($14.21 average)
How much profit can a boat winterization business make?
With an average price of $300, a boat winterization business can bring in a substantial seasonal profit. Winterizing just two boats a day could result in a daily revenue of $600 throughout the fall.
How can you make your business more profitable?
Many boat winterization businesses also offer basic small boat repairs. To add repair services, business owners should take a marine engine repair course. Annapolis School of Seamanship, Universal Technical Institute, and many other schools offer classes.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your boat winterization business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a boat winterization service. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources
Certificate of Occupancy
A boat winterization service can be run out of a storefront or small office. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease space:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a boat winterization service.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build your own location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for you business’ location to ensure your boat winterization service will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a boat winterization business
Since boat winterization is a seasonal business, a concentrated marketing effort should be made from late summer through late fall. During this time, business owners can post flyers, purchase ads in local papers, and conduct local search engine optimization campaigns to reach potential customers.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
To increase customer retention, business owners should contact previous customers in late summer. Sending direct mail or even calling customers to schedule winterizations can keep those customers from switching to a competitor’s services.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Boat Winterization Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Anyone who loves boating and is mechanically inclined may enjoy running a boat winterization business. Business owners get to spend their days working on boats, and they don’t have to miss many days on the water since winterization is done at the end of the season. Mechanical skills are needed because winterization includes checking the engine oil, fuel, onboard plumbing, and other fluids.
This type of business can be run on the side since the work is seasonal and can be done part-time. Business owners who have primary jobs can supplement their income by winterizing boats during their off hours in the fall.
What happens during a typical day at a boat winterization business?
Winterizing a boat typically takes a few hours. The exact work done depends on the type of boat being winterized, but it usually involves the following:
- Pulling the boat out of the water (if not previously done)
- Cleaning the boat (possibly power-washing or polishing it)
- Draining some of the fluids in the engine
- Adding stabilizers and/or antifreeze to the engine fluids that are left
- Servicing the other fluid and electrical systems on board
- Covering the boat in shrink wrap
- Placing the boat in storage (either inside or outside)
This work may be performed in an indoor workspace, outside, or at a customer’s location.
What are some skills and experiences that will help you build a successful boat winterization business?
At the very least, business owners must know how to winterize many different types of boats. Customers will have inboards, outboards, inboard/outboards, sailboats, and wooden boats, each with slightly different needs.
To learn how to winterize different boats, prospective business owners should spend a season working at a marina that offers winterization services. There are a number of free guides on boat winterization, but these are better used as references than training materials. They don’t cover everything that business owners may encounter. (Boat U.S. is a well-known organization that has published a thorough guide.)
What is the growth potential for a boat winterization business?
Most boat winterization businesses are small, local operations. For example, Mike’s Marine Service is a typical marina that offers winterization and other services.
Businesses that expand beyond a defined region usually focus on a single aspect of winterization -- shrink-wrapping -- and offer the service for more than just boats. This is what Michael Enos did with Fast Wrap, a business that grew to dozens of locations by offering shrink-wrapping service for boats, amusement park rides, and other winterized equipment.
TRUiC's YouTube Channel
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One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
What are some insider tips for jump starting a boat winterization business?
Going to customers’ locations has several benefits beyond merely keeping startup costs low. By not procuring a specific workspace, business owners:
- Keep their overhead low, which allows them to undercut the competition
- Offer a more convenient service, which can become a major selling point
- Make themselves visible in boating areas, which leads to an increased number of clients
How and when to build a team
Many business owners start out by themselves and a number never hire employees. Those who do want to grow the business usually bring on seasonal workers to help meet the demand in fall. Having at least one employee also makes shrink-wrapping boats go much faster.