Start a marina by following these 9 steps:
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 guide to starting your marina. 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 marina?
Starting up a marina business or purchasing an established one requires a significant financial investment. At the time of writing, there were 18 marinas for sale on Marinas for Sale. They ranged in price from $625,000 for a marina in Upstate New York to $8 million for a marina and hotel development opportunity in Florida.
One of the largest upfront expenses when building a marina is the installation of wet slips (places for boats to dock). These can cost $50,000 to $60,000 each, although there are ways to keep them more affordable. In addition to wet slips, marinas usually need equipment for taking boats in and out of the water, buildings for on-site storage, land for uncovered storage, a building for an office and insurance. Additionally, obtaining the necessary permits and licenses can be a long and expensive process.
Because it costs so much to build a marina, business owners who want to keep their costs manageable may prefer to buy an established marina. Getting an established marina can make the permitting and licensing process easier, and there won’t be a need to install wet slips. Business owners may be able to get an especially good deal if they can find a motivated seller, such as someone who’s becoming older and doesn’t have children who are interested in taking over the business.
Business owners that want to install new or additional wet slips might be able to reduce the cost of the slips by using floating docks. Floating docks are only practical if the water is always calm, and they need to be taken out before any ice comes. In calm areas of lakes that don’t freeze, though, these can be an inexpensive way to increase a marina’s docking space.
What are the ongoing expenses for a marina?
The ongoing expenses for a marina business, like the startup expenses, are significant. Some of the larger ongoing expenses include maintenance costs, employees’ wages, insurance premiums and licensing fees.
Who is the target market?
A marina business’ ideal customer is someone who owns a sailboat or powerboat that’s too large to easily trailer. Not only will such a boat need to be docked or moored during the boating season, but it will take up a lot of docking space. Since docking and storage fees are often charged by the size of a boat, the costs for keeping these boats can be high. Large powerboats also require a lot of fuel, which can bring in more revenue if a marina sells fuel.
How does a marina make money?
A marina business’ primary source of revenue comes from providing docking, mooring and storage for boats. Docking and storage fees are often charged based on the size of a boat.
Other potential sources of revenue include:
- Selling boating supplies and equipment
- Selling fuel for boats
- Selling fishing licenses (depending on a state’s licensing requirements)
One full-service marina in Minnesota even offers on-site entertainment and a firepit for evening gatherings.
How much can you charge customers?
Docking and storage fees vary a lot. How many amenities a marina offers, where a marina is located (both including its geographic region and particular location within a harbor, the size of a boat and the type of a boat all can affect how much a marina charges. For example, Mint Life reports that mooring rates for sailboats can range from a few hundred dollars per season to $1,000 or more per month. A marina in the caribbean charges $1.05 per foot of boat per day during the boating season (if paid daily)
How much profit can a marina make?
The profit potential of a marina also varies. How long the boating season is in a marina’s region and how big people’s boats are greatly impact how much a marina can make. A marina in a good location, however, can potentially earn tens of thousands of dollars, if not much more, each year.
How can you make your business more profitable?
Marina businesses can increase their revenue streams by partnering with charter fishing and tour boat companies. Often, these companies may be willing to pay a fee for any customers that a marina refers.
A marina may also hire a mechanic to service and repair boats. In some cases, this can become a very significant second revenue stream for a marina.
What will you name your business?
Choosing the right name is very important. Read our detailed guide on how to name your business. 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.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your marina is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
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.
Recommended: Find the right bank for you, read our review of the Top 5 Banks for Your Small Business
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
In most states, it is necessary to obtain a marina license. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
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.
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.
To decrease liability and increase transparency, it is best to have customers sign a Marina Storage Agreement. An example of such an agreement can be found here.
Marinas are periodically inspected by state health departments mainly to ensure that sewage is disposed of properly. A sample marina inspection checklist can be found here.
STEP 7: Get Business Insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
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 marina
Connecting with local boating professionals is also one of the best ways to market a marina business. As a business owner connects with local captains, they’ll develop a reputation. When recreational boaters see commercial vessels at a marina, they’ll assume that the marina is a quality place to do business.
How to keep customers coming back
As is the case with many land-based businesses, location is extremely important when running a marina. Local boaters will want to be able to quickly get to the marina and take their boat out, so a marina should be easily accessible by road. Visiting boaters won’t have a car when they dock, so a marina should ideally be within walking distance of local shops, restaurants and other businesses. Finally, all boaters will want to be able to easily get into and out of a marina, so having easy access from the water is important.
It may take time to find a marina that’s easily accessible by road, walking and water, but a business owner’s patience in selecting a location will likely be well rewarded.
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 Marina In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
People who are familiar with boats and mechanically inclined may be well-suited for owning a marina business. Having boating experience will help a business owner anticipate their customers’ needs. Basic mechanical skills can help reduce maintenance costs, as owners can make basic repairs to docks and other facilities themselves. These skills aren’t absolutely necessary, but they can help a lot.
What happens during a typical day at a marina?
Most marina business owners are highly involved in their business’ daily operations. They both interact with customers and manage their business. Depending on what services a marina offers, a business owner may:
- Help boaters fuel up
- Sell boaters supplies and equipment
- Relay the day’s weather forecast
- Recommend places to go boating
- Help weigh fish
When not directly helping customers, a business owner may:
- Manage and schedule employees
- Reorder and restock products and supplies
- Repair docks and other facilities
What are some skills and experiences that will help you build a successful marina?
A marina business owner should be able to maneuver a boat themselves, so they can help any customers who have trouble launching, docking, mooring or taking a boat out. While boaters are generally expected to be able to hand their own boats, helping an inexperienced boater or someone who’s having trouble is preferable to having them damage a dock or launch. For interested business owners who don’t have experience boating, the U.S. Coast Guard has a variety of safety courses that are offered throughout the country. Other organizations, such as BoatUS Foundation also offer courses on different aspects and types of boating.
Business owners also need to know how to manage employees and inventory, price their products and services, and market their marina. They also need to be familiar with environmental regulations, such as the Clean Boater Act. The Association of Marina Industries offers several levels of training on topics like these. A marina consulting firm, like Marina Management Services, Inc. may also be able to help with some of these aspects of running a marina.
What is the growth potential for a marina?
Many marina businesses remain independent businesses with one location. Some, however, have grown to be regional or national chains. Freedom Boat Club, for instance, has more than 115 locations. Nautical Boat Clubs is a smaller franchise, with 10 locations in four states.
TRUiC's YouTube Channel
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Take the Next Step
Find a business mentor
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.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a marina?
Boaters will come to marina owners for all kinds of boating information. They might ask about the current weather conditions, the best places to go boating or what type of bait to use fishing.
To be able to answer customers’ questions, marina owners need to become very familiar with the waters surrounding their facility. They also should connect with captains of fishing charters and tour boats, as these captains are often the best source for current wind, weather, boating and fishing conditions. They’ll have knowledge that only locals possess.
How and when to build a team
The number of employees that a marina business needs depends on how many services it offers. A marina that only offers mooring may be able to get by with just one or two employees who help move boats and repair facilities. A marina that has products for sale, sells gas and offers other services may need several employees from the outset.