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Friday
Jul152016

COMMERCIAL BOATS AND MARINAS 

This article, by Dennis Kissman, was published in Marina Dock Age –  March 2015

It is not uncommon to have water dependent commercial ventures operating out of a recreational boat marina.  Most of these operations are recreational boats for hire operated by the boat’s owner and operated as a separate business.  As a marina owner or manager these types of operations can have a positive impact on the profitability of the marina but if not controlled properly can have a larger negative impact.

Some of the more common enterprises include sport fishing charters, day sailing cruises, dive boats and what is commonly referred to as head or party boats where a large number of people are on the boat for a particular activity or event.  These types of operations operating out of your marina attract a different type of clientele than the typical recreational boater.

There are three important aspects to consider when a commercial venture operates out of a recreational marina.  First, is the increased risk of liability, second, additional wear and tear on the marina’s infrastructure and third is if the marina is designed to accommodate commercial ventures.  Let’s look at each of these three issues and understand what is at stake.

First on the subject of risk; as the marina operator you need to ask yourself the following questions.  Are the boats that are working out of your marina for hire recognized by the public as a legitimate business?  Do they have a business license and do they carry the proper insurance coverage that includes the marina as an additionally insured on their liability policy?  If you answered no to either of these two questions you could be placing your marina at risk should an incident occur involving one of these operators’ paying customers while on marina property.  One of the more frequent incidents with people not familiar with marinas is the “slip and fall”.  If a slip and fall accident occurs when that person is either boarding or disembarking the charter boat it is unclear who is at fault, the marina, the boat owner or the injured person.  What you can be sure of is that the marina will be named in any litigation resulting from that accident.

If you have the possibility of this happening at your marina talk to your insurance agent to make sure you are properly protected.  Also have your insurance agent review the boat owners insurance to confirm they have the proper protection for the marina.

Second, boats operating as commercial ventures will add additional wear and tear on the marina’s infrastructure as compared to that of a recreational boating customer for two reasons; first the increased number of people coming to the marina and second the frequency in which it happens.  Also, a commercial charter boat, because of the frequency it departs the dock and returns, puts more pressure on the mooring cleats, pilings and the dock structure itself than you would expect from a pleasure boat customer.

Is there a designated location in the marina where commercial boats are docked or are they scattered throughout your marina?  If they are scattered throughout the marina it is a problem.  It is like trying to mix oil and water.  Recreational boaters come to their boat to relax and enjoy the ambiance of the marina and being out on the water.  Once there is commercial activity on the dock that ambiance is lost and often times results in losing your recreational boating customer all together.

To minimize this impact on the marina all commercial activity working out of your marina ideally should have separate access to a dock dedicated to this type of activity.  Depending upon your marinas configuration this may not be possible but you should try to at least group these boats with like activity as much as possible and keep then as close to the bulkhead or shoreline as possible.  Although your recreational boat customers may have to walk pass this activity when going to their boat they will not have people walking by their boat on a frequent basis.

The third issue; is your marina designed to accommodate commercial ventures? Charter boats will add additional demands not only on the docks but also on the marina’s parking lot and restroom facilities.  Most times these issues are not mentioned in any permitting requirements imposed on a marina but the marina should address these issues so as not to inconvenience your recreational boating customers when wanting to use their boat.  If it is your decision to cater to the commercial boat customer then you should take into consideration their specific needs.  One example is that we have found these commercially operated boats always need more secured storage space whether on the dock or in a dedicated storage facility than that of a typical recreational boat owner.  Also, these commercial operated boats will usually demand more utility services than the recreational boater.  Make sure that your utility infrastructure can accommodate the higher demands.  If your dockage rate structure includes any utility services these commercially operated businesses should be sub metered and charged based on usage.  If you do not do this there is a good chance that the marina will end up subsidizing their businesses.

If you have or are considering commercial boats working out of your marina consider an alternate rate structure that would be appropriate for commercial boats for hire working out of your marina as their demands on the marina are far greater than the recreational boater.  As previously stated, commercial ventures operating out of your marina can have either a positive or negative financial impact on your marina.  Since no two marinas are exactly alike I think it is safe to say that thinking through all the consequences of your decision is paramount.  Take into consideration either the short and long term gains or losses keeping in mind short term gains in profitability may result in long term losses.



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