Chartering for Fun and Profit?

Don't be misled by the title, because at times, you're going to find neither fun, or profit being a charter operator, especially in the profit part.  OK, now that I have burst your balloon about getting filthy rich in the Charter Fishing Industry let's get down to the reel facts pertaining to your newly chosen career that looms large on the not to distant horizon.  

I imagine by the time you've considered being a licensed, for hire charter captain you've developed the angling cleverness necessary to be a fairly proficient producer of the of fish you intend to catch.  Now, I'm not speaking about just when it's easy and everyone is loading up with fish, but on those marginal days when the word "cooperation" in not in your targeted species vocabulary.  If you can't catch fish under all circumstances on a consistent basis and at all times of the season?  Then garner the skills needed before proceeding any farther into your new found career.  Expertise is an acquired taste that takes several years to hone to a razor sharp edge.

Requirements for Charter License

Before you can become a Charter Captain, there's several hoops to jump thru.  A complete physical, a recent drug test, knowledge of first aid and proof of citizenship (birth certificate).  Then you have to be accepted by the United States Coast Guard just to qualify to take an extremely difficult test.  The "Rules of the Road" section of the test requires a score of 90% to pass and I've heard it said, "there's a combination of more than 5300 questions they can ask."  The "Rules of the Road" are predicated on prevention of collision at sea where you learn there are firm guidelines, but no one has an absolute right of way "if" collision needs to be avoided.  Plan on a lot of hard study if you plan on passing.  And to exacerbate the test issue it's likely you haven't taken a more than a drivers license test in several years.  So, just learning how to take a test again is going to be relevant.  

Prerequisites to this job include much more than you were probably aware of.
You're going to find yourself to be a one-man special forces army.  The first thing that comes to my mind that's important is, book keeping skills to keep track of business expenditures and your client's scheduled fishing trips.  Getting back to the business end and keep sight of "business expenditures" is vital to whether you sink, or swim as a charter captain.  You're no longer taking friends and family members on an occasional off the dock sojourn.  If you do your home work like me, knowing the cost factored into each trip will be helpful in turning a profit.  Hopefully, your earnings will be enough to maintain your business as a profitable venture.  

Many charter operators that I've seen actually lose money every time they leave to dock with paying passengers and are destined to failure in the long haul.  From what I'll seen in the past 5 seasons, many of new breed charter operators are just trying to defer the price of the family cruiser and let you help pay for it.  So, in other words many part-time operators will never will see chartering as a profitable business.  According to a study done back in the 1980's the average life of a charter business was something around five years.  In my twenty years in the business I've seen plenty come and go.

I can't stress heavily enough in what the involved reel costs are!  Dockage, maintenance, general supplies, ice, fuel cost, incidental tackle, charter insurance, boat cost, travel expense, paying a deckhand, advertising, phone, office supplies, licenses and fees all become part of the vital equation of profitability.  In my case, based on a 100 lake charters per year when you figure in all the expense incurred it costs well in excess of $225.00 to run a $350.00 half day deal.  One thing about the charter business, get used to everyone having their hand in your pocket, because that's exactly the way it is!  Also, that's one of the reasons I don't particularly care to run half day trips, because you're working with a pretty slim margin.    Running two half trips a day?  Forget it, because a 6 hour charter in reality takes about 8 hours counting preparation, fish cleaning and readying the boat for the next group of anglers.  Now, 16 hours a day is a little more than I want to digest at this stage of my career.

Safety Issues

Now, this subject deserves extremely close examination.  Safety must be first and foremost in your mind set, because you' re responsible for other peoples lives and well being.  To my knowledge only one charter vessel has ever sunk in the charter industry.  The boat that went down was fishing with passengers aboard off Port Austin when this tragedy occurs, all hands were rescued, although the boat was lost and still rests on the bottom of Lake Huron.  This in itself is an amazing testimony to the safety record of all licensed charter captains in Michigan.

My biggest concern with safety, is injuries aboard.  Things like passengers wondering about while the craft is underway, riding on the gunnels and transom while not paying attention to the big picture.  In my 20 years as a charter captain I've two major incidents when customers passed out, or fainted requiring hospitalization.  Also, I've had two persons stick hooks in themselves, with both having consumed too much alcohol.  So, I guess the point I'm trying to make here, is that you're not on a lark and are responsible for other peoples lives.  

Where Do You Get Charters?

The most important thing you have to remember about the charter business you have to have paying charter guests before it becomes a business.  Now, just because you laid a few fish on the dock before doesn't mean the world will beat a path to your boat with eager guests willing to fork over a goodly sum on money.  Up until the time you start generating revenue it's not a business that will support itself.

Certain outfits will book charters for you at a 20% off the top charge.  The one that comes to mind here in Manistee is "Friendly Fred's" (Fred MacDonald) Charter Booking Service which doles trips to only his favorite cronies most of the time.  Now, Fred looks mainly at the 20% going into his pocket and not the skill level of the charter operator.  And as you can tell, since Fred's all-out alliance with the Indian Casino here in Manistee we get along like oil and vinegar.  I just wonder if Fred's seen the 5 net tugs in Solberg's Marina?  Moving on, another outfit that does this in a vastly improved way is Best Chance Charters in Saugatuck, Michigan.  They don't run the favoritism thing and are much better at booking a multitude of charters than anyone else I know.  Plus, all their captains are extremely top notch.

Word of mouth is probably the best advertising, but until you build a customer base, advertising in outdoor magazines and doing Sport Shows is an avenue that worked for me in the 1980's.  However, since the advent of the internet my results from both have been lack luster.  Case in point: in the late 80's a 1/8 page in the Woods n Waters cost less than a 100 bucks, now it's over $300.  Sport and Fishing Shows used to cost under $500, now you'll tie up at over a grand in each including out-of town meals and lodging.  Brochures stuffed into the "right place" can reap rewards if you can get them into, oh, let's say.......the busiest restaurant in town.  Advertising is a silent cost that adds to the price of every trip, like it, or not.  So, beware and look before you leap.

Another way is to receive trips is from as well established charter operation and catch some of the over-flow business most captains will encounter from time to time.  Working together is what this job is supposed to be, or better put; cooperation is one of the keys of success.

One venue I almost forgot to mention, was getting "so-called" publicity from outdoor writers and promotional events like television shows.  Keeping in mind, the writer, or TV Show "personalities" are just regular folks and not larger than life.  No matter who they might be.  Here's a little understood fact; they need you, as much, as you need them.  Without someone new with fresh approaches to catching Great Lakes fish, their column or show becomes a continuous re-run with the same people.

I was lucky enough to do several TV Shows in the latter 80's and early 90's and formed good working relationships with noted outdoor journalists and TV hosts.  Taking writers is easier than do a TV deal, because on a TV shoot the footage is most important.  Cameras get in the way, and the entire process of your regular routine can slowed by as, much as 50%.  Here's a tip worth of note.  If you're required to do an on-camera interview, do it with gusto and animation.  Then if the camera gets you jittery and you say something wrongly, like stumbling on words...yell "cut!"  That way it will have to be re-done without making you look too stupid.

Last, but not least is maintaining a mailing list, or a complete data base of every paying guest you've had onboard.  The public has a short memory, and with the hectic pace of today's lifestyle can forget about the fun they had with you.  So, a friendly reminder in the form of a mailer will jog their recollection and possibly generate a day's work for yourself.  Now, these folks have already been with you and in most cases with repeat business, you know exactly what to expect.  So, cherish the return fisherman and your life as a charter operator will be a lot easier.

Show Tip: Here's something need to iterate about doing the "Shows," once many years ago I did the Pontiac Silverdome and we hit with a blizzard, canceling out any crowds on Friday and Saturday.  An ice storm produced the same results when I did the Lansing Show too.  Sport Shows run in late winter, so be cautious with these.

Dealing with the "Agencies"

Your first stop is going to be with the U.S.C.G, although my license now states it's from the Merchant Marine.  If you opt for a school like Great Lakes Training to prepare you for the test, that's a 6, or 7 day cram course that will cost you around 7 Ben Franklins (100 dollar bills).  Then it's an additional $275.00 more to take the test at their facility. This training school was started by Dave Waddell, as an offshoot of his brief association with Houston (pronounced how-stun) Marine Training based in New Orleans, LA.  Incidentally, the charter license used to be free, now they charge you around a 100 bucks to send it to you.

Get ready to make new friends with the Marine Safety Officer from the DNR with pricey boat inspections every two years.  Boat inspection fees went from 25 bucks in 1983 to $250.00 for a new boat inspection in 2002.  Once the $250.00 is covered, then inspections drop about a 150 bucks.  Please keep in mind purchasing all necessary safety gear to pass the scrutiny the Marine Safety Officer runs in the neighborhood of around grand.  I almost forgot to mention the monthly catch reports that need to be sent in ever month during season.  If you don't send them in within allotted time, the State will yank your boat inspection license.

In my case I also get to deal with the State of Michigan's Motor Fuel Tax Bureau to get back .19 cents a gallon on gas purchased on the water for my business.  

Also, I get to do business with the feds again with the paper pushing bureaucracy  called the U.S.D.A. aka Forrest Service here in Manistee, so I can give them part of my revenue from every trip I run on the Big Manistee River.  I get more correspondence from the Forrest Service than from anyone else.  I consider their involvement with the Big Manistee River Public Launches as a travesty of justice.  It used to be free to launch and retrieve your boats on the BMR for all.  Now, they even charge the sport fishermen a yearly surcharge to access their use ramps.  The excuse given is to pay for the ramp maintenance, however there's a federal law that covers the marine usage of gas.  Earmarked federal gas tax dollars are supposed to pay for this and not us!  So, I believe we're getting a snow job and not the truth!

If you pull in to use their public out-houses at the Forrest Service Access Sites and don't have a yearly tag, or purchased a daily tag for 3 bucks, they can write you a 70 dollar ticket for having to take a leak.  Talk about the land of the free.........eh?

Here's a tip in passing your Michigan DNR boat inspection, have everything out and ready for the CO and tell them you want a safe boat too.  The Marine Safety Officer is there for your good also.  Most of the time, even if minor infractions are found they still pass your vessel and tell you what to fix.  Make sure to have your charter license, boat registration and up-to-date proof of charter insurance papers too.

Retiring and Chartering?

I heard it said several times, "when I retire I plan on becoming a charter operator."  Well, the straight and simple truth is, unless you have a high tolerance for over-work, little sleep and low wages this job is not retirement bliss.  Due to the nature of the short season associated with our Great lakes Fishery, "you've gotta make hay, when the sun shines."  Meaning when July, August and early September you'll be at the boat everyday, if you plan on making any money with your 100 and some thousand dollar investment.  If you're a poor quality producer of fish the last statement is not going to apply, because you'll have no repeat business, and find it distasteful taking money under false pretenses.

People Skills

You're going to need to have some talent for being a salesman.  Relaying your message to the paying public is what sales are about.  In my case, I believe that I can inform a potential guest as what to expect without making phony-baloney "pie in the sky promises."  Exchanging exact information about fees, lodging, length of the trip, fishing license info, years in business and the size of your vessel all need to be shared with the budding paying guest.  Put your best foot forward and go from there.  Establishing a friendly relationship early into the conversation by calling him by his first name always works to ease the awkward stage of "let's get to know one another." 

It's my belief that the public is paying for a quality captain, so act like one and bring up the safety issues, as soon as they board you boat.  And above all else be yourself at all times,  not a wishy-washy and afraid to tell them exactly what's needs to be done, especially when the fish is at the net.  Time allowing, every morning I hold a brief mini-school so my passengers will have an idea of how to develop a sound technique on how to fight and land fish with a high degree of success.

When the Fish Don't Bite?

This is the time for complete and total honesty and not flimsy excuses like "you should have been here yesterday."  Most of the time our Great Lakes fish will bite, but locating them can be the main problem.  Just be patient and keep using the process of elimination until you find a winning combination.  Truth is your best friend and if your guests hold you personally responsible they didn't empty the lake, tell them to go to a trout pond where it a sure thing.  Just the name "fishing" implies risk and not all of your charters will be full boxes of fish no matter how hard to try.

Your guests will recognize an all out maximum effort.  Also, they see an unwillingness change locations, a dirty boat and shoddy tackle.  So, bear down and keep a good assortment of what the fish are chewing on aboard, and a spiffy-clean well equipped boat.

IRS

Just the mention of the IRS is enough to get anybody shaking in their boots.  This is ranks as one of our governments most powerful bureaucracies.   Yes, they can and do allow your business expenses to be deducted from your overall income.  Now here's the catch, if you don't show a profit within a said amount of time, usually three years.  Then IRS says you're a hobby, says you're not a business and comes after you for underpayment of back income taxes.  Also, they wait the three years, or more, so they can tack on a hefty 9% interest charge and along with the back taxes owed it will amount to one healthy chunk of dough in a big hurry! 

How do I know these things?  From first hand experience, even though I showed no outside income, other than the charter business income, they still stuck it to me to the tune of around 10 grand.  Now, to add insult to injury, they also inform the State as to your underpayment on taxes, then the State jumps on the band wagon and sticks you for more dough.  While I could have fought the IRS findings with a tax attorney and probably won, what was the attorney fee gonna be?  Plus, you go to their court and not a public, or federal court where thing might be a little more impartial.  You go directly to the IRS court and you can imagine how impartial they're going be.  After weighing all the options I decided to pay up and consider it "the price of doing business!"

Reasons for Failure?

Let's start this topic with what I call, "the grass is always greener syndrome."  Meaning things appear to better if you're on the outside looking in. Most wage earners spend their entire life working for a paycheck with little knowledge of what went into that check handed to you at the end of the week. Here's a fact you're going to have to contend with in most cases, as charter operator has never ran any sort of business before getting a grandiose idea about running a charter service.  This is a major strike against you if you haven't been involved in some type of business as the proprietor knowing the pitfalls that will beset any sort of business endeavor.  

Once the realization hits the operator that is a reel job and requires long hours and intense dedication to break even, let alone make a profit.  Please keep in mind, the season is only 6 months long and boat payments are a every month deal.  So, you don't have 12 months of income, you only have 6!  Let's not lose sight of when the public wants to go too.  In Manistee the big deal is April (Brown Trout) July, August and early September (King Salmon time).  If you stay in Manistee during May and June plan on scarce appeal of your fledgling charter venture, all be it may the fishing is pretty darn good.

I've never met a charter captain who didn't put forth the effort to catch fish, but I have see varying degrees of working hard to insure this fact happens.  No repeat business, means a pretty skimpy schedule for the next season, so you'd better put forth the required effort and hope the fish bite like hell.  Also, it's my belief the Michigan charter customer is spoiled with becoming accustomed to limit catches and more fish boated deemed necessary to call it an extremely successful outing.  

Forget Where They Came From?

Many a newly licensed captain forgets his roots came from the ranks of sport fisherman and feels overly empowered with his new found status.  Well, I'll let you in on a secret, being a charter operator is a "no big deal" thing.  It only means that you've leapt over all the hurdles to become a legal, for hire outfit.  It has nothing to do with your fish catching skills, or places you head and shoulders over the sports fleet.  So, in other words don't ever forget where you came from and treat every boater, or fishermen with the same respect you want.

Granted there will be times when things can get a little out of hand, but maintain a cool head, because paying passengers are not onboard to deal with boat rage.  Dodging discourteous boats, tangling lines with other vessels and having fish cut off by other watercraft is gonna happen no matter what.  So, just accept it as one of the drawbacks of the job and go on, as if it didn't take place at all.

Reel Charter Snippets

1.  Don't lower your rates to the folks that are always looking for a deal, let them go elsewhere, because in the long term they're going to be nothing, but major grief!

2.  Fishing in rough and uncomfortable seas is the surest way to lose clients.

3.  Let the guests become drawn into the excitement and if possible have them get their own rod when a fish strikes.

4.  Never under any circumstances take for granted a limit catch means repeat business.  My worst repeats are from heavy catches and making it look too easy

5.  Be patient with your guests, but also inform them you've got a job to accomplish and stay out of the way when necessary, especially when a large fish is behind the boat.

6.  It's fine line to maintain firm control of your vessel without displaying the antics of Capt. Ahab in search of Moby Dick.

7.  Get a deposit, talk is cheap and things get reel serious once money crosses your palm.

8.   Don't under estimate your clients ability to become part of your winning team, they will rely on you for needed instructions, so take charge and give it.

9.  Don't worry what other charters are producing, because it's a waste of your mental energies that can be devoted to the next fish you're gonna catch.

10. Can You Do It?  Yes you can!  I'm a perfect example that anyone can. 

11.  Don't lose sleep over the passengers that either didn't like you, or thought you weren't doing you utmost to show them fish and a good time.  It's the nature of the world not to get along with everyone.  We all have had experiences with people were more likely to be compatible with, and visa versa.

12.  Don't race other captains to produce fish, the only race I'm in is the one that leaves the clientele the most satisfied.

13.  Good, bad or indifferent I try to make a stanch impression, so my guests will always remember my name.  It surprises me that several of the fishermen I taken have been on charters before and don't recollect their previous captains names

14.  Don't be a cut-throat and charge way less than your competition, because they'll never throw you a trip, or two your way if you're the cheapest operator in town.

15.  Try not to flash big catches at the brag-board until less fortunate captains have cleaned their catch and said goodbye to their guests.

16.  Don't try to book trips over your boat radio, by doing way too much bragging and pissing everyone off in the process.  

17.  As with any start-up company you're going to need absolute 100% total cooperation from your spouse, friends and family.  Long hours and the strain of building any business is a daunting task.

I hope the info I shared with you will take some of the mystery of running a charter service.  Also, I hope that you gained a better insight into our Great Lakes Fishing Industry from the inside looking out.  Admittedly when I was a sport fisherman I always looked on charters with some kind of envy.  Now, I see a different picture of all the work you have to go through for a small financial  recompense, My biggest reward comes from doing something that I love and seeing the total excitement of newfound devotees to the sport of Great Lakes angling.........Capt John

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