Buying a yacht for private use is a great investment - in your future adventures, in your new lifestyle, in your mental and physical well-being. You get to explore the unexplored, spend quality time with your friends and family, or party like a celebrity. It's an experience of a lifetime and a dream come true for many.
However, even though you try your best to maximize your time on board, there are still weeks or even months when the boat’s unused and the crew ‘underutilized’. When your boat is just sitting in the marina, it’s just costing you money.
That’s why you should consider putting your yacht in a charter fleet. It can not only offset your expenses but even generate profit. Most importantly, it guarantees that your yacht is fully maintenanced and in top shape for when you decide to set sail on another vacation.
Chartering your own yacht is a great way to earn money off your investment. (Image source: Shutterstock)
The benefits of chartering your yacht
Chartering your yacht is a great strategy for making some money off your yacht when you’re not using it. But there are also a number of other advantages - here are the main ones:
A busy charter yacht can cover a significant portion of your operating expenses such as dockage, maintenance, insurance, and other incidentals. Additionally, charter yacht ownership produces an income that you otherwise as a private owner wouldn’t have, providing a faster return on the investment.
A yacht that is marketed for charter has a better market profile. On top of that, If the yacht is active and has a proven success record of providing high quality experience to its clients, it will attract both charter guests and potential buyers in the future. In the long run, chartering is a sound strategy for increasing your boat’s value which would otherwise depreciate with time.
It may sound counterintuitive but yachts that are part of the charter fleet are usually more regularly and better maintained. Frequent cosmetic and mechanical maintenance that chartering requires can extend the life of your yacht and preserve its resale value.
Charter yachts attract the best caliber of crew that will maintain their service at the highest industry standard. That also means you can enjoy the same quality of service whenever you decide to use it for personal plans.
Charter yachts require frequent maintenance. An experienced yacht crew will keep the yacht in
top-notch condition. (Image source: Shutterstock)
Earnings and expenses
As a yacht owner, you can definitely earn a profit by chartering your yacht and offset your costs. Here’s the breakdown:
The price of the charter depends on the market, the size, model, condition of your boat, the number of cabins, etc. The expenses which you must take into account as the boat owner include:
- insurance
- registration
- permits
- ship maintenance
- crew salaries
- charter equipment (water toys, bed linen, towels, shampoos, etc.)
- professional photography
Charter yachts which provide a wide selection of water toys are often booked better. (Image source: Shutterstock)
Even though there are many factors that influence the boat price, we at Magnum always try to set a competitive price that’ll make you stand out on the yacht charter market.
See the prices for the luxury yachts in our fleet here.
How many weeks can I charter my yacht?
For luxury yachts, you can expect your yacht to be booked for a minimum of 6-12 weeks a year, depending on the season.
The average number of weeks is higher for chartering sailboats and catamarans, usually about 14-20 weeks.
What to expect of a yacht charter management company?
With the right agency for yacht charter management, you can reap all the benefits of chartering your own yacht - offset operational costs, keep your crew sharp and your boat in top shape, as well as build a brand reputation.
The role of such a company is to provide consulting, support and help you achieve maximum booking through thoughtful promotion.
Here’s how that works in the example of Magnum:
Once a yacht owner decides to partner with our agency, we both sign the Central Booking Agreement. It states the rights and obligations of the owner, as well as the rights and obligations of us as a central agency. In it we also define the price list according to which the charter service for a particular vessel will be charged.
The agreement can be signed for a definite period (1 year) or for an indefinite period and can be terminated via written notice (from either party).
Bookings, promotion & payments
Once we sign the Central Booking Agreement with the boat owner, we focus all our efforts on promotion and positioning the boat on the market. It takes some time for the yacht to become "recognized" on the market but since we have access to a large global booking system through which we receive inquiries (YACHTFOLIO), this process doesn’t take too long.
A central agency for yacht charter management will help you to achieve more bookings through top yacht promotion. (Image source: Shutterstock)
After receiving an inquiry from a potential client, we send them a detailed offer with the price and presentation materials (brochure, crew profile, etc.), to give them a complete and better impression of the yacht. If the client confirms the booking, we sign the MYBA contract. The contract is signed by all the parties involved in the booking process - the client (charterer), broker, stakeholder and the yacht owner.
Payment to the yacht owner is made in such a way that half of the amount to be paid to the owner is paid on the day of the boarding, and the remaining amount on the day of unloading (or the first working day, if unloading day is during the weekend).
The responsibilities of the yacht owner
If you decide to charter your yacht, here’s what’s expected of you as the owner:
- During the term of the Central Booking Agreement, the yacht owner is not allowed to enter a business partnership with another yacht charter agency and is obliged to refer all agents who may contact him to his central agent.
- The yacht owner mustn’t promote his yacht independently or without the consent of his central agent.
- The owner must deliver professional photographs of the boat to the agency.
- The owner is obliged to invoice his charters in accordance with the regulations of the Republic of Croatia.
- The yacht owner is obliged to ensure the registration of the vessel and to have valid insurance policies.
- The yacht owner must provide other documentation and take actions that precede the provision of accommodation services on board.
- The yacht owner is obliged to provide an adequate crew in accordance with the size of the boat and the uniforms for all crew members.
- The yacht owner is obliged to sign the charter agreements on time and report any problems or delays to the agency as soon as possible.
- The boat must be adequately prepared for chartering - that includes cleaning, equipment procurement, as well as accommodation, uniforms & training for the crew members.
- The yacht owner must have a registered company and be able to issue invoices.
Why choose Magnum as your yacht charter management company?
Since we were founded in 2004, we’ve been recognized as one of the most highly qualified yacht charter companies in Croatia, with the fastest-growing fleet in the country. As members of the Mediterranean Yacht Broker Association, we maintain our business at the highest standards of professionalism and ethics.
We are well established in the yachting community: our agency is a YACHTFOLIO subscriber and collaborates with a large number of both global and local clients, as well as partner agencies.
Our team of experts have the know-how and the experience to ensure that your yacht reaches its full charter potential - that means maximizing the number of bookings and subsequently, revenue. We fully devote ourselves to each yacht owner and have an ‘all-hands-on-deck’ approach to supporting you.
If you would like to charter your yacht through our agency, feel free to contact us here.