For example, working as a captain, entertainment coordinator, guest services manager, or another important position aboard another ship would be good preparation for starting your own line.
Developing a cruise line on your own will require you to build your service offerings, buy or charter ships, create marketing strategies, and design operational structure on your own, which will be expensive and require trial and error. Working with a syndicate can give you the benefit of having partners that share in your business and also share the risk and responsibility.
Avoid taking on the large players, like Carnival and Royal Caribbean, directly, as these are powerful and established companies. However, there are a number of smaller companies that serve under 10,000 passenger per year. You could compete against these companies more easily than you could against the larger ones. [1] X Research source
It would be more cost-effective to start a boat-charter service or mini-cruise ship line. This would also somewhat simplify your navigation restrictions and enhance your ability to access more remote locations.
The cost of this type of small boat depends on its size and features, but even a small cruise ship with 100 berths will cost about $50 million. A full-sized cruise ship, like those used by Royal Caribbean and Carnival, will cost you at least $150 million (for the smallest ship class). The largest ships currently on the water cost a whopping $1. 2 billion. Your cost will also depend on your specific ship needs. Are you fine with customizing an existing one, or do you need to have a boat or ship built from scratch? Obviously customizing or buying a ready-made cruise boat will cost less than commissioning one from scratch. [2] X Research source You will also need operating capital to buy fuel, pay dock fees, pay employees, stock the ship with supplies, and for other ongoing expenses.
To cover these costs, you will have to fill the boat with customers and find a way to earn back your charter fee, plus a profit for yourself, over the course of the trip.
Your cruise line’s name. This should differentiate you from your competition in the same way that your offerings do. Make sure that your name reflects the type of cruise line you are starting. The activities you plan to provide on your cruise. For example, whale-sighting cruising, on-board activities, visiting cities or islands, etc. Your pricing structure. Remember that cruise lines profit primarily from on-board purchases like food and alcohol, rather than from the ticket sales. For a starting point, the average price of a cruise ticket in 2015 was $1,350, while customers spent an average of $429 on on-board purchases. However, much of the ticket price is eaten up by overhead expenses, like crew and fuel costs. [5] X Research source Earnings and growth projections.
The easiest way to finance a business is to do it yourself using your savings. However, coming up with this type of money this way is not feasible for most people. Taking out a small business loan can be an effective solution for funding your business, assuming you qualify for one. To do so, you will need experience, a sound business plan, and good personal credit. The Small Business Administration, SBA, offers guarantees on small business loans that can help you get the loan you need. The limit for an SBA-guaranteed loan is $5 million, through an International Trade and Export Working Capital loan. Most of the other SBA programs offer less and are subject to strict underwriting. In addition, you must find a lender who is familiar enough with the industry and willing to make loans, as the SBA program is a guarantee, not a source of capital itself. Angel investors are more difficult to obtain but can be a great source for both capital and advice, as the angel is usually an experience businessperson. Angels offer start up funds in exchange for equity (partial ownership) in your company. [6] X Research source
The easiest way to finance a business is to do it yourself using your savings. However, coming up with this type of money this way is not feasible for most people. Taking out a small business loan can be an effective solution for funding your business, assuming you qualify for one. To do so, you will need experience, a sound business plan, and good personal credit. The Small Business Administration, SBA, offers guarantees on small business loans that can help you get the loan you need. The limit for an SBA-guaranteed loan is $5 million, through an International Trade and Export Working Capital loan. Most of the other SBA programs offer less and are subject to strict underwriting. In addition, you must find a lender who is familiar enough with the industry and willing to make loans, as the SBA program is a guarantee, not a source of capital itself. Angel investors are more difficult to obtain but can be a great source for both capital and advice, as the angel is usually an experience businessperson. Angels offer start up funds in exchange for equity (partial ownership) in your company. [6] X Research source
If you run a very small operation, you may be able to fill many of these roles yourself.
Customers can sue for any number of reasons, so it’s best to get the highest insurance coverage amount that you can afford. Passengers can even sue over rough seas.
You will also need to obtain liquor licenses for the relevant regions if you are not cruising in international waters. In all case, contact the relevant authority (ports, the coast guard, local governments, etc. ) to inquire about specific permit and license requirements. You must adhere to the CDC’s twice-annual required health inspections, due to the outbreaks of various intestinal diseases on cruise ships. This is also a form of liability.
For example, many cruise lines are now seeking to attract millennials by offering cruises focused more on adventure and destinations than on on gambling and shopping. [8] X Research source
