How to Start a Canoe and Kayak Rental Business

Here is the most important information you need to know if you want to start a canoe and kayak rental business:

1. Location — Find a location near water where people are allowed and interested in canoeing and kayaking. Rivers, lakes, and coastal areas are popular choices.
2. Franchise — Here are some of the best canoe and kayak rental franchises to choose from: Freedom Boat Club, Wheel Fun Rentals, and Get Up and Go Kayaking.
3. Equipment — Invest in different types of canoes and kayaks. Also offer paddles, life jackets, safety gear, and transportation racks.
4. Storage solutions — You’ll need a secure place to store your canoes and kayaks when they’re not in use. Racks and shed space are necessary.
5. Register your business — A limited liability company (LLC) is the best legal structure for new businesses because it is fast and simple. Form your business immediately using ZenBusiness LLC formation service or hire one of the best LLC services on the market.
6. Legal business aspects — Register for taxes, open a business bank account, and get an EIN.
7. Insurance — Liability insurance can cover accidents, while property insurance can protect your canoes, kayaks, and equipment.
8. Online presence — Take your canoe and kayak rental business online and create a website where people can book services in your shop.

You May Also Wonder:

Is canoe and kayak rental a profitable business?

Both canoeing and kayaking are very popular so you should have no problem getting customers if you have a good location. Profit margins are also relatively high, so there is definitely money to be made. 

What is more popular canoe or kayak?

Kayaks tend to be more popular because they are easier for one person to maneuver. Both are popular, however, with people who enjoy water recreation.

How can I create a user-friendly reservation system for customers?

You can go to a web developer to put a booking system on your website. Developers have expertise in making those systems user-friendly.

How can I maintain and repair the rental equipment?

Your best bet is to learn how to do maintenance and repairs yourself to save on costs. If not, you can hire someone with experience.

What are some effective ways to gather feedback and improve the rental experience for customers?

You should send surveys to customers after their rentals to get feedback. Then you should make changes using their comments.

Step 1: Decide if the Business Is Right for You

Pros and Cons

Starting a canoe and kayak rental business has pros and cons to consider before deciding if it’s right for you. 

Canoe and Kayak Rental Industry Trends

Industry Size and Growth

• Industry size and past growth — The US kayak rental industry is worth an impressive $105.3 million after modest growth in the previous five years.
• Growth forecast — The US kayak rental industry is poised for steady growth during the next five years. 
• Number of businesses — Almost 2,300 kayak rental businesses are operating in the US. 
• Number of people employed — The kayak rental industry employs about 5,500 people.((https://www.ibisworld.com/united-states/market-research-reports/kayak-rental-industry/)) 

Trends and Challenges

Trends

• Kayak rentals are rising in popularity post-pandemic, as people look for outdoor activities that are closer to home. 
• Pedal-drive kayaks are gaining ground on paddle-propelled kayaks.

Challenges

• Injury risks are a real concern, so liability waivers are a necessity.
• Ensuring safety means regularly inspecting and maintaining vessels, and staff must have CPR certifications. 

How Much Does It Cost to Start a Canoe and Kayak Rental Business?

Startup costs for a canoe and kayak rental business range from $20,000 to $40,000. Costs include canoes and kayaks, and a van and trailer to transport boats and renters after trips. 

You’ll need a handful of items to successfully launch your canoe and kayak rental business, including: 

• Canoes and kayaks
• Van
• Trailer
• Life jackets

Start-up Costs	Ballpark Range	Average
Setting up a business name and corporation	$150–$200	$175
Business licenses and permits	$100–$300	$200
Insurance	$100–$300	$200
Business cards and brochures	$200–$300	$250
Website setup	$1,000–$3,000	$2,000
Location rental depoist	$1,500–$3,000	$2,250
Canoes and kayaks	$10,000–$20,000	$15,000
Van to transport renters after trip - down payment	$2,500–$5,000	$3,750
Trailer to transport canoes and kayaks	$3,000–$5,000	$4,000
Life jackets	$500–$1,000	$750
Total	$19,050–$38,100	$28,575

How Much Can You Earn From a Canoe and Kayak Rental Business?

Prices for canoe and kayak rentals are about $30 per person for a two-hour trip. Your profit margin after overhead should be about 40%. 

In your first year or two, you could have 10 vessels and an average of 20 customers 200 days of the year, bringing in $120,000 in annual revenue. This would mean $48,000 in profit, assuming that 40% margin. As you get more traffic to your business, and you add more canoes and kayaks, sales could climb to 40 customers a day for 250 days of the year. With an annual revenue of $300,000, you’d make a tidy profit of $120,000.

What Barriers to Entry Are There?

There are a few barriers to entry for a canoe and kayak rental business. Your biggest challenges will be:

• The substantial startup costs
• Finding a waterfront location with adequate storage

Step 2: Hone Your Idea

Now that you know what’s involved in starting a canoe and kayak rental business, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an Opportunity

Research canoe and kayak rental businesses in your area to examine services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a business that also rents peddle boats and paddle boards or kayak rentals on a whitewater river. 

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Define Your Rental Menu, Pricing, and Additional Monetization Streams

In addition to kayak and canoe rentals, you could also offer paddle boards, fishing equipment, and scenic guided tours. You could even expand into bike rentals. 

How Much Should You Charge for Canoe and Kayak Rentals?

Prices for canoe and kayak rentals average about $30 per person for a two-hour trip. After your overhead and labor costs, you should aim for a profit margin of about 40%. 

Once you know your costs, you can use our profit margin calculator to determine your markup and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify Your Target Market

Your target market will be broad, so you should spread out your marketing to include sites like Tiktok, Instagram, and Facebook. Your market may also be tourists, so you should place flyers at local restaurants, hotels, and other attractions. 

Where? Choose Your Canoe and Kayak Rental Location

You’ll need to find a place on the water that at least has a storage building for your canoes, kayaks, and lifejackets, and perhaps with an office as well. You can find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

When choosing a commercial space, you may want to follow these rules of thumb:

• Central location accessible via public transport
• Flexible lease that can be extended as your business grows
• Ready-to-use space with no major renovations or repairs needed

Step 3: Brainstorm a Business Name

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “canoe rentals” or “kayak rentals,” boosts SEO
• Name should allow for expansion, for example, “Kayak & Canoe Rentals Inc.” over “Kayak & Canoe Fishing Adventures”
• A location-based name can help establish a strong connection with your local community and help with the SEO but might hinder future expansion

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Business Plan

Here are the key components of a business plan:

• Executive summary — A brief overview of your business, highlighting key aspects such as goals, market position, and financial projections
• Business overview — Detailed information about your canoe and kayak rental business, including its mission, vision, location, legal structure, and ownership
• Product and services — Clear descriptions of the canoe and kayak rental services you offer, along with any additional services like guided tours or equipment sales
• Market analysis — An examination of the target market for your business, including customer demographics, needs, and trends in the canoe and kayak rental industry
• Competitive analysis — Evaluation of competitors in the local area, highlighting strengths, weaknesses, opportunities, and threats to your business
• Sales and marketing — Strategies for promoting and selling your canoe and kayak rental services, encompassing advertising, promotions, pricing, and sales channels
• Management team — Introduction to the key individuals responsible for running the business, detailing their relevant skills, experience, and roles
• Operations plan — The practical aspects of running the business, covering equipment procurement, rental processes, safety measures, and day-to-day operations
• Financial plan — Projections of the financial performance of your business, including income statements, balance sheets, and cash flow statements, outlining the financial health and sustainability of the venture
• Appendix — Additional supporting documents or information, such as resumes of key team members, detailed market research, legal documents, or any other supplementary material relevant to the business plan

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose Where to Register Your Company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to canoe and kayak rental businesses. 

If you’re willing to move, you could really maximize your business! Keep in mind that it’s relatively easy to transfer your business to another state. 

Choose Your Business Structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your canoe and kayak rental business will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole proprietorship — The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General partnership — Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) — Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corporation — Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corporation — This refers to the tax classification of the business but is not a business entity. A corporation or an LLC can elect to be an S Corp for tax status. In an S Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have.

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number or EIN. You can file for your EIN online, or by mail/fax. Visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund Your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loan — This is the most common method but getting approved requires a rock-solid business plan and a strong credit history.
• SBA-guaranteed loans — The Small Business Administration can act as a guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Government grants — A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and family — Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding — Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal — Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best options, other than friends and family, for funding a canoe and kayak rental business. You might also try crowdfunding if you have an innovative concept. 

Step 8: Apply for Licenses and Permits

Starting a canoe and kayak rental business requires obtaining a number of licenses and permits from local, state, and federal governments. Depending on the body of water and local regulations, you may need a watercraft license. 

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your canoe and kayak rental business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability — The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business property — Provides coverage for your equipment and supplies.
• Equipment breakdown insurance — Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation — Provides compensation to employees injured on the job.
• Property — Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto — Protection for your company-owned vehicle.
• Professional liability — Protects against claims from clients who say they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP) — This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential Software and Tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks. 

You may want to use industry-specific software, such as The Flybook, Rentrax, or Quipli, to manage your boat inventory, bookings, and payments. 

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, FreshBooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences of filing incorrect tax documents can be harsh, so accuracy is crucial. 

Develop Your Website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using website builders. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech savvy, you can hire a web designer or developer to create a custom website for your business.

They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

Marketing

Here are some powerful marketing strategies for your future business:

• Professional branding — Align your branding with the adventure spirit and serenity of nature, reflected across all marketing materials.
• Local SEO — Optimize your website for local searches relevant to outdoor adventures and water sports, encouraging positive customer reviews to enhance visibility. Regularly update your Google My Business and Yelp profiles to strengthen your local search presence.
• Social media engagement — Utilize platforms like Instagram and Facebook to share visuals of scenic locations and engaging canoeing and kayaking content.
• Content marketing — Produce a mix of content, including paddling tips, environmental conservation articles, and customer testimonials.
• Community engagement — Host and sponsor local paddling events and environmental clean-ups to foster community involvement.
• Partnerships with local businesses — Collaborate with outdoor retailers and adventure clubs for cross-promotions and bundled services.
• Direct outreach — Establish connections with local hotels and travel agencies to create joint packages that include your rental services.
• Loyalty and referral programs — Introduce discounts and rewards for repeat customers and referrals to boost customer loyalty and engagement.
• Targeted advertising — Leverage digital advertising and local tourism outlets to reach individuals and groups interested in outdoor activities.
• Email newsletters — Regularly update your community with news on services, seasonal advice, and exclusive offers through email communications.
• Professional website — Develop a user-friendly site with appealing imagery and valuable information about your rental services and local attractions.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that set it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your canoe and kayak rental business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your canoe and kayak rental business could be:

• Guided kayak fishing on a stunning river
• The best lake views are on our kayaks and canoes
• Scenic canoe lunch tours on a sparkling lake 

Networking

You may not like to network or use personal connections for business gain but your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a canoe and kayak rental business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in boats for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in canoe and kayak rentals. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a canoe and kayak rental business include:

• Livery workers — assisting customers, transporting renters and boats
• General manager — scheduling, accounting
• Marketing lead — SEO strategies, social media

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Canoe and Kayak Rental Business — Start Making Money!

Ready to have some fun in the sun working in the great outdoors? Starting a canoe and kayak rental business is a great way to make good money and have a fantastic lifestyle. Kayaking, in particular, is growing in popularity as people look for ways to have healthy, outdoor fun close to home, so your rentals should be in high demand. You can make even more money by offering paddle board and bike rentals, as well as guided kayak fishing.  

You’ve learned the ins and outs of entrepreneurship, so now it’s time to hit the water and start a successful canoe and kayak rental business!