Financing Diversification
Financing an expansion or diversification of a commercial fishing business can be complicated and your options for sources of financing may be much broader than when you first started fishing. If you are upgrading, you will also want to consider the tax implications of asset sales and acquisitions.
Here, you'll find links to tools that may be helpful as you take steps toward diversifying.
Proceed with caution
Consider carefully before making the decision to diversify. What makes sense for your neighbor's operation might be beyond the capabilities of your own. Costs of retooling might be too high, or the new fishery might make too great of demands on your time or fishing skills.
Maybe the best way for you to generate additional income is outside the fisheries altogether, whether with an additional job or business, or other outside investments.
Loan payment calculator
A simple loan payment calculator can help you analyze the effects of different interest rates and payment schedules on your bottom line. We provide one on the "Vessels and Equipment" tab in the Proforma spreadsheet (below).
You may look at some of the same sources of financing you used when first starting out your fishing business. The loan comparison chart on this website outlines some of those sources of financing.
Another unique option for commercial fishermen is to put fishing income aside for future vessel improvements through a Capital Construction Fund with the National Marine Fisheries Service.
Resources
Use this Excel workbook to analyze various “what-if” scenarios in your fishing business. Enter predicted fuel, bait, gear, moorage, crew, and insurance costs and see how each changes your bottom line. You can look at the impact of different loan interest rates, or targeting different salmon species, or adjusting your days at sea.
The workbook consists of 8 linked worksheets. The one titled “Main Sheet” is your final product. The other 7 sheets, automatically linked to the main sheet, are where you enter information in the input fields outlined in green. Click to enable macros when opening.
Use the series of videos produced by Greg Fisk and the University of Minnesota to learn how to work with financial spreadsheets.
Instructions for using the Pro Forma Fishing Vessel Operational Analysis workbook.