What it is
A boat dealer rarely pays cash for the boats on the floor. A floor plan lender, often a bank or a manufacturer finance arm, pays the builder for each unit. The boat is collateral, and the dealer owes the lender until it is sold.
How it works at a boat dealership
When a new boat is delivered, the dealer draws on the floor plan for the invoice amount. Interest accrues on the balance for as long as the boat is unsold. When the boat sells, the dealer pays off that unit, usually within a few days of the sale. Lenders audit the lot to confirm that financed boats are still there and that sold boats were paid off.
Many programs also include curtailment schedules that require partial paydowns as a unit ages, and some manufacturers subsidize interest for a period on certain models.
What dealers watch
Most dealers watch total floor plan interest against gross profit, and which units are costing the most to carry. Boats Group year-end data, reported by Denison Yacht Sales, put the average time to sell a new boat in North America at 279 days in 2025, up 50 days from the year before. Every extra day is another day of interest.
Why it matters
Floor plan is usually one of the largest recurring costs in a boat dealership, and it rises when boats sit. It also sets the pace of the whole operation: what the dealer can afford to stock, how many boat shows to attend and how hard to push an older unit before the next model year arrives. Dealers who understand their floor plan terms make better ordering decisions in the fall, when next season's boats are committed.
Common mistakes
The usual problems are selling a boat and paying it off late, letting a curtailment date pass unnoticed, and not knowing the true carrying cost of a slow unit. All three come from tracking floor plan status in a spreadsheet separate from the inventory list.