Will Vinyl letters stick to a inflatable boat or would a person need to paint the letters on the side? Is there another way that I'm not thinking of? Thanks
Vinyl letters will wrinkle and peel off eventually.
West marine sells DIY lettering kits in several colors:
http://www.westmarine.com/1/1/10817--inflatable-boat-lettering-numbering-stencil-kits-kit-black.html
You can also order a custom registration plate through them as well:
http://www.westmarine.com/1/1/21813--registration-numbering-kit.html
Another way is to stencil it yourself and use Krylon Fusion, which bonds to PVC, most plastics, and other stuff real well.