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Starting a Wrecker Services Company – A Complete Guide

Do you want to start a wrecker service company? If YES, here is a complete guide to starting a wrecker service business with NO money and no experience.

Okay, so we have provided you an in-depth sample wrecker service business plan template. We also took it further by analyzing and drafting a sample wrecker service marketing plan backed up by actionable guerrilla marketing ideas for wrecker service companies. In this article, we will be considering all the requirements for starting a wrecker service business. So put on your entrepreneurial hat and let’s proceed.

Why Start a Wrecker Services Company?

If you are interested in the construction industry and you are an aspiring entrepreneur who is looking towards starting a business in the United States; then it is good to know that there is hardly any business in the construction industry that you aren’t going to make good returns on your investment.

If you decide to start a business in the demolition and wrecking industry by offering basic wrecking services, you would be sure of making huge returns from your investment. This is because reliable statistics shows that the demolition and wrecking industry in the United States of America rakes in a whooping sum of $5 billion dollars annually.

If you want to partake in this thriving industry, then you need to obtain the necessary license and then launch your own wrecker services company. The truth is that the market is still pretty much open for new investors to come in. Although there are competitions at various levels in the industry, but if you are able to come up with a good business strategy, then you are sure of getting a share of the available market in the construction industry.

If you have weighed your options and have made up your mind to start a wrecker services company, then you should make sure that you carry out thorough feasibility studies and also market survey. If you are interested in starting a wrecker services company, then you should ensure you read through this article for the necessary industry guide.

Starting a Wrecker Services Company – A Complete Guide

  • Industry Overview

Businesses that operate in the demolition and wrecking industry mainly wreck and demolish buildings and structures and sometimes sell salvaged materials. Other services rendered by companies in this industry include the clearing and recycling of debris, interior strip outs, handling of asbestos and hazardous materials, site remediation (decontamination and waste disposal), concrete cutting and explosive demolition. It is important to clearly state that excavation and land-clearing are not part of the demolition and wrecking industry.

If you are a close observer of happenings in the demolition and wrecking industry, you will agree that the industry has been recovering from the effects of the recession which drastically reduced demand for construction services. Nevertheless, the business has begun to experience little growth and the industry is projected to grow past its pre – recession magnitude.

Usually, as the value of residential and nonresidential construction increases, the need for demolition of old structures increases, as well as increase income for demolition and wrecking companies. Land development and construction markets are projected to grow rapidly as economic growth encourages the construction of new retail and commercial facilities.

The demolition and wrecking industry will continue to experience growth in all parts of the world especially in developed countries such as United States of America, Canada, United Kingdom, Germany, Australia, South Korea, Italy and Germany et al. The company with leading market share in the industry in the United States is Northstar Group Holdings, LLC.

Statistics has it that in the United States of America alone, there are about 4,505 licensed and registered demolition and wrecking companies scattered all across the length and breadth of the country and they are responsible for employing about 23,252 employees. The industry rakes in a whooping sum of $5 billion annually with an annual growth rate projected at 2.1 percent within 2011 and 2016.

A recent report published by IBISWORLD shows that establishments in the demolition and wrecking industry are distributed roughly in line with population density, though regional variations in industrialization and urbanization create a larger industry presence in some areas.

The report also estimates that the Southeast, Great Lakes and Mid-Atlantic regions hold the largest share of industry locations. While the Southeast region has the largest share of establishments in the industry, this 22.7 percent share is somewhat lower than its share of the total US population, 25.4 percent.

Despite the fact that the wrecker services business involves both government establishment (Public works department) and the private sector, that does not in any way make the industry to be over saturated. The fact that construction works and renovation of buildings are being carried out on a regular basis means that there is always a ready market for wrecker services companies.

Just like any other business, if you are able to conduct your cost analysis, market research and feasibility studies before launching your wrecker services company, you are not going to struggle to grow the business because there are loads of people and businesses out there who are looking for wrecker services companies and demolition and wrecking companies to help them handle demolition and wrecking in their property in other to pave way for reconstruction as required by the laws of the United States of America.

Over and above, starting and operating a wrecker Services Company can be challenging, but the truth is that it can be rewarding at the same time. One good thing about the industry is that it is open for both big time investors and aspiring entrepreneurs.

Starting a Wrecker Services Company – Market Research and Feasibility Studies

  • Demographics and Psychographics

The demographic and psychographic composition of those who hire the services of wrecker services companies are not restricted to construction companies and real estate investors. There is a wide range of both corporate and individual clients who cannot successfully handle the demolition or wrecking of their facility without hiring the services of a standard and licensed wrecker services company.

As a matter of fact, the target market for a wrecker services company should involve construction companies, farmers, property management companies, property development companies and players in the real estate and construction industry amongst others.

So, if you are tinkering with defining the demographics of your wrecker services company, then you should make it all encompassing.

List of Niche ideas Within the Wrecker Services Company That You Can Specialize in

Just as we have in other industries, there are several areas that you have to look into mastering in the wrecker services industry. Most wrecker services companies tend to operate general demolition and wrecking services that a standard wrecker services company is expected to offer. That is why it seem that there are no niche areas in the industry.

But on the other hand, some wrecker services companies may decide to major in some key areas such as;

  • Pre – demolition and wrecker planning and analysis
  • Total or selective wrecker and demolition of buildings (e.g. offices, warehouses and apartments)
  • Total or selective wrecker and demolition of structures (e.g. sport stadiums and oil rigs)
  • Wrecker and demolition and rehabilitation of sites following fire or industrial explosion
  • Environmental cleanup of wreckages after natural disaster
  • Asbestos removal
  • Selective dismantling and facade preservation for historic buildings
  • Implosion wrecker and demolition of buildings and structures
  • Removal, disposal and sale of materials from demolition sites, including recycling

The Level of Competition in the Demolition and Wrecking Industry

Irrespective of the line of business you decide to pitch your tent, you are still going to compete with others and even the government who are into same area of business and wrecker services business is not an exemption.

The level of competition in the demolition and wrecking industry to some extent depends largely on the location of the business, your niche area of operation and of course the capacity of your wrecker services company. If you can successfully create a unique niche for your wrecker services company, you are likely going to experience little or no competition.

For instance, if you are the only wrecker services company in your location that is into selective dismantling and facade preservation of historic buildings and also engage in wrecking and demolition of sites following fire or industrial explosion, you can successfully monopolize the market for a long time before you start having competitions.

It is imperative to also state that the competition in the demolition and wrecking industry depends also on the capacity of your wrecker services company. But over and above, there are several wrecker Services Company and demolition and wrecking companies scattered all around the United States.

So, if you choose to start your own wrecker services company in the United States, you will definitely meet stiff competitions amongst wrecker services companies, and demolition and wrecking companies that also offer same services that you intend offering. Besides, there are larger wrecker services companies that determine the trends in the industry and you should be ready to compete with them for customers.

List of Well – Known Brands in the Wrecker Services Industry

There will always be key players in different industries of the world. In every industry, there are always brands that perform better or are better regarded by customers and the general public than others. Some of these brands are those that have been in the industry for a long while and so are known for their vastness, while others are best known for how they conduct their businesses and the results they have achieved over the years.

These are some of the leading wrecker services companies in the United States of America and in the globe;

  • Cleveland Wrecking – Covina, CA
  • H. Griffin Wrecking Co. Inc. – Multiple Locations
  • LVI/Mazzochi Wrecking Inc. – East Hanover, NJ
  • Alarcon Bohm – Oakland, CA
  • American Demolition/Concrete Cutting Inc. – Santa Ana, CA
  • Bedroc Contracting LLC – Lyndhurst, NJ
  • Bierlein Companies, Inc. – Midland, MI
  • Brandenburg Industrial Service – Chicago, IL
  • Cherry Demolition, Inc. – Houston, TX
  • Ferma Corporation – Mountain View, CA
  • Interior Removal Spec. Inc. – South Gate, CA
  • Manafort Brothers Inc. – Plainville, CT
  • MCM Management Corp. – Bloomfield Hills, MI
  • Midwest Steel Co., Inc. – Houston, TX
  • North American Dismantling Corp – MI
  • Nuprecon, Inc. – Snoqualmie, WA
  • Robinette Demolition Inc. – IL
  • B. Cox Inc. – Richmond, VA
  • Testa Corp. – MA
  • Two Rivers Demolition Inc – CA

Economic Analysis

When it comes to starting a wrecker services business, you just have to get your costing cum economic analysis right if your intention of building the business is to generate profit, grow the business and perhaps expand the business and start competing at the national level.

When conducting costing and economic analysis for your wrecker services business, you just have to critically examine these key factors; place, pricing (as it relates to fueling, services and maintenance), and promotion. As a matter of fact, you would have to continue to review these key factors at regular intervals while running your business. As a wrecker services business owner, you just have to have a proper grasp of your competitive landscape if indeed you want to maximize profits and be in the frontline of the industry.

It is important to note that fueling and servicing and maintenance cost of demolition tractors are some of the most important factors contributing to the overall cost of running a wrecker services business and should be considered as a major factor when carrying out your costing and economic analysis. This is why standard wrecker services companies would prefer to assemble in-house maintenance and servicing team as against contracting the maintenance of their heavy – duty tractors and trucks to an automobile maintenance and servicing garage.

Starting Your Wrecker Services Company from Scratch vs Buying a Franchise

There is no hard and fast rule when it comes to choosing how you intend starting a business. Basically, you should be guided by your overall business vision and mission statement. When it comes to starting a business of this nature, it will do you a world of good to start from the scratch as against buying a franchise. This is so because you can hardly get the franchise of a wrecker service company to buy in the United States of America.

Besides, it is easier to start and run a wrecker services company from scratch to profitability without leveraging on a known brand name. People will patronize your services based on accessibility and pricing as against relying on a brand name.

With wrecker services business, you should just try as much as possible to get the right employees, build business relationship with key stakeholders and then leverage on every marketing tool within your disposal especially the internet to market your services.

Please note that most of the big and successful wrecker services companies around started from the scratch and they were able to build a solid business brand. It takes dedication, hard work and determination to achieve business success.

Possible Threats and Challenges You Will Face When Starting a Wrecker Services Business

If you decide to start your own wrecker services business today, one of the major challenges you are likely going to face is the presence of well – established wrecker services companies in your target market location and even government public works department that also offer wrecker services. The only way to avoid this challenge is to create your own market; concentrate on households, individuals and also startups construction companies who need the services of a wrecker services company.

Some other threats and challenges that you are likely going to face when starting your wrecker services company are mature markets, bad economy (economy downturn), stiff competition, volatile costs, and rising fuel prices. So also, unfavorable government policies, seasonal fluctuations, demographic/social factors, downturn in the economy which is likely going to affect consumer spending and of course emergence of new competitors within the same location where your wrecker services company is located. There is hardly anything you can do as regards these threats and challenges other than to be optimistic that things will continue to work for your good.

Starting a Wrecker Services Company – Legal Matters

  • Best legal entity to use for this type of business

When considering starting a wrecker Services Company, the legal entity you choose will go a long way to determine how big the business can grow; some wrecker services companies design their business and services for regional markets, while others for national markets.

By and large, you have the options of either choosing a general partnership, limited liability Company which is commonly called an LLC, or a sole proprietorship for a business such as wrecker services company. Ordinarily, sole proprietorship should have been the ideal business structure for a small scale wrecker services company especially if you are just starting out with moderate startup capital and with just one bulldozer and truck. But people prefer limited liability Company for various reasons.

As a matter of fact, if your intention is to grow the business and operate all across the United States of America and perhaps other countries of the world, then choosing sole proprietorship is not an option for you. Limited Liability Company, LLC or even general partnership will cut it for you.

Setting up an LLC protects you from personal liability. If anything goes wrong in the business, it is only the money that you invested into the limited liability company that will be at risk. It is not so for sole proprietorship and general partnership. Limited liability companies are simpler and more flexible to operate and you don’t need a board of directors, shareholders meetings and other managerial formalities.

These are some of the factors you should consider before choosing a legal entity for your wrecker services company; limitation of personal liability, ease of transferability, admission of new owners, investors’ expectation and of course taxes. If you take your time to critically study the various legal entities to use for your wrecker services company, you will agree that limited liability company; an LLC is most suitable. You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or an ‘S’ corporation especially when you have the plans of going public.

Catchy Business Name ideas Suitable for a Demolition and Wrecking Company

Typically, when it comes to choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Characteristically, it is the norm for people to follow the trend in the industry they intend operating from when naming their business.

If you are considering starting your own wrecker services business, here are some catchy names that you can choose from;

  • Thomas Beckley® Wrecker Services Company, LLC
  • First Nation® Wrecker Services Company, Inc.
  • Kingsley White and Sons Wrecker Services Company
  • Building Bulldozers Limited
  • Venires Control® Wrecker Services Company
  • Roger Dowell Wrecker Services Groups, Inc.
  • Augustine Lopez Wrecker Services Company
  • Clinton Benson Demolition and Wrecking Company
  • Harry Brown® Demolition and Wrecking Company
  • Green Tee® Wrecker Services Company.

Insurance Policies

In the United States and most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. Thus, it is imperative to create a budget for insurance policy cover and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your wrecker services business.

Here are some of the basic insurance policy covers that you should consider purchasing if you want to start your own wrecker services business in the United States of America;

  • General insurance
  • Health insurance
  • Liability insurance
  • Equipment and Auto Insurance
  • Risk Insurance
  • Workers compensation
  • Overhead expense disability insurance
  • Business owner’s policy group insurance
  • Payment protection insurance

Intellectual Property Protection/Trademark

If you are considering starting your own wrecker services business, usually you may not have any need to file for intellectual property protection/trademark. This is because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

On the other hand, if you just want to protect your company’s logo and other documents or software that are unique to you or even operation concepts, then you can go ahead to file for intellectual property protection. If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO.

Is Professional Certification Needed to Run a Wrecker Services Company?

Apart from the results you produce as it relates to professionally carrying out wrecking and demolition activities, professional certification is one of the main reasons why some wrecker services companies stand out. If you want to make an impact in the demolition and wrecking industry, you should work towards acquiring all the needed certifications in your area of specialization.

Certification validates your competency and shows that you are highly skilled, committed to your career and up-to-date in the market. These are some of the certifications you can work towards achieving if you want to run your own wrecking services business;

  • LEED Certified
  • Gold Seal Certified; COR Certified

Please note that all wrecker services companies and demolition and wrecking companies, especially those that also handle hazardous waste management are mandated to obtain the appropriate certification.

List of Legal Documents You Need to Run a Wrecker Services Company

The essence of having the necessary documentation in place before launching a business in the United States of America cannot be overemphasized. It is a fact that you cannot successfully run any business in the United States without the proper documentations.

These are some of the basic legal documents that you are expected to have in place if you want to legally run your own wrecker services business in the United States of America;

  • Business and liability insurance
  • Commercial Vehicle Operator’s Registration for haulage trucks
  • Appropriate driver’s licenses for bulldozer drivers
  • Assistant’s licenses for assistants
  • Health inspection Certificate
  • Proof of ownership, proper identification and vehicle license
  • Copy of license for the service support facility and/or a recent inspection report
  • Tax Payer’s ID
  • Fire certificate
  • Certificate of Incorporation
  • Business License
  • Business Plan
  • Non – disclosure Agreement
  • Employment Agreement (offer letters)
  • Employee’s Handbook
  • Operating Agreement for LLCs
  • Insurance Policy
  • Apostille (for those who intend operating beyond the United States of America)

Financing Your Wrecker Services Business

Starting a standard wrecker services business can be capital intensive especially if you choose to launch a large wrecker services company with the capacity to service your immediate community and also to engage in waste management and recycling.

Securing a land facility, bulldozers, fleet of haulage trucks, building a waste recycling plant and purchase of equipment are part of what will consume a large chunk of your startup capital, but if you choose to start the business on a small scale with just one heavy duty bulldozer and haulage truck, you may not have the need to go source for fund to finance the business.

When it comes to financing a business, one of the major factors that you should consider is to write a good business plan. If you have a good and workable business plan document in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business.

Here are some of the options you can explore when sourcing for startup capital for your wrecker services business;

  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell of shares to interested investors
  • Applying for loan from your bank
  • Pitching your business idea and applying for business grants and seed funding from government, donor organizations and angel investors
  • Source for soft loans from your family members and your friends

Choosing a Suitable Location for a Wrecker Services Company

Starting a wrecker Services Company comes with its own challenges; it is a business that should be located out of residential facilities and close to construction sites. It cannot be overemphasized that the location you chose to start your wrecker services company is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of people and businesses with the required purchasing power, and a location that has minimal hurdles to cross as it relates to construction of a waste recycling (optional).

If you make the mistake of renting or leasing a facility for your wrecker services business in a location that is difficult to access or a location with difficult terrain, then you must be prepared to spend more on fueling and maintenance of your heavy – duty bulldozers and waste haulage trucks.

It is important to note that a business facility in a good location does not come cheap, hence you should be able to allocate enough fund for leasing/renting in your budget. If you are new in the dynamics of choosing a location for a wrecker services business, then you should feel free to talk to a business consultant or a realtor who has a full grasp of the city and perhaps country you intend starting your wrecker services business.

Most importantly, before choosing a location for your wrecker services business, ensure that you first conduct thorough feasibility studies and market survey. The possibility of you coming across similar business that just closed shop in the location you want to open yours can’t be ruled out. It is for this reason that it is very important to gather as much facts and figures before choosing a location to set – up your own wrecker services business.

These are some of the key factors that you should consider before choosing a location for your wrecker services business;

  • The demography of the location
  • The demand for wrecking and demolition services in the location
  • Accessibility of the location and closeness to construction sites
  • The number of wrecker services companies in the location
  • The local laws and regulations in the community/state
  • Traffic, parking and security et al

Starting a Wrecker Services Company – Technical and Manpower Details

When it comes to starting a standard wrecking services business with the capacity to carry out removal, disposal and sale of materials from demolition sites, including recycling, you will need the following equipment/machines; bulldozers, heavy – duty tractors, concrete cutters, waste haulage trucks, Rigid Outer Containers that promote accessibility via lid options, Attached Lid Containers, AFL Industries’ Specialty Wastewater Treatment, Two-Sided Carts increase picking/stocking efficacy, Hazardous Material Overpacks, Toledo Metal Spinning, Cleanline Waste Receptacles and Garbage Sorting recycling amongst others. It is important to state that this equipment can be purchased as fairly used if you are operating on a low budget.

When it comes to choosing between renting and leasing a facility for your wrecking services company, the size of the wrecking services company you want to own, and your entire budget for the business should influence your choice. If you have enough capital to run a pretty large and well – equipped demolition and wrecking company with a standard waste recycling plant, then you should consider the option of long lease or out rightly purchasing a land; when you lease or purchase a land, you will be able to work with long – term planning, structuring and expansion.

As regards the number of employees that you are expected to kick start the business with, you would need to consider your finance before making the decision. Averagely, when it comes to starting a standard demolition and wrecking business on a large scale, you would need the services of the following professionals; Chief Operating Officer (you can occupy this position), Admin and HR Manager, Transport and Logistics Manager, Marketing and Sales Executive (Business Developer), Accountant, Hazardous and Non – Hazardous Waste Operators/Cleaners, Waste Truck and Bulldozer Drivers and Customer Services Executive/Front Desk Officer.

Over and above, you would need a minimum of 5 to 15 key staff members to effectively run a medium scale but standard wrecking services company. Please note that there will be times when you are expected to go out of your way to hire experts to help you handle some job functions.

If you are just starting out you may not have the financial capacity or required business structure to retain all the professionals that are expected to work with you which is why you should make plans to partner with specialists in the industry.

The Service Delivery Process of a Wrecker Services Company

The operation process as it relates to wrecking services companies depends largely on their niche area of operation. For example, a wrecking services company that also carries out hazardous waste collection and management is far different from a wrecking services company that just carry out demolition, wrecking and concrete cutting services. Those that are involved in hazardous waste collection and management are extra careful and they pay attention to details because of the nature of the business.

The process of a wrecking services company starts with securing a contract to carry out demolition or wrecking of a property. Before the contract is sealed, the nature of the job to be carried out with will be noted. The bidding process for the contract, assessment of the property and the needed manpower and machine will be noted amongst other key factors.

Once the proper permits and documentation are done, then men and machine will be moved to the site where the demolition and wrecking will be done. After the demolition and wrecking, the wreckages will then be cleared and dumped in a dumpsite or in a recycling plant (yard).

It is important to state that a wrecking services company may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated business cum services process is not cast on stone.

Starting a Wrecker Services Company – The Marketing Plan

  • Marketing ideas and strategies

The fact that the entry barrier for starting a small – scale wrecking services business is low means that there is bound to be more players in the industry no matter the location you choose to start yours. In essence, you must come up with creativity and innovations if you must carve out a market for yourself within the available market in your community, city, state or country.

When you are drafting your marketing plans and strategies for your wrecking services company, make sure that you create a compelling personal and company profile. Aside from your qualifications and experience, it is important to clearly state in practical terms what you have been able to achieve in time past as it relates to demolition and wrecking services. This will help boost your chances in the market place when marketing your services.

Please note that in most cases when you bid for demolition and wrecking contracts from corporate organizations/industries, you will be called upon to defend your proposal, so you must be pretty good with presentations.

Here are some of the platforms you can utilize to market your demolition and wrecking services;

  • Introduce your business by sending introductory letters alongside your brochure to construction companies, farmers, property management companies, property development companies and players in the real estate industry amongst others in the United States (if you are just starting out, you may want to concentrate on start – ups and smaller businesses)
  • Promptness in bidding for demolition and wrecking contracts et al
  • Open your wrecking services company with a party so as to capture the attention of residents who are your first targets
  • Advertise your services in community based newspapers, local TV and radio stations
  • List your business and products on yellow pages (local directories)
  • Leverage on the internet to promote your wrecking services company
  • Engage in direct marketing and sales
  • Encourage the use of word of mouth marketing (referrals)
  • Leverage on the internet to promote your business
  • Join local chambers of commerce and industries around you with the main aim of networking and marketing your services; you are likely going to get referrals from such networks
  • Engage the services of marketing executives and business developers to carry out direct marketing for you

Strategies to Boost Your Wrecker Services Company Brand Awareness and Create Your Corporate Identity

If your intention of starting a wrecking services company is to grow the business beyond the city where you are going to be operating from to become a national and international brand, then you must be ready to spend money on promotion and advertisement of your brand.

In promoting your brand and corporate identity, you should leverage on both print and electronic media and also social media (the internet). As a matter of fact, it is cost effective to use the internet and social media platforms to promote your brand, besides it is pretty much effective and wide reaching.

Another strategy is to sponsor relevant community based programs, TV and radio programs, advertise your business in relevant magazines and newspapers. Below are the platforms you can leverage on to boost your brand and to promote and advertise your business;

  • Place adverts in magazines and related newspapers, radio and TV stations
  • Encourage the use of word of mouth publicity from your loyal customers
  • Leverage on the internet and social media platforms like YouTube, Instagram, Facebook, Twitter, LinkedIn, Snapchat, Badoo, Google+ and other platforms to promote your business
  • Ensure that you position your banners and billboards in strategic positions all around your city
  • Distribute your fliers and handbills in target areas in and around our neighbourhood
  • Contact your friends, people in your neighbourhood and everyone on your mailing list et al by calling them up and informing them of your wrecking services company and the services you offer
  • Advertise your business in your official website and employ strategies that will help you pull traffic to the site
  • Brand all your official heavy – duty demolition tractors, bulldozers, trucks and cars and ensure that all your staff members your branded shirt or cap at regular intervals.
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