A two truck business is two things in one; challenging and rewarding. To start a tow truck business is not cheap. You will need between $10,000 and $50,000 to start one but it’s a viable business that would get you good returns within a short period.
The Market – Why You Should Start a Tow Truck Business
Have you ever had such an experience where your car breaks down in the middle of nowhere with no mechanic in sight to fix it for you? Of course you didn’t leave your expensive ride there out in the middle of nowhere and hitched a ride to your destination.
You must have called the tow truck guys to help you wheel your car right back to the mechanic’s garage where it could be fixed. Several of such occurrences happen daily on highways on a daily basis with such drivers having no other choice than to run to the saviors; the tow truck guys. On the flipside, when there parking rules flouted and the police need to impound such vehicles, tow truck drivers are often called upon to perform this task
As a tow truck business owner, you would not lack customers and what’s more? It’s a recession proof business. I know you are excited right now and would wish to start your business as soon as now but hold on a second and take a look at the things you need to do before you launch your tow truck business.
Starting a Tow Truck Company – Sample Business Plan Template
1. Build your fleet
There are different types of tow trucks and each one has its own special function. There are the flat-beds that are used to move vehicles that are already seriously damaged and there are also rear-hook towing vehicles that can move less damaged cars by hooking the rear axle of the damaged car to the tow truck’s hook.
However, you don’t have to purchase all the different types of trucks to start-up; you can just buy one for a start and then continue to build your fleet as your business increases.
2. Decide how you want to operate
How do you intend to operate your business? Would you prefer to operate alone as a single-truck towing company or would you like to hire other drivers and run a multi-truck company?
Remember that if you choose to run a multi-truck company, you will need more capital and more than one towing truck. You would also need to have an office which would serve as your central dispatch unit. This is where client’s calls would be received and available trucks would be sent to handle the situation.
3. Register your business-: Of course you will need to register your business with the state and file all necessary documents.
4. Obtain business license
Some states would require that you have a business license before you can run a tow truck business. Some states would even demand for a particular class of driving license to be permitted to drive tow trucks. So you need to find out what the law of your state concerning tow trucks and comply accordingly.
5. Determine where will you park your vehicles? – Starting a tow truck business requires that you have somewhere to park your fleet of trucks as well as some of the vehicles you help to remove. You would need a large yard for this.
6. Find out where will your patronage come from?
Starting any business at all without first studying the market to see where the customers are and how to reach them, is like putting the cart before the horse. Before you invest in a tow truck business, you should really sit down to think of how you will get customers to patronize your new business.
Most tow truck companies get business calls from private clients who are already aware of their business either by direct marketing to them or through referrals. You may also get calls from the police to help move impounded or accidental vehicles or from automobile repair shops. To get business calls from any of these sources, you would need to build a solid relationship with these people.
You should visit and introduce your business to them. One strategy that works very well is to offer them some kind of reward for every client they refer. This may be a certain percentage of what you were paid for the job.
As you plan to start your tow truck business, do not forget to fix prices for your services. When fixing your prices, you must ensure that you put into consideration all the expenses that you would undertake to complete each job. You should also find out what other people running the same business charge.
8. Employ other drivers
If you will be running a multi-truck tow business, you will need to hire other drivers to drive the other trucks in your fleet. However, you must ensure you conduct driving tests for prospective clients to test their driving skills. You should make sure they have valid driving license.
You should also enforce wearing of uniforms with your company name and logo on it. This would not only increase awareness for your company. It would also make them appear neat and very professional.
And when you finally start your tow truck business, do not forget to continue to advertise and promote your business through the use of social media, distributing flyers and handing out your business cards to as many people as you can.