You have finally made up your mind to get out of the regular 9-5 job and start your own business. There is nothing as pleasing as being your own boss, calling the shots, and being in control. Being an entrepreneur comes with freedom.
However, now that you have chosen to start a towing business, you are going to need some help getting started. You will need the right tips and advice to get you started on a good foot. The industry is a lucrative one and you are guaranteed of earning good money from it. To help you succeed with your towing business, here are some tips to help.
Starting a Towing Business; Tips to Help
1. Determine what business type to start
With a towing business, there is more than one way to make cool cash. So before you delve into the industry, identify which area you will be focusing on. Do you want to do roadside assistance or you want to be towing for law enforcement agencies? Will you prefer towing for a motor club or just settle for towing for auto repair shops?
Determining which niche you will be going into will help you decide who your target customer will be and also know how to better reach them.
2. Recognize who your target customers are
Like earlier said, identifying with a unique niche will help you determine who your target customer is. There is no way you can provide the best service if you don’t know who your business will be serving. A towing business has more options than just rendering roadside assistance. There are more services they can offer and so is their customer base a wide one. Below are some more services a towing business can provide:
- Towing for auto repair shops
- Towing for law enforcement agencies
- Towing for auction houses
- Towing for motor clubs
- Towing impounded vehicles
In summary, you might be receiving calls from such people are individuals, police departments, auto repair shop owners, property owners, and many more.
3. Register your business and make it official
When you start a towing business, you should also have it in mind to register it and make it a legal entity. That will make it easier for you to run your business without worrying you might cross paths with the law. So, enquire about the necessary requirement to get this done and do it.
Ideally, you may also be asked to obtain some licenses and permits based on the requirement for running a towing business in your state. Just do it and wait for the amazing rewards that come with the action.
4. Get your taxes in order
That is the next thing to do before you finally hit the road. Make sure you have got all your tax information taken care of. Not doing so may deprive you of wonderful opportunities in the future. No reputable company will want to partner with you if you are defaulting in the payment of your tax.
5. Plan your finance
This type of business requires a whole lot of money to start. From buying the truck to purchasing some other equipment and securing an office space, running a towing business may be a capital-intensive venture. That means even before you start at all, you should figure out what your funding source will be like. Will you be taking from your personal savings, family, friends, or through crowdfunding?
You can also consider getting a loan from your bank or a private lender at an agreed cost. You can also take advantage of commercial truck financing to get loans to cover your equipment financing.
6. Invest in the right equipment
Equipment purchase will definitely be taking the bulk of your budget for starting a towing business. A new truck could cost as much as $100,000, and you will definitely need a truck to run such a business. However, there is a lighter way to go about purchasing equipment for your towing business.
You can buy used tow trucks at a fraction of the cost of a brand new one while it still serves you well. Just look for a good deal and go for it.
7. Get the right insurance for the business
After your equipment, this likely the next area you will be putting the bulk of your budget. You will need to get insurance for your business to save you on rainy days. Getting a couple of insurance plans may be enough for you unless you will be offering a variety of towing services too. There are many risks you will need to protect yourself against, so also are different insurance to cover you. Below are the most common insurance coverages for a towing business:
- Auto liability
- Physical damage insurance
- On-hook coverage
- Garagekeepers insurance
- Garage liability
8. Promote your business and win more clients
Your customers are the soul of your towing business. So you need to put in your best to get more customers for the business. Market your towing business and let people know about it. Use different marketing strategies to get this done.
Research the best places and methods to promote your business and get the best results. But focus on the cost-effective ones so you don’t burn out your budget on advertisement. So consider creating a website for the business and use social media to establish a huge inline presence. Help people find you more easily by creating a marketing plan that will take your business to them.
