If you’ve ever broken down on the side of the road or experienced car failure away from your home, you know how desperate these types of situations can feel. Odds are, you called a tow truck service to rescue you from your dilemma.
For this reason, these businesses are in high demand and can prove to be incredibly successful. So why not start your own towing business? You’re nearly guaranteed a plethora of potential customers.
As long as people have cars, they’re going to have car trouble. And when this happens, you get paid.
But how do you become a small business owner? How can you get your towing company off the ground?
Keep reading for all the answers.
Learn More About the Towing Industry in Your Area
First, you need to find out more about the local towing market. Are there a lot of other towing businesses in your town that will offer competition? If so, how can you separate your towing company from your competitors?
In some cases, it might be better to start your business in a different area to avoid an oversaturated market. However, you also need to find out about:
- Necessary licenses and insurance
- Marketing strategies
- Operating costs
- Equipment requirements
- And more
Market research is one of the most important steps in the process of becoming a small business owner.
Write a Professional Business Plan
Based on your assessment of the towing industry, you can write up a professional business plan. A business plan is necessary for outlining your future towing business. It should detail everything from the structure of your company to your financial projections.
We recommend spending an adequate amount of time creating a respectable business plan, as it will impact your ability to get financed. Banks, investors, and other lenders will only provide financing to entrepreneurs who have done their homework, know their stuff, and appear credible.
Acquire Startup Funding
For most people, business ownership wouldn’t be possible without financing. Starting a towing business costs money. You need funding for vehicles, equipment, commercial property, and more.
To get funded, approach your bank for an SBA loan. However, if you can’t qualify for a small business loan, there are other options.
For example, you can find a business partner to improve your loan eligibility or seek funding from investors. There are also crowdfunding sources, personal loans, and other sources of money to start your towing company.
Take Care of the Essentials
Finally, let’s talk about what you need to start your towing career. To start an operational towing business, you’ll need:
- Tow trucks
- Towing equipment
- A commercial driver’s license
- A business License
- Insurance for tow trucks
- A marketing plan
- A commercial space from which to operate your business
- Office equipment
- Business software (point of sale, finance management, etc.)
- And more
Once you acquire your financing, make sure you invest in everything you need for your business to function properly. And remember, it’s okay (and sometimes ideal) to start small and build up your company as it grows naturally. Don’t over-extend yourself with too many expenses.
Thinking About Starting a Towing Business?
If you’ve got big plans to start a towing business, we couldn’t be more excited for you. We know you will be successful. Just make sure you do your homework and take things slow.
And if you’re searching for more business advice or financing tips, look no further. Our blog is full of content created to help entrepreneurs like you carve their way through the business world. Check out some of our other articles before you go.