Starting a successful towing company is going to take a lot of work, but it could be your first step toward complete financial freedom. Here is a quick look at some tips and tricks that will help you build a profitable towing business from the ground up.
Decide on a Business Structure
Even if you are going to be the only employee for quite some time, you probably don’t want to register your business as a sole proprietorship. Those types of business are very easy to file taxes for, but your assets are going to be at risk if the company goes under or you get tied up in a legal battle. Most experts agree that an LLC is the best option for an entrepreneur who is starting their first business venture. With an LLC, your personal assets are going to remain safe no matter what happens to the company.
Invest in the Right Equipment
During the initial stages of this process, your biggest expense is going to be your truck. In addition to purpose-built tow trucks, you might also want to take a look at trucks with detachable car trailers. That type of equipment isn’t going to be as expensive as a traditional two truck, and the money that you save could come in handy down the road. After you have decided on a truck, you must make sure that it is properly registered.
Don’t Skimp on Insurance
Commercial vehicles need very specific insurance, and you could lose your license if you don’t have the proper coverage. Most companies that offer business insurance have policies specifically for tow truck drivers. That type of insurance is going to cover your personal equipment as well as any vehicles that you are towing. It will also be your first line of defense if your business is sued for any reason.
Properly Market Your Company
The final step in this process is reaching out to potential clients, and you might want to start with a few local law enforcement agencies. Most of those agencies have lists of tow truck drivers who can be called whenever a vehicle is impounded. You also have the option of reaching out to local businesses who might need to have the occasional vehicle towed from their premises.
Once your towing business is up and running, you must be diligent about sticking to your budget. Everyday expenses can quickly spiral out of control, and you want to be sure that your fledgling company stays in the green.
You must be logged in to post a comment.