How To Begin a Towing Company – Part 1

This guide on starting a towing company covers the essential information That Will Help You Determine if this Company Is a Great match for you.
Learn more about the day-to-day activities of a towing business owner, the typical target market, growth potential, startup expenses, legal considerations, and much more!

A tow truck company transports these vehicles to repair stores, impound lots and other locations as directed. Some tow truck companies also supply emergency roadside assistance.

Who is this business right for?

Anyone who’s mechanically inclined might be well-suited to begin a tow truck business. Towing vehicles is generally straightforward. Sometimes, however, hooking a busted car up to a tow truck or extricating a car from a tight place could be hard. A mechanically inclined head can help out others in these situations.

What happens throughout the course of a typical day at a towing business?

A tow truck company owner spends the majority of their day driving to broken-down, stranded and abandonded vehicles, connecting them up to the tow truck, transporting them to a different place, and unhooking them from the tow truck. This job is almost completely done outside, and the work must be accomplished whatever the weather.

What is the target market?

Tow truck companies receive calls from several outlets. Police departments, other municipal departments, people, motor clubs, repair shops, auto auction companies and property owners could all call a tow truck to maneuver vehicles.

A tow truck business will make its money by charging customers for tows. A typical fee will incorporate a flat fee, a mileage fee, and a storage fee for the tow, the distanced towed, and the storage of the vehicle, respectively.

What is the potential for growth in a towing business?

Most tow truck companies serve a single geographic region. In large metropolitan areas, they might just serve the city — or perhaps just part of town. In less-populated locations, they may cover more territory, but they are usually still limited to a single region.

A few businesses promote nationally towing services. They efficiently offer a referral service, for a fee.

What are some experiences and skills which will help you build a successful towing company?

A tow truck company operator must understand how to — and be licensed to — run a tow truck. In a lot of states, tow truck drivers need a Class B permit. A Class B license generally enables drivers to operate a vehicle that weighs more than 26,000 pounds. Alternatively, it can include the vehicle that is towing another vehicle weighing 10,000 pounds or less.

The startup costs related to launching a tow truck company are substantial, mainly because company owners must purchase a tow truck.

Licensing prices are another major startup expense. Along with paying for a Class B license, company owners frequently also need to acquire a permit from their own state, and they may need other licenses from local municipalities or street departments. Company owners should check with their state and local city or county clerk office to learn what the exact permits are that are needed and how much they are to purchase. They often are a couple hundred dollars, and they can be much more.

A business must also buy insurance. The first month’s premium might be two or three hundred bucks.

Keep reading through to Part 2 – what are the steps for starting a towing company to get the rest of this guide.

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