When you’re ready to start your towing company, follow these steps to make sure that your business is compliant legally and avoid wasting time and money as your business develops:
(Be sure you’ve read Part 1 before digesting everything here in Part 2 to get the full picture.)
A strategy your small business.
- A definite strategy is essential for success as a entrepreneur. A few important points to keep in mind are your first costs, your targeted market, and the time needed to break even.
- Form a legal point. Placing an authorized business entity prevents you from being liable if your towing company is sued. You’ll need to enroll for a variety of state and federal taxes before you can open for business.
Open a business bank account. A dedicated checking account for your towing firm keeps your finances organized and makes your business seem more professional to your clients.
- Set up business accounting. Recording your various expenses and sources of revenue is important to understanding the financial performance of your business. Maintaining accurate and detailed accounts also greatly simplifies your yearly tax filing. Failure to acquire required permits and licenses can lead to hefty fines, or even cause your business to be shut down.
- Get business insurance. Insurance is highly suggested for many business owners. If you hire workers, workers compensation insurance may be a legal requirement on your state. Your brand is the ideology behind company stands for, and how your company is perceived by the general public. A solid brand will help your company stand out from rivals.
- Make an Internet presence. A website for your business lets your customers learn more about your company and the services or products that you offer. You can even use social media to draw new customers or clients. Look around for a coupon before you set up your website – you might be able to save 15% or more when you produce a business site with a service like Weebly.
Where can I locate a business mentor?
One of the most significant resources an entrepreneur can get is quality mentorship. As you begin planning your small business, connect with a free small business source near you to get the help you want.
Having a support network set up to turn to during tough times is a major factor of success for new small business owners.
How to promote & market a towing company
Every tow truck company should have an internet presence so that individuals who need a tow can find the business. Tow truck companies should not completely ignore advertising channels like social websites, but they’re usually wiser to steer many funds towards neighborhood search engine optimization (SEO) companies. People are more likely to utilize an internet search engine to discover a nearby towing company when they need one than they are supposed to engage with one on Facebook or even Twitter. Typing in towing service Detroit into a major search engine is more likely to yield a useful result than looking for a video on Youtube or even navigating to the Yellow Pages since this takes an extra step. Efficiency in getting help is especially key when people find themselves in an emergency situation.
Many tow truck companies also seek out contracts with cities, repair shops, apartment complexes and similar businesses. These contracts offer a more stable revenue stream than advertising towards people do.
The Way to keep customers coming back
Individuals often need their vehicles quickly when they break , and land owners want improperly parked cars eliminated from their property as rapidly as possible. Providing speedy service retains these clients happy.
Many government agencies deal with multiple towing providers — and they’ll notify each firm when a vehicle needs to be transferred. The company that gets into the automobile first typically gets to tow it, and the others do not obtain any work from the call.
Most companies need to collect sales tax on the merchandise or services they provide. To learn more about sales tax and how it will have an impact on your company, read our article, Revenue Tax for Small Firms.
Maintain Personal Asset Protection
Do not think that just forming an LLC, or some other type of business, will save your own assets in the event of a litigation or other matter alone.
When your personal and company accounts are blended, your personal assets (your home, vehicle, and other valuables) are at risk in case your LLC is sued. In company law, this can be called piercing your company veil.
Just how much can you bill clients?
It’s also standard practice to control a daily storage fee for any vehicles that are saved on the company’s property.
What are the ongoing expenses and costs for a towing company?
Ongoing expenses for a tow truck company which are typically fixed include some licensing fees that have to be renewed and insurance premiums. Costs can vary and might include employee salaries, truck depreciation and repairs, and fuel.
Just how much profit can a towing firm make?
The exact amount varies depending on the area a business is in.
How can you make your towing business more profitable?
A tow truck company can diversify and increase its earnings by offering emergency roadside assistance.