When you think of tow-trucks, what comes to mind? Fist-shaking frustration as a car is towed from its parking spot, or heartfelt thanks as a broken-down car is shifted from a busy highway?
What if there was another image to come to mind: counting up the cash after another lucrative week in the towing business?
It may be an option you haven’t considered, but really should. To learn how you can get towing for dollars by starting your own towing operation, read on!
The Towing Business
The automobile towing industry is a smart business to be in. The industry is up 3.0% on where it was five years ago. By the end of 2020, it’ll be worth $8bn in revenue.
Sounds like a good ticket to be on, right?!
Perhaps money isn’t your primary driver, and you’re more about providing employment to those that need an opportunity. In that area as well, towing is a big hitter. The number of towing businesses has grown by 6.9% to 49,189 in five years, increasing employment in the area by 4.9%.
Extreme weather events mean business for tow trucks. These events are expected to happen more often, which has a silver lining for those in the towing industry. Safer cars, and driverless cars, far into the future, might mean changes to the number of tows per year, but that’s hard to predict just yet.
What Do Tow Trucks Do?
The towing industry has a few business areas, so when getting started, you’ll need to have a think about which ones you’d prefer to target. There’s passenger car towing, commercial vehicle towing, and of course, roadside assistance.
The more cars there are on the road, the more likely there will be car accidents or parking infringements. Which means the greater number of cars in a city, the more work there will be for you. You will, of course, have to research if there are already too many tow trucks in your area, or you’ll not get the amount of business you’re hoping for.
Is It Dangerous?
The towing industry can present some risks and difficulties. You’ll often be out in harsh weather since that’s when car accidents are more likely to happen. You’ll also frequently be driving when you’re normally asleep, bringing in dangers of driving when feeling drowsy.
While you might not expect it, it can also be an emotionally-taxing and difficult job. You’ll be dealing with customers at distressing times, and that can take its toll. Finally, it can be a competitive industry, and you might find yourself in conflict with other towing companies if they claim it’s their turf.
Deliver on Customer Experience (CX)
You (or your drivers) will have to deal with emotional customers in difficult circumstances. They might be angry at you towing them out of a no-standing zone. Or in shock after walking away from a severe car accident.
You mightn’t have considered the customer experience (CX) side of the towing industry, but we promise it’s a thing! Training your staff in soft skills, so they are able to manage these situations gets you great online reviews and repeat business. And that’s critical.
These days, those positive online reviews mean more customers. It’s what potential customers will scan through when they’re roadside, looking for which towing operator to call for assistance. It’s why some say online reviews are the best thing that’s ever happened to small business.
There are simple yet innovative ways your drivers can deliver a ‘wow’ experience to customers, by bringing hot coffee and pastries with them, or knowing how to empathize with and comfort people in distress.
No doubt you’ve got some of your own ideas on how to deliver great CX through a customer-centric culture.
Now, to get started in the business. Step one is doing your research. Work out where there is a low ratio of accidents to tow trucks, and aim to get started there. Over time, you’ll build up great customer reviews, and customers will seek you out over a greater catchment area.
Next, work out how much you’ll need to invest in getting set up. This means costing everything from websites and business cards to buying one or more trailers to get going on the towing front.
It’s a good idea to get small business advice on accounting and employment laws to make sure you do everything above board. The last thing you want is an issue with the IRA or an ex-employee because you made a mistake before you even really had the chance to be successful.
Getting the Right Advice
Beyond trailers and drivers, there are logistic business details you need to get started. You need staff to take calls, with good attention to detail when noting the pickup location. You’ll also need mechanics to keep your trailers in good condition.
You’ll need someone keeping an eye on HR aspects, like payroll and recruitment. Your HR officer should be keeping an eye on your drivers’ workload, making sure they’re not logging too many hours as driving tired is a risk to all of you.
Hire a great accountant and get regular sound advice from a lawyer as well. As you get started, you can get external advice, and as you grow, bring these team members in-house as full-time employees, for cost-effectiveness.
Get Going in the Towing Business!
There you have it: towing is a profitable, growing business, and not a hard one to get started in. If you think it sounds like you, time to look into the right trailers and get investing. Remember to train your staff in the technical as well as the CX skills for the job.
Once you’ve got all that happening, you’re ready for success in the towing business! If you found this article helpful, be sure to check out more expert advice on our business blog.