Overview of Tow Truck Profits
Tow truck charges an average of $120 per tow, which may include both a flat fee and mileage charge. The average storage fee is in the tune of $20 per day. The average towing business owners make anywhere between $30,000 and $100,000 annually.
Starting a Tow Truck Business
Licensing Requirements
The first step in getting a tow truck license in NY is to apply to the New York State Department of Motor Vehicles (NYS). There are specific requirements for tow truck license applicants, including being at least eighteen years old. You may need a high school diploma or GED to qualify. A valid driver’s license is another requirement.
Operational Costs and Services
Running a tow truck business involves a range of operational costs, including:
- Fuel
- Maintenance
- Insurance
- Staff wages
- Licensing fees
These businesses get businesses from a wide range of outlets and often provide emergency roadside assistance.
Business Profitability
How much profit can a towing company make? The average tow truck business owner makes between $30,000 and $40,000 annually. Expenses and profit margins should be monitored closely to ensure the business remains profitable. It is also advisable to explore different business financing options.
Starting the Business
To start a tow truck business:
- Write your business plan.
- Register your business.
As a business owner, you’ll be able to retain all of your profits. This contrasts with tow truck drivers who, on average, don’t make as much money.
Purchasing vs. Leasing Tow Trucks
Cost of Ownership
In an urban area a towing license and tow truck can cost you as much as $200,000 with no accounts in place. The average tow truck driver salary in Canada is $60,000 per year. Owning a tow truck can provide you with the opportunity to build a loyal customer base and establish a reputable brand.
Purchasing brand-new tow vehicles can be pricey. If you don’t intend to use the tow truck for a number of years and can easily maintain it, buying a used one is a better idea. The price of the tow truck might range from several hundred thousand dollars to more.
Leasing Tow Trucks
Leasing a tow truck avoids the upfront costs of purchasing a vehicle and can offer lower monthly payments than traditional loans or equipment financing.
Credit Considerations
When getting a tow truck with bad credit, it is essential to consider the implications on your ability to get a loan.
Ways to Make Money with Tow Trucks
Earning Potential
Whether you’re looking to be self-employed or operate a tow truck business, there are many opportunities to make money. You can earn anywhere from $12,000 to $30,000 depending on the type of tow truck you operate and your location. Another way to make money with a tow truck is to transport items for local auto salvage yards.
Building a Successful Business
As the number of vehicles on the road continues to rise, the demand for tow truck services also increases, leading to more opportunities for profit.
Here are 10 steps to help you start a successful tow truck business:
- Research and planning.
- Offer additional services.
- Identify target markets.
- Analyze competition.
- Consider Internet marketing strategies.
- Provide essential roadside assistance.
- Choose the right tow truck.
- Diversify towing services.
- Establish a brand.
- Find business financing options.
Diverse Revenue Streams
Here are some ways to diversify revenue with a tow truck:
- Construction Work.
- Moving Service.
- Deliver Items.
- Snow Plowing.
Nationwide, tow truck drivers make $13.30 per hour, which is a $27,664 salary. However, this can increase significantly for tow truck business owners who manage to retain all of their profits.