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Monday, September 8, 2008

Towing company | Business Ideas

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I know that this isn’t the most interesting business idea that I presented so far but it is a profitable one. This kind of business is very good to start if your country has a good economic growth and the registration of cars is growing year by year. To that I must add that if your country has bad roads this is a plus :), (I thought I would never hear myself say that).

To start such a business you won’t need much money, but the profitability will depend on your capability to make the company known. That means a web site, flyers, word of mouth, ads in car services, partnerships with car services, or why not make an agreement with the local police (they recommend you to car owners that suffered an accident and in return you tow their police cars for free if they have problems).

To keep the costs to a minimum you can start the business by using second hand cars and platforms (in the future you can buy new ones). A second hand vehicle costs around 15.000 euro (19.000 $) and the second hand platform about 2000 - 5000 euro (2800 - 7000$).

You have to be very careful when you put a car on the platform, especially if it is new, so you don’t scrape the paint. Usually to avoid such situations you will have to make an agreement with a local insurance company.

The prices are usually between 0.50 - 1 euro / km (0.7 - 1.4$ / km). The profits are pretty good if you manage to transport about 30 cars a month. Also you can make profits by transporting boats or other machines that need special care. You can sell ad space on the car, there are insurance companies or services that would like to buy add on your car.

But unfortunately this business has some weak points - price of gas and the congestion in the big cities.

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