How to Set Profitable Tow Truck Business

Are you thinking of starting your own towing business? Chances are that you have the zeal and passion to start a business, but you don’t know where to begin. There are key things to put into consideration when you want to become a tow truck business owner. We have compiled this guide on how to start a towing business and covers the essential information to help you with your efforts. To succeed in towing business, you will need to learn about the day-to-day activities required, the typical target market, the startup costs, the growth potential as well as legal considerations.

Who is this business for?

Every day, vehicles break down, are illegally parked or are left stranded. A tow truck business helps in transporting these vehicles to repair shops or at a place of convenience. Anyone who has mechanical passion is well suited for this type of job. A towing business is mostly straightforward. However, care should be applied during the towing process to ensure the safety of vehicles as well as of those involved. During a typical day, a tow business owner spends most of their time driving a broken-down or stranded vehicle. They might also be called to tow vehicles which are illegally parked. All you need to do is to hook them to a tow truck and transport them to the desired location.


The target market for this type of job is from calls that a tow owner receives from different places. It can be from the police department, individuals, municipal departments, motor clubs, repair shops, auto auction companies among others. A towing company makes money through a couple of ways. The primary method is through charging clients for tows. A typical charge may comprise of a flat fee for a tow, storage fees as well as mileage fees.

Attracting Customers

The challenge of any business is to attract customers. It is very important to build a loyal customer base which comes from building on relationships. One way of getting started is through building a relationship with a local repair shop. Garages normally maintain partnerships with towing companies, and in return, they get a discount for every successful business.

Skills and Experience

A tow truck business owner must know the basics of towing. He must be legally licensed to operate a tow truck business. In most cases, driving towing trucks require a class B license. The startup costs associated with running a tow truck business can be substantial. An owner must start by purchasing a tow truck, work on getting licenses and other required permits that come at a cost. A business must also purchase all the required insurances.

To start a tow truck business, there are key steps that have to be followed. The first thing is to plan your business. Next, you need to form a legal entity that is either defined by a sole proprietorship, partnership or corporation. Next, you have to register for taxes as defined by your state. It is very important to open a business bank account to keep track of all business finances. It is also very important to set up business accounting. Obtain the required permits and licenses, get a business insurance and work towards defining your brand.

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