You’ve come to the right place if you want to learn how to start a utility trailer rental business. The best part about starting a utility trailer rental business is that you don’t have to be available on a set schedule to run it because, aside from customer phone calls and trailer deliveries and pickups, you don’t have to be available all of the time. Furthermore, the initial investment required to start a utility trailer rental business is relatively low. This step-by-step guide will assist you in learning more about this business venture and determining whether it is the right step for you as an entrepreneur.
1. Familiarize yourself with Utility Trailer Rental Industry
Since hauling and moving is always in demand, utility trailer rental businesses provide a vital service to a specific demographic. Utility trailer rental businesses typically rent out a variety of trailers to their customers. Businesses and customers, who do not want to spend a fortune on utility trailers, rent them for short-term use. Since the utility trailer will generally be used to transport items from one location to another, businesses or individuals need a utility trailer for just one or a couple of days maximum. This is the reason why this service completely makes sense. When a utility trailer is rented, the rental company delivers it to the specified location and then picks it up at the end of the rental period.
Businesses and Individuals don’t have to worry about purchasing a utility trailer that they’ll only need temporarily. Utility trailer rental businesses benefit from rental fees on their trailers on a regular basis, allowing them to profit from their one-time trailer purchase and possibly scale the business by purchasing more utility trailers in the inevitable future.
Most utility trailer rental businesses cater to residential, commercial, and industrial clients. Their typical target market consists of businesses hauling landscaping equipment, garden equipment, lawnmowers, camping gear, and much more. Furthermore, you can also target individuals who want to move bulky items from one location to other.
With such a multitude of uses, a utility trailer rental business can be so beneficial to you if you target the right audience. A utility trailer can truly make life sweet, and this business can cater well to anyone looking for a utility trailer temporarily. Utility trailers, new or used, are very affordable all around. Therefore, if you want to get into a rental business, starting a utility trailer rental business is a great choice.
How much does it cost to buy a Utility Trailer?
You can buy used utility trailers for as low as $1500. However, if you want to start a utility trailer rental business you should buy at least a couple of commercial-quality utility trailers which will cost you around $6000 each.
How much does it cost to start a Utility Trailer rental business?
You could start a utility trailer rental business at a basic level for around $14,000 (assuming you buy two new commercial-quality utility trailers). An extra $3000 could get you off to a great start. That being said, if you want to operate on a bigger scale and want to provide a variety of utility trailer choices to your prospective customer, you will need to buy at least 5 commercial utility trailers to start with, which alone costs around $30,000. Therefore, it will cost you around $40,000(utility trailers plus marketing-related costs) to start a utility trailer rental business on a big scale.
Keep in mind, if you want to go really cheap, you can either buy used utility trailers, make your own trailers or you could buy as you grow. If you don’t mind a little hard work, utility trailer rental is one of the best businesses to start and grow.
Is Utility Trailer rental business profitable?
Yes, Starting a utility trailer rental business is incredibly profitable. However, make sure to do your market research properly and have a solid marketing strategy in place. The success of your utility trailer rental business will be determined by the number of clients you find. Buying a single commercial utility trailer will cost you around $6000. And you can rent the same trailer for around $70 per day. That means you will make all your money back by renting your utility trailer for just around 85 days. After that everything is your profit. Furthermore, unlike truck rental businesses, the maintenance cost for a utility trailer is next to nothing.
Is Utility Trailer rental business worth it?
With such a low startup cost, a utility trailer rental business is absolutely worth it. You can realistically buy just one utility trailer and start your business journey from there. The best thing is you can even start a utility trailer rental business by buying used trailers or even cheaper if you can build your own. A single high-quality commercial utility trailer can generate anywhere from $400 to $500 per week. Furthermore, this business is highly scalable and you can reinvest a portion of profit back into the business and scale it to a million-dollar rental business in no time.
2. Plan your Utility Trailer Rental Business
The planning phase is critical for the success of any business. The same applies to the utility trailer rental business too. Let’s get into some of the key steps you will need to understand while planning your utility trailer rental business.
Choose a name for your utility trailer rental business
Whether you want to start a utility trailer rental business or a golf cart rental business, you must choose a name that reflects your values and beliefs.
Keep in mind that the legal business name must comply with state naming rules in the states where you intend to operate your business; otherwise, the state may refuse to accept the documents filed to form or qualify your utility trailer rental business.
Prior to deciding on a name for your utility trailer rental business, it is also a good idea to talk about branding and how it will affect your business. The main question here is whether your legal business name will also be your brand name, or whether your brand name will be distinct from your legal name.
To be honest, it is preferable to use your legal business name as your brand name when first starting out. Why? You may inquire. The reason for this is that it simplifies things, is extremely simple, and is significantly less expensive.
However, if you operate an informal business (sole proprietorship, limited liability partnership, or general partnership), some states require you to use your surname as the legal name of your company.
Would you mind if your surname served as your legal business name? If the answer is YES, you can proceed to the next step. On the other hand, if your answer is NO, please stick with me.
If you do not want to use your surname as your legal business name, you must file a Fictitious Business Name Statement with the county in which your utility trailer rental business’s head office is located.
Shopify’s Business Name Generator is super useful while brainstorming brandable names for your utility trailer rental business. Once you decide the name of your utility trailer rental business, you need to perform three final checks.
- First, check your State’s business name database to see if your desired business name is available.
- Second, do a domain name search to check if your business name is available as yourbusinessname.com. If it is available go ahead and register the domain before anyone else gets it. BlueHost offers domain names free of cost if your purchase 1-year hosting package with them. You can use the tool below to see if the domain name is available.
- And lastly, do a federal search on the US Trademark Electronic Search System and make sure nobody has already trademarked your name.
If the name for your utility trailer rental business is available you can choose to trademark it, but honestly – don’t bother about it right now. It is a lengthy process and will cost you around $600. I would rather spend the money and time on the marketing channels.
Utility trailer rental business plan
If you want to start a successful utility trailer rental business, you will need a compelling business plan at a minimum. A well-written business plan should explain the company’s core objectives and how it plans to achieve them. One of the other purposes of a utility trailer rental business plan is that it makes your business look professional and appealing to prospective lenders and investors.
All in all, a well-written actionable utility trailer rental business plan is a crucial document for your utility trailer rental business. Without it, you’d be running around like a headless chicken.
A compelling business plan has many sections, some of the must-includes are:
- Executive Summary
- Business Description
- Market Analysis
- Competitor Analysis
- Services to Offer
- Competitive Pricing Strategy
- Marketing Strategy
- Financial Projections
You can use business plan software like BizPlan and Enloop to compose a professional-looking business plan. However, don’t get lazy and pay someone 20 bucks to write a business plan for your utility trailer rental business. You will need professional high-quality work.
3. Register your Utility Trailer Rental Business
You will need to register your utility trailer rental business in order to operate it as a legal entity. But before you register the business, you need to understand and choose a business structure for your utility trailer rental business. You’ll want to choose that intelligently because how you establish your utility trailer rental business will affect your taxes and legal responsibilities.
Consider one of the most frequent business structures:
a. Sole Proprietorship
This form of unincorporated business is owned by a single person or a married couple. Your business will not need to be registered, and your taxes will be reported on your personal tax return.
b. General Partnership
An unincorporated firm with numerous owners that, in terms of registration and taxes, is similar to a sole proprietorship.
c. Limited liability company (LLC)
A registered business that provides personal protection to all of its members in the event that your company gets sued. You can decide whether you want to be taxed as a partnership or as a corporation.
This is a sort of incorporated business, with S-corporations and C-corporations being the most popular. The taxes you pay will differ based on the sort of corporation you form.
4. Register for Taxes and Obtain an EIN
As a responsible business owner, you must always follow the law. That is, you must adhere to all tax, licensing, and employer regulations. Taking the time to learn about any legal requirements for running your utility trailer rental business will save you a lot of trouble—not to mention money and stress—down the road. What business taxes you must pay and how you must file them will be determined by the business entity you choose, as well as other aspects of your utility trailer rental business. It might be a good idea to speak with a tax professional right now to ensure you understand what to expect.
If your utility trailer rental business employs other individuals, you’ll need an employer identification number. This is also known as an EIN or a tax ID number for a business. You can obtain your EIN from the IRS online for free and use it when filing taxes for your utility trailer rental business. It is also required if you want to open a business bank account, get a business credit card, or apply for a business loan. Even if you do not intend to hire employees, obtaining an EIN has numerous advantages.
5. Get Funding for your Utility Trailer Rental Business
Even if you have a top-secret utility trailer rental business service approach that can capture the hearts of customers from miles away, but you don’t have enough money, your rental business will fail. It may sound absurd, but in order to make money, you must first have money. There is no escaping the fact that purchasing a utility trailer is costly. Well, if it wasn’t so expensive, everyone would buy one, and the utility trailer rental sector would be dormant. Not to mention the fact that you may be paying exorbitant rent, marketing your service, and hiring personnel with lucrative salaries and benefits.
Small businesses like utility trailer rental businesses can take advantage of numerous incentives, subsidies, loans, and equity investments. However, regardless of the funding source you choose, you will need to have (at a minimum) the following documents:
- A Utility Trailer Rental Business Plan
- Projected Financial Statements
- Tax returns of both the business owner and the business itself (when available)
- An explanatory document on how the money will be used
- A description of services offered by your utility trailer rental business
After you’ve done the number crunching and figured out how much money you’ll need for your utility trailer rental business, you may look into the following choices.
Obtain Funds through SBA Backed Lenders
Even if you have little to no money and wish to start a utility trailer rental business, you may be eligible for an SBA loan. The United States Small Business Administration (SBA) works with lenders to provide loans to small businesses around the country.
One thing to keep in mind is that the agency does not make direct loans to small business owners. Instead, it develops guidelines for its lending partners, community development organizations, and micro-lending institutions.
SBA-guaranteed loans have a number of benefits. The loan rates and prices are frequently equivalent to those of non-guaranteed loans. SBA-backed loans also come with continuous assistance to help you launch and run your utility trailer rental business. Moreover, certain SBA loans have lower down payments, more flexible overhead restrictions, and no collateral requirements.
Obtain Funds through Banks
If you are unable to obtain funding for your utility trailer rental business through state-level agencies or SBA-backed loans, your next step is to seek regular small business loans from banks. As a result, you must conduct due diligence and understand how lenders evaluate your utility trailer rental business. If you do, you may be able to obtain a traditional loan with a longer-term and a higher loan amount.
Obtain Funds through P2P Lenders
The term “Peer to Peer” refers to a sort of financing that is very similar to crowdfunding, with the exception that your utility trailer rental business loan application is vetted and presented to numerous lenders and investors. If traditional lenders have turned down your utility trailer rental business loan application, this sort of funding is a perfect alternative. Some of the well-known peer-to-peer lending companies are:
6. Promote your Utility Trailer Rental Business
Most business owners, for some reason, do not include marketing in their business strategy. This is likely one of the most serious mistakes you can make, and you should avoid it at all costs. For a service-oriented business like a utility trailer rental business, marketing, and advertising make or break your business. Furthermore, if you do not have a large sum of money to invest right away, you must understand what it takes to successfully promote a utility trailer rental business. You’ll also need a solid marketing strategy and communication strategies in place.
Let’s go over some of the traditional and modern marketing strategies you can use to promote your utility trailer rental business.
Build a website
I can’t stress this point enough. You will NEED a website in order to operate your utility trailer rental business. There is no way around it. The world has become digital and you must create a digital presence for your utility trailer rental business.
Make sure to utilize the power of the internet. Additionally, you must customize your utility trailer rental website and make it align with your brand. You can put pictures of your trailers plus testimonials and make an excellent impression on your visitors. After all, actions speak louder than words.
Don’t forget to include your mission statement on your utility trailer rental website and let your customers know why they should rent from you. Having a website creates a digital presence for your utility trailer rental business so your potential customers can search and find you on the web.
You can read my guide on how to make a basic website for your small business if you want to do it yourself. However, if you want someone else to work on the technicalities while you focus on acquiring more customers for your utility trailer rental business, we are ready to help you. Our $499 digital package comes with a professionally designed website, custom email, 24/7 support and maintenance, SEO, and digital marketing services. You wouldn’t want to miss the deal. Contact us today before the deal runs out.
Establish social media accounts
Create a digital presence for your utility trailer rental business by establishing social media accounts. You must be strategic in this regard, as you do not want to waste your time appearing on all social networks, particularly those that do not align well with your target audience.
You want your utility trailer rental business to be on, depending on the size of your operation:
Nowadays, almost everyone uses social media not only to communicate with friends and family but also to shop for goods and services. Getting your utility trailer rental business in front of your target audience can result in more leads and sales. Moreover, it can also be used to keep current customers informed and to attract new customers.
Run Paid Ads
Paid Ads have the ability to target prospective customers within a specific demographic and region, making them an excellent tool for your utility trailer rental business. Consider running paid ads through services like Facebook Ads, Yelp, or Google AdWords. Furthermore, the best thing about paid advertisements is that they produce results quickly, allowing you to scale your utility trailer rental business both vertically and horizontally.
If you need any professional help to run paid ads for your utility trailer rental business, please contact us. We will be more than happy to provide you with help and resources for absolutely free.