How Much Can You Make Owning A Towing Company? Answered

Here we begin with all details about How Much Can You Make Owning A Towing Company? A tow truck company assists in moving broken-down vehicles to repair shops, impound lots, and other sites as ordered when they are abandoned, stranded, or illegally packed in unusual areas. Some companies that rent out tow trucks also provide emergency roadside assistance.

This industry is in extremely high demand and will continue to expand. The average age of the auto fleet, the frequency of car accidents, and parking enforcement by private landowners and governments all influence the need for tow trucks. Tow trucks can be called by police agencies, people, motor clubs, repair shops, auto auction firms, and property owners to move vehicles.

How Much Can You Make Owning A Towing Company?

The intermediate annual salary for a tow truck owner in the United States as of June 3, 2023, is $47,295. Suppose you need a quick pay estimator of about $22.74 per hour. This amounts to $909 each week or $3,941 per month.

The bulk of Tow Truck Owner salaries presently ranges between $35,500 (25th percentile) and $50,000 (75th percentile), with top earners (90th percentile) making $75,000 annually across the United States, while ZipRecruiter is reporting yearly wages as high as $93,500 and as low as $24,000.

The wide-range average salary for a tow truck owner is up to $14,500, which indicates that there may be many opportunities for promotion and higher pay depending on experience, location, and skill level.

In your area, the average yearly pay for a tow truck owner is $47,801, which is $0 (0%) less than the $47,295 national average—the highest-paying state for tow truck owners out of all 50 states.

As millions of current jobs are listed locally around America, ZipRecruiter regularly checks its database to determine the most precise annual salary range for Tow Truck Owner positions.

What Are The Initial Tow Truck Business Expenses?

The truck itself is the major upfront cost when starting a tow truck business. What is the price of a tow truck? Your desired type of vehicle and the state of the market will determine the answer.

On the lower end of the price range, a new light-duty tow truck will still cost more than many used cars. An ultra-heavy-duty tractor-trailer, which is more expensive, can tow even the largest loads. A mortgage is an option that lowers your initial fees but increases your monthly payments.

If you choose a used truck, the cost might be significantly lower and range widely. You should avoid purchasing a vehicle that is more than a few years old because a used vehicle will cost more to fix than a new one will. The best action is to check for vehicles for sale in your area to get the most accurate cost for new and used models.

Using a pickup vehicle as a tow truck can help you launch your towing business at a lower cost. If you own a flatbed pickup, you only need a wheel lift. If desired, you can add a towing setup. You can also consider purchasing a secondhand pickup truck, especially for your towing company.

What else is required to launch a towing company? In addition to the truck, consider the comforts and equipment you want in your cab. The more consumers you can assist, the more tools you will have. A GPS, tire repair equipment, traffic cones, a lockout kit, a portable air compressor, booster cables, a jack, gasoline tanks, and floodlights are a few examples of gear.

How Much Recurring Expenses Are There?

The amount of money you can generate as a trucking company owner depends on your outgoing costs. The more you can control your maintenance expenditures, the more money you can make. Here are some examples of recurring monthly or annual payments to take into account:

Insurance

There are various types of insurance that you’ll need as a tow truck driver. You also require on-hook and cargo insurance in addition to general liability. You’ll also need a Garage Keepers’ policy if you own a storage business.

Since some large providers left the market in 2017, tow truck insurance prices have increased. As a result, I plan on paying a hefty deductible for liability insurance. Depending on the type of business you run, the cost of one vehicle every year can change.

While receiving citations or getting into accidents might drastically raise your rates, towing in a rural location can reduce prices. You should consider paying extra for insurance if your company primarily deals in repossessions.

You must supplement your current coverage with towing insurance if you offer towing as an add-on service for another aspect of your business, such as auto repairs. To obtain actual costs and weigh your options, get in touch with one or more insurance providers.

Fuel

Your gasoline expenditures will change depending on how far you drive, how fuel-efficient your truck is, and the price at the time. Diesel fuel, which is more expensive than gasoline, powers most tow trucks.

Assume that your monthly mileage is 20 miles per call, the average cost of diesel is $3.25, and you get 13 miles per gallon. Your monthly fuel expenses will come to almost $1,100 in such a case. Naturally, these fuel expenses should be covered by your charges.

You can check the U.S. Energy Information Administration for average diesel fuel prices. A gasoline-powered light-duty truck can also help you save some money.

Repairs 

Monthly costs for repairs can change. There will be months when your truck needs little to no maintenance, and there will be months when the prices will be higher. Nevertheless, you should set aside money each month for repairs and maintenance.

Set aside a specific monthly amount and keep any extra for future, more significant repairs. To know how much to budget, acquire recent estimates from a few nearby repair businesses for the most common fixes. Purchasing a newer truck with fewer miles will help you save money on repairs.

Marketing 

You must invest in marketing to keep a continuous flow of clients from month to month. Customers can find towing services mostly through four channels: Google, motor clubs, referrals, and law enforcement.

By establishing a low-cost network with the local police, motor clubs, and repair shops, you can attract some consumers. To capitalize on customers looking for towing services online, you need to invest significantly in internet marketing.

Your monthly marketing expenditures—which might range in size—can support you in keeping a prominent online presence and generating a steady income. If marketing is done well, it should more than pay for itself by attracting new clients. To find out what marketing spend is appropriate, speak with various marketers.

How Much Money Can You Expect To Make?

You undoubtedly want to know how much income and profits you may expect to make after evaluating your costs. To be successful, as with any business, you must work hard.

However, knowing your costs and the going rate for towing services may help you comprehend the profits you can anticipate. So how much money does an owner/operator of a tow truck make?

A crane and tower operator has an average yearly pay of $64,010, whereas a light truck driver makes $34,730. These are the wages of drivers who work for different companies, though.

You can earn more or less based on how you manage your business if you own it since you keep all the profits. It all depends on how much effort you put in, how sound your company plan is, and how lucky you are.

Most tow truck firms have a base hookup price and charge per mile. Depending on the provider and the area, towing services can cost more or less on average. Many towing businesses charge a base amount for the first few miles, adding a fee for each subsequent mile.

Additionally, depending on your region, you can charge for services like tire changes and jumpstarts provided at the roadside.

There are numerous strategies to boost your earnings. One strategy is to grow your business gradually. You can start making more money after paying off loans or the truck mortgage and expanding your clientele.

You can justify charging more when establishing a name for yourself in your industry and receiving positive online evaluations. You can expand your consumer base each month by hiring people. You can improve your income by expanding your company to offer emergency roadside assistance or impound services.

Highest Paying Cities For Tow Truck Owner Jobs

We’ve discovered 10 cities where a tow truck owner’s regular pay is higher than the national average. San Buenaventura, California, is at the top of the list, followed closely by Santa Clara, California, and San Francisco, California, in the second and third spots.

San Francisco, California, outperforms the national average by $11,038 (23.3%), while San Buenaventura, California, continues this pattern by exceeding the $47,295 average by an additional $42,055 (88.9%).

The average salary is higher than the national; therefore, moving provides a tow truck owner with many opportunities to develop financially.

The average compensation for these top 10 cities differs by as much as 49% between San Buenaventura, California, and Hayward, California, demonstrating a substantial possibility for positive wage variance in a Tow Truck Owner role.

This is another element to take into account. The cost of living should also be considered when weighing location and compensation.

Best Paying Related Tow Truck Owner Jobs In The US

According to our research, at least five positions in the tow truck owner job type pay more yearly than the average tow truck owner’s salary. Top examples of these positions include Heavy Duty Tow Truck Operator, Vehicle Recovery Truck Driver, and Freelance Tow Truck Owner.

Notably, the salaries for all of these positions range from $15,127 (32.0%) to $47,250 (99.9%), higher than the average tow truck owner pay of $47,295. If you’re qualified, you can earn more than the typical Tow Truck Owner employment by being hired for one of these related positions.

Conclusion

I hope you know How Much Can You Make Owning A Towing Company? A towing company can broaden its services by providing emergency roadside assistance to increase revenue.

By providing this service, you set yourself up to make money from other services like fixing flat tires, emergency gasoline delivery, and other related services. Also, please note that towing companies may be able to boost their income by leasing tow trucks.

When the conditions for the purchase are satisfied, certain leasing agreements allow the truck to be purchased at the end of the lease. If you are still determining the market, leasing may be better than purchasing a new car.

Frequently Asked Questions