How to Start a Towing Company

A new business venture, no matter what it may be, at the beginning, carries a certain risk that can be largely controlled with a systematic and planned approach. Starting a towing company is the same. While operating a tow truck straight out of your garage is entirely plausible, you would still need to approach the right governmental departments to get relevant licenses and also to ensure you have adequate insurance.

As a concept, a towing company is a great business to step into. When a car breaks down, the driver is not equipped to transfer their vehicle to the nearest auto repair shop by themselves and would need to depend on a towing service. At the same time, most auto repair shops do not have towing services of their own and need to rely on external services and collaborations with towing companies. What this provides is a space for businesses that already have an existing clientele.

But the process of starting your own company has many steps you need to undertake first.

The seven steps to your own towing company

If you try to consider all the steps it takes to start any business at one go, it may feel overwhelming. That is why you need to follow a list of steps that act as basic guidelines, informing you of what you need to do. As long as you ensure each step in this list is undertaken, you can rest assured that the process of starting your own towing company becomes less stressful.


  • Create a business plan: An official plan that clearly highlights your vision for your company is the first step. Instead of relying on developing your concept as starting your business, start with the concept. In this manner, you clearly know what you are selling. Even as a towing company, you would need to brand yourself in a certain way to stand out. Usually, towing companies are selected based on relevance. The company nearest to an auto repair shop or a site of disaster. That means that doing your research and discovering the need for a towing company in your locality of business is important. If there is no need for a towing company in that area, or if the location is already heavily serviced, then select another location. Obtaining a parking lot for your business in your area of operation can serve as a base for work. Also, decide on what kind of towing you want to do, options include emergency towing, dealership towing, commercial retail towing among others.
  • Obtain your list of requirements: There are certain documentations and licenses you will require before you start your own towing business. You need to approach the relevant departments of your government to obtain a business permit before you can commercially benefit from your towing company. At this point, you also need to decide on your base of operations. Many people choose to operate their business from their private homes, saving money for rent. Others prefer a professional office. Any company needs an address, and you should obtain one for yourself as well.
  • Take care of the finances: The most important aspect of any business is breaking even and making enough income to sustainably continue that business. Your startup costs, meaning the amount you must invest to begin the business needs to be assessed and equipment costs factored into the equation. Do your research and find out how much you need for your licenses as well. Should you need investors, prepare a pitch that best advertises your vision for your personal brand.
  • Invest in a tow truck: As the main star of your new business venture, your tow truck cannot be equipment you skimp on. As the main piece of equipment you need to operate, the tow truck should ideally be top of the class and capable of moving vehicles with ease. As long as you have one tow truck, you can start a towing company. For a company that visualizes itself as having multiple tow trucks, all you need to do is hire drivers to work for you, and your business is ready to thrive. A brand new business, however, should take the time to test the waters. Do not purchase more than three tow trucks at the beginning, three being the upper limit. Once you have established yourself in the business, you can expand your fleet.
  • Obtain commercial liability insurance: Having insurance is extremely important, especially for a towing business. Ideally, you would need something that provides compensation for damage to your tow truck, any damages to you as well as compensation for damage to the client’s car.
  • Exclusive contact information: The main form of communication you will engage in will primarily be over the phone. Always being available, especially for emergencies promotes a good image for your brand. At the same time, consider building a small website that puts your name out on the internet. A Facebook page, as well as a Twitter account, can help to promote your company as well. As a new business, make sure to utilize the benefits that social media platforms provide in reaching out to the masses.


  1. Contact auto repair shops and car dealerships: These are the people who will provide you with business and information on potential clients. Therefore, having a good relationship with them is important. Every business thrives on communication, and you need to use that human link to access benefits conducive to the growth of your company. Provide a mutually beneficial relationship so that auto repair shops have a reason to call you over other towing companies – an easy way to do this is by building a good relationship and providing access to benefits such as discounts.

As long as you factor in that at the end of the day you will be working with people, your company would be in a good place to operate. You need to also remember that you will be working in client servicing, and that too, potentially with clients who are distressed because of damages to their vehicles. Learning how to deal with your clients is also an important part of running your business, and is the key difference between a successful venture and one that has to eventually close its doors.

Want to check out a great towing service in Las Vegas? Check out Larry’s Tow today! We also operate in nearby Henderson, NV.

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