Tow Truck Business Plan
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Tow Truck Business Plan Template
Executive Summary
Business Overview
TJ’s Tow Truck Service is a startup towing company located in Tacoma, Washington. The company was founded by Tory Jane Jamison, a tow truck driver who has driven tow trucks for a former employer for ten years. She was known among customers as the “most friendly and most experienced” tow truck driver they’d ever met and her former employer gave her the award most years as the “Best in Class Tow Truck Driver” within the company overall.
TJ’s Tow Truck Service will provide a comprehensive array of products and towing services, including towing of cars and pickup trucks, along with smaller recreational vehicles or trucks with trailers. In addition, services such as battery servicing, tire changes, lockouts, and fuel delivery are offered to customers in need of assistance. Because of Tory Jane’s background, her expertise in her role, and her customer reviews, she believes that she can start a successful tow truck business.
Product Offering
The following are the services that TJs Tow Truck Service will provide:
- Towing services within a fifty-mile radius for cars, trucks and vans or small recreational vehicles
- Proprietary app that offers up-to-the-minute service details for clients
- Battery charges, startups, and servicing
- Tire changes, repairs and installations
- Lockout repair and key retrieval
- Fuel delivery when vehicles is out of gas
Customer Focus
TJ’s Tow Truck Service will target residents within a fifty-mile radius. TJs Tow Truck Service will target interstate and state highway travelers within a fifty-mile radius. TJs Tow Truck Service will target retail tire stores, auto repair companies and insurance companies. Commercial fleets (businesses that use multiple vehicles and need long-term contracts) and law enforcement agencies will also be targeted.
Management Team
TJs Tow Truck Service will be owned and operated by Tori Jane Jamison. She recruited three former tow truck driver associates, Ron Harbinger, Track Masters, and Bill Acker, to join her business to take on management roles in the tow truck company.
Tori Jane Jamison started her career as a U.S. Marine, where she was assigned to a truck driving role and service attendant for the U.S. Marines. She served four years within that capacity and ended her career after those years with an exemplary record of duty and expertise in her field.
Ron Harbinger is a thoroughly experienced tow truck driver, with a twenty-year background of successfully towing vehicles of all sizes without a single “event” or “injury” attached to his service. Ron will take on the new role of Tow Truck Supervisor, overseeing the truck-driving team and handling all human resources issues.
Track Masters is a well-trained master of driving in all weather conditions, including snow, ice and thunderstorms. He has seven years of experience and will take on the role of Scheduling & Service Supervisor, overseeing the scheduling of service calls and the customer service environment overall.
Bill Acker is a veteran tow truck driver with almost twenty years of experience. He is joining the team as the Maintenance Supervisor, overseeing the care and safety of all tow trucks, including replacements, repair and serving of all vehicles on the property. He determines when roads are safe to travel or when other weather conditions or events preclude allowing drivers to venture out onto the area roadways.
Success Factors
TJs Tow Truck Service will be able to achieve success by offering the following competitive advantages:
- Friendly, knowledgeable, and highly qualified team of TJs Tow Truck Service
- Proprietary app that tracks services and allows up-to-the minute response times
- Emergency service as requested by law enforcement or fire department
- TJs Tow Trucks Service offers the best pricing in town. Their pricing structure is the most cost effective compared to the competition.
Download the Tow Truck business plan template (including a customizable financial model) to your computer here <–
Financial Highlights
TJs Tow Truck Service is seeking $200,000 in debt financing to launch TJs Tow Truck Service. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and marketing costs. The breakout of the funding is below:
- Office space build-out: $20,000
- Office equipment, supplies, and materials: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
The following graph outlines the financial projections for TJs Tow Truck Service.
Company Overview
Who is TJs Tow Truck Service?
TJs Tow Truck Service is a newly established, full-service tow truck company in Tacoma, Washington. TJs Tow Truck Service will be the most reliable, cost-effective, and efficient choice for residents and travelers in Tacoma and the surrounding communities. TJs Tow Truck Service will provide a comprehensive menu of products and services for any customer to utilize. Their full-service approach includes a comprehensive array of services to be offered to the analyst..
TJs Tow Truck Service will be able to cover an extensive area of Tacoma, as well as the surrounding communities in several rural directions. The team of professionals are highly qualified and experienced in towing and ancillary services. TJs Tow Truck Service removes all headaches and issues usually experienced by customers who need emergency towing and ensures all issues are taken care of expeditiously while delivering the best customer service.
TJs Tow Truck Service History
Since incorporation, TJs Tow Truck Service has achieved the following milestones:
- Registered TJs Tow Truck Service, LLC to transact business in the state of Washington.
- Has a contract in place at one of the office buildings, where the tow truck company will set up its 10,000 square foot staff lounge and office area.
- Reached out to numerous contacts to include former customers as new customers.
- Began recruiting a staff of six tow truck drivers and office personnel to work at TJs Tow Truck Service.
TJs Tow Truck Service Services
The following will be the services TJs Tow Truck Service will provide:
- Towing services within a fifty-mile radius for cars, trucks and vans or small recreational vehicles
- Proprietary app that offers up-to-the-minute service details for clients
- Battery charges, startups, and servicing
- Tire changes, repairs and installations
- Lockout repair and key retrieval
- Fuel delivery when vehicles is out of gas
- Roadside Assistance
Industry Analysis
The tow truck industry is expected to grow over the next five years to over $39 billion. The growth will be driven by:
- an increased number of calls for roadside assistance due to crowded freeways, self-driving cars, electric cars, and other forms of travel not yet known.
- The growth will also be driven by an increased number of customers who own digitally-controlled vehicles that they cannot move (as when batteries die).
- the increased number of accidents on roadways and highways. These will be due to an increase in semi-trucks on the highways and vehicles that crowd city streets.
The two truck industry costs will likely be reduced as tow truck products will be less-expensive to purchase from wholesalers or distributors and new methods of vehicle assistance will come into play, such as apps that can open locked vehicles, or apps that demonstrate the exact issue within the car when it stops unexpectedly.
Download the Tow Truck business plan template (including a customizable financial model) to your computer here <–
Customer Analysis
Demographic Profile of Target Market
TJs Towing Service will target residents within a fifty-mile radius. TJs will target interstate and state highway travelers within a fifty-mile radius. They will target retail tire stores, auto repair companies and insurance companies. Commercial fleets (businesses that use multiple vehicles and need long-term contracts) and law enforcement agencies will also be targeted.
The precise demographics for TJ’s towing service are:
| Total | Percent | |
|---|---|---|
| Total population | 1,680,988 | 100% |
| Male | 838,675 | 49.9% |
| Female | 842,313 | 50.1% |
| 20 to 24 years | 114,872 | 6.8% |
| 25 to 34 years | 273,588 | 16.3% |
| 35 to 44 years | 235,946 | 14.0% |
| 45 to 54 years | 210,256 | 12.5% |
| 55 to 59 years | 105,057 | 6.2% |
| 60 to 64 years | 87,484 | 5.2% |
| 65 to 74 years | 116,878 | 7.0% |
| 75 to 84 years | 52,524 | 3.1% |
Customer Segmentation
TJs Tow Truck Service will primarily target the following customer profiles:
- Residents of Tacoma, Washington and nearby regions
- Travelers on highways in or near Tacoma, Washington
- Retail tire stores
- Auto repair companies
- Insurance companies
- Commercial fleets
- Law enforcement agencies
Competitive Analysis
Direct and Indirect Competitors
TJs Tow Truck Service will face competition from other companies with similar business profiles. A description of each competitor towing truck company is below.
Midway Towing Services
Midway Towing Services is a tow truck service catering to the needs of medium-sized trucks and cars. Midway focuses on the unique requirements of these vehicles and provides assistance with an eye on safety, efficiency, and customer satisfaction. Midway Towing Services is located 30 miles away from Tacoma, Washington and serves travelers on the highways the feed the web of freeways through Tacoma. The towing truck company does not typically take routine service calls, but remains committed to emergency services when charges for services will be more lucrative for the company.
Midway Towing Services is owned by a partnership of family members who concentrate on the superior usage of their trucks and they ensure that medium-weight vehicles, including other tow trucks, vans, box trucks and others can be lifted and towed successfully. The company operates on a 24-hour a day basis and offers a special “Snow Package” to put chains onto trucks and heavy vehicles on a discounted basis.
Titan Towing Solutions
Titan Towing Solutions is owned and operated by Jack Higgins, a former semi-truck driver with over twenty years of experience. Titan Towing Solutions is focused on one type of customer: semi-trucks on the highways or city roadways that need either scheduled assistance or emergency assistance. The company does not offer roadway assistance for any other class of vehicle. Titan Towing Solutions has been in business since 1999 and has garnered several community awards and the “Most Reliable Towing Company in Tacoma.”
Titan Towing Solutions offers products to semi-truck drivers within a small convenience store that can ease the pains of driving shifts; such as semi-truck accessories, snow removal products, apparel, refreshing beverages, caffeine-loaded sodas, snacks and packaged appetizers.
AutoCall Roadway Services
Autocall Roadway Services is a retail store and tire repair service center that also provides tow truck service when the single tow truck owned by the company is available. The main theme of the AutoCall Roadway Services company is that driver safety of vehicles is the most important aspect of driving, so the company representatives will often stop to assist any driver with information or offers to call for tow truck service. As a for-profit company, the retail-comfort side of products available for purchase by drivers is the primary driver of revenue, rather than those of a tow truck service company.
Autocall Roadways Services prides itself on being open 24/7 every day of the year and offers an inventory of multiple food and beverage choices for drivers.
Download the Tow Truck business plan template (including a customizable financial model) to your computer here <–
Competitive Advantage
TJs Tow Truck Service will be able to offer the following advantages over their competition:
- Friendly, knowledgeable, and highly qualified team of TJs Tow Truck Service
- Proprietary app that tracks services and allows up-to-the minute response times
- Emergency service as requested by law enforcement or fire department
- TJs Tow Truck Service offers the best pricing in town. Their pricing structure is the most cost effective compared to the competition.
Marketing Plan
Brand & Value Proposition
TJs Tow Truck Service will offer the unique value proposition to its clientele:
- Highly-qualified team of skilled employees that is able to provide a comprehensive array of towing services and vehicle products for everyday or emergency use.
- Proprietary app that allows up-to-the-minutes resources and response times for clients.
- Unbeatable pricing for customers; they will offer the lowest pricing in Tacoma.
Promotions Strategy
The promotions strategy for TJs Tow Truck Service is as follows:
Word of Mouth/Referrals
TJs Tow Truck Service has built up an extensive list of contacts over the years by providing exceptional service and expertise to former customers. Those customers have already indicated they will use TJs Tow Truck Service when services or products are needed. They’ve also agreed to help spread the word of TJs Tow Truck Service.
Print Advertising
Direct mail response cards will be mailed to all residents, select businesses, and law enforcement procurement offices in the region. The offer will be a discount on services during the first three months of service. In addition, an offer to provide long-term contract pricing will be added for law enforcement or commercial fleet companies.
Website/SEO Marketing
TJs Tow Truck Service will fully utilize their website. The website will be well organized, informative, and list all the services and products that TJs Tow Truck Service provides. The website will also list their contact information and a map of regional service areas. The website will utilize SEO marketing tactics so that anytime someone types in the Google or Bing search engine “tow truck company” or “towing near me”, TJs Tow Truck Service will be listed at the top of the search results.
Pricing
The pricing of TJs Tow Truck Service will be moderate and on par with competitors so customers feel they receive excellent value when purchasing their services.
Operations Plan
The following will be the operations plan for TJs Tow Truck Service.
Operation Functions:
- Tori Jane Jamison will be the Owner and President of the company. She will oversee all staff and manage client relations. Tori Jane has spent the past year recruiting the following staff:
- Ron Harbinger, a thoroughly experienced tow truck driver, with twenty years of experience, will become the Tow Truck Supervisor, overseeing the drivers and handling all human resource issues.
- Track Masters is a master of all-weather driving and has been a tow truck driver for seven years. He will take on the role of Scheduling & Service Supervisor, overseeing the service calls and customer service.
- Bill Acker, also an experienced tow truck driver, will become the Maintenance Supervisor, overseeing the care and safety of all tow trucks, including replacements, repair and serving of all vehicles on the property.
Download the Tow Truck business plan template (including a customizable financial model) to your computer here <–
Milestones:
TJs Tow Truck Service will have the following milestones completed in the next six months.
- 5/1/202X – Finalize contract to lease office space
- 5/15/202X – Finalize personnel and staff employment contracts for TJs Tow Truck Service
- 6/1/202X – Finalize contracts for TJs Tow Truck Service clients
- 6/15/202X – Begin networking at community events
- 6/22/202X – Begin moving into TJs Tow Truck Service office
- 7/1/202X – TJs Tow Truck Service opens its doors for business
Management Team
TJs Tow Truck Service will be owned and operated by Tori Jane Jamison. She recruited three former tow truck driver associates, Ron Harbinger, Track Masters, and Bill Acker, to join her business to take on management roles in the startup company.
Tori Jane Jamison started her career as a U.S. Marine, where she was assigned to a truck driving role and service attendant for the U.S. Marines. She served four years within that capacity and ended her career after those years with an exemplary record of duty and expertise in her field.
Ron Harbinger is a thoroughly experienced tow truck driver, with a twenty-year background of successfully towing vehicles of all sizes without a single “event” or “injury” attached to his service. Ron will take on the new role of Tow Truck Supervisor, overseeing the truck-driving team and handling all human resources issues.
Track Masters is a well-trained master of driving in all weather conditions, including snow, ice and thunderstorms. He has seven years of experience and will take on the role of Scheduling & Service Supervisor, overseeing the scheduling of service calls and the customer service environment overall.
Bill Acker is a veteran tow truck driver with almost twenty years of experience. He is joining the team as the Maintenance Supervisor, overseeing the care and safety of all tow trucks, including replacements, repair and serving of all vehicles on the property. He determines when roads are safe to travel or when other weather conditions or events preclude allowing drivers to venture out onto the area roadways.
Financial Plan
Key Revenue & Costs
The revenue drivers for TJs Tow Truck Service are the fees they will charge to customers for the products and services they provide.
The cost drivers will be the overhead costs required in order to staff TJs Tow Truck Service. The expenses will be the payroll cost, rent, utilities, office supplies, and marketing materials.
Funding Requirements and Use of Funds
TJs Tow Truck Service is seeking $200,000 in debt financing to launch its tow truck driving company. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and association memberships. The breakout of the funding is below:
- Office space build-out: $20,000
- Office equipment, supplies, and materials: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
Download the Tow Truck business plan template (including a customizable financial model) to your computer here <–
Key Assumptions
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.
- Number of Customers Per Month: 65
- Average Revenue per Month: $162,000
- Office Lease per Year: $100,000
Financial Projections
Income Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
| Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
| Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
| Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
| Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
| EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
| Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
| PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
| NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
Balance Sheet
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
| Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
| Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
| Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
| Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
| TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
| Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
| Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
Cash Flow Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | ||||||
| Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
| Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
| CASH FLOW FROM INVESTMENTS | ||||||
| Investment | ($180,950) | $0 | $0 | $0 | $0 | |
| Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
| CASH FLOW FROM FINANCING | ||||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 | |
| Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
| Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
| Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
Tow Truck Business Plan FAQs
What Is a Thrift Store Business Plan?
A thrift store business plan is a plan to start and/or grow your thrift store business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
You can easily complete your Thrift Store business plan using our Thrift Store Business Plan Template here.
What are the Main Types of Thrift Store Businesses?
There are a number of different kinds of thrift store businesses, some examples include: Vintage thrift store, Consignment thrift store, and Goodwill thrift store.
How Do You Get Funding for Your Thrift Store Business Plan?
Thrift Store businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start a Thrift Store Business?
Starting a thrift store business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Thrift Store Business Plan - The first step in starting a business is to create a detailed thrift store business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your thrift store business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your thrift store business is in compliance with local laws.
3. Register Your Thrift Store Business - Once you have chosen a legal structure, the next step is to register your thrift store business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your thrift store business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Thrift Store Equipment & Supplies - In order to start your thrift store business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your thrift store business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.
Learn more about how to start a successful thrift store business: