A van rental business involves hiring out commercial vehicles to businesses or private individuals for an agreed sum. If you venture into a van rental business, then you’ll be entering a vibrant industry where your success will be largely dependent on the number of vehicles in your fleet and how well you have utilized them. However, regardless of the market competitiveness, there are still abundant opportunities for smart and enterprising operators to succeed and even expand into other rental businesses.
Why a van rental company?
The van rental industry can be quite lucrative if you know how to beat the competition and stand out to your target market. In addition to daily hires, you may also rent out vans on long-term contracts, which simultaneously solves a common problem faced by vehicle rental companies — lost income from vehicles unrented and parked in the garage.
The first things to do
The first step is to do a good research of the van rental business potentials in your area. Identify existing van rental businesses in your locale and their reach, then decide on an ideal location for your venture. Remember this can be a really competitive sector, so know your target customers well to understand what better ways to serve them and edge the competition. You can carry out some informal interviews to know businesses and individuals that would benefit more from a van rental business.
An airport or a place close to an airport is usually a good spot to locate a van rental business. If opportunities for that are not available or very slim, you may consider a franchise or perhaps locate elsewhere.
Another potentially profitable business siting are tourists spots, as people may be willing to hire expensive vans they wouldn’t otherwise own. This gives you a great window of opportunity to explore.
That said, don’t forget to draw up a fine business model and build your fleet, besides researching the right location for your van rental venture. Also, find out regulatory requirements such as getting business permits before renting out your first vehicles, as well as insurance needs for adequate cover and to take care of any business emergencies. You may find more here about the requirements for insurance.
As a van rental entrepreneur, you will need to be good with numbers and have great management and marketing skills. That also means you should be personable, which will really help with the customer care and branding side of things.
Decide on a daily or contract hire format
Renting vans to customers can be done on either a daily or contract basis. Contract hires are usually for businesses and the leases are typically long-term, for a set amount of time. Daily hires could be for businesses too or individual needs. The vehicles are rented for short periods of time.
Should you sign up with a franchise or not?
Another area of the van rental business you may want to consider is whether to join a franchise, which could help you simplify the setup process for your business. You can sign up on the website of a major car rental franchise and request for information on how to be a part of the brand. They will reach back to you and help you to set up the franchise. Typically, this option takes less paperwork and money than when you choose to go solo with your brand. It is also less expensive and helps you buy into an established brand and business model.
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