Help in starting a new van hire business

[gumball]

We are wanting to start a van hire company. We are int he very early stages of thinking about this and would appreciate any advice..... the following questions spring to mind:

• We ideally plan to run this on a small scale at home to start with - maybe just a couple of vans..... see how it goes! - does running it from home affect home insurance/laws in anyway?
• Should we buy vans or lease them?
• Do vans need to be new/young age vans or can you get and rent out older vehicles?
• What size of van is most popularly rented?
• What insurance cover is required in order to rent out vehicles? where from?
• What rental agreements are required with customers - are there clear dos and donts for designing the forms?
• How do you register a new van rental company? Do we even need to be a company or sole trader?
• Accepting VISA payments from customers - is this easy to do/and how much does it cost to accept VISA payments (I understand the company is charged for transactions).
• It sounds a great business idea in a city with only a few companies doing this.......But are there any known major pitfalls for vehicle rental companies?
• How would we promote the new venture?

Grateful for any replies to any questions.......... thanks in advance

 

[TheGuru2010]

We are wanting to start a van hire company. We are int he very early stages of thinking about this and would appreciate any advice..... the following questions spring to mind:

• We ideally plan to run this on a small scale at home to start with - maybe just a couple of vans..... see how it goes! - does running it from home affect home insurance/laws in anyway?
• Should we buy vans or lease them?
• Do vans need to be new/young age vans or can you get and rent out older vehicles?
• What size of van is most popularly rented?
• What insurance cover is required in order to rent out vehicles? where from?
• What rental agreements are required with customers - are there clear dos and donts for designing the forms?
• How do you register a new van rental company? Do we even need to be a company or sole trader?
• Accepting VISA payments from customers - is this easy to do/and how much does it cost to accept VISA payments (I understand the company is charged for transactions).
• It sounds a great business idea in a city with only a few companies doing this.......But are there any known major pitfalls for vehicle rental companies?
• How would we promote the new venture?

Grateful for any replies to any questions.......... thanks in advance

Ok well all the best with the venture,

a couple of point i can help with

• I would advise your home insurer that you are trading from home, (You wouldnt want them to kick out a claim) - you usually shouldnt have any problems.
• On the insurance side you will need cover for hire & reward, as you are a new venture this wont be cheap. Remeber that some companies can do fleets from 3 vehicles rather than 5 these days. get some quotes on single vehicles then as a fleet.

Theres a couple on the insurance front

Best O Luck

 

[stefanraj]

Its a good idea,But before that you have to analyze the market completely.I don't have that much idea about this business,Its better if you go in Google and search some company or consultant.They will give you the best idea.

 

[TheDude]

Some things that pop to mind:
-If you run a business from home and it effects your neighbors, don't you need planning permission?
-Leasing has millage restrictions and overage fines?
-New vans: no mots, hopefully lower garage bills, look good (image) but £££ Old vans: mots, larger garage bills, maybe tatty, less £££ ..... but could be a niche, low price rentals
-We rent transit size and not compacts.
-Ring an agent or google for rental insurance.
-Buy a stock rental agreement and get a solicitor to amend to suite your business.
-See an accountant to advise on company or trader, vat, etc
There are a few guys here that can advice on card acceptance.
-Major pitfalls: someone smashing up your van/s and cannot meet commitments, theft or late returns together with problems trying to get the £££ for this, having to turn down customers cus you have 2 vans, breakdowns.
-online, flyers to companies, yellow pages.

Good luck

 

[TheDude]

ah ... one more thing regarding new / old vans.

If I was Mr Blue Chip Company wanting to rent a van to carry out some work at my Blue Chip customer, I would not hire a 'rent a wreck' van (image), however if I wanted to rent a van to collect some logs, then I would look for the cheapest rental I could find.

If your budget is old vans to start off with, market your services to the 'groups' who would rent them.

 

[Dangarwe]

I have expereince in business, but have none in vehicle hire, so any advice, pointers, links for the relevant paper work I need is very much appreciated.


Hello

I was just wondering if you managed to setup and how things are going, like you I would like to start up as well i have 2 vans and would like to know if it is a viable business before I invest anymore into it

 

[Dangarwe]

Hello

I was just wondering if you managed to setup and how things are going, like you I would like to start up as well i have 2 vans and would like to know if it is a viable business before I invest anymore into it

 

[Nicsselfdrivehire]

Hi,
Just wondered how the new venture is panning out?

 

[Friendly Movers Ltd]

Is there any update on subject?
We are going to start van rental as well within next few weeks. Looking for more and more informations regarding renting to privates and companies.
We will be getting 2-3years old vans in all sizes just need some advice with insurance ...

 

[TheGuru2010]

Is there any update on subject?
We are going to start van rental as well within next few weeks. Looking for more and more informations regarding renting to privates and companies.
We will be getting 2-3years old vans in all sizes just need some advice with insurance ...

Have you already put together your business plan for this?

Whats your target market - (Commercial Builders, Private people for house moves etc).

What driver range are you looking for (Only drivers over 25, only over 21 etc)

What will be your acceptance criteria (individuals, there points, claims etc)

Are you looking for a PAYG scheme or annual insurance?

Do you have a estimated vehicle utilization figure?

Best Regards

 

[Friendly Movers Ltd]

Bussiness plan is almost ready.
So far we have been doing man&van, removals and storage ... We had a fleet insurance for all of our vehicles in this company although we thing about getting PAYG for rentals as if they are not rented than at least they don't cost us anything.
Drivers above 21 although we will require higher deposit for those between 21-25. We are thinking about max points of 6 on licence. and daily limit of around 100-150miles.
We will be looking mostly at private people and small bussinesses.

We haven't thought about estimated vehicle utilization figure? To be honest this is the first time I have heard about it. Can You help a little bit with that as well?

Many thanks

 

[TheGuru2010]

Bussiness plan is almost ready.
So far we have been doing man&van, removals and storage ... We had a fleet insurance for all of our vehicles in this company although we thing about getting PAYG for rentals as if they are not rented than at least they don't cost us anything.
Drivers above 21 although we will require higher deposit for those between 21-25. We are thinking about max points of 6 on licence. and daily limit of around 100-150miles.
We will be looking mostly at private people and small bussinesses.

We haven't thought about estimated vehicle utilization figure? To be honest this is the first time I have heard about it. Can You help a little bit with that as well?

Many thanks

I can try my best, one thing you obviously want at the end of all this is profit !

What you have to take into account is going to be the following (rough guideline only).

Vehicle Cost Per Month - Say £300?
Vehicle repairs Per Month - say £100?
That would put the outlay for this vehicle at £400 per month

Say you went on PAYG insurance & the bottom rate for this is £10 per day.

say you charged £60 Per day hire that leaves you with £50.00 for the company after the insurance figure.

so to get to the £400 you would need to hire the vehicle 8 days per month. to break even.

The above is just a rough guideline of how you should be looking at it & I am sure there is more cost along the line, fuel, tax etc.

What you also need to look at is that the PAYG self drive hire insurance only covers your vehicles while they are on hire so you would need a motor trade policy if you wanted cover for them whilst at premises or for employees to take to the garage etc.

I can e mail you across a quote pack for you to complete on the PAYG system.

Any questions fire them across & ill try my best

 

[Friendly Movers Ltd]

in this case we did think about it.
Plan is to buy first 5-7vans for start.
We have funds prepared for that and then there is not much of monthly cost per vehicle. We have our own yard, removals and van hire will be in the same place so if the vans are not rented/insured they will be parked on private property and it should be fine we thought.
We will also have our own garage and mechanic which is going to be looking after the vans so we are planning to save some £££ on that as well ...
We are looking now for rental agreements and a best way to promote.

 

[TheGuru2010]

in this case we did think about it.
Plan is to buy first 5-7vans for start.
We have funds prepared for that and then there is not much of monthly cost per vehicle. We have our own yard, removals and van hire will be in the same place so if the vans are not rented/insured they will be parked on private property and it should be fine we thought.
We will also have our own garage and mechanic which is going to be looking after the vans so we are planning to save some £££ on that as well ...
We are looking now for rental agreements and a best way to promote.

I can dig out some sample agreements for you to work from if this helps?,

The PAYG scheme we offer also gives you a full booking system

 

[Friendly Movers Ltd]

I can dig out some sample agreements for you to work from if this helps?

It would be great. thanks

The PAYG scheme we offer also gives you a full booking system

So how does it work and can you quote us?

 

[JEREMY HAWKE]

Many smaller hire companies in the last year have shut down to the increase in insurance. You could be looking at around 4 K a year per vehicle.
the monthy costs of keeping a hire van ect (without insurance costs) should be more like £600 a month .

It costs a lot more than you might think

 

[Friendly Movers Ltd]

Many smaller hire companies in the last year have shut down to the increase in insurance. You could be looking at around 4 K a year per vehicle.

Not if we have a private parking and go for "PayAsYouGo" so called insurance, then it is covered only when vehicle is rented. That is our undestanding, correct me if I'm wrong.

the monthy costs of keeping a hire van ect (without insurance costs) should be more like £600 a month .

It costs a lot more than you might think

If it is around £600/month that what are this costs?

Vehicles are going to be bought for cash, no leas.
Mot is £50/year per van.
Road Tax is around £200/year per van
Insurance is covered by customer (included in rent)
Diesel is on customer.
Repairs and services are done by our own mechanic so no high costs on that.

Correct me if I've got it wrong - isn't this the way to do it? Better ideas - let me know ...

 

[seasider]

Bussiness plan is almost ready.
So far we have been doing man&van, removals and storage ... We had a fleet insurance for all of our vehicles in this company although we thing about getting PAYG for rentals as if they are not rented than at least they don't cost us anything.
Drivers above 21 although we will require higher deposit for those between 21-25. We are thinking about max points of 6 on licence. and daily limit of around 100-150miles.
We will be looking mostly at private people and small bussinesses.

We haven't thought about estimated vehicle utilization figure? To be honest this is the first time I have heard about it. Can You help a little bit with that as well?

Many thanks

Unless you are based in a big city where lots of people want to hire to just to do local jobs you'll struggle to get customers with limits like those. All the firms round here do 500 miles a day.

 

[Friendly Movers Ltd]

Unless you are based in a big city where lots of people want to hire to just to do local jobs you'll struggle to get customers with limits like those. All the firms round here do 500 miles a day.

We are based in London and as far as I'm concerned all rental companies offer around 100-150miles a day on van rentals.
We might offer even 250-350miles a day if that brings us more customers - we all know that not many customers will go over that anyway, especially in london

 

[JEREMY HAWKE]

Not if we have a private parking and go for "PayAsYouGo" so called insurance, then it is covered only when vehicle is rented. That is our undestanding, correct me if I'm wrong.



If it is around £600/month that what are this costs?

Vehicles are going to be bought for cash, no leas.
Mot is £50/year per van.
Road Tax is around £200/year per van
Insurance is covered by customer (included in rent)
Diesel is on customer.
Repairs and services are done by our own mechanic so no high costs on that.

Correct me if I've got it wrong - isn't this the way to do it? Better ideas - let me know ...

I have been running large vans for many years it does not matter how you purchase them they will need to be replaced .For a hire van you would need to spend 10 k plus . Replace 3 engines and two gear boxes at around year 2 or 3 and you will start to hit my figure.

 

[estwig]

I'm all for running a business from home, I do it.

If anyone starts a van hire business from home anywhere near me, they won't last long.

I suspect I'm not alone in this, be mindful of your neighbors!