Starting a tow truck business can be a great way to generate a solid revenue stream. This is especially true during bad economic times when many people don't have the money to make necessary car repairs, leading to breakdowns. AAA reports that roadside assistance calls have remained steady despite the economic downturn, according to USA Today. To start a tow truck business in California, you will need specific licenses and understanding of the industry.
Create a business plan that includes detailed research on the tow truck industry, including locations of competitors, sources of daily customers, costs for a new or used truck, liability insurance, business name and marketing strategy. Use the Small Business Administration's online planner as a guide.
Obtain the necessary California permits and licenses, including a Class B commercial license from the California Department of Motor Vehicles (DMV). Become familiar with towing regulations in California, which are available on the DMV website. Obtain relevant licenses and permits for your city and county. Go to Business.gov to check what's required in your area.
To familiarize yourself with the tow truck business and develop relationships, join the recognized industry organizations. The California Tow Truck Association and Towing and Recovery Association of America offer industry news and member referrals. Contact your local AAA Club about becoming a contractor.
Purchase trucks. There are different types of trucks, such as full-bed tow trucks and tow trucks to pull semis. Make sure to get the insurance required. Find a parking place for your truck, unless your city allows commercial vehicles to be parked on the street.