Start a moving company by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your moving company. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a moving company?
Start-up costs for a moving business are fairly low. Your first purchase should be a van or truck. Aside from transportation, you’ll just need a few basic items, which will set you back approximately $1,000-$2,000:
- Moving dollies
- Moving pads
- Furniture belts
- Moving boxes
- Packing and wrapping materials
Read our moving company purchasing guide to learn about the materials and equipment you'll need to start a moving company, how much to budget, and where to make purchases.
What are the ongoing expenses for a moving company?
Monthly overhead costs are relatively low compared to many businesses. Most start out running the company out of their homes, moving to a warehouse location when the business has grown significantly.
Your largest expenses will be payroll and payroll taxes. Vehicle maintenance, insurance, and fuel costs come in a close second. Other than that, all you need is a phone line, website support, and a regular marketing strategy.
Who is the target market?
Typically, moving companies have a revolving door of customers. While a large percentage of people move each day, few are consistent repeat customers. Those looking for long-term stability seek out local businesses, who regularly require items moved from one location to another.
How does a moving company make money?
Revenue is generated from each move. Many companies offer services above and beyond moving furniture from one location to another. Each additional service increases your earning potential. Exact price will be determined by the level of service required and the miles logged for that particular customer, or the hourly cost for smaller, local moves.
How much can you charge customers?
Moving companies typically charge on an hourly basis and per mover. Standard costs are $25-$30 per hour per mover. When moving longer distances, many companies charge based on mileage and weight.
How much profit can a moving company make?
Business owners who are willing to put in the extra effort to build their business have reported profits of more than $49,000 in the first year. Moving companies who focus on winning contract bids with local businesses make significantly more, reporting earnings upwards of $450,000. Your profits are directly tied to the amount of services you offer, how much you put back into your business, and your goals for long-term growth.
How can you make your business more profitable?
Companies who have reported higher earnings offer more than basic moving services. If your goal is to expand your business’ profits, consider including the following in your business plan:
- Charge additional fees for homes with stairs
- Bidding on contracts with local businesses
What will you name your business?
Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your moving company is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Find the right bank for you, read our review of the Top 5 Banks for Your Small Business
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Many states require moving companies and/or moving vehicles to be registered with the state’s department of transportation.
Moving companies operating across state lines also need to register with the US Department of Transportation.
In addition, certain local licensing or regulatory requirements may apply. For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
Moving businesses should consider requiring clients to sign a service agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example service agreement.
Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your moving business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.
STEP 7: Get Business Insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a moving company
Start by developing your brand. Design a logo that best represents you and will evoke trust. Include your logo and contact information on employee uniforms and the company moving truck. An user-friendly and intuitive website, as well as social media accounts are also critical components to your marketing strategy.
How to keep customers coming back
Be sure you’re listed in all local business directories and become an accredited BBB moving company. Join moving associations such as [International Association of Movers (IAM), who provide a wealth of information and assistance for their members. My Moving Reviews is also an invaluable resource for moving companies of all sizes. Treat your customers (and their belongings) with respect and care, as word of mouth goes a long way in this line of work.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Moving Company In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
If your entrepreneurial spirit is looking for an industry that is stable in any market, starting a moving company is a sound choice. While you’ll need a few things to get started, the overall start-up costs are fairly low. And, since almost 80% of moves are in-town, the overhead costs are even lower. The job does require some heavy lifting, but the interaction with clients and personnel ensure no two days are alike.
What happens during a typical day at a moving company?
As the owner of a moving company, your daily tasks will require part muscle and part brains. Depending upon the client’s needs, you’ll be carefully packing items and transporting them from one location to another. While demand is high, it’s also highly competitive. You’ll spend part of every day on a marketing strategy, which should include social media posting, gathering information necessary to bid on local contracts, following up with client inquiries, and following up with clients.
What are some skills and experiences that will help you build a successful moving company?
Your most critical skills for a successful moving business is personnel management and delegation of tasks. Whether on the phone or in person, much of your day will be spent interacting with customers and your moving team, so interpersonal skills is a must. Understanding your market will assist you in building a solid marketing and sales strategy. Movers need a decent amount of strength to move larger objects/furniture.
What is the growth potential for a moving company?
Typically, moving companies choose to remain small, serving a small radius of customers. If you’re thinking larger scale, there are a number of businesses that have found success by franchising their enterprises and/or expanding their services. If partnering with a national franchise is part of your business plan, companies such as Two Men and a Truck and Little Guys offer wonderful franchising opportunities.
Should you consider joining a franchise?
Joining a moving company franchise can be a good option for entrepreneurs who prefer to use a proven model rather than start from scratch. While joining one can mean slightly higher initial costs and less control, a quality franchise offers great benefits such as initial and ongoing support, marketing assistance, and brand recognition.
Opening a moving company franchise typically requires $90,000-$700,000. Larger moving company franchises typically cost more, while more niche favorites often have lower startup costs.
Interested in joining a moving company franchise? Check out our favorites.
TRUiC's YouTube Channel
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
How and when to build a team
Unlike other businesses, you cannot run a moving company alone. Your reputation hinges on a solid team of employees. They will be packing and moving both heavy items and fragile family heirlooms. Carefully vet each candidate to ensure honesty, integrity, and a solid work ethic.