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 step guide to starting your rv rental business. 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 an rv rental business?
If you are opening a new start-up, your costs may be substantially higher, as you’ll need to purchase one or more RVs. If you take over an existing business, though, the costs may be lessened or worked into the overall pricing of purchasing the business. Either way, you will need to invest in at least a few RVs to get started. Additionally, you will need business and personal liability insurance, a webpage for the business, and an investment in marketing and advertising options, in order to spread the name of your business. Since many entrepreneurs don’t have the capital on hand to initially invest, you may want to research financing and investment options, either independently or through a lawyer or accountant. If you already own an RV, most of your start-up costs are nullified, and you can focus on advertising your services.
What are the ongoing expenses for an rv rental business?
Since the RVs are the cornerstone of your business, the maintenance and upkeep costs will be your biggest concerns. Other costs will include:
- Regular tune ups, oil changes, and replacement parts
- New tires, balanced, and alignment
- Cleaning and interior maintenance, including bathrooms, bedding, and upholstery
- Insurance for the RV and renters
- Partnership and advertising through an RV rental platform, if you choose to use such a service
Who is the target market?
Individuals, couples, and families, who enjoy camping and outdoors activities, but want more of a home away from home than a tent, will be your primary target market.
How does an rv rental business make money?
A RV rental business makes its money from the rental fees collected from customers. The fees will fluctuate, depending on the type of RV and the length of time the RV will be rented.
How much can you charge customers?
Rental pricing will varies, depending on the type and age of RV. $100-200 per day is average pricing for Class A-C motor homes which are 10 years or older, with an additional $100-200 per day for newer RVs. You will need to do some independent research to determine the pricing in your region of the country and price your own rental(s), accordingly.
How much profit can an rv rental business make?
Depending on the number of RVs you have available for rental, you could see profits anywhere between $5,000-30,000 annually.
How can you make your business more profitable?
Consider renting your RV for in town events, such as sporting events, community gatherings, and concerts. Many people will forego hotel rental for an option to have greater freedom to come and go and move locations, as needed. The shorter trade distance will also save mileage on your RV and you can charge the same price per day.
What will you name your business?
Choosing the right name is very important. 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.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your rv rental business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
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.
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
Certain state permits and licenses may be needed to operate an RV rental business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
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.
For 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.
Certificate of Occupancy
An RV rental business is generally run out of a sale lot. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to an RV rental business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your RV rental business will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
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 an rv rental business
As mentioned previously, linking with a RV rental or share platform will give you access to a greater number of potential customers. There will be a fee involved with such a platform, but this is an excellent method for casting a larger customer net. additionally, create your own Facebook page, Instagram account, and even a personal business website. You may also want to create flyers and pamphlets to distribute at regional RV parks and campgrounds. Getting the word out of what RVs you have and where you’re located is critical for jump starting your Rv rental business.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
As is the case with most independent small businesses, your reputation precedes you. Make sure you’re always offering a clean, well-maintained RV to each renter.
- Offer incentives, such as reduced pricing, for return customers.
- Create travel packages and park guides for RV renters.
- Give discounts for customers writing reviews or adding photos to your rental website. Customer testimonials can be very powerful in capturing and keeping customers.
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 An RV Rental Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Those individuals with experience in retail sales, have customer service experience, and/or sufficient mechanical knowledge will gravitate to a business opportunity, such as this. You must also be comfortable talking to potential customers and should have some knowledge of of the state and national park rules and regulations for RV camping.
What happens during a typical day at an rv rental business?
A RV rental business thrives on customer interest and a quality RV product, ready to be rented and sent out on the open road. Therefore, day to day activities will focus on the acquisition of new customers as well as the retention of past customers, balanced with the care and maintenance of your RV fleet.
What are some skills and experiences that will help you build a successful rv rental business?
Customer service and positive communication skills are necessary traits for matching your renters with rentals. Talk to your customers to understand what they want and what will be the best fit for their needs. You should also have a fairly extensive knowledge of the different types of RVs available, how they drive, and which units will fit your customers’ needs. Ideally, you should be somewhat of a RV enthusiast, as well, able to convey your own experiences on the road and camping in RVs. Plus, you will need to express some knowledge of the mechanical aspects of each RV and be able to give advice to your clients, both before they have left and once on the road, so they can properly plan for the trip ahead of them.
What is the growth potential for an rv rental business?
More and more individuals, couples, and families are choosing RV rentals as an exciting method for exploring the country. Customers can maintain a temporary home and level of comfort, similarly offered for extended stay hotel suites. The difference being, a RV gives the customers the freedom to visit multiple locations, without having to re-pack a suitcase before each departure. This flexibility gives RV rentals a decided advantage for customers looking to visit more than one destination. Consequently, the RV rental business is becoming more and more popular, with new and return customers looking for exciting adventures on the open road.
TRUiC's YouTube Channel
For fun informative videos about starting a busines visit the TRUiC YouTube Channel or subscribe below to view later.
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.
What are some insider tips for jump starting an rv rental business?
Since the RV will more or less rent itself, you just have to make sure people are aware of your rental business. This means you will need some sort of marketing blast to spread your company’s name. Employ social media and any free or low cost options through the internet to broadcast your options and contact information. Some independent RV renters will use RV share options, such as RVShare or Outdoorsy as platforms to direct more customers to their RV options. You will pay a fee to the site, but you should also see increased customer traffic and responses to your rental(s).
How and when to build a team
Much of this business will only require one or two people to successfully run it. You will need to be able to answer customer calls and internet inquiries, clean and maintain the RVs, and interact with customers, face to face, when they pick up and return the RVs. But, as your business grows, and the number of RVs you offer expands, you may want to consider taking on a couple more employees, especially if the are capable of assisting in all aspects of the business.