Van Hire / Self Drive Business

[samn01]

I have "a friend" who is now considering opening a small Van / lorry hire Business.
Does any one have any experience in this area.
My only experience is when ever you want to hire one at short notice they are fully booked so there must be room in the market for more companies.
Apart from the purchase of the vans, insurance costs and office/parking costs I can't think of much else that would stop it being quite a good business and fairly easy to run cheaply.

Any comments or opinions would be greatly appreciated.

Sam

[samn01]

Thanks....Hmmmmmmm

[samn01]

What I really need to know is a rough figure for insurance costs. The self Drive insurance market seems to be very small and I am having a bit of trouble getting the info.
The company plan to purchase 10 vans to start off with.
3x Transit
3x Hi-Top Transit LWB
3x Luton with Tail lift
1x Side Tipper Truck Jobby.

All high Milage and all about -10 years old. Total Value of fleet to be around 15-20K give or take a couple of grand.

If anyone has any ideas on insurance costs it would be great.


Rgds
Sam

[samn01]

Breadline Racing said: If your looking to use vehicles over 3.5 tonnes GVW (Gross Vehicle Weight) basically anything bigger than a Transit van, you may well require a Standard National operators licence, and person holding a Certificate of Professional Competence (CPC), suficent funding must also be proven, this is about £3000 per vehicle. Best stick to vans really.

Breadline- Thanks for the info.
Do you mean 3.5 Tonnes with or without load?
Does a Luton fall into this category?
Funding? Do you mean we have to have 3K in the bank for every Van we have? Or do you mean that is the cost of the certificate? Sorry I don't quite understand what you mean by funding.

[samn01]

Thanks for that......Things are much clearer now!

Sam

[samn01]

Ruf, and others thanks for the insight. I have phoned around quite a few of the hire companies and the prices I have been quoted have been a lot higher than £22 per day for a transit, more like £49-60 - I guess this is because I am not a transport consultant and I don't have a large corporate account with a hirer. In saying that I expect most of my customers to be private or hirers from SMEs (or am I just being naive?).
I am interested in your reaction to the thought of the 10 years old vans. I have hired 4/5 transits over the last 12 months, all of them from smaller hire firms rather than nationals and none of them have been newer than 5 years old. Would the thought of hiring a 1993 Ford transit be that bad, I mean it is just a van and probably only being used once or twice and if it works for me it would not make a difference.
Has the Transit really come on that much in the last few years?
For me having no experience in this industry purchasing an old fleet reduces the risk attached to this venture. I could understand if you were renting a car for a holiday etc but when renting a Luton to move house does age matter, if the answers yes I will have to re-think this perhaps.

Again thanks for all your thoughts, keep them comming.
PistonHeads - Market research matters.

Sam

[samn01]

Does anybody know any commercial estate agents in the Essex area that work with retail property?

I am really struggling to find any. Perhaps I am not searching correctly but after many hours on yell.com and Yahoo I have only found one and that was though a referral.

Thanks in advance.

Sam

[samn01]

sgee said:

samn01 said: Would the thought of hiring a 1993 Ford transit be that bad, I mean it is just a van and probably only being used once or twice and if it works for me it would not make a difference.
Sam

your point re vans being used once or twice concerns me. Do you mean once or twice per week? Surely if the vans are going to bring in a profit they need to be rented more than 2 days per week

Sorry, I was not clear, what I ment to say was I was supprised that people that maybe hiring a vehicle to uses only once or twice (I.E two trips bofore returning it to me) would worry about the age of the vehicle they were hiring as long as it had no problems.

The other point is that old vans will have high mileage resulting in higher risk of breakdown. Some days they'll be driven for a few hundred miles and others just local miles. So if one assumes that a van puts on 500 miles in a week, that's 26k miles a year, which makes over 250k miles in 10 years, which will need higher costs for repairs and regular maintenance and greater risk of breakdown than newer vans.

You are right, I have decided to invest a little more money and aim for vans that are 6 years oldish.
I obviously plan to upgrade them once the business is up and running and I will not have these for more than a year or so. Keeping overheads low at first is one of my golden rules of business.

You could of course set yourself up as a niche - similar to rent a wreck in the states where the selling point is cheap rental in a banger, which may be appropriate for low mileage rentals, but not for long trips, where the risk of breakdown would be too high.

Not quite what I had in mind but thanks for the idea

[samn01]

RUF,

Thank you very much for that information.
Consider your beer account well and truly opened and growing.


Sam