Is a towing business
profitable?

The four numbers that decide it

• Calls per month. Insurance, the truck payment, the yard and dispatch cost the same whether the truck runs 30 calls or 130. The busier the truck, the thinner each call’s share.
• Revenue per call. Cash, account, police-rotation and motor-club work pay very differently, and some rates are capped. Your mix of work sets the average.
• The empty miles. The drive to the pickup and back burns fuel, wear and paid time that nobody may pay for.
• Fixed costs. Commercial insurance is often the largest, alongside the payment, yard, dispatch software and phones.

A worked example

Example figures only, not typical and not a forecast. This is TowProfit’s example truck: $350 a call, 50 loaded and 30 empty miles, 2 paid hours at $30 an hour, fuel at $4 a gallon and $7,000 a month of overhead and truck payment.

Each call costs $140 to run, so it adds $210 before fixed costs. It takes 34 calls a month to cover the $7,000 of fixed costs. After that, the calls are what the business keeps before income tax, owner pay above the wage entered, and saving for the next truck.

The same truck at $150 a call adds $10 a call before fixed costs, so it would take 700 calls a month to cover them. Low-paying work can fill a quiet day, but it cannot carry the fixed costs on its own.

What the example leaves out

Operating cash is not profit. It leaves out income tax, the truck’s loss of value beyond its payment, major repairs, and the cash a business needs to hold while it waits to be paid. A lender, an accountant or your own records will set those numbers.

Ways owners move the numbers

• Price from your own costs, and judge each motor-club offer against the whole job, including the empty miles.
• Add accounts that bring steady calls: repair shops, dealers, fleets and rotation lists where you qualify.
• Fit the truck to the work. A heavier truck than the calls need costs more to buy, insure and run.
• Shop insurance and check it each year. Premiums vary widely between carriers.

How to price towing · Motor-club call check · Startup cost calculator · Used tow truck prices