Thread: Calculating benefits and ROI for truck rental

Hello,

Not sure if this is the right place to put this question - if I'm in the wrong spot, please let me know.

Next week I will be suggesting to the owners that we start working on having a truck that customers can rent for in-town moves. I envision the truck being wrapped with our facilities information, and I see the truck as being a great way to be helpful to customers, while simultaneously marketing our businesses.

One of the owners has stated he thinks there is too much risk and that these are too costly. He is a numbers guy, and he needs to see the bottom line on a project like this before he will jump. Problem is, I don't have a CLUE how to calculate the costs of this!

Can anyone here with experience in renting a truck to customers comment on the costs and benefits?

Thank you!

Jim

For costs, I recommend contacting On The Move. For the benefits, they are endless. I have been at properties with and without trucks. Having a truck is often the clencher in getting the rental. NOT having a truck is often the reason for NOT getting the rental! Hard to measure that in exact dollars.

Add to that the fact that you WILL get a few rentals every year from people who saw the truck driving around just at the time they need storage. Makes it easy for them to decide at a time when they have too much on their minds.

Not really much help with exact numbers, I know, but hopefully it will give you some direction.

I agree with MamaDuke, who is also known as the Fountain from which all storage wisdom flows! Our free move-in truck is a HUGE draw here!

And I have gotten many a phone call from someone who stated "I got your phone # off your truck, I'm sitting behind it at a red light" Gotta love the combo of cell phones and storage trucks!

I think it all boils down to is how much risk the company/owners are willing to take. When we were shopping trucks, insurance was the biggest deterrent. After contacting the three big truck rental companies we settled for UHAUL. No, we don’t have our logo on the truck ( that would be nice ) but we still get tenants that rent units and or trucks. No maintenance, insurance, fuel and minimal headaches. Before you make a decision stop by the local UHAUL place and take a walk around their trucks and look for damage, scratches, dings, etc. What you see is what to expect with your truck or someone else’s.

The facility I utilize rents Penske - they're actually a Penske dealer for lack of better word. Was working really well for them until Penske opened a full facility down the highway that now competes with them, along with some satellite facillities like some local big box stores - all that impinge on their territory. Nothing like market saturation. One reason I don't do this - too many truck rental facilities within a few miles that are struggling for a piece of the pie. (and soon I'll have a big bob tail that I am lien sale'ing - I doubt I'll get bidders so it'll end up being mine...)
So before you make the jump, make sure there is indeed a market - that doesn't require beating the competition on pricing.
But if you want to do it, I can get you former UHaul bobtail for dead cheap!

We use On The Move, I think they are the best way to go. We lease a truck from them for 5 yrs and then at the end of 5 years there is a purchase option, or we can trade it back in to them I think, but we will be purchasing ours I know. They are not like being a dealer for some truck rental company that tells you what to do and how to do it. Now that being said what are your goals with your truck? Are you trying to bring in extra money with truck rental, or will you use it to help bring in more storage tenants? We use ours to bring in storage rentals. We offer a free move in truck, first time we charge $15 for insurance and then first 25 miles are free and only $0.25 a mile after that. If they want to rent it again it is $15 for insurance, $50 per day (these are all a 24hr rental) and $0.25 for all miles, we may eventually stop renting it out other then the free truck with move in. Our truck was brand new about 2 yrs ago, I think the truck costs us $831 a month, and that includes insurance, the only other thing to consider is truck maintenance, we do all of that in house so it doesn't cost us much at all. That being said we actually lose money on the truck itself, maybe bring in $200 -400 a month in truck rental income, but we usually gain a few customers a month that the truck seals the deal, and if they stay for say 6 months then the truck was well worth the investment. I would love to get a second truck from them someday, but we are not ready for that just yet.

A huge part of the results depends upon one question "Is the place you park the truck highly visible to slow moving traffic?"

My facility is off the main road and not very visible and we rent UHauls. We make about $3,000 per year with no risk. The trucks sit idle 80+% of the time.

If the truck is highly visible while sitting, it will bring some customers. A sign for your facility would help, some. I am not sure it would bring a lot of customers since the vast majority of storage users DON'T rent a truck.

We looked into owning a truck. Didn't like the liability and depreciation compared to benefit.

We settled on a third option. We offer a "Free One Day rental." They use us to reserve a UHaul truck and we get a 20% commision. It is THEIR rental. They pay all and there is no liability. We give credit, on the first full month's rent for the base rate, $19.95 or $29.95 depending on size of storage unit. THey pay mileage, insurance, taxes.

One out of six or seven will take us up on this offer. We get to offer a "Free Rental" and it costs us $3 to $4 average cost to us per renter with no liability. You can go to www.EasyMoveMS.com to see how we structure the offer.

I am an associate here at On The Move and would be delighted to answer any questions you may have. Please give me a call at 830.428.0781 and I can cover all of your needs.

Jarred Buckler

Thank you to those that offered the information as regards On The Move! Having your own truck, with your own name on the side has many benefits. It's a portable billboard - advertising your facility every time it's out on the road. We hear from clients that offer it up in the community to homeowners associations, scouts, any fund raising events - again, giving them lots of exposure. Our program includes a $5million insurance program - so the liability issue is addressed.
Also -having your own truck allows YOU to be in charge. You always have the truck available for your clients. Note that some truck rental companies allow you to list their website for move-in on your site and once you click on their site, they offer to find other facilities in the area. Basically you are directing your potential clients to your competitors websites! On The Move doesn't do that. We don't rent out self-storage units, so we will never go into competition against you! Please call for more details. 830-428-0781

Here is some food for thought on Uhauls programs for having trucks at your locations:

To be able to rent Uhaul trucks and trailers you must first become a Uhaul dealer. There is no cost in becoming a dealer! After signing a contract and completing some short training courses (web based takes a couple hours to go through them all) your location will be on uhaul.com as a place for pick up and drop off of Uhaul equipment!
One way trucks verses rotation trucks:
Most Uhaul dealers will see only "one way" equipment which means the trucks and trailers can be rented locally (rented and returned to the same location) as well as being sent one way from one zip code to another anywhere in the US and Canada. The other type equipment is known as rotation or in-town equipment, this also can be trucks or trailers. What "in town/rotation" equipment means is that a particular piece of equipment (truck or trailer) is assigned to a set entity for local rentals only!
For your customers the pricing for moving vans is as follows:
A local rental, depending on the size is 19.95, 29.95, or 39.95 per rental period plus milage
One way rentals are a flat fee from point a to point b and we allow the customer more than enough milage and days to make their trip! As long as they are under the allowed miles and days there is no extra cost to them.

As a self storage dealer you have a couple of great opportunities to have at your facility! If you qualify (ill get into what qualifies you later) you can receive a rotation truck at your location or you can opt for a CoStar truck! A CoStar truck is a uhaul rotation truck that we will image the back half on both sides with your business name and phone number! It is really sharp ! I can post pictures of some of my storage dealers CoStar truck if you would like!
There is no cost to your facility for rotation trucks if you can maintain a reasonable workload on them. That is what helps qualify your location get a permanently assigned truck.
Even if you don't get a rotation truck at your location you still will have one way trucks available for you to reserve for your customers!

As this forum topic asks the benefits and ROI are, if Uhaul fits in your business plan you can have access trucks to rent your customer to help with move-ins at no cost to you (actually we pay you a commission on each reservation and rental you do) and uhaul maintains them and you do not need any extra insurance to have them!

I hope this helps and does not come off as a sales pitch, please ask any question or give me feedback on your experiences
Thank you
Rob