Should you have a set price list

A lot of people seem to charge based on their mood at the time of the call…

The same tow service that one day would get a quote of $60, the next day for some reason, goes up to $85 or $90 or even $100…


So why is that?? How would that affect your business?

Well, for one, it’s just not the way to run a business… you don’t charge more just because you can…

I think that it’s bad policy, can get you in more trouble down the line, and… WHY? I mean if you can be profitable at $60, why risk losing the call because you are just “extra greedy” that particular day? It’s certainly not the right way to run a business.

Can you imagine you go to the deli and they charge the person in front of you $5 per pound of ham, but they charge you $6? FOR THE SAME HAM?

That is BAD business manners, bad policy, and it may give you some extra bucks today, we should remember that we are in business for the long haul. It’s a marathon, not a sprint.

Am I right?


Being an On Call Driver

Being an on call driver for a towing company has its pros and cons…

What does it mean to be on call?

Flat_Bed_Tow_TruckWell… If you’re a tow truck driver, it means you don’t get a lot of privacy. An on call tow truck driver must be available at all times. That means when you’re shopping for your kid’s Christmas present, when you’re sleeping, when you’re in the bathroom, or at a funeral… Unless it’s not your own, you should be ready to roll!

And an on call tow truck driver must have the tools available to perform any job and anytime.  Being on call means that you must plan every activity around the fact that you may be called upon and have to be ready at a moment’s notice.

It’s not easy on the family (that may have some bearing on the high divorce rates among tow truck drivers), but more importantly, it may have an effect on you, the tow truck driver.

Some people seem to think that the reason tow truck drivers are grouchy individuals has to do with exactly that: they just have no set schedule.

And the difference between an ambulance fighter or a firefighter in comparison to a tow truck driver may have to do with the fact that the first two most likely have a pension plan and a retirement date already set in their heads, along with the ease of working 24 hours on, 48 hours off…

So keep that in mind next time you accuse a tow truck driver of being mean or crabby or unfriendly.



Phone Manners and Difficult Customers

The words we use can cause a dramatic effect the relationships you have with your customers

The choice of words we use in any given situation is much like traveling in a Time Machine: any small adjustment one way or another can create an outcome that is substantially different than expected. In the movies, the time traveler is always warned to not do anything to change the course of history, but inevitably, he interacts with somebody causing a disruption in the fabric of time.

It’s always portrayed as something small, like teaching a kid who keeps getting beat up by bullies to defend himself… You know, something you wouldn’t think would be a big deal but it ends up having a huge impact on the future. Maybe the kid grows up to become a criminal instead of finding a cure for heart disease (which was his intended destiny).

That’s how words work with your customers.

The other day I got a call from a lady who wanted to pick a fight from the outset: as soon as I grabbed the phone she was yelling: “how much are you gonna rip me off for a tow…”

She was very angry because she had been the victim of theft: someone had stolen her keys (why just the keys, I don’t know…) and her car had to go to the dealership to get a new set made.

The dealership wouldn’t provide free towing, even though she had dealt with them for over a thousand years, and she was just itching for another fight…and she almost had it, with me. But I held myself back and I told her our rates.

I was understanding and courteous and used consoling words like “I’m sorry to hear that”.

I suggested a few different ways she could pay for the service; ways that might not sting as much right now, and finally her shell began to soften and she started breathing again, and the words came out a lot slower and in a pitch that wasn’t so high.

She finally settled down a bit and apologized for being so upset… Only time will tell, but I believe I gained a new customer that day, one that I would have if I had used other words.

Your choice of words and how you use them can be the difference between making a sale or losing a sale. It can be what escalates a complaint or resolves it. Your words can help build a relationship that lasts long into the future or kill it before it even gets a chance to start.

What happens with most of us is that we are so busy answering phones and dealing with problems -which as you know is exactly what the towing this is all about- we are taking care of employees, fixing trucks and so much more that we don’t always switch gears when it comes time to solve the customer’s problems…

We are always in crisis mode.

The people involved in your business, the drivers and dispatchers you work with, know how things work and don’t expect you to drop everything at a moment’s notice to solve their problems.

Well.. not always… but that’s exactly what your customers expect. That’s what they want and rightfully so.

Customers are having their own crisis going on and are looking to you to solve it. It can be hard switching back and forth from “crabby old guy”, dealing with everybody’s crap, to the helping hand and calming voice that everybody wants in a difficult situation. But you gotta do it. Makes all the difference in the World.

Determining Your Towing Rate

How to determine your rates

A huge part of owning a successful towing business is setting your basic towing and service call rates. Most new towers are so excited to be in business that they lose their heads when the phone rings… In an effort to run every call they will do and say anything to make the sale and practically give their services away in the process.

Before you can properly charge for your services, you need to know what it costs to be in business. There are two types of costs in any business: fixed costs and variable costs

Fixed Costs

Fixed costs are what you pay, whether or not you turn a wheel, and they include your truck payment, rent or mortgage, your telephone, utilities, bookkeeping, uniforms, advertising, insurance and other expenses like licensing and registering your trucks, business and merchant licenses, association dues, subscriptions and ongoing education, among others.

Variable Costs

Variable costs vary with the amount of work performed and they include fuel, repairs, tires, servicing, parts, windshield washer fluid, miscellaneous expenses like damages, office supplies and shrinkage.

Determining Your Rates

What we’re doing here is determining what rates you can charge, not setting up your books for accounting purposes. Your truck and any real estate owned are assets, but for the purposes of setting your rates they’re considered liabilities.

The four steps for determining your rates for your basic services are:

  • identify and enumerate both fixed and variable costs
  • determine how many calls you run monthly
  • use the Profit Calculator to find your desired rate for basic services
  • test them in the market and consult your competition

Identify Fixed and Variable Costs

When you’re just starting off you won’t have most of the information you need to complete the list. This leads many new towers to take the easy route and fall in line with the lowest competitors’ rates or even worse, they’ll come in a few dollars under.  It’s a bit harder but instead I suggest you take the time to make some calls and gather the average costs. Assume you will be replacing tires annually, and for repairs & parts take the cost replacing an engine and divided by 24 months. It won’t be completely accurate, but you will have a conservative starting point.

Determine the Potential Number of Monthly Calls

Use a conservative number. I suggest eight calls per day multiplied by twenty two work days per month (weekends off) which comes out to 176 calls per month. if you work eight hours per day, you should easily be able to run one call per hour. You can adjust this as needed.

Find Your Desired Rate

Plug all the numbers into the Profit Calculator: fixed costs, variable costs and days work per month then multiply the number of calls you believe you’ll be able to run by an average sale per call trial rate. This gives you your average monthly sales. Subtract your cost from that number and you have a before tax monthly profit. Adjust the average sale per call until you have a monthly profit amount that you can live with.

Test and Review

Now that you have your average sale per call trial rate, the rate at which you should receive the desired monthly profit, everything being equal you need to test it. But before you do that, make a few calls to your competition to see what their rates for some more services are. Call a couple repair shops and inquire as to the rates they pay and then allow the market to help you decide. If what you’re charging for basic services is reasonable and somewhere between highest competitor’s rates and lowest competitor’s rates you should be fine. Within a short time you’ll know and you can adjust accordingly if necessary


Welcome to my Blog

I have decided to write about the business of towing. I have substantial business experience, and some towing experience and hopefully I will do a decent job at combining the two.

My name is Ivan Luvchenko and it will be my pleasure to write to all new aspiring and struggling tow truck owners and hopefully help in some way to become more profitable. I will include some case studies as I go along for you to reference. I hope this blog is helpful. Enjoy.