Here’s How You Can Finance Your Dream RV Rental Business
RV renting has become a popular business for travel enthusiasts who wish to share their love of travel to fellow gallivanters. If you’re one of these people, you might have probably thought of having your own RV rental business. Who doesn’t want to earn a little extra money?
Most individuals who love traveling, especially going on road trips, have their own RVs. While some save up money for their next camping or road trip, you can be one of the few who earns from renting RVs.
How much you can earn from an RV rental business
The first thing you should think about before putting up an RV rental business is the business risk and how much you can earn from it. When thinking of the capital, compute the potential costs of buying several RVs, maintenance costs, and insurance costs.
It’s advantageous if you already own an RV. This way, you no longer have to think about purchasing an RV for the sake of renting it. However, you also have to think about buying other RV units for other potential clients. This is where you have to carefully consider the purchase price and the maintenance costs.
Businesses may be low during the off-season. However, your off-season might not be the same for others, especially for those who travel a lot. On average, an RV rental owner can earn $100 per night, depending on the RV type and condition.
There are several factors to consider before you can put a price on rent. If the RV is roomier and has a lot of amenities, then the rent can go as high as $200 per night. However, if the RV is old or small, then the rent should be lower. The fancier the amenities, the higher the price. Still, you can make money even though the RVs you rent out are simple.
Besides renting your RVs solely for camping purposes, you should also think of other ways to make people want to rent out your units. You can have your RVs rented for town fairs, sporting events, concerts, and other community gatherings. The money you will get from these events will make you earn more than just renting your RVs for camping.
Think of other costs
The start-up costs for an RV rental business is expensive since you have to acquire one or more RVs. Aside from purchasing RVs, you also have to pay for other expenses involved in your business- both start-up and ongoing expenses.
Examples of start-up expenses are business insurance, personal liability insurance, marketing investment, website, and business registration expenses. RV rental owners should cover their RVs with insurance policies. Aside from insurance, you should also invest in marketing strategies to advertise your business.
On the other hand, ongoing expenses RV rental owners should prepare for are oil changes, regular car maintenance, and cleaning maintenance. The maintenance and upkeep of your RVs is the main component that can keep your RV rental business going. Your business will not grow if you won’t take care of your RVs.
It is always a good idea to stash some money as starting funds for your RV rental business. It is the safest way to finance it because you do not have to worry about creditors asking for money from you. However, this method might take you longer to start your business.
Nevertheless, this method is still a good way to finance your business. So, start saving today. However, if you do not have adequate finances, you should look for other ways to earn money and save up.
- Remove unnecessary expenses from your monthly budget. You can do so by ditching your daily coffee run or refraining from eating out. You can also cut-off unnecessary subscriptions to cable and magazines. These small adjustments will all be worth it once you earn money from your RV rental business.
- Set up a garage sale. Look for things that you no longer use and sell them to your family, friends, neighbors, and even online. Make sure that the things you sell are still usable.
- Look for a part-time job where you can work at least an hour a day. The added work might be hard, but the added income will help in financing your rental business.
Look at used RVs
If you want more income, then you should invest in more than one RV. However, buying several brand new RVs can be very expensive. Opt for second-hand RVs instead if you want to purchase more than one unit.
You should also consider some things before buying a used RV. One would be the value or depreciation of the unit. Two, the damage and wear and tear of the unit. Third, how much update is needed to make the unit presentable and good to use. It’s better if you find used RVs that you can easily work with, you will save a ton of money for the start-up cost.
Consider taking out financing options
Saving up for an RV can take up too much time. Buying second hand RVs also poses a risk regarding the quality and durability of the units. The best way to finance your RV rental business is to take out financing options. There are banks and financial institutions that offer loans for campers and business owners in the RV industry.
The first thing you need to do is consult with your bank about loan options to accommodate your current account balance. Banks can set the payment in a way that the amount will automatically be deducted from your account per month.
Next, talk with a private lending institution to offer you loan plans for a business like this. If you have a good credit score, then the loan terms might be better for you. However, if you have bad credit, credit institutions might give you complicated requirements before you can take out a loan.
Lastly, you can ask family and friends to lend you some money. Payments can be set up to make it easier for you to pay back the loan. You can also negotiate with them for the interest rates and payment period.
Camping might be something you enjoy and spend money on. However, you can also earn money from your love of camping by starting an RV rental business. With this, you can also share your love for camping with other enthusiasts. However, you must first assess your financial condition. From there, you can start planning how you can finance your RV rental business.
Lauren Cordell is a wanderlust who is also interested in the financial world. She writes stories about her travel experience and destinations including camping, RVs, Airbnb’s, and the likes. Her goal is to help her readers discover great deals and enjoy the best out of their travel plans.