How do I get started?

You’ve got a GREAT IDEA! You want to start a company that rents RVs or autos.  Maybe it’s just to rent your personal RV.  How do you get started?

Some insurance programs do not directly accept a start up operation that has no experience and requires your new business to undergo specialized training.   Starting a Rental Business is not like starting up a clothing boutique or other entrepreneurial business.  There are laws and regulations that govern the Rental Industry.  These laws are different from state to state.  You need to know what you can and cannot do and your insurance needs to comply with those regulations as well.

In another blog, we discussed the need to be a formal business. Setting up your business involves not only the legal paperwork to become an LLC or S Corp, but also includes creating documentation that will be the foundation for your business.

The following is an example of this documentation:

1. Resume – This is your company, why do you need a resume? You need a resume to show that you either have experience in the Auto Rental/Sales or RV Rental/Sales/Service industry or that you have a foundation in business, work history etc. to show that you have what it takes to start and maintain a company.
2. Business Plan – What are your goals? Do you know what your target market is? How will you bring customers to your business? Are there any other business models you are planning to enact? Do you have enough capital to get things off the ground? OR are you just starting small because of other business related needs such as a 1-5 unit car rental as replacement vehicles for your separate auto repair business? In the case of RVs, maybe you just want to rent out your personal RV.
3. Rental Agreement – This is very important to your business. It is the contract between you and your renter. It defines your responsibilities as well as the renter’s responsibilities. It also defines your insurance carrier’s responsibilities to a certain extent.
4. Procedures – There are several types of procedure documents you need to have in place: Counter Procedures, Walk Through Procedures, Check In & Out Procedures. Depending on your location, you may also need a Severe Weather Procedure. These documents establish a consistent routine for renting your units out.   They demonstrate that you will always know what condition your vehicle is in before and after the rental, and that you’ve demonstrated to your renter how to operate the vehicle safely.   By signing off on these documents, as appropriate, you have proof, in the event of an incident, that your renter agreed to the condition of the unit, and was shown any safety or special function such as Auto Park or running a generator on an RV. Operational consistency can protect you and your company for costly legal costs.

Training is the second part of this equation. Knowing what you can and cannot do as a rental agent is very important.  The laws and regulations differ from state to state.  For example, in some states you can sell a partial Collision Damage Waiver (CDW), which means that you can just waive the deductible rather than the entire loss for your renter.  Other states strictly forbid this.  CDW in and of itself will be another blog!  Training gives you the understanding of how to deal with certain customer and business situations, what information to collect from your renter, and your responsibilities.

Experience is the other factor in getting started. If you have previous experience or you hire someone with sufficient experience, you may be able to get your business off the ground without training.  However, you still need to develop documentation.

You now have the foundation to get your GREAT IDEA started.