Here’s All You Need to Know About Starting a Profitable Motorcycle Rental Business

Motorcycles are more than just two-wheeled vehicles. They represent a dream, a culture, and a way of life. And in the thriving rental market, motorcycles offer a great business opportunity.  It is possible for motorcycle enthusiasts who love to ride to make a living from their passion for motorbikes.

Though creating a motorcycle rental service is a big venture with considerable challenges, the fact that this kind of business requires minimum investment and can be established online makes it surprisingly easy to start up. It is possible to earn substantial profits, which helps motivate many entrepreneurs. Not to mention, they get to spend time with the powerful motorcycles they love so much.

Back in the day, owning a typical brick-and-mortar-based rental dealership was the only way to start a rental business, EagleRider being one such example. However, motorcycle rental platforms like Riders Share and Twisted Road have proved that with today’s technological advancements, it is possible to run a profitable and reputable motorcycle rental business online. Even EagleRider has since evolved and established a strong online presence.

If you use it to your advantage, technology can help you grow and advertise your business, generating more revenue.

Whether you want to have a physical or a virtual motorcycle rental company, here are some tips to help you get started:

You do not need to mimic the business practices of other motorcycle rental services as what worked for them might not work for you. However, you can always learn from the experiences of older rental services that have become big names in the industry.

The best way to enter the industry and study the rental business model is to purchase a running business for sale. It does not have to be a large-scale rental business. Even a reputable small-scale motorcycle rental business would do. Conduct thorough research and find multiple motorcycle rental businesses. Afterward, contact the owners and ask if they would be interested to meet. If they agree, go to meet the owners at an appointed time and place. There, you will have the chance to inform them about your plans, while discussing the potential of their company’s business model.

One of the major reasons an owner sells a running motorcycle rental business is due to a lack of investment and profits. So, you need to know exactly what kind of business you are investing in before you commit.

Ask the owners why they are selling the business. You may also want to know whether it is a new set-up, what challenges the owners faced while starting the business, and how they solved problems while running the business.

These questions will prepare you for the challenges that you might face and may also help you come up with unique strategies for handling those challenges ahead of time.

Next, you can ask the owners for suggestions about expenses, yearly profit, number of employees, debts, bank pledges, assets, lawsuits, customer responses, client retention, and other questions that come to mind.

There is a strong possibility that you will find more than one operational motorcycle rental business for sale in your area. By asking the questions mentioned above, you will gather enough data to compare, contrast, and learn how a motorcycle business is started, run, and becomes profitable.

In the process, you may find a profitable business that you can buy. If you cannot, you at least have the blueprints required to start a profitable motorcycle rental business from scratch.

Another way to gather information about how to start a motorcycle rental company is to learn directly from a business owner. You will have to be careful here. If you give off the impression that you’re competition, then you won’t get the information you need.

You can develop a good work relationship with other businesses by assuring them that you won’t compete with them by offering different services.

You can also share your business ideas to develop trust with other business owners. However, this approach tends to only work with small-scale businesses.

Compared to buying an operational business and starting your own enterprise, buying a franchise may be the smarter business strategy for ambitious individuals having a good credit record and a good net worth. It forces you to start your business from scratch but you are guaranteed success as you can take advantage of the company’s existing business model.

Unlike new motorcycle rental start-ups, franchises tend to be more successful for various reasons:

• More customers are aware of the brand, so you don’t have to spend years trying to create a name for yourself within the industry.
• In addition, a franchise greatly reduces the risk factors involved with starting a new business.
• Furthermore, the company provides adequate training and support to new employees, allowing them to be part of a profitable business while further promoting the brand.
• It requires less effort and finances to maintain a franchise than to start your own business.
• You don’t have to worry about funding aggressive marketing campaigns and being outperformed by older competitors. As long as the product the franchise provides is still in high demand, your business will remain profitable.

Other motorcycle rental companies that have their own franchises include Rent-a-Wreck, American Rider, and Unlimited Biking.

Once you find the best opportunity, try to get in contact with and set a time and place to speak to the marketing representatives of the company whose franchise you are interested in. They may invite you for a group session or a meeting to give you an opportunity to ask all your questions about their franchise’s policies.

If you are interested in buying the franchise, you will have to fulfill certain requirements:

• Pass an interview
• Undergo a credit score check and present proof of a strong financial plan to satisfy the company’s representatives' expectations that you can reliably run the franchise.
• Get the location approved. The company will not allow you to open a franchise in just any area you want.

If you have enough funds, you can buy the EagleRider franchise. Since the company is well-known for its Harley rentals and tours across the United States, the chances to attract customers will increase exponentially compared to if you were a fresh start-up in the area.

However, EagleRider has some strict requirements that you must meet to become a franchisee.

Requirements to buy EagleRider Franchise

• Proof of running or managing a retail facility before.
• Must be willing to successfully complete all training requirements.
• Good credit record manifesting timely payments.
• Liquid capital for financing your rental fleet: starts at $64,352- $229,048.
• Liquid capital to buy rental fleet on cash: starts at $136,000 - $425,000.
• Minimum required net worth: $400,000.
• The Minimum number of rentals: 8 rental units
• Sharp business acumen
• Must be able to create a business
• Must execute EagleRider franchise procedures
• Project management

Now, you need to choose a niche for your motorcycle rental business. What type of services are you going to offer to the customers? Will you offer only a certain type of motorcycle, a certain brand of motorcycles, or will you own a large fleet with plenty of variety? Here is a list of possible suggestions for your motorcycle rental business’s niche:

• Certain motorcycle rental companies only offer a specific brand of motorcycles, whether only Harley Davidson, BMW, Honda, or Yamaha motorcycles. For example, EagleRider offers a wide variety of Harley Davidson motorcycles, while Hertz Ride offers a large selection of BMW rentals.
• Will you also provide trike rentals such as the Can-Am Spyder and Slingshot rentals just like SK WaterCraft Rentals and Turo?
• Will you provide only tourers, cruisers, standard street motorcycles, or scooters?
• Will you offer adventure or safety riding gear available for rent?
• What kind of drop-off policy will your business have?

The location of your motorcycle rental business can determine whether it will succeed or fail. Starting a motorcycle rental company in an area with little to no demand for rentals will not be profitable. Similarly, if you start in an area where there are already big and popular motorcycle rental businesses, your business may not be able to compete with them.

Make sure to research a location that is densely populated with high demand for rentals and less competition in the area.

A great example of a profitable location would be Sturgis, South Dakota. The local motorcycle rental businesses generate the most revenue in August during the Sturgis Motorcycle Rally. Furthermore, the Black Hills, Mount Rushmore, and other scenic motorcycle rides attract riders not just to the United States but all over the world. Hence, many rental companies in Sturgis take advantage of their location and the high demand for rentals.

Some motorcycle rental businesses profit the most during the summer and fall when tourist activity is high. Make sure to avoid placing your business in a location that suffers from extreme climate and less tourist traffic.

Personal branding starts with deciding on a unique name for your rental business. Try to be creative when coming up with a brand name. Your brand name should indicate the kind of business you run while making it distinct from similar businesses.

Make a list of as many unique names as you can come up with. Seek help from family, friends, and even Google. Brainstorming is key to coming up with a unique business name.

Next, create a logo for your business. A logo should look professional and stylish, especially when you create social media pages to promote your business online.

With your research completed, your niche decided, and your business name established, you need to start the legalization process. Here are some tips:

There are different types of business registrations offered to business owners. Such examples include sole proprietorship, limited liability, and a corporation.

A sole proprietorship is the simplest type of registration. Compared to a limited liability company or a corporation, you are not registered with the state which makes it a more cost-effective method. However, you need to purchase permits to legalize your business and you will have to risk complete liability should your business go bankrupt.

The biggest benefit of a limited-liability company is that it keeps your personal assets safe in case your company goes bankrupt, you have unpaid taxes, or have accumulated debts. With limited liability, you will be liable to pay only the amount that you invested in your business after a lawsuit or going bankrupt.

Similar to an LLC, a corporate structure extends liability protection to the business owner. Hence, your personal assets, such as your home, vehicles, or other assets will not be used as collateral to settle a debt.

The only difference between a corporation and an LLC is the taxation system, as this is paid for by the corporation rather than individual owners.

Depending on your business registration, you will need to get a tax identity number. It is best to consult a taxation attorney to help you determine whether you need a separate tax ID for your new business and how to complete the procedure.

A business plan will function as a guide that will help you run your business once it is up and running. You can make changes to it over time, but in the early phase, it is important you build a plan based on your research, set your goals, and stick to them as much as possible.

Moreover, your business plan will help you explain your business idea to money lenders, increasing your chances of securing a loan.

Start researching nearby banks and the services they offer in regard to supporting new businesses. Even if you have enough funds to start your business, you may need a loan in the future. For this, you need to have a deep understanding of the interest rates and policies of the bank you want to work with.

If you have ever rented a motorcycle, you should know the importance of buying sufficient motorcycle rental insurance. In addition to planning all the funds and loans you need for the business, you need to have your business insured to protect your customers in the event of a crash, as well as your property, assets, and employees.

Rental businesses must have insurance that covers bodily injuries, property damage, and stolen motorcycles or motorcycle parts.

If you buy commercial insurance for your fleet and your business, it may put a strain on your finances. Hence, general liability insurance may be the better option to provide all the minimum coverage necessary to run a motorcycle rental business.

After completing the paperwork, business plan, financial plan, and insurance policy, you need to choose whether you want to run an online or a physical motorcycle rental business.

If you want to run a rental business in a fixed rental location, then EagleRider is the best example of this business model.

On the other hand, if you want to run an online business, then Riders Share is the best example to follow.

Having an official website makes it easier for rental services to list their motorcycles available for rent. However, you would have to provide road assistance, third-party liability coverage, and general motorcycle insurance to provide financial protection. For safe transactions, you need to have strong software for background checks, motorcycle endorsement checks, and license and credit card verification.

Just like with Riders Share, it is recommended you charge between $10 - $ 35 per rental to cover all expenses and damage costs.

Most motorcycle rental businesses profit the most during the vacation season. They are usually dependent on the revenue generated from high tourist traffic during the warmer months. As a young start-up, if you follow the online rental business model, it will save a lot of expenses such as salaries, office rent, insurance, maintenance costs, and other utility charges.

Just like any other business, a motorcycle rental service requires a lot of hard work to succeed. There is no such thing as overnight success in this business. The advantage of starting a motorcycle rental service is that you will be investing in something you love. It is possible to start your business from scratch with minimum investment and from the comfort of your home.