How to start a motorhome rental business

Starting a motorhome rental business in the UK can be a lucrative and exciting venture for entrepreneurs who are passionate about the great outdoors and adventure.

With the popularity of staycations on the rise and the increasing demand for unique travel experiences, motorhome rental businesses have seen a surge in demand.

The UK has a diverse range of scenic locations and tourist attractions that are perfect for motorhome travellers, making it an ideal location to launch a motorhome rental business, motorhomes were more popular than ever, thanks to a rental boom.

UK travellers looking for a good value staycation remain interested in motorhomes despite a recession, ongoing airport chaos, and tightening consumer budgets.

The motorhome rental industry was looking positive before the pandemic and the cost-of-living crisis. Caravans and motorhomes are expected to surge from 755,000 to 889,000 by 2030 according to the Centre for Economic and Business Research.

It’s the perfect time to start your own motorhome rental business since motorhomes are becoming increasingly luxurious and resemble hotels on wheels.

Throughout this article, we’ll cover everything you need to know about motorhomes, insurance, peak booking periods, and the essential gear your customers will expect you to carry.

Market research

The first step in starting a business is to conduct market research. Then, you can decide whether going ahead with the business is financially smart for you based on an understanding of the market you’ll be operating in.

Start by gathering a list of companies that offer motorhome and campervan rentals in your area. These are your competitors. Take a look at the following:

• How much they charge.You can also use this information when it comes to deciding your prices, since it will give you an idea of how much you could potentially earn.
• How busy they are.Do they manage a lot of vehicles? Are there always spare vans or do they have to turn away bookings? Your vehicles should be in high demand based on this information.
• What exactly they offer.Offering a benefit that your competitors don’t will help you stand out from the crowd, whether it’s a slightly lower price, freeview connected TV, or a quirky-decorated vehicle.

Finding the right location

The best places to find customers aren’t in the holiday hotspots like Cornwall or Cumbria, but rather in the towns and cities where holidaymakers live, rather than the ones they visit.

As a standard practice, customers come to you to pick up their vans, load up their vans at home, and then journey on to their holiday destinations.

The level of demand in your chosen area should be evaluated using your market research since people who live near the seaside may not wish to stay there.

A motorhome rental business could be started anywhere in the UK. Accessibility is key.

Further good news: starting your rental business from home is perfectly possible (and advisable). If your customers drive over to you, you’ll also need a parking space to store their car safely while they’re on holiday, if they’re staying with you.

You may require a larger space, equipped with power and shelter, if you decide to add more vehicles to your rental fleet.

You can find mobile home storage facilities near you by doing a Google search, or even ask local farmers if they have any spare barns you can rent.

Equipment, software, and costs

You will need to invest heavily in equipment and digital systems if you want to run a motorhome rental business.

Firstly, you are going to need the following:

A motorhome to rent out

The first thing you should consider purchasing is a caravan, motorhome or campervan if you do not already have one.

How much does it cost to buy a motorhome?

Depending on the model, the number of beds, the size, the features, and whether you’re buying used, the price of a mobile home can vary enormously.

The average price of a model starts around £5,000, while top of the line, spacious models can cost as much as £300,000. So, it really depends on your budget and what you are looking to offer your customers. You can expect to pay between £25,000 and £70,000 on average.

Vehicle cleaning products and basic repair equipment

When they come back to you, you’ll need to clean them thoroughly and professionally. It’s also possible that you will need to do a few small repairs here and there, but if you aren’t skilled enough, it’ll be safer for you to hire a professional.

Supplies for your customers

Make sure you stock your mobile home with a few essentials so your guests can enjoy their vacation worry-free. You might want to consider purchasing:

• Kitchen equipment
• Bed sheets, pillows and duvets
• Cleaning products and equipment
• Maps of the local area, and/or a GPS system
• A TV with a DVD/BluRay player and a radio
• A bike rack
• A first aid kit
• A fire extinguisher
• A tow bar
• Levelling blocks
• Gas containers
• Electric cables and adaptors for hooking up to mains electricity

In addition to European travel kits and European electrical adaptors, you should also provide your motorhome customers with European travel kits.

Booking capabilities

Making enquiries and bookings with you should be easy for customers. Your professional email address and a reliable telephone number are essential for dealing with customers first-hand.

With a more modern approach, you might find that setting up your website with online booking software (more on that in section five) is a real time-saver. It allows customers to see their motorhome’s availability and make booking enquiries easily online. Additionally, these platforms provide a smoother, simpler user experience for your customers.

A vehicle tracking system

Making an income from motorhome rental

What is the potential income from renting out a motorhome? Obviously, this depends on how frequently you rent out your motorhome, your prices, and the expenses you incur maintaining your vehicles.

The income you earn from each hire will usually be seasonally based, although you’re likely to make a profit right away.

During the summer, British families and couples search for motorhome and campervan rentals on Google in large numbers. During Christmas and New Year, demand may also be high.

During festivals, too, there is the opportunity for profit, with plenty of attendees looking for a little luxury rather than a tent stay. To take full advantage of this, you should create a custom festival package.

Since this business is seasonal, it’s best to keep your full-time job and start it part-time. The business has plenty of potential to become full-time as the demand for motorhomes grows and you start making more steady income.

Read more: Is the staycation trend expected to continue?

Regulations, licences, and insurance

What regulations, licenses and insurances is needed for starting a motorhome rental business?

You will need the necessary business licenses

In the UK, there are several business licenses and permits that may be required to legally operate a motorhome rental business and hire out motorhomes. The specific licenses and permits required may vary depending on the location of the business, the number of motorhomes being rented out, and other factors.

Firstly, the business may need to register with the local council as a commercial business and obtain a business license. Additionally, the business may need to obtain a motor vehicle operator’s license to legally operate the motorhomes on public roads.

If the business plans to offer insurance for their rental vehicles, they may need to obtain a license to sell insurance. They may also need to obtain a public liability insurance policy to protect against claims made by third parties for injury or damage caused by the rental motorhomes.

Furthermore, the business may need to comply with health and safety regulations and obtain relevant permits for the safe storage of fuel and other hazardous materials. It is important to research the specific licenses and permits required for a motorhome rental business in the specific location in the UK and comply with all legal requirements to avoid penalties or fines.

Get self-drive hire insurance

Self-drive hire insurance is a crucial aspect of operating a motorhome rental business, as it provides essential coverage and protection for both the rental company and the customers.

This type of insurance typically covers accidents, damages, and liability that may occur during the rental period. It ensures that in the event of an unfortunate incident, the financial burden is minimized, and the business can continue to operate smoothly.

Three reputable insurance companies that offer self-drive hire insurance policies for motorhome rental businesses are:

1. Aviva: Aviva is a well-established insurance provider that offers comprehensive self-drive hire insurance policies designed specifically for motorhome rental businesses. Their policies often include coverage for accidental damage, theft, liability, and personal belongings.
2. Hiscox: Hiscox is known for its tailored insurance solutions, and they offer self-drive hire insurance that caters to the unique needs of motorhome rental companies. Their policies may include protection against damage caused by renters, public liability coverage, and legal expenses coverage.
3. AXA: AXA is a globally recognized insurance company that provides specialized self-drive hire insurance for motorhome rental businesses. Their policies typically cover accidental damage, third-party liability, and can be customized to fit the specific requirements of the rental company.

When selecting an insurance provider for your motorhome rental business, it’s essential to carefully review the coverage options, policy terms, and customer reviews to ensure you choose a reliable and suitable insurance partner.

Prepare to accept payments

To prepare to accept payments for your motorhome rental business, consider implementing the following top five steps and examples:

1. Research Payment Processors: Look into reputable payment processors like Stripe, PayPal, or Square that can securely handle transactions for your business.
2. Accept Credit and Debit Cards: Ensure that your payment gateway supports credit and debit card payments. This provides customers with a convenient and widely-used payment method.
3. Offer Mobile Payment Solutions: Incorporate options like Apple Pay, Google Pay, or Samsung Pay to cater to customers who prefer using mobile payment apps.
4. Enable Bank Transfers: Allow customers to make payments through direct bank transfers, providing an alternative payment option for those who are hesitant to use credit cards.
5. Set Clear Payment Policies: Establish transparent payment policies, including deposit requirements, cancellation fees, and rental rates. Communicate these policies clearly to customers during the booking process.

By taking these steps, you’ll create a seamless payment process, accommodate various customer preferences, and ensure a positive rental experience for your motorhome business.

Find customers

Getting the word out about your business is crucial once it’s ready to go. Your business won’t succeed if nobody knows it exists.

Summer bookings are usually secured during the off-season, so you should advertise all year long. The majority of your time will be spent on marketing.

Here are some ideas to get you started:

• Launch a website.You should be visible online, as potential customers will often search for you on Google first. You’ll be better off hiring a web designer or investing in a website building tool if your website is professional, modern, and easy to navigate. If people search for local motorhome rental providers, your contact details should appear high on the search results page, as well as your site should be optimised for SEO.
• Place adverts in local newspapers. You should ensure that your advertisement looks sleek, professional, and includes all of your contact information. If you don’t have much experience in design, consider hiring a freelance designer.
• Carry out leaflet drops. To put it another way, design and print leaflets and place them through local letterboxes. Although it sounds intrusive, this is actually a standard marketing technique – think of how many takeaway menus and local business advertisements you’ve seen.
• Print posters, and ask local businesses to display them in their windows.
• Sign-writeyour As your motorhomes trawl the country, you will get your business name and contact information in front of countless people. On the back of each vehicle, you can simply write ‘On hire from [business name], [business website]’.

Frequently asked questions

What kind of research should I conduct before starting a motorhome hire business in the UK?

Before starting a motorhome hire business in the UK, it is important to research the market demand, competition, pricing, and target customer base. This research can help you understand the industry trends, customer preferences, and potential revenue streams.

How can I finance my motorhome hire business?

Financing options for a motorhome hire business may include personal savings, loans from banks or other financial institutions, crowdfunding, or investment from venture capitalists. It is important to create a detailed business plan and financial forecast to help secure financing.

What kind of marketing strategies should I consider for my motorhome hire business

To market a motorhome hire business, it is important to have a strong online presence through a website and social media channels. Consider partnerships with travel agencies, tour operators, and event planners to expand your customer base. Also, offering promotional discounts and referral programs can help attract new customers and generate repeat business.

Conclusion

In conclusion, starting a motorhome hire business in the UK can offer entrepreneurs many benefits, including the potential for high profits, a flexible schedule, and the opportunity to provide unique travel experiences for customers. However, there are also several challenges and considerations that must be taken into account, including the significant upfront costs of purchasing or leasing motorhomes, complying with legal and regulatory requirements, and managing the maintenance and repair of the vehicles.

It is important for entrepreneurs to conduct thorough research, create a solid business plan, and have a deep understanding of the industry and its trends before starting a motorhome rental business. With careful planning and execution, a motorhome rental business in the UK can be a rewarding and successful venture.