How to start a campervan hire business
If you are considering renting out campervans and don’t really know where to start then this article should help.
I’m certainly not a business guru, or anything close, but I started a small campervan hire business with my brother and ran it for 5 years until selling up. We got somethings spot on, gained some fantastic publicity and had tons of bookings. On the flip side we got a lot of things wrong and I wish I’d read a, ‘How To’ article like this before I’d started.
Campervan rental is a fragmented industry; there’s a lot of small operators, renting anything from 1 – 20 campers. There’s no set way of doing things and so I’m offering some guidance based on what did and didn’t work for us.
Established Rental Company? If you currently run a rental business and think that I’ve missed something or have got something wrong then let me know in the comments below. Lets improve this article so that we can really help people get off to a flying start.
#1 Where to start?
Start by considering a few more questions:
What sort of business do you want? Hobby business, part-time or full time.
Many people start with 1 or 2 campervans and rent them out as a second job or to supplement their income. That’s fine, but you will need to think about the questions below and make a rough plan. I’m not talking a full business plan, unless you’re looking to get a grant or business loan, but have an idea about the direction in which you’re heading.
Where do you see the business in 5 years time?
From our experience I’d say you need to keep things very small (1 to 2 vans) or go big (8 plus vans). The in between, say 4 campervans, can be done part-time but you’ll struggle in high season if you have a regular job. Also, it won’t provide enough income as a full time, stand alone business. If you’re planning on creating a full-time career out of this, my advice is to start small and think big.
How flexible can you be?
Flexibility is key in getting this off the ground.Think about people arriving early to collect, late to collect, or late to return the campervan (or all of the above). Think also about breakdowns at 1 pm on a Wednesday for example, or on a Friday evening. Will you be able to get there? And will you have the time to organise transport or alternative accommodation for the next renters?
#2 Establish your target audience
The type of camper, the interior you choose and the equipment that you provide can all appeal to a different type of customer. Before you do anything you should consider who your perfect customer or target audience and then think about those lovely people living in your camper for a week in heavy rain; how will they cope, will they have space and be comfortable etc. with so much ‘van time’?
Examples of some customers and the campers you’d need:
Under 25s: Small, simple campervans that are basically a bed with portable cooker etc. Simple, small campers = low insurance for under 25s.
Young Families: Consider converting larger vans (larger than VW T5s) and kitting them out with everything you’d expect in a modern camper, such as a lower bed, roof bed, kitchen area with a sink, fridge, freezer, and hob. Possibly even gas heating. OR go with T5 type sized vehicles and scour the web for the best full, drive-away awning you can buy.
Older Couples (60+): You’re into motorhome territory here, although there will be some that love the nostalgia of a classic VW.
If you’re wondering where classic VW campers fit into this, aside from appealing to a few older customers, then I’d say they have a huge target market, spanning decades. The classics are so popular that you’ll rarely be short on bookings. However, the costs involved with keeping these beautiful vehicles on the road and rentable are quite high. Don’t let that deter you though as these stunning campers could be your fastest route to a successful business. The key is for someone working in the business to be knowledgeable and practical with VW campers.
#3 What is the Best Campervan to Rent Out?
Lets talk VW. Are they the best campervans on the market? Not in my opinion and if buying a campervan for personal use I’d probably opt for something else. However, here’s 3 reasons why VW campers are great for rental:
They are ridiculously popular. This matters because when potential customers look to renting a campervan they will often want and expect VW.
They are expensive to purchase. This seems like a reason not to rent them but actually people often want to try what they can’t afford.
They almost market themselves, particularly the classics. Lets say you opt to buy a 2009 non VW van that’s been converted to a camper. Now try and explain to people why they should rent that over the VW T5 that they could rent 5 miles from you. Trust me you will find the converted van sitting on the forecourt far too often.
They look great. People want to feel special on their holiday and many want there vehicle to turn heads.
So why on earth would you opt for something other than VW? Well it’s all about your customers again. You shouldn’t necessarily give them what they want (Wait! What?). Instead it’s probably best to offer them what they will need. Take under 25s for example, they would opt for a VW California over almost anything else. Once you explain the really high insurance premium, high excess fee, the upfront security deposit and the cost of filling up the tank however, they’ll opt for the camper that looks like the car they just turned up in but with a great set up as the seats convert to a bed and there’s even a hob and cooler.
Similarly, families may think that a classic VW would be the perfect fit, until they spend a night in one and realise that they simply can’t do without some modern luxuries and more space.
Is it really all about the customer?
Not really. It’s also about what you can afford and what will work for you.
Initially, we opted for the classic VW to rent out. At one point we had 4 69-71 campers and we were rushed off our feet on change over day. The problem we had is that we weren’t mechanics or anything close to handy with these vehicles. All our profits were eaten up by actual mechanics. Classics breakdown and have more faults than modern campers in general. You need to be a good fit for them.
Some people will tell you that classic VWs are fantastic and if looked after will rarely let you down. I’ll tell you that they will rarely be treated with tender loving care by renters and you will need to be quite knowledgeable about them, have a back-up engine in the garage and even a back-up campervan if your budget allows.
#4 Stay Niche
Don’t make the mistake of being all things to all people. If you overstretch yourselves by offering multiple types of campervan it will be to the detriment of your business. Remember this: Go Niche or Go Broke.
Keep things simple and choose the van type. Stick to that type until it works or fails. If it fails you can pivot and opt for another camper type. If it’s successful you can either purchase more or consider other options.
#5 Setting up your business
We went for a Ltd. Company from day one. I would recommend that you do the same but you should speak to an accountant to understand the benefits. Or you could save money and do some research online.
Why Ltd.? In short, if something goes drastically wrong your business will be liable and not you personally.
A) Terms and Conditions and Rental Agreements
This is possibly the least exciting part of establishing your business, but I can’t stress enough how important it is.
Here’s my top 3 recommendations for T&Cs:
- Start by reviewing terms on competitor websites, or better still on campervan rental websites in completely different areas. Please, under no circumstances copy other terms. Reviewing these terms will help you so much in planning for and setting up your business. It will give you far more knowledge than merely browsing through competitor websites.
- Note down everything that you think should be include in your terms and try to put them together yourself before taking them to a solicitor to be drawn up properly. Before you decide not to spend the £600 or so for this service, think about the worst case scenario for your business. It may go something like this: serious accident involving your campervan occurs, you find yourself in court and are confident you’re covered due to your terms. Unfortunately, you’ve made a mistake on the terms which you drew up yourself. I’ll leave the scenario there. Use a solicitor, go Ltd., use an accountant.
- T&Cs should be signed when your customer reserves the campervan of and the rental agreement signed prior to departing with the vehicle. Be as professional with this as your local car rental company is.
B) Business name, Website and Initial Marketing
In my opinion you should not be too clever with your business name. If you can get ‘camper’ or ‘campervan’ in the name, along with your rental area then great. Also, do not restrict the future prospects of your business by opting for a ‘self-limiting’ name. For example, ‘Devon Bongo Rentals’ will be a problem if no one rents your bongos and you decide to rent VWs instead.
Website name (domain)
Try to match your business name. Search on 123-reg or Go Daddy.
Website Design and Build. Personally I’d do this this: Buy hosting with Bluehost or possibly Go Daddy, purchase a premium WordPress theme and install it yourself. You can find themes that look exactly the same as the demo once installed and you simply change the colours, text and images etc. Yes you can customize themes but it requires some skill. If this all seems daunting get someone on Fivver.com to do it for a few dollars or contact me here for more info.
If you opt for a web designer instead don’t spend a fortune. The money is better spent elsewhere until you have money coming in.
Getting found online
Read about SEO and Local SEO. This could be the single most important thing you do when it comes to marketing your business online. It’s all about making your website highly visible in the search engines (mainly Google) and increasing traffic (visitors) to your website. Modern SEO is also about converting site visitors into paying customers.
I have viewed literally hundreds of campervan rental websites and many are dreadful. They simply do not provide the visitor with enough information for what they are looking for and need. Provide visitors with tons of info that you can offer them, why they should choose you (include testimonials), how they can contact you, follow you and ultimately book a holiday with you.
Consider using Fiverr, Design Crowd or 99 Designs.
Build an audience
I toyed with the idea of placing this at the very top of this article. Before you do anything you should create social media profiles on platforms such as Facebook, Twitter and Instagram. Put yourself out there by letting friends and family know what you are up to and ask people to share your business idea and posts to help you get going.
Stuck with what to share? Don’t irritate people with self promotion posts all of the time or dull posts on what you are up to. Think about the things that you like and share online.
Brighten up peoples day with stunning images of campers and places in your local area, and share useful articles that you’ve found online, or have written yourself as blog posts. Yes you can promote your business, but not too often.
We sold our camper company in 2014 and prices will have increased but the best way to explain this category is to use our pricing structure and method:
3 night hire – Fri 4 pm to Mon 10 am
4 night hire – Mon 4 pm to Fri 10 am
7 night hire – Fri 4 pm to Fri 10 am
7 night hire – Mon 4pm – Mon 10amShort Break
April – May
July & Aug
Oct – Dec
Why this system works?
You can maximise profit and minimise effort. If you opt to allow collection and return of campers on any day of the week and charging a daily rate, campers could be sitting around for days without a rental and you’ll be busy with the business everyday. By choosing specific collection and return days you force people to book those days, which makes it more likely that campers will be out on hire, resulting in less ‘forecourt’ time. It also makes it easier for change over days and financial planning.
You should take a non-refundable booking deposit for each reservation. This is your business and you should run it as such. Some customers will want to cancel nearer the hire due to personal commitments or a poor weather forecast. The fact that they’ve paid the deposit will deter them from cancelling, and if they do cancel you have their deposit to put towards promoting the available slot so that you don’t come up short. Our deposit was £150. We took booking’s over the phone, via email and online. Around 35-40% of booking’s were made online via a booking system.
Renters must sign and return (online or by post) your terms and conditions and I recommend sending them a copy of your rental agreement prior to hire day. Ensure they receive a follow up letter or email (we sent both). Make your collection and return conditions are clear, but be friendly.
What to include in rentals
This can be answered early on when considering the type of business you want to be. Make a decision on whether the basics that people need to live in a campervan are included or extra. We included a welcome pack (a few local goodies such as biscuits and wine), all cooking and dining equipment necessary and bedding. We charged extra for things like a bike rack and drive away awning because these were not ‘essentials’. Remember that people aren’t getting anything for free as your price will reflect what is included or excluded from hire.
Collection and Return Days
We had set days and it worked well. Renters had to return vehicles by 10am. Many were late, and although our terms stated fees for late return we never charged customers. Instead we quietly expected campers to be back by 1130am but requested they be back by 10am.
Tip: Assume renters will be early to collect and late to return and adjust your times to reflect this.
How to change over (in brief):
Check the campervan over thoroughly once returned with the renter still on the premises. Check for damage inside and out and compare to the ‘walk around’ you did with the renter prior to hire.
Ask the renter what they did, where they stayed, what they liked and didn’t like. Their feedback is really important for improving your service and for creating a campervan guide to your area if ever you wanted to. Ask the renter to review your service on Google, Facebook or your website.
If there are 2 of you, one should focus on the cleaning and one on checking over the camper (this includes engine checks, tyres and fixing problems etc).
Have a second set of all campervan equipment provided with the hire and simply swap it over (I.e. bedding, cooking and dining essentials and camping gear).
After washing the camper the person cleaning the van should then do the campervan checks as well.
You should then both go through all safety checks and be sure that the campervan is safe for rental.
Spend a minimum of 30 mins going through the rental agreement with renters and showing them the camper. If you’re renting classic spend longer and let them drive the camper with you in the passenger seat.
Have a ‘walk around’ the camper to mark down any damage from previous hires and request that renters sign both this sheet and the rental agreement prior to hire.
Of course you will have checked drivers licences and other relevant details by this stage. You will also have taken a security deposit. We charge £500 but would charge £750 now. We used a card machine to hold the details of a credit card for up to 7 days after the rental.
We planned on £15,000 Turnover per camper, per year. This figure will depend entirely on the camper type, length of season and your pricing amongst other things.
You will have an opportunity to increase sales by offering Collisions Damage Waiver Fees, retaining deposits on cancellations and even selling products such as, hoodies.
I mentioned above that the type of camper that you have chosen to rent out will directly affect your turnover. If you purchased a £40,000 VW California then you’ll charge far more per week then you would for a small, converted mini van. Don’t get fixated on renting the best and most expensive campers on the market though. This doesn’t mean you’ll make more money.
You could have 4 budget campers instead of one high end camper and even though you’d be charging far less for each booking, you’ll have more bookings and more opportunity for upsells. If the luxury market is for you then great. But do not make the mistake of purchasing a campervan because it’s what you personally want. Go with what your customers will need and with what will make you money.
Why do large rental companies offer any day hire? Because they can. They have large fleets and spend a lot on marketing which means they’re forever promoting their vehicles and so can offer customers true flexibility. It’s not always the best system if you only have a few campervans.
I’ve been what I would call realistic in putting this article together. It’s important that you consider both the ups and downs of running a small business like this. I don’t want to put any pressure on you, but your customers are most probably booking the holiday of the year with you. They will be spending a lot of money in all with travelling to you, renting the campervan, opting for some extras, paying for campsites and meals etc. It is up to you to provide them with the experience they deserve.
Come rain or shine almost all of our customers absolutely loved their campervan holidays with us. We had quite a relaxed approach with customers and made them feel completely at ease the moment they turned up.
What is the main thing I would do differently if I started again? I’d go down the budget campervan hire route for a younger audience and those who just want a mobile base. I’d do this because customers would be pretty chilled out, it would be cost effective to have 1 or 2 back up vans and it would be financially viable to scale up quickly if your campers are permanently booked up. But this will not be for everyone, you should go with campers that suit you, your target audience and your area.
If I have missed anything or you have any questions please let me know in the comments below – thank you!!