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Breakdown recovery

Entering the breakdown recovery industry

After acquiring a truck I needed to find work for it and fast.

DATE

2012

COMPANY

Breakdown Recovery

INDUSTRY

Rescue & Recovery

Introduction

After seeing someone I knew doing quite well with a recovery truck earning a few quid, or so they said. I decided to get a truck myself to generate an income and start a business in this new industry. Little did I know that my contact was full of rubbish. He wasn’t making any money whatsoever. So I was stuck with this truck. I managed to find ways to actually gain contracts with some really good customers, big clients which made the venture all worth it. Although offering 24 hour service was hard.

Gained chauffeur contract

Landed really consistent and high paying contract with Birmingham’s largest chauffeur company. They were based by Birmingham airport.

Landed RAC sub-contracts

Able to land sub-contract work for both the RAC, AA and the GreenFlag. Establishing myself with these sub-contract companies was critical to success.

Purchased equipment cheap

A contact sold us about £2000 worth of recovery tools and equipment. For basically free. Gave him a drink for them. It pays to keep your contacts happy. 

Got great deal on first recovery truck

Managed to find a business that was struggling who used a recovery truck to deliver cars in their audio equipment shop. The guy needed money desperately. So I purchased the truck from him for hardly anything. 

Situation

I knew someone who had a recovery truck. They said they were working for someone carrying out recovery work, on a self employed / contract basis. But they wanted to get rid of their truck now. Their truck was a tilt and slide. It was a Renault Midlum. Although an ok machine. It wasn’t the best of the best. It wasn’t a Scania, or something. 

They tried to sell it to us, but they wanted £7000 for it. Too much money for that.

The tilt and slide vehicles would also not work for super low down vehicles. His one was a standard tile and slide. So there was a chance the underneath of vehicles would get caught. To be able to handle Ferrari’s and other sports cars needed a special tilt and slide, a super low approach one. But when on the road, and the machine is down on the ground, the back end takes up a ridiculous amount of space. It is also slower getting vehicles on and off.

Taking this into account, we opted to buy a spec lift. And to find a super reliable one, which had the engine power to handle anything.

After needing a vehicle to collect and deliver cars. Acquired a recovery truck. It was a Mitsubishi Canter with a spec lift. Paid for in cash. It also had a passenger cab on the back to carry lots of people safely if they were broken down and stranded. It also had a winch, which was extremely useful.

I realised that as the cars were being advertised, they were effectively sitting around doing nothing, there was a lot of time in the day whereby no money was coming in. I wanted to make the truck get used far more. After all, what is the point of shelling out money for a recovery truck and not take advantage of the extra income that it can provide.

I set out to get the recovery truck to start earning its own income. Not reliant on our car sales.

I also could see an opportunity to advertise free collection and delivery on all servicing and repairs.

Hindrances

– Finding a great recovery truck at the right price was a sticking point. Many vehicles out there were rust buckets. Or old transits that someone had ran into the ground. They had ramps on the back and a fixed tail. Basically cheap junk.

Other vehicles were tilt and slides, but they were too expensive, or as explained above, too large for quick jobs. 

– Another challenge was to find work for the truck. There were many insurance companies out there who used independent suppliers to pick up broken down vehicles. Scrap yards and garages also needed recovery trucks. Body-shops. Other breakdown recovery providers also had a list of suppliers they used to keep their yearly paying members on the road.

– When I started searching for work. It was clear as day, that most local body shops and repair garages already had people they used for recovery work. And that they would pay these recovery people barely anything.

– It would be a challenge to get smaller companies to provide us recovery work.

– There were many one man band recovery people operating a truck, illegally or not. This was their sole income, so like a poor person’s mindset, they were striking up work with others and willing to do jobs for bloody nothing. Literally a job that should cost £400 they would do for £100. There is no way these people would ever become successful, but that was the mindset of this market.

– There was competition from other established, professional recovery companies. A lot of them had all the facilities in place. The staff, tools, amount of vehicles to handle jobs. Everything was already there for them to win the game. And to stop others from entering the market.

– If there was a tender available to win from a supplier, it was these bigger more professional recovery companies that would usually win them.

– The profit margins for nearly every single job I researched was terrible. Even from the RAC and GreenFlag. They were especially bad. But these “larger” recovery companies would still happily work for the RAC, because if they didn’t some other person would take up all the work instead. It was an industry full of shark infested waters.

– For a lot of work, suppliers required something called a PAS 43 Certification. PAS 43 is the specification for the safe working of vehicle breakdown and recovery operations. Without this PAS 43, obtaining contracts was difficult. 

– Advertising online was a pain. The major keywords had been taken over by the big boys. Those making millions and millions. It was also super expensive to target the breakdown recovery words because everyone was bidding the words up. Due to the profits they would get back. An average long distance recovery job would be £300. And it would cost maybe £20-£50 to acquire that customer.

– Other keywords were dominated by the RAC et al, they would generate £80 a year on average and their customers would usually last for several years. Thus making them probably £1000 and then some. So it pays them to spend big on advertising. Some customers never leave their breakdown membership for life. 

Actions

– I contacted every single repair garage in the area to see if I could get recovery work from them. Or to get a referral if they didn’t need anything themselves. Just to put my name out there.

– I contacted every single scrapyard in the area and did the same.

– I contacted every single independent and major car dealer in the area and did the same.

– I contacted every single insurance company, breakdown recovery providers like the RAC and their competitors to see if we could get on their list.

– I decided to expand the website and use Google and the internet to find our own independent customers.

– We advertised recovery services in all physical media and in professional industry magazines. We literally tried everything. And tracked the adverts with call tracking. So each piece of advertising would have it’s own unique phone number. So you can see what is working and what isn’t.

– I got in touch with every single other Recovery Company in the UK, the CEO or owner or whatever, to ask them how they did it? How did they get where they are today? The Professional Recovery Magazine gave me the contacts of all of them worth talking to.

Results

– Pure luck was what brought the work in. Luckily I landed a few major contracts. It wasn’t skill at all. Or technique, just pure unadulterated luck.

– I landed a contract with a major chauffeur company to pick up their broken down vehicles and deliver them back to their base. Their fleet were brand new Mercedes vehicles where the electronics would always go wrong. We were there to help them out. They discovered me through the website I made. We would get jobs from these quite regularly and they were happy to pay the proper money.

They were in Birmingham, about 25 miles away, but we would travel all over the country to collect their vehicles. Each job would pay £250-£400. It varied. But they always paid right on the night. Standing there waiting for the vehicle, then boom. We got the card machine out and they ran their purchase through.

– When we were in a petrol station, a bloke working for another recovery company saw our truck. It stood out. We got into a conversation with him. And as he wanted to go home early. He let us handle the job he had for that night. This initial job paid like £600. This contact then would give us jobs on the regular.

– The contact also sold us a whole slew of tools and equipment for a recovery truck. We got them for basically free. It pays to keep your contacts happy. He was just an employee, so any extra money we gave him, he was over the moon with, as he only earned an hourly wage.

– After trying to contact the RAC, GreenFlag, AA and their major rivals. They would not let us on their books unless we had the PAS43 Certification. So that was a waste of time.

– I did manage to luckily convince one company however to get a contract with them. They found me though my website and they had a customer they were desperate to help out. No other provider of theirs could service the customer at 1am. We dealt with the customer promptly, within the hour. This customer came from a company called OneCall Insurance. They had a turnover of over £43 Million. Every week we would get a few jobs per week from them. We did all the work for them in a 20 miles radius.

It was only because of my negotiating tactics and how quick we were to respond that they accepted this deal and started sending us work. The lady thought I was enthusiastic and trusted me.

– Although the RAC would employ recovery companies to help them. Even in busy times those recovery companies didn’t have enough vehicles. So they would sub-contract the work out. Christmas was the best. Every breakdown company was stuck being overloaded with work, so we would swoop in and help them out. Charging 3x the normal price just because you can. They had no other option. They couldn’t afford to lose the RAC contract. 

– Another lucky part was that the person who was trying to flog us his £7000 Renault Midlum recovery truck, knew a person in one of the UK’s largest auction groups. It just happened that this auction place needed a new donkey worker to move their vehicles from Plot A, to Plot B in their storage facility. It required a recovery truck, a spec lift. Mr Renault didn’t have one, he had a huge tilt and slide which was too large.

So we went out to the auction place, it was huge. We saw what it was all about and decided we would try it out for a bit. We were sent an enormous amount of work. By pure chance.

Evaluation

Doing pure breakdown recovery work was not ideal. Rescuing people from the side of a road, at night and in the snow was awful. Sometimes you would be on a motorway or a busy road with a chance some truck can veer right into you.

Luckily we did not get much dangerous road work. If an individual wanted us to come to their aid, we would charge a premium in these circumstances. A stupid amount of money, to get them to go away, but they still paid. 

I learnt that sometimes you get success from being in the right place at the right time. You cannot force anything to happen. It’s a numbers game. Or you just get lucky. If I didn’t buy the truck, make the website, learn how to market, I would never have gotten the attention of any insurance companies to get a contract.

I also learnt that if I see an opportunity, I get a huge buzz knowing I can take it. And I nearly always do take it up if I think it’s an exciting fit. I don’t know why but I can’t help myself. I would rather say I tried, than to never do anything at all and die without success, without ever following your dreams. You regret the things you don’t do more than the things you do.. do.

I also learnt that I can sell people on my ideas, my vision. I also know how to build websites that work and create an online presence that does what you intend it to do.

During this part of my life, I couldn’t believe that the profits of most companies were dire. They had all these expenses but at the end of the day, they were making zilch. The only companies doing any good were the finance and insurance sectors. They were making the big bucks. And that is where I want to be. Not running around like a headless chicken making a bit of money.

The future

This was not my passion so really looking back it was a complete waste of time. I would never touch this industry again. Most companies hardly make anything. Profit margins are too slim. Contracts are too volatile. People under-cutting each other constantly.

In the future I should focus on something I’m truly excited and passionate about.

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