Want to get started with your very own junk removal business? Sick of grinding away at the old 9-5 rat race and want to choose your own hours, rates, and contracts? This guide will give you some insight on how to start a junk removal business in the United States, with three different approaches and the pros and cons of each.
First and foremost, starting a junk removal business is much like starting up other small businesses. You take all of the risks but stand to gain all of the rewards. There’s no guarantee of success, but you will absolutely fail if you sit on the sofa daydreaming about it but never get started!
Secondly, consider that the junk removal industry in the United States is worth over $10 billion with over 20,000 junk removal firms operating across the nation. Americans throw away nearly 5 lbs of junk every single day, on average. There has perhaps never been a better time to get started in this industry than right now.
Method 1: Start a junk removal franchise
One of the most convenient ways to get started in the junk removal industry is to operate a franchise with one of the bigger, more well-known junk removal companies that operate nationwide.
Junk removal franchises tend to require large investments but come with less risk than starting your own company. And when we say large investment, we’re talking anywhere from around $100,000 – $150,000 just to get started. Oh, and you’ll also need your own box truck as well.
On the plus side, however, being part of a franchise can help out since you don’t need to worry about marketing or lead generation as much – they’ll handle that for you. You’ll also benefit from brand recognition, so it might help you get noticed and bring in more business.
How much does it cost to start a junk removal franchise?
It depends which company you go with to start your franchise, but most of the big national junk removal companies require an initial investment of around $100,000 – $150,000. This typically includes liquid assets and a franchise fee.
Also consider that most franchisees will have to pay around an 8% royalty fee for all jobs. So, if you’re pulling in $50,000 in a year, $4,000 of that is immediately gone.
Risks of starting a junk removal franchise
Many people think that starting a franchise comes with less risk than starting up a junk removal business themselves, and there is some truth to that. You get most of the benefits, such as brand recognition and the ability to easily be found online thanks to the well-known websites and social media profiles of the company you’re franchising under.
The risks, however, should be considered nonetheless. For starters, the large capital investment typically means that you won’t be seeing much (or any) profits during your first year or two. If you’re working by yourself, pulling in $150,000 in one year isn’t very realistic.
Secondly, your franchise is often at the whim of corporate head office. If the company is getting review bombed for bad service or something controversial, well, your franchise may suffer in lost revenue. In other words, you exchange some freedom to run your business as you like and to take advantage of what works in your area.
Is it worth starting a junk removal franchise?
For some people, starting a franchise might be a safer long-term investment that comes with a sense of security. If you’ve got a hundred thousand dollars sitting around and you’re not afraid of seeing any returns for the first couple of years, sure, starting a franchise could be a good idea.
For those that want to make the most out of their junk removal company and have full ownership, it’s often better to go all the way and start your own junk removal company yourself.
Method 2: Work for a junk removal company
Now, this method isn’t exactly starting your own junk removal company at all, but it’s still a good option if you want to build up a little experience in the industry and make a few bucks while you’re at it.
If you can’t beat ‘em, join ‘em!
Working for a junk removal company near you, whether it be a small local team, one of the big national junk removal companies, or simply working for your municipal sanitation department (which is a little different since it’s mostly trash and garbage hauling), you can at least build up a bit of experience and find out if working in this industry is right for you.
After all, why start a business doing something you find dull and boring?
Risks of working for a junk removal company
As with all employment, the risks are that you do all of the work in exchange for a paycheck. You’re not in control, you can’t negotiate contracts, pick your own hours, or do things your way.
Is it worth working for a junk removal company?
According to the Bureau of Labor Statistics, the closest NAICS industry to junk removal, Waste Management and Remediation Services: NAICS 562, had average hourly earnings of $26.60 with an average of 41.2 hours of work per week for nonsupervisory employees in October 2021.
Just to give a rough estimate of possible earnings, that’s an average of around $1,095.92 per week, or $2,191.84 per bi-weekly paycheck before taxes. Depending on where you live in the USA, that could be pretty darned good or it might not be enough to get by.
Is it worth it to work for a junk removal company? Well, if you plan to start your own business it is definitely a good way to cut your teeth a little and to get to know some of the ins and outs of the industry.
Method 3: Start your own junk removal company
So you want to start your own junk removal company? When you go down this route, the sky’s the limit in terms of earnings potential and freedom to do things the way you want. Some junk removal startups can pull in $1,000 – $2,000 on a good day, others might struggle to get even a single call for a job on a bad day.
How much does it cost to start a junk removal company?
If you want to start your own junk removal company, here’s what you’ll need:
- Business name: what’s your company going to be called? Most small junk removal businesses use “Junk-something” and while it doesn’t need to be flashy, it sure as heck is effective. It needs to tell the customer pretty clearly what you do without having to think too much about it. Cost: free!
- Box truck: you absolutely need an adequate vehicle to haul away junk, but it doesn’t need to be a big, expensive dump truck or a box truck right away. You can get started with just a pickup truck, but eventually you’ll probably want to upgrade to a 5-ton pickup, a hydraulic truck, or something bigger if you need. Think about your truck seriously, because a bigger truck can haul away more junk and you can also charge higher premiums for jobs since you can perform a house cleanout or office cleanout in fewer trips. Cost: a few thousand for a pickup truck up to $30,000+ for a bigger box truck.
- Business License: getting a business license is required for any legitimate junk hauling company, but it’s not as big of a hassle as many make it out to be. Depending on your city or state, the process is pretty affordable and not too time-consuming. Cost: around $50 – $400.
- Insurance: although insurance is not absolutely necessary, it is highly recommended for junk removal businesses since a lot of things might go wrong. Knocking over an antique vase in a customer’s home by accident, or causing damage to a home when moving out heavy furniture are all possibilities. There were 73 workplace fatalities in 2020, and even one is too high a number. Get insured and get protection. Cost: around $500 – $1,000 per year.
- Personal protective equipment: every junk hauler needs proper personal protective and safety equipment, but depending on what you specialize in you might need more. Generally, you should set aside a budget for rugged work gloves, N95 masks, straps and bungee cords, and some good dollies to get in and out of peoples’ homes. You should also have tools on hand for basic disassembly of furniture and appliances that can’t fit out the door, like hot tubs, pool tables, dinner tables, trampolines, etc. Cost: varies – budget around $1,000 for PPE and supplies.
- Business marketing: last and certainly not least, business marketing is essential. You could have the best hustle and muscle for the job, a spiffy new truck, and all the time in the world to get started but you won’t get anywhere if nobody knows your business even exists! For startup businesses, marketing can be a real hassle. Getting your name out can start with letting friends and family know, passing out flyers at laundromats, community centers, local gyms and restaurants, etc. That might bring in some business, but to really get noticed these days you must have a great website and social media profile. If you don’t have experience or the time to learn web development or manage a social media profile, you’re already at a disadvantage. Cost: varies from free to potentially thousands of dollars.
Risks of starting a junk removal company
As with all small businesses, you stand to gain all of the benefits but also put in all of the risk. You won’t have a stable income, at least in the beginning, like an employee does, so some months you might pull in $10,000 while others you might struggle to make $2,000.
Moreover, as the owner of a junk removal company you now have the responsibility of maintenance and upkeep of your vehicle, taxes, accounting, hiring (if you need employees), negotiating contracts, and much more.
The good news is that you don’t need a business degree to get started (although that might help). These days there are plenty of tools out there to help you with scheduling and accounting, or you can always hire an accountant to look after the finances for you.
The biggest risk for many junk removal companies, however, is that they simply lack the marketing muscle of the big competitors. Some of the big names (you know who they are) can easily drop $200,000 on digital marketing, pull out fancy television ads, and so on. How can you compete with them?
Is it worth starting a junk removal company?
In 2022, junk removal is a thriving industry in the United States with no signs of slowing down. The business income potential is huge, and there has perhaps never been a better time to get started than right now.
If you’ve had enough of the daily grind and want to make like Fleetwood Mac and “go your own way” then start a junk removal company today. Not a lot of people these days want to get their hands dirty and work in the trades or haul away junk from peoples’ homes – it isn’t glamorous, but someone’s gotta do it!
How to maximise your revenue with junk removal services
How hard is it to get started in the junk removal industry with your own company? The first few steps above are fairly straightforward and it’s relatively easy to get your license, insurance, a pickup truck, and your safety equipment. But how do you get jobs?
This is a big problem for a lot of junk removal startups. If you don’t spend any time on marketing, you won’t be getting any business (except for some sympathetic friends or family, perhaps). If you spend too much time on marketing, that’s time you should be spending on junk removal.
In terms of cost, there are two routes to go down: pay nothing or pay a lot. Free marketing is often great, like word of mouth, but also consider listing yourself on business directories, create a Google My Business account, Yelp, etc.
But if you really want to bring in plenty of leads, you’ll want to have your own website and social media presence. Attracting people to your website requires digital marketing, which for many businesses happens through Google Adwords and pay-per-click advertising, plus you’ll have to either make the website yourself or pay hundreds or thousands of dollars to a team to do it for you.
The good news is that there is a better way. You don’t need to spend thousands upon thousands of dollars to start your own local junk removal franchise. With JunkGator, a small nominal subscription fee gets you quality leads for work in your area, anywhere across the United States.
Start using JunkGator today
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