ATV Rental Business Plan [Sample Template]

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Are you about starting an ATV rental company? If YES, here is a complete sample ATV rental business plan template & feasibility report you can use for FREE.

Okay, so we have considered all the requirements for starting an ATV rental business. We also took it further by analyzing and drafting a sample ATV rental business marketing plan template backed up by actionable guerrilla marketing ideas for ATV rental businesses. So let’s proceed to the business planning section.

Why Start an ATV Rental Business?

Starting and managing an all-terrain vehicle rental business is a way to share your outdoor enthusiasm and also encourage others to enjoy off-road adventures. Your target market may include families, outdoor adventurers, contractors or scientists who want to use the machines to reach remote areas.

One of the decisions you have to make when starting this business is the choice of location. A suitable location for this business is usually off-road areas or back country recreational locations where the machines are allowed. You have to check with the state or federal agency that manages the area to know what permits or licenses you will need to operate.

Also, you need a front office for meeting customers and a garage from which you can fix broken down vehicles if you choose to repair them on-site rather than sending them to a nearby mechanic. You also need a covered vehicle storage area.

You should also consider offering customers insurance for a fee that covers damage to or collision with your vehicles. Take your time to explain the needed deductible before the insurance kicks in. You can also fold the cost of the insurance into the rental fee, although you still need to explain to each renter what is covered.

If a customer claims to have ATV coverage, ask for a copy of his policy to confirm it also covers rentals. You may also want to offer collision waiver damage for a fee that keeps the customer’s insurance company from going after them for damages.

But in a situation where a customer refuses optional insurance, ask them to sign liability waivers to protect your business in the event the customer is injured.

You need to understand that the most expensive aspect of this business is purchasing your ATVs. It’s advisable you go for used ATVs in prime condition to save money. You can begin with just a few, gauge the response to your business, and add on more machines as the business grows.

You can also provide training on how to drive the machines and proper off-road etiquette to keep damage to trails to a minimum.

To get the ATVs to the site, you can either rent transportation equipment to the customer or deliver the equipment yourself. Renting trailers and hitches for an additional cost means you need to show customers how to secure, then load and unload the equipment.

It’s very important to state that most rentals are based on time rented and the type of ATV, with fully loaded, more powerful machines renting for more. Refundable deposits are another fee to determine in case the renter does not return the vehicle or they cause damage.

Take your time to develop a rental schedule, such as by the hour, half or full day, or multiple days for renters who head for distant trails.

If you provide or rent helmets, gloves or goggles, add these costs into your rental pricing structure or charge for them separately. To promote your ATV rental business, align with local tourism boards or chambers of commerce to get word of your rentals to tourists and workers in the area.

Consider creating a website with keywords relating to outdoor recreational opportunities in your area. Get involved on forums catering to four-wheeling enthusiasts.

A Sample ATV Rental Business Plan Template

1. Industry Overview

Report has it that the rising penetration of recreational activities and sports across the globe will ginger up the all-terrain vehicle market size from 2017-2024. Advancements in infotainment system offer superior entertainment and user-friendly experience with GPS tracking, Bluetooth connectivity and mobile tracking facilities, thereby, enhancing driving experience.

Note that the growing technical development in quad bikes with upgraded performance and efficiency will without doubt boost all-terrain vehicle market size from 2017 to 2024. It is believed that large array of technologies coupled with independent suspensions, electric start and shaft drives provides enthusiasts with great riding exposure.

Innovative infotainment systems keep the drivers informed, up-to-date, connected and entertained. But have it in mind that the reduction in component manufacturing cost will minimize the overall product price and, thereby improving product sales.

Industry experts endorse and regulate precise usage of these products with safety helmets, seatbelts and footrest arrangements. Regulatory guidelines regarding number of passengers permitted per vehicle and limitations for children below 16 years are just a few protocols directed to reduce fatalities and injuries.

According to industry statistics, profit margins in the overall all-terrain vehicle market are promising due to lower substitute availability. It is believed that technological expansions have led to competent product performance and ease in driving and thereby enhancing profit margins for several OEMs.

Manufacturers gross profit margin ranges from 30%-35% while distributors’ margin varies from 15% to 20%. The net profit margin is a very important factor that shapes the scope of each industry players including manufacturers, component suppliers, retailers and online distributors.

Also note that growing emphasis of industry participants on developing environmentally friendly versions to eliminate excessive sound will propel all-terrain vehicle market share.

Report has it that the advent of hybrid models including hybrid diesels will have positive impacts due to their extremely fuel-efficient engines and minimal emissions. Also, development of lightweight and efficient models for their implementation in military and defence sectors for effective combat supplies movement is projected to fuel industry growth.

But then growing negative environmental impacts on soil and vegetation negatively impacts industry share. Shear forces of motorized quad bikes develop gullies and mud holes that alter hydrologic patterns and intensify erosion. Adverse effects of these quad bikes on environment may lead to prohibition of their usage in affected areas and may further affect the growth of the all-terrain vehicle market.

2. Executive Summary

UC Rides is an exciting and profitable new business in Davis, California that will rent utility ATV’s to Agricultural and Resource Economics students of the University of California, Davis, as well as anyone who would have a need for efficient ATV’s.

There is currently no business like this in Davis, which caters to this market. Utility ATVs are the most popular type of ATV. This type of ATV typically has short travel suspension, a big motor and more accessories designed for working or hunting.

Utility ATVs are used in industries such as agriculture and ranching where repair work, feeding and other tasks are done. They are also very popular with hunters who traverse rugged terrain, often carrying heavy cargo. There are thousands of agricultural students in UC Davis that need ATV’s to visit and attend to their farm works.

Most of these students do not have the disposable income to purchase an ATV, but they are in a position to pay $100 per month to rent one. The University of California, Davis (UC Davis) boasts of 104 undergraduate majors and 96 graduate programs.

It has a Department of Viticulture and Enology (concerning the scientific study of grape-growing and winemaking) that has been and continues to be responsible for significant advancements in winemaking utilized by many Californians wineries. Note that this campus is noted for its top-rated Agricultural and Resource Economics programs

Students of Environmental Horticulture and other botanical sciences have many acres of campus farmland and the University of California, Davis, Arboretum at their disposal. It is indeed a daunting task to walk to these farms and facilities, the more reason we at UC Rides are providing students with ATV’s to make their journey and quest for knowledge easier.

In year one, we would attempt to get 15% of all agricultural and resource economics students. This would equate to over 250 ATV’s rented. We expect the five year growth rate to be at least 55%. Assuming an average purchase price of $950, and a ten month rental contract at $100 per month, it is possible for UC Rides to be profitable in year two.

3. Our Products and Services

Our main service at UC Rides will be to rent ATVs on a monthly basis. In addition to this, our secondary services will include ATV trainings and accessories. We will also rent out ATVs to university authorities for land survey and management and security patrol.

We at UC Rides plan to expand into the electric vehicle market in the future if it becomes a feasible transportation alternative. We believe that this will be positive for us because we already will have an established customer base who is interested in low cost or environment friendly transportation alternatives.

According to our extensive research, there are currently no other competitors in this market. The only competition that we expect will be from university transportation and automobiles. This is a separate segment and does not offer the freedom and price flexibility that we at UC Rides offer.

4. Our Mission and Vision Statement

Our vision at UC Rides is to provide our clients with ATVs that will make their daily commute easy and productive.
Our mission is to create a platform for our clients to be able to rent quality means of transportation at a fair price. We plan to establish a profitable business which will treat employees fairly and provide financially for its owners.

Our Business Structure

The official name of this company will be University of California Rides, Incorporated. This exciting business will be formed as an S corporation, due to its tax advantages and ability to reduce liability. UC Rides will be located in Davis, California.

This location is ideal because of its close proximity to the University of California. If UC Rides is successful, which we believe that it will be, we hope to open others at various other university towns. Below are detailed professionals we plan to employ to achieve our business visions and goals.

Company President
Garage Manager
Human Resources and Admin Manager
Sales and Marketing Manager
Mechanics
Accountants/Cashiers
Maintenance and Secretarial staff
Cleaners

5. Job Roles and Responsibilities

Company President

Boosts management’s effectiveness by recruiting, selecting, orienting, training, coaching, counselling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results;
In charge of fixing prices and signing business deals
In charge of providing direction for the business
Establishes, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
Charged with signing checks and documents on behalf of the company
Evaluates the success of the organization

Garage Manager

In charge of managing the daily activities in the ATV garage
Ensures that proper records of ATVs are kept
Ensures that the garage facility is in top shape and ATVs are properly arranged and easy to locate
Controls distribution and supply chain inventory

Admin and HR Manager

Tasked with maintaining office supplies by checking stocks; placing and expediting orders; evaluating new products.
Makes sure operation of equipment by completing preventive maintenance requirements; calling for repairs.
Defining job positions for recruitment and managing interviewing process
Carrying out staff induction for new team members
In charge of training, evaluation and assessment of employees
In charge of arranging travel, meetings and appointments
Oversee the smooth running of the daily office cum business activities

Sales and Marketing Manager

In charge of external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
Models demographic information and analyse the volumes of transactional data generated by customer purchases
Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
Identifies development opportunities; follows up on development leads and contacts
Documents all customer contact and information
Represents the company in strategic meetings
Helps to increase sales and growth for the company

Mechanics

Find out mechanical problems, often by using computerized diagnostic equipment
Test parts and systems to ensure that they are working properly
Repair or replace worn parts
Disassemble and reassemble parts
Use testing equipment to ensure that repairs and maintenance are effective
Adhere to checklists to ensure that all critical parts are examined
Do basic ATV checkup and maintenance, including changing oil, giving tune-ups, checking fluid levels, and rotating tires

Accountant/Cashier

In charge of preparing financial reports, budgets, and financial statements for the organization
Provides managements with financial analyses, development budgets, and accounting reports
In charge of financial forecasting and risks analysis
Performs cash management, general ledger accounting, and financial reporting
Tasked with developing and managing financial systems and policies
Tasked with administering payrolls
Ensuring compliance with taxation legislation
Handles all financial transactions for the organization
Serves as internal auditor for the organization

Maintenance and secretarial staff

Makes sure that all contacts with clients (e-mail, walk-In centre, SMS or phone) provides the client with a personalized customer service experience of the highest level
Through interaction with customers on the phone, uses every opportunity to build client’s interest in the company’s products and services
Manages administrative duties assigned by the human resources and admin manager in an effective and timely manner
Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to customers when they make enquiries

Cleaners

Tasked with cleaning and washing all the ATVs in the garage at all times
Ensures that toiletries and supplies don’t run out of stock
Cleans both the interior and exterior of the garage facility
Handles any other duty as assigned by the garage manager

6. SWOT Analysis

Our key objectives at UC Rides is to rent 250 ATV units in year one and to establish a self-sufficient and profitable company by year three. We hope to rent at least 400 units by year three and 750 units by year five (15% annual growth rate). We are not making all these assumptions verbally without plans to reach them.

We have analysed our industry and we are prepared to achieve all our business goals and still expand to other viable markets. To further emphasis on our findings and market opportunities, below is a summary of what they believe are our strengths, weakness, opportunity and threats in this industry.

Strength

According to our SWOT analysis, our strength in this business lies on the excellent customer service and value we plan to establish at UC Rides. We plan to attract clients and gain substantial market share by providing affordable rental prices and reaching our target market.

We also plan to bring a whole new vibe into the rental industry by serving our customers with integrity and timeliness; resulting in repeat purchase.

Weakness

According to our swot analysis, our major weakness is simply the time it will take us to convince UC Davis students of the benefits of using our services. Although we have no available competition in all of Davis, it still makes our business foreign to the agricultural and resource economics students of UC Davis.

Opportunities

UC Davis is a public research university and land-grant university adjacent to Davis, California. It is part of the University of California (UC) system and has the third-largest enrollment in the UC System after UCLA and UC Berkeley.

The institution has been labelled one of the “Public Ivies”, a publicly funded university considered to provide quality of education comparable to those of the Ivy League. The South side of the campus core boost of the 100-acre UC Davis Arboretum, which includes 3.5 miles of paved paths, vast farm lands, 4,000 tree specimens, Putah Creek and Lake Spafford, which are meant to be accessed by students.

Threat

One of the major setbacks we are going to face at UC Rides will be the rigorous processes of setting this business in Davis and the level of acceptance UC Davis school authority will be willing to give. Another threat we might face will be the arrival of a new ATV Rental outlet in the same location where ours is located and even online.

7. MARKET ANALYSIS

Market Trend

According to industry data, the utility segment in all-terrain vehicle market is expected to be valued at over USD 3 billion by 2024 because of the growing utilization of these products particularly in military & special forces, agriculture and forestry.

Several manufacturers have developed numerous models to cater to increasing product demand from various applications. Report has it that sports ATV demand was around 180 thousand units in 2016 and will gather a CAGR of more than 4% over the forecast period.

This can be attributed to its growing usage for recreational purposes because of the increasing number of recreational parks and outdoor facilities providing adventurous driving activities. Advancements in drive system with high durability and superior performance for difficult trails are prime factors for increasing penetration.

Also note that the youth segment of this industry accounted for over 13% of overall all-terrain vehicle (ATV) market size in 2016. This segment growth is attributed to the growing product demand from all age groups and manufacturers focusing on providing vehicles for various sporting events focusing on kids and adults.

Sports application is expected to hold approximately 26% of the volume share and will witness a CAGR of over 5% by 2024 due to shifting consumer preference for recreational and adventurous sports backed by rising disposable income.

Militarized quad bikes pose high growth rate as they can be easily transported inside numerous aircrafts including Boeing’s MH-47, special operations helicopters, Bell Boeing, and Sikorsky’s. They offer ground troops with mission flexible modular design, improved mobility, folding roll cage, greater payload and responsiveness.

Full armoured quad bikes are used to provide protection from attacks. Furthermore, increasing military investments for specialized automotive by several countries will support all-terrain vehicle market penetration.

Report has it that North America accounts for over 50% of the all-terrain vehicle market volume share due to shifting trend toward extensive usage in several areas including agricultural lands, forestry and mountains. Rising adoption of off-road and recreational activities will positively impact the industry expansion.

Numerous snowmobile associations and clubs across the region conduct sports events yearly, leading to increased sales of these quad bikes and thereby propelling industry size during the forecast timeframe.

Asia Pacific all-terrain vehicle market registered over USD 730 million in 2016, due to increasing demand from military & defence and entertainment sectors. Also rising defence expenditure and increasing purchasing power parity is expected to positively support product penetration.

The proliferating demand from various emerging economies including india and China will significantly contribute toward enhanced revenue generation.

8. Our Target Market

Our target market is made up of university students. Since a majority live close at the northwest end of campus which holds the majority of the Segundo undergraduate housing complex, and various alternative housing sites, such as Orchard Park, Russell Park, The Colleges at LaRue Apartments, and Primero Grove, our ATV’s will be in a good option for them to get to the Arboretum in the South side of the campus.

We also anticipate getting a small amount of customers that are outside of the university students segment. These customers would be other farmers in Davis or even school authorities that will want our ATV’s for security patrol and land survey and management.

We expect our market to grow in two ways. First, it will grow as gas prices continue to increase. This will make the cost of driving an automobile even more expensive. Second, as the number of students increases, so will the target market and the number of students who are interested in our product.

Our competitive advantage

UC Rides will rent ATVs to University of California agricultural and Resource Economics students, as well as others who would have a need. From our research, there is currently no business like this in California that caters to this market. In UC Davis it is possible for a student to have their own mode of transportation that is fairly inexpensive.

Our target market at UC Rides would be the approximately 100,000 full-time UC Davis students. There are thousands of agricultural students who move daily from their lodges to UC Davis vast farmlands and forestry. This is where our ATVs come into play.

Many students do not have the disposable income that it takes to purchase an ATV can pay $100 per month to rent. Assuming an average purchase price of $950, and a ten month rental at $100 per month, it is possible for UC Rides to be profitable by year two.

9. SALES AND MARKETING STRATEGY

Source of income

UC Rides is expected to grow in sales at a rate of 15% per month, starting from the conservative estimate of 25 ATVs rented. Note that this financing will come initially from the executive board, giving room for credit to cover unforeseen expenses, if necessary.

Growth will be rapid and produce profits almost immediately. We plan to earn income by renting ATVs to the students of UC Davis, school authorities and various farmers in the area.

10. Sales Forecast

Our personnel assumptions at UC Rides are based on our employees working 40 hours per week at averagely $7.00 per hour. The mechanic will work approximately 20 hours per week at $15.00 per hour. But as the number of ATV rentals increase, the mechanics weekly hours will increase.

Our owner, William Brentwood, will also fill in and oversee the business. Note that the owner’s salaries with not be drawn until the business is profitable and all investments have been paid back in full. We at UC Rides believe there will be variation in monthly sales forecasts, but we expect to reach 250 units in the first school year.

Marketing and Sales strategy

We at UC Rides plan to make use of knowledgeable salespeople to assist any customers who have doubts regarding renting an ATV. We plan to make sure the sales staff know the benefits of using an ATV and can explain this to the potential customer.

Some customers will worry about the safety and whether or not they can ride an ATV with no experience. We will service this customer with safety and instructional classes.

Our main marketing strategy at UC Rides will be to make potential customers aware of us via campus publications. We plan to advertise in such things as the student-run freeform radio station, KDVS, UC Davis Student phone book, Greek directory and in the Coffee House known as the CoHo that serves over 7000 customers daily in UC Davis.

Our method of distribution would be to rent ATV’s directly out of the shop. In order for UC Rides to reach both the three and five year goals, one of the things that must happen is to get the idea of an ATV accepted as a means of transportation.

11. Publicity and Advertising Strategy

We believe that our business will be successful only if our target market knows about us and how affordable an ATV rental can be. We have made plans to advertise in the student-run radio and in Unitrans, the student-run bus system.

Another good source of advertising which is also relatively inexpensive would be in the Greek Directory. We would also try, at some point, some promotions such as free ATV rental contests and free safety courses. Below is how we plan to promote UC Rides to the whole of California;

Put adverts on community based newspapers, radio and TV stations
Encourage the use of word of mouth publicity from our loyal customers
Make use of the internet and social media platforms like YouTube, Instagram, Facebook, Twitter, LinkedIn, Snapchat, Google+ and other platforms to promote our business.
Make sure we position our banners and billboards in strategic positions all around Davis.
Share our fliers and handbills in target areas in and around Davis, California.
Advertise our used ATV rental business in our official website and employ strategies that will help us pull traffic to the site
Brand all our official ATVs and trucks and ensure that all our staff members wear our branded shirt or cap at regular intervals.

12. Our Pricing Strategy

Our main service at UC Rides will be to rent ATVs on a monthly basis. Our secondary services will include ATV trainings and accessories. We will also rent out ATVs to university authorities for land survey and management and security patrol.

We plan to price our products at a level that is affordable for the student and that provides financial sustenance for the company and its owners. Our ATVs will be priced at a rate of $100.00 per month. A discount will be offered to those who sign up for a school year lease (10 months). The accessories will be offered above cost, but at a reasonable level.

Payment Options

We at UC Rides plan to make our services available in a convenient manner to our potential clients. UC Rides will maintain extended hours and meet with clients in their hostels and campuses, whichever is more convenient. ATV buyers can contact UC Rides by telephone, fax, social media platform and e-mail.

We also expect a 15% mark up over ATV obtained from dealer auctions and fleet companies. The rental industry norm for the leasing portion of the business is 10%.

We have also partnered and registered with the necessary financial institutions in the country and we hope to make use of that relationship. Our bank account numbers will be made available on our website and promotional materials so that it will be easier for clients to make payments when necessary.

Payment by via bank transfer
Payment via online bank transfer
Payment through point of service machines
Payment via check
Payment via mobile money
Payment with cash

13. Startup Expenditure (Budget)

UC Rides will rent ATVs to University of California agricultural and Resource Economics students, as well as others who would have a need for it. From our research, there is currently no business like this in California that caters to this market.

Our key objectives at UC Rides is to rent 250 ATV units in year one and to establish a fully self-sufficient and profitable company by year three. We hope to rent at least 400 units by year three and 750 units by year five (15% annual growth rate).

We are conversant with happenings in the industry and we are prepared to leverage opportunities made available to us in the market. We have analysed our industry and we are prepared to achieve all our business goals and still expand to other viable markets. Outlined below are the ways we plan spending our start-up cost;

The Total Fee for Registering the Business in Davis: $600.
The budget for insurance, permits and license: $20,000
The Amount needed to acquire a suitable Facility for 6 months in Davis, California (face lifting of the facility inclusive): $75,000.
The Cost for the purchase of furniture and gadgets (fridges, TVs, Sound System, tables and chairs et al): $20,000.
The Cost for Equipment: $15,000
The Cost for inventory : $2,000,000
The Cost of Launching a Website: $700
Our marketing and publicity budget – $150,000
Additional Expenditure (Business cards , Signage, Adverts and Promotions et al): $7,000

From our detailed analysis above, we will need approximately $2,500,000 to start UC Rides. We have also put plans in place to raise the funds and capital.

Generating Funding/Start up for UC Rides

UC Rides will be funded by William Brentwood. The majority of the funding will come from private savings and local investors, plus loans backed by starting assets. The cost of starting UC Rides including inventory, legal expenses, and advertising, is approximately $2,500,000. We anticipate that this company will start generating immediate cash flow.

Generate part of the startup capital from personal savings and local investors
Generate part of the startup capital from friends and other extended family members
Generate part of the capital from the bank (loan facility).

Note: we have been able to raise $1,500,000 ($500,000 from personal savings, $800,000 from local investors and $200,000 from friends and family as soft loan), and we are at the final stages of obtaining a loan facility of $1,000,000. We have verified all the necessary procedures to actualize or get our startup fund.

14. Sustainability and Expansion Strategy

Indeed ATVs provide an excellent way for people to enjoy the outdoors and explore local areas while communing with nature.

We plan to bring this new vibe and enthusiasm into the UC Davis area, while providing students with a better means of transportation to farms and rugged areas. We took our time to research our market around the area and we understand the kind of demand for ATVs in the area.

The University of California, Davis (UC Davis) boasts of 104 undergraduate majors and 96 graduate programs. This university is noted for its top-rated Agricultural and Resource Economics programs and the large Department of Animal Science through which students can study at the university’s own on-campus dairy, meat-processing plant, equestrian facility, and experimental farm.

Students of Environmental Horticulture and other botanical sciences have many acres of campus farmland and the University of California, Davis, Arboretum at their disposal. Our plan is to focus squarely on these students and expand by providing better transport options for them.

We have taken our time to talk to other rental business owners and take note of their tips and suggestions. We have made arrangements to purchase the right types of ATVs and other protective gear. We have also visited some local manufacturers and informed them of our plans to open an ATV rental business. We have compared different manufacturer’s prices and services and we’ve settled for one that best suits our goals.

Although finding insurance can prove tough, we’ve hired the services of a lawyer to help us draw up release forms for our customers. We plan to always ensure the safety of all customers in order to protect our business from a variety of injuries.

Aside from having staff with great customer service skills, we plan to make sure our mechanic is always around to assist in the operation of the business.

We’ve also developed a functioning operating system to help us grow our business. This includes an excellent pricing system, our number of hours of operation and a maintenance schedule for the ATVs. We also understand that advertising and promotions is an important aspect of business.

We have established a marketing plan we know will work for our business and we’ve aligned with relevant businesses in and around the school campuses to help us reach our desired height.

Checklist/Milestone

Business Name Availability Check: Completed
Business Incorporation: Completed
Opening of Corporate Bank Accounts: Completed
Opening Online Payment Platforms: Completed
Application and Obtaining Tax Payer’s ID: In Progress
Application for business license and permit: Completed
Purchase of Insurance for the Business: Completed
Conducting feasibility studies: Completed
Leasing, renovating and equipping our facility: Completed
Generating part of the startup capital from the founder: Completed
Applications for Loan from our Bankers: In Progress
Writing of Business Plan: Completed
Drafting of Employee’s Handbook: Completed
Drafting of Contract Documents: In Progress
Design of The Company’s Logo: Completed
Printing of Promotional Materials: Completed
Recruitment of employees: In Progress
Purchase of the Needed software applications, furniture, office equipment, electronic appliances and facility facelift: In progress
Creating Official Website for the Company: In Progress
Creating Awareness for the business (Business PR): In Progress
Health and Safety and Fire Safety Arrangement: In Progress
Establishing business relationship with banks, financial lending institutions, vendors and key players in the industry: In Progress