Apr '24 (edited) • RV Rental Business
Buying RVs using bank financing
Buying RVs using bank financing with a specific business plan is easier than you might think. There are several ways to start going about building a business plan or approaching a bank to finance one RV to rent as a business or a fleet of RVs.
I'll go over how I started, built a business plan and approached a bank for a line of credit to start purchasing more RVs for our fleet. I started with little money and not much credit to my name. The odds of getting a yes after approaching a bank and asking for $1,000,000 to buy a bunch of RVs with no track record of the business model seemed low.
My first few RVs started out with owner financing by approaching owners and asking if they would be interested in that (separate comment on that in this poll's comments. Once I built up a fleet of 3-4 RVs, studied how to operate a rental fleet as much as I could and rented them out for a season I was able to have a profit & loss statement to show for it. Banks like to see a profit & loss statement, balance sheet and plans for the future.
One thing I had on my side is that RVs are assets and unlike asking for working capital, if I was unable to make the business work for any reason I could simply sell the assets (RVs) and the bank would be able to recoup most if not all of their investment. Asking for working capital is much harder because you can't sell expenses you used the money for like you can an asset backed investment.
After a season of positive profit I made sure to organize all my books (I used quickbooks) and began with my business plan using the revenue, expenses and profit from the previous 6 months to cast projections. That's when the business plan comes into play. You will need to plan at least a year ahead and be able to tell a story with your plan.
Start off the story with where you started before you had any RVs. Then lay out what you have done so far. Next lay out what the next year could look like with the banks investment. Your plan will need to be a profitable one. Canva is a great tool to create a business plan with (kind of like Microsoft powerpoint, but more user friendly) Highlight why your business is a good investment and why having asset backed investments will take a lot of the risks out of it.
There is a video I will post in this group soon showing how to buy an RV and assume a lot less risk if you needed to sell it shortly after buying. Like I said, there are many ways to go about creating a business plan and approaching a bank or investors to start building your fleet, but this is how I built mine and secured a 7 figure line of credit.
Times are a different now with ever changing market conditions which makes things more difficult. This is a buyers market though which makes RV prices much cheaper. If this helped let me know in the comments, would be happy to write more.
(photo attached is my first few RVs when starting out parked on a commercial lot I found on Facebook marketplace for $650/month)
1
0 comments
Buying RVs using bank financing
skool.com/sweat-equity-rental-business-4125
You will get topics, tactics, & resources on starting or growing your business and collaborating to achieve growth. Free, without admin restrictions.
Powered by