Moving Company Business Overview
The moving industry provides services that help individuals and businesses transport their belongings from one location to another. These businesses help people navigate life changes, such as relocating for work, purchasing a new home, or downsizing.
The most common business models in moving companies include:
- Local Moving Service: Handles moves within the same city or metropolitan area, typically completed within one day
- Long-Distance Moving Service: Manages interstate moves requiring multiple days of travel and specialized equipment
- Commercial Moving Service: Focuses on helping businesses relocate offices, equipment, and inventory
- Full-Service Moving: Provides complete moving solutions, including packing, loading, transport, unloading, and unpacking
Many new moving companies find success by starting small, focusing on local services, and gradually expanding their offerings as demand grows.
Related: Checklist To Start A Business
How Do Moving Companies Make Money?
Moving companies earn their primary income by charging customers to transport their belongings from one location to another. The cost typically depends on factors like distance, volume of items, and labor requirements.
Additional revenue sources for moving companies include:
- Packing Services: Offering professional packing and unpacking services using company-supplied materials
- Storage Solutions: Providing temporary or long-term storage facilities for customers’ belongings between moves
- Supplies Sales: Selling moving boxes, tape, bubble wrap, and other packing materials directly to customers
- Specialty Item Transport: Charging premium rates for moving valuable items like pianos, artwork, or antiques
- Insurance Coverage: Offering additional protection plans beyond basic liability coverage for transported items
Industry Statistics
The moving services industry helps people and businesses transport their belongings during relocation. Under NAICS code 484210 – Used Household and Office Goods Moving, this industry includes companies that provide residential and commercial moving and relocation services. Here are some highlights from the industry data.
Moving Company Industry Size & Growth: The moving services industry generated $23.2 billion in revenue last year. Over the past five years, the industry has grown by 2.4% annually. Growth is projected to continue over the next five years, driven by ongoing demand from residential moves and commercial relocations. (IBISWorld)
Number of Moving Companies: There are 21,892 moving companies operating in the U.S. The industry remains fairly fragmented, with the largest companies controlling relatively small market shares. The top three companies include Arcbest Corporation, Unigroup Inc., and Atlas World Group Inc. Arcbest Corporation leads with $1.56 billion in revenue, while Unigroup follows with $961.4 million in annual revenue. (IBISWorld)
Moving Company Profit Margin: Moving companies typically maintain profit margins of 8.2%. (IRS)
States with Most Moving Companies: The Great Lakes region has a high concentration of moving companies due to its manufacturing base and consistent need for commercial relocations. These businesses serve both residential customers and industrial clients requiring the transport of materials to new facilities. (Bureau of Labor Statistics)
Startup Stories
Costs To Start a Moving Company
Starting a moving company can cost between $50,000 and $250,000, depending on the size of the operation and type of service offered. This range accounts for both small local moving companies and larger operations handling long-distance moves.
There are many expenses involved in starting a moving company, but here are some of the biggest costs:
Trucks and Equipment: Moving trucks is the largest expense, ranging from $30,000 to $100,000 per truck. Used trucks can lower initial costs, but maintenance expenses may be higher. Most companies start with at least one 26-foot box truck suitable for residential moves.
Insurance Coverage: Commercial auto insurance, cargo insurance, and general liability coverage typically cost between $8,000 and $15,000 annually. Insurance rates depend on the number of trucks, types of items transported, and coverage limits selected.
Moving Equipment: Basic equipment including dollies, straps, blankets, ramps, and protective materials costs between $5,000 and $10,000. This equipment allows safe handling and transport of furniture and other items while preventing damage during moves.
Storage Space: The rent for a warehouse or storage facility for equipment and temporary storage services ranges from $2,000 to $5,000 monthly. The size and location of the facility significantly impact the cost.
These costs represent rough estimates for starting a moving company. Actual expenses will vary based on location, scale of operations, and business model chosen.
How profitable is a moving company?
A moving company’s profitability can depend on a range of factors, including the volume of business, operating costs, and service pricing.
To estimate a moving company’s potential profitability, we can make some assumptions based on industry averages. Let’s assume an average moving job costs the customer around $1,000. If a new moving company completes about three jobs per week, that’s approximately $3,000 in revenue per week or $156,000 annually.
Expenses for a moving company can include employee salaries, truck maintenance, fuel, insurance, marketing, and office rent. Assuming these expenses total around $6,000 per month, that’s $72,000 in annual expenses.
Subtracting the expenses from the revenue gives us an estimated gross profit of $84,000 ($156,000 – $72,000). This is a basic estimate; actual profits can vary based on pricing, number of jobs, and specific operating costs.
While profitability is good, maintain a cash buffer for slow times. Peak moving times tend to (but not always) happen more in the summer, as many families don’t want to disrupt the household during the school year.
Staying on top of maintenance is important to keeping a moving company profitable. If a truck breaks down during the peak season, revenue will likely decrease.
Resources: