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How to Start a Car Wrapping Business in 6 Simple Steps [2023 Update]

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The vehicle wrap industry will reportedly grow by 22.5% between 2023 and 2030, so it’s no wonder more people are considering getting into the business.

There’s also the fact that its profit margin is extensive; you can earn $10,000–$50,000 of profit a month, depending on your business model and services.

The thought of starting such a business is stressing you out, isn’t it?

You may be tempted to ditch your idea and start another conventional business, but we won’t let that happen!

If you don’t know how to start a car wrapping business, here’s the only guide you need.

How Profitable is Owning a Car Wrapping Business?

We’d say owning a car wrap business is pretty profitable.

The average profit margin of such a business is 30%, which is more than what you’d expect from a small business.

Since the average price of wrapping a single car is $2500–$3000, you can earn a total of $143,000 annually if you wrap only one car per week, which gives you $42,900 in profit.

Suppose you start wrapping two cars per week for $3000 each, you’ll earn an annual profit of more than $100k, and that’s without unleashing the full potential of the business.

If you offer more elite services and start wrapping more cars per week, you can jump-start your annual profit into $150,000–$200,000.

According to industry analysis, the vehicle wrapping business is expected to reach a whopping size of $5.81 billion during 2023, so these numbers aren’t far from reality.

However, we can’t guarantee such a profit. In the end, it depends on your target market, location, and offered services.

What You’ll Need to Start a Car Wrapping Business [& Associated Costs]

You’ll have to allocate a hefty budget for your car wrapping business. Though it’s a highly profitable field, it has a large startup cost.

Here’s everything you’ll need to start your business, along with how much it’ll cost you.

  • Wrapping equipment: The equipment you’ll need to start wrapping cars includes printers, laminators, etc. These will cost you $3000–$6000, depending on the types.
  • Wrapping materials: You’ll need to buy a large amount of vinyl wrap and printing materials to kickstart your business. These will cost you $3000–$10,000, depending on the amount and size of vehicles you intend to wrap.
  • Labor: To build your team, you’ll have to pay labor wages of $15–$40 per hour. You can calculate the total cost depending on how many men you need for the job.
  • Insurance: With a business dealing mainly with cars, you’ll need liability insurance, which will cost you $500–$2000 annually.
  • Licenses and permits: There are a couple of licenses you need to start a car wrapping business, but don’t worry. They’ll only cost you $100–$300 on average.
  • Garage: If you don’t own a suitable space for your business, you’ll have to rent a garage. It can cost you $3000–$5000 or more annually, depending on how much space you need.

Do I Need a License or Certificates to Start a Car Wrapping Business?

Yes, starting a car wrapping business demands a number of licenses.

They can differ according to your state, so you’ll have to check, but these are the general licenses and permits you’ll need to start:

  • A doing-business-as or DBA license
  • Employer Identification Number for taxes registration
  • OSHA health licenses
  • Intellectual property rights

Why You Should Consider Starting a Car Wrapping Business As a Side Hustle

A car wrapping business offers a high return on investment, and it’s relatively easy to find your target audience and sell them your product.

Here’s why you should consider it:

  • High return on investment: It’s true that this business requires a large startup cost, but it also has a high potential ROI. Customers are willing to pay large sums to get their cars wrapped, and your profits can shoot through the roof if you decide to target luxury cars.
  • High demand: There’s a current high demand for car wrapping because it protects the paint and gives the car a trendy look. Entering into a highly-demanded business makes it easier to advertise for it and start working.
  • Scalability: A car wrapping business is relatively easy to grow when there’s increased demand, which makes for better profit margins.
  • Easy to advertise: Advertising for a car wrapping business isn’t as challenging as other businesses because buyers make the decision on impulse. With some low costs, you can easily advertise on your car wrapping business.

How to Start a Car Wrapping Business in 6 Simple Steps

vector graphic showing an illustration of how to start a car wrapping business

Now that you’ve decided to take things seriously and start your business, here’s a step-by-step guide to starting it:

Step 1: Do Your Market Research

Doing market research means checking car wrapping businesses in your state and taking note of their price points, services, type of wrap they use, etc.

You’ll want to see what the market is lacking, so you can fill the gap with your business.

The next step is identifying your market.

Do you want to target passenger cars only?

Or are you willing to target small businesses to wrap their vans, trucks, etc?

After doing so, you can start determining your services accordingly.

Step 2: Determine Your Services

Some car wrapping facilities offer only single-color wraps and transparent protective wraps. Others offer bold colorful wrapping and advertisements.

Depending on the market you chose to target earlier, you’ll have to determine what services you’re willing to offer.

Step 3: Plan Your Business Model

Your business model is like the manual you’ll follow from the moment you start planning to the moment you launch your business.

It should include your key goals, funding methods, services and products, UPS, and competitive analysis.

It should also have an overview of your business’s operational plans, like labor count and logistical details.

Think of it this way: if you ever need an investor for your business, your business plan should tell him everything he needs to know.

Step 4: Choose the Business’s Legal Structure

The legal structure of your business will determine how you pay your taxes and what paperwork you need to register the business.

It’ll also determine your personal liability.

Here’s a brief overview of the main legal structures to choose from:

  • Sole proprietorship: The easiest legal structure to follow; it dictates that the owner receives all profit, but is also 100% responsible for liabilities.
  • Limited liability company: This structure exists separately from its owners, and they bear no personal liability.
  • Partnership: Same as a sole proprietorship, but with two or more owners.
  • Corporate: This structure consists of shareholders and board members, and the owners bear no personal liability.

Step 5: Choose the Location and Business Name

Do you have a garage suitable for a car wrapping business, or will you have to rent a suitable space?

Start weighing your options and choose a space large enough to hold more than one car if you intend to grow your business.

Aside from the location, you also need to choose a name for your new business. Choose a name that’s memorable and concise.

At the same time, it should include keywords of your business, like ‘automobile wrapping.’

Keep in mind that you’ll have to choose a name available for registration. You can check that through the USPTO website.

Step 6: Secure the Paperwork

Now that you created your plan, chosen your business structure, and created your brand identity, it’s time to start securing the paperwork.

Start by registering your business and getting an EIN for taxes registration. Then, start working on the necessary licenses and permits.

If you need a bank loan or a government grant to fund your business, start looking for the necessary paperwork as well.

Things to Consider When Building a Car Wrapping Business

Before jumping head first into a new business, it’d be wise to consider some things:

  • Can You Run a Wrapping Business By Yourself? Running a business can be stressful, no matter how easy it is to manage. Determine if you need a partner before deciding to put your heart into this new idea.
  • Do You Have Enough Space? Perhaps the most important aspect of a car wrapping business is the place. You need to have enough space to hold multiple cars plus the equipment.
  • Do You Need Funding? A car wrapping business has a lot of startup costs, so you may want to consider bank loans, crowdfunding options, and SBA-guaranteed loans before you start buying equipment. Or, you may consider selling a property to fund your business.
  • Do You Have Enough Knowledge of the Market? The vehicle wrapping market is constantly changing to fit new trends. You need to study the market well to know the gap you need to fill, and you need to know how you’ll target your audience and sell your services.

INSPIRATION: Car Wrapping Business Ideas

If you need some inspiration, here are some business ideas you can adopt:

  • Race Car Wrapping: Almost all race cars are wrapped in a vinyl car wrap. You can create a business catering to race cars only. Their owners are often willing to pay large sums to get their cars to tip-top shape.
  • Luxury Car Wrapping: Ever seen a glammed-up Lambo with a galaxy-themed wrap? You can be the one doing that. Granted, you’ll need to be extra careful dealing with high-end cars, but the paycheck will be worth it.
  • Damaged Vehicles Wrapping: No one wants to drive around in a damaged vehicle. That’s why a car wrapping business dedicated to damaged cars can be an excellent idea to transform cars that underwent road accidents.

Frequently Asked Questions

Here are some frequently asked questions about car wrapping businesses:

How Much Does it Cost to Wrap a Car?

Depending on the size and type, a car can cost $3000–$6000 to wrap.

Sedans are on the cheaper end of the spectrum, and vans, trucks, and luxury cars are on the expensive end.

What Vehicles are Best to Wrap for Business?

At this moment, passenger cars are the largest consumers of car wrapping services.

However, car wrappers usually prefer vans and trucks because they offer more space for advertisements and designs.

Similar Businesses to Consider Starting

If you’re shying away from the idea of a car wrapping business, here are similar ideas to consider:

Wrapping Up

Now, you should have a good idea of how to start a car wrapping business. You first have to do market research.

Then, you have to create your business plan, choose the legal structure, and start securing the necessary paperwork.

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