Complete Guide on How to Start a Dumpster Rental Business

Here is what you need to know before starting your dumpster rental business:

1. Purchase equipment — Invest in high-quality dumpsters and a reliable delivery truck equipped with a roll-off system. Consider starting with a range of dumpster sizes to cater to different customer needs, from small home renovation projects to large construction sites.
2. Licenses and permits — You will need a waste hauler’s license, and possibly zoning permits if you are storing dumpsters on your own property. Check with local regulations to ensure compliance.
3. Waste disposal logistics — Establish agreements with local waste management facilities or landfills for waste disposal. Understand the costs and regulations for waste dumping, and consider recycling and sustainable waste management practices as part of your service offerings.
4. Register your business — A limited liability company (LLC) is the best legal structure for new businesses because it is fast and simple. Form your business immediately using ZenBusiness LLC formation service or hire one of the best LLC services on the market.
5. Insurance — Get adequate insurance coverage. This should include liability insurance, vehicle insurance, and workers’ compensation insurance if you plan to hire employees.
6. Legal business aspects — Register for taxes, open a business bank account, and get an EIN.
7. Online presence — Build an online dumpster rental software that features functionalities like real-time inventory management, online booking, and payment integration, scheduling for drop-offs and pick-ups, and customer account management.

You May Also Wonder:

Can a dumpster rental business be profitable?

Yes, a dumpster rental business can be profitable, even if you only start with three dumpsters. Average prices to rent a dumpster are about $500 for a week, so if you can keep them consistently rented, you can make good money. 

How do I differentiate my dumpster rental business from competitors?

You can choose a niche market for your dumpsters, such as construction companies or remodeling businesses. You could also price your dumpster rentals slightly lower than the competition.

What is the most common dumpster size?

Dumpster sizes range from 10 yards to 40 yards. The size used depends on the needs of the customer. For something like a small remodeling job, you might only need a 10 yard dumpster.

What are the different types of dumpsters?

There are several types of dumpsters, including front-load and rear-load dumpsters, which are smaller and used for regular waste disposal. Roll-off dumpsters are larger and typically used for construction or demolition projects. Compactors are specialized dumpsters that compact waste using a hydraulic press for more efficient disposal.

What is the growth potential of dumpster rental business?

Your dumpster rental business’ growth potential is only limited by the number of dumpsters you have and how big you can grow your operation in your local area.

Step 1: Decide if the Business Is Right for You

Pros and cons

First, it’s important to clarify that a dumpster rental business rents dumpsters for short-term use, generally to homeowners doing remodeling projects or to construction firms disposing of debris from job sites. And the crucial element to keep in mind is that dumpster rental businesses must dispose of all the waste that ends up in their dumpsters, including recyclables and hazardous materials, according to local laws and regulations.

Starting a dumpster rental business has pros and cons to consider before deciding if it’s right for you.

Dumpster rental industry trends

Market analyst IBISWorld says an increase in construction activities in the US will drive demand for dumpster rental and other waste management services.

Industry size and trends

• Industry size and past growth – The US dumpster rental market has expanded by 40% in the past decade and is now worth more than $500 million.((https://www.ibisworld.com/industry-statistics/market-size/dumpster-rental-united-states/))  
• Growth forecast – The global dumpster rental market is predicted to expand more than 3% annually through 2027.((https://www.researchandmarkets.com/reports/5406526/dumpster-rental-market-2021-2027)). 
• Number of businesses – More than 200 dumpster rental businesses are operating in the US.((https://www.ibisworld.com/industry-statistics/number-of-businesses/dumpster-rental-united-states/))
• Number of people employed – The industry employs around 6,000 people.((https://www.ibisworld.com/industry-statistics/employment/dumpster-rental-united-states/))

Trends and challenges

Trends in the dumpster rental industry include:

• Residential construction and remodeling are on the rise, increasing the need for dumpster rentals to remove waste from construction sites.
• Customers are seeking dumpster rental services that repurpose or recycle dumped materials. Repurpose means doing things like taking disposed marble countertops and cutting them to be used for something like fireplace tiles.

Challenges in the dumpster rental industry include:

• Hazardous materials cannot be disposed of along with non-hazardous materials and preventing customers from putting those materials into the dumpsters can be a challenge.
• Dumpsters picked up from construction sites can be overfilled and dangerous to transport.

How much does it cost to start a dumpster rental business?

Startup costs for a dumpster rental business range from $20,000 to close to $50,000. Costs include purchasing 3 dumpsters, which cost around $5,000 each, and a down payment on a roll off truck. Also included is the cost to rent a warehouse storage space.

You’ll need a handful of items to successfully launch your dumpster rental business, including: 

• Dumpsters – at least 3
• Roll-off truck 

Start-up Costs	Ballpark Range	Average
Setting up a business name and corporation	$150 - $200	$175
Business licenses and permits	$100 - $300	$200
Insurance	$100-$300	$200
Business cards and brochures	$200 - $300	$250
Website setup	$1,000 - $3,000	$2,000
3 dumpsters	$12,000 - $30,000	$25,000
Down payment on a roll off truck	$6,000 - $10,000	$8,000
Warehouse storage space	$1,500 - $3,000	$2,250
Total	$21,050 - $47,100	$34,075

How much can you earn from a dumpster rental business?

Costs vary based on the duration of the dumpster rental and the size of the dumpster. The average weekly rental price for a 10-yard dumpster is about $500. Your profit margin should be about 50% after expenses, including storage rental and part-time labor.

In your first year or two, if you consistently rent 3 dumpsters a week, you’ll bring in over $78,000 in annual revenue. This would mean a nice profit of almost $40,000, assuming that 50% margin. As your business grows and you add more dumpsters, you could rent 10 dumpsters a week. With annual revenue of $260,000, you’d make a healthy $130,000.

What barriers to entry are there?

There are a few barriers to entry for a dumpster rental company. Your biggest challenges will be:

• Finding the necessary startup funding
• Entering a competitive market

Step 2: Hone Your Idea

Now that you know what’s involved in starting a dumpster rental business, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an opportunity

Research dumpster rental businesses in your area to examine their services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing an eco-friendly dumpster rental service that recycles and repurposes dumped materials.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

You might also provide junk removal service if you’re willing to go fully into waste management. Your company could also take care of debris and other trash and waste removal. 

What? Define your services

Your services are pretty straightforward but offering recycling and repurposing services can add revenue and help to build your brand. Dumpster rental services will generally just be dropping off, picking up, and appropriately emptying the dumpsters. 

How much should you charge for dumpster rentals?

The average price for a dumpster rental is about $500 for a 10-yard dumpster for one week. Your ongoing expenses will be storage space rental, part-time labor, and fuel. You should aim for a profit margin of at least 50%.

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price point. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Your target market will be contractors and construction firms, as well as landlords and building developers. You can find them on Facebook and LinkedIn. You could also partner with contractors and remodelers to get referrals to their customers.

Where? Choose your business premises

Unless you have your own space to store your dumpsters and truck, you’ll need to rent out a warehouse storage space. Find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

When choosing a commercial space, you may want to follow these rules of thumb:

• Central location accessible via public transport
• Ventilated and spacious, with good natural light
• Flexible lease that can be extended as your business grows
• Ready-to-use space with no major renovations or repairs needed

Step 3: Brainstorm a Business Name

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “dumpsters” or “dumpster rental”, boosts SEO
• Name should allow for expansion, for ex: “Clean Sweep Disposal” over “Construction Waste Disposal”
• A location-based name can help establish a strong connection with your local community and help with the SEO but might hinder future expansion

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that set your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Business Plan

Here are the key components of a business plan:

• Executive Summary: A brief summary outlining the core elements of the dumpster rental business plan, including its purpose, goals, and potential.
• Business Overview: An overview of the dumpster rental business, detailing its mission, vision, and key objectives.
• Product and Services: Clearly define the range of dumpster rental services offered, specifying sizes, durations, and any additional features.
• Market Analysis: A comprehensive analysis of the dumpster rental market, including target demographics, trends, and potential growth opportunities.
• Competitive Analysis: Evaluate competitors in the dumpster rental industry, highlighting strengths, weaknesses, and unique selling points.
• Sales and Marketing: Outline the strategies for promoting the dumpster rental services, encompassing pricing, advertising, and customer acquisition methods.
• Management Team: Introduce the key members of the management team, emphasizing their skills and roles in the success of the business.
• Operations Plan: Detail the day-to-day operations of the dumpster rental business, covering logistics, supplier relationships, and service delivery.
• Financial Plan: Present a detailed financial forecast, including startup costs, revenue projections, and a break-even analysis.
• Appendix: Include any additional supporting documents or information, such as market research data, permits, or legal documents.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to dumpster rental businesses. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your dumpster rental business will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just needs to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have.

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best options, other than friends and family, for funding a dumpster rental business. 

Step 8: Apply for Licenses/Permits

Starting a dumpster rental business requires obtaining a number of licenses and permits from local, state, and federal governments.

To operate your truck you’ll likely need a commercial driver’s license (CDL), which you can obtain through your department of motor vehicles.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your dumpster rental business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks. 

You may want to use industry-specific software, such as Docket, DRS, or ServiceCore, to manage your online booking, dumpster tracking, dispatching, and invoicing.

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial. 

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using website builders. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

Marketing

Here are some powerful marketing strategies for your future business:

• Professional Branding — Ensure your branding reflects reliability, efficiency, and professionalism across all aspects, including logos, vehicle branding, uniforms, and marketing materials.
• Local SEO — Optimize your website for local search terms related to dumpster rental, waste management, and construction services to improve visibility among potential clients. Regularly update your Google My Business and Yelp profiles to strengthen your local search presence.
• Business Networking — Forge connections with local construction companies, event planners, and commercial enterprises that frequently require dumpster services by participating in local trade shows and business expos.
• Social Media Engagement — Use platforms like LinkedIn for B2B networking and Facebook to reach local businesses and homeowners, sharing updates about your services, environmental tips, and community involvement.
• Content Marketing — Maintain a waste management blog that provides valuable information on proper waste disposal, recycling tips, and selecting the right dumpster size for various projects.
• Email Marketing — Keep your clients up-to-date with newsletters about new services, environmental initiatives, and special offers.
• Customer Testimonials — Showcase reviews and case studies from satisfied customers to highlight the effectiveness and convenience of your services.
• Partnerships with Local Businesses — Collaborate on events where your dumpsters are needed, such as large sales or community clean-ups, to enhance local business relationships.
• Referral Programs — Develop a referral program that benefits both the referrer and the new customer, promoting word-of-mouth marketing.
• Loyalty Discounts — Offer discounts or special terms for repeat business clients or long-term rentals to encourage loyalty.
• Branded Equipment — Ensure your dumpsters and vehicles are well-branded, utilizing them as mobile advertisements to increase brand awareness.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your dumpster rental business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your dumpster rental business could be: 

• Save the planet — recycle everything! 
• Go ahead with that big remodeling job, we’ll handle your waste
• Keep your complex clean with top-of-the-line dumpsters 

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a dumpster rental business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in dumpsters for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in dumpster rentals. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

You’ll probably run the business on your own, and just hire a few part-time workers to do drop-offs and pickups. If your business gets larger, though, Potential positions for a dumpster rental business include:

• On-Call Drivers – drop-offs and pickups of dumpsters
• Dispatcher – dispatch drivers to drop-offs and pickups
• General Manager – staff management, scheduling, accounting

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Dumpster Rental Business – Start Making Money!

Dumpsters might not sound very exciting, but you’ll be excited when the cash starts rolling in! The US dumpster rental industry is a half-billion-dollar market and it’s expected to continue growing, so why not grab a piece of that pie? You can even expand later and offer other  similar services such as junk removal, or you can widen your coverage area. There are many possibilities.

You’re off to a great start, having honed your knowledge about starting a business, so get ready to launch your dumpster rental services and turn trash into your big success story!