Moving to a new place can be difficult, especially if you have a lot of belongings you want to take with you. Typically, you would look for companies that can help you move, such as U-Haul.
If you want to hire U-Haul for its services, you may be wondering why U-Haul is so expensive. I looked up the facts, and here is what I discovered!
Why Is U-haul So Expensive?
1. High Demand
Any service or product in high demand becomes expensive since the provider has limited resources.
As such, any time U-Haul is attending to more customers than usual, the company will likely raise its prices.
That said, this is because U-Haul only has so many vehicles and employees available, making its resources more valuable.
Therefore, U-Haul can try to ease the demand while benefiting by increasing its prices for moving services.
2. Pick Up And Destination
Where you want your belongings to be picked up and delivered can significantly impact U-Haul’s cost.
Still, while U-Haul has over 20,000 locations across Canada and the United States, it should technically be easier for U-Haul to transport your items.
However, the distance between your belongings’ pick up and destination can affect how much you have to pay for U-Haul.
Additionally, other aspects, such as a sudden need for people to leave the area, can make U-Haul more expensive.
Inflation is a huge reason why most goods and services become pricey, and U-Haul services are no exception.
Let’s say the cost of living in one place begins to go up; this will often start with the cost of necessities like groceries, gas, etc.
Eventually, businesses need to keep up with the higher cost of living by increasing their prices accordingly.
Essentially, U-Haul cannot maintain the same prices that it used to offer years ago, so you can expect its services to get more expensive throughout the years.
4. Brand Name
U-Haul is one of the largest and most popular self-storage rental, moving truck, and trailer companies in Northern America, making U-Haul a well-known brand name.
Typically, brand names can affect the cost of a service because branding influences a customer’s decision.
For instance, customers are more likely to do business with popular brand names because they believe they will get a better experience from a famous brand.
Therefore, this allows U-Haul to charge more for its services since customers will assume they will get efficient services.
Since U-Haul offers many moving services, U-Haul greatly relies on gas to use its vehicles to provide its services to the public.
As such, U-Haul’s prices can be heavily dependent on how much gas costs and gas prices can go up or down.
However, as of 2022, gas prices have been reaching some of the highest points we have seen.
Therefore, U-Haul has to make up for how much it spends on gas by charging its customers more money.
Marketing is crucial for most businesses to stay afloat and spread brand awareness, even if the brand name is already popular, like U-Haul’s name.
Generally, marketing will give already famous companies more business to keep the company successful.
Therefore, U-Haul invests a lot in marketing by creating funny and entertaining online ads, commercials, etc., to connect with its audience.
However, marketers and marketing campaigns are not cheap, so U-Haul has to recoup these expenses by making U-Haul expensive.
7. Higher Insurance Rates
As mentioned earlier, U-Haul services are focused on transportation, which means U-Haul heavily relies on trucks, trailers, etc., to make money.
Typically, transportation businesses will need to put insurance on their vehicles to prepare themselves for any potential accidents.
However, insurance rates have been rising as more people are using cars to reach their destinations, which means there is a higher chance of getting into an accident.
So, U-Haul can make some of its money back for spending on insurance by making its services cost more.
8. Lack Of Competition
U-Haul has some monopoly over the moving service industry since U-Haul does not have that much competition.
While there are other moving service companies, U-Haul is one of the most popular ones, so most people do not even know they have other options.
As such, U-Haul can charge its customers more since they do not realize they have cheaper alternatives.
Surprisingly, the sudden number of wildfires and forest fires across the United States can make U-Haul costly.
When a fire has recently occurred in an area, it is more difficult for U-Haul to find an ideal route to deliver your belongings.
U-Haul relies on its employees to earn money since people will be required to transport and carry its customer’s items.
Therefore, when you pay for U-Haul services, you will also be paying the employees performing the service for you.
U-Haul is still a business that wants to remain successful, and a company can be considered successful when it makes a profit.
Therefore, U-Haul cannot be expected to constantly break even with its finances, so U-Haul will need to make its services expensive to gain profit.
U-Haul is a popular moving and self-storage company in Northern America, and U-Haul is expensive since the company has a monopoly over the moving industry.
Additionally, U-Haul usually adds the cost of employees’ salaries, gas, insurance, etc., to the final cost of your U-Haul service.