Do you want to start a pedicab company? If YES, here is a 20-step guide on how to open a pedicab business with no money or experience.
Pedicab business is a subset of the taxi and limousine services industry. A pedicab is a small, pedal-driven vehicle operated by a driver. Just as with taxi cabs, customers hire pedicabs to take them to their destination. Please note that if you intend to start this type of business, it is advisable to first look at the existing laws and zonal regulations in the country or state you reside in to know what is expected of you.
You also need to pay a visit to the regulatory bodies in your country to know what is expected of you before you can legally open your own pedicab transportation business in your city.
You can start your pedicab transportation business from a small town in the United States and if you are good at what you do, it won’t be too long before your brand becomes a nationally recognized brand especially if you go into franchising.
Steps to Starting a Pedicab Transportation Business
Understand the Industry
This type of transportation is amazing because it is a rickshaw vehicle powered by a bicycle. Pedicabs were introduced in North America in 1962, where they were a means of transportation at the Seattle World’s Fair in the state of Washington
Pedicabs are better suited for short trips, as the cab’s fuel is limited by the strength and endurance of the driver. Pedicab businesses provide a clean, quiet, alternative form of short distance transportation. Pedicabs are known to help ease traffic congestion during well-attended community events.
The Taxi and Limousine Services industry is a major sector of the economy of the United States and it generates a over $20 billion annually from more than 338,882 registered and licensed Taxi and Limousine services companies.
The industry is responsible for the employment of over 413,046 people (drivers and administrative staff members). Experts project the industry to grow at a 6.7 percent annual rate. There is no establishment in this industry that has a dominant market share in the United States.
A research conducted by IBISWORLD shows that the Taxi and Limousine Services industry is in the mature stage of its life cycle. Industry value added (IVA), which measures the industry’s contribution to GDP, is also expected to grow at an average annual rate of 5.3 percent within the next 10 years.
Within that same period, GDP is estimated to increase by 2.1 percent per year on average. The industry demand is usually influenced by disposable income levels, corporate profit and domestic trips by US residents. When it comes to advertising your pedicab services company, there shouldn’t be any limit to how far you can go. You could start with handbills and distribute them in tourist sites and public places.
If you have cash you can place advert spots on Newspapers, TV and Radio, and if you don’t have enough cash you can start with the worldwide web. As a matter of fact, the internet has become one of the cheapest and most potent advertising platforms.
Over and above, pedicab services businesses all over the world are still enjoying good patronage particularly if they have comfortable pedicabs, professional drivers and if they are well positioned and if they know how to reach out to their target market.
Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic composition of those who patronize pedicab transportation cut across people who reside in your location of operation, tourists, visitors and of course event planners (pedicab rental services for wedding and social functions), park operators, and businesses that make use of pedicabs for advertising. In essence, your target market can’t be restricted to just a group of people, but all residents and businesses in your area of operation.
So, if you are thinking of launching your own pedicab transportation business then you should make the target demographics all encompassing, you can partner with public facilities such as stadiums and airports, hospitals and medical centers et al.
Decide Which Niche to Concentrate On
Most pedicab transportation companies tend to provide a wide range of services. That is why it seems that there are no niche areas in the industry. But on the other hand, players in the pedicab transportation services industry may decide to specialize in any or all of the following;
- Providing and charging customers a fare for transportation via pedicab
- Providing tours for residents and tourists in pedicab
- Create specialized sightseeing tours via pedicab
- Engage in contracting with businesses to make use of pedicabs for advertising
The Level of Competition in the Industry
The competition that exists in the pedicab transportation services industry goes beyond competition amongst pedicab transportation companies; you will be expected to compete with other players in taxi and limousine services industry that also provide sightseeing for tourists.
So, it will be right to say the competition in the pedicab transportation services business is relatively competitive. The truth is that no matter the level of competition in an industry, if you have done your due diligence and you brand and promote your services or business properly, you will always make headway in the industry.
Just ensure you pedicabs are comfortable, easy to paddle, equipped with entertainment gadgets, your workers are well – trained, and your customer care services is top notch and you know how to attract and reach out to your target market.
Know Your Major Competitors in the industry
Here are some of the most popular pedicab transportation companies in the United States of America;
- Guided Central Park Pedicab Tour
- Grand Monuments & Memorials Tour
- Central Park Pedicab Tour by Pedal Me Green
- Highlights of Central Park Pedicab Tour
- DC Rickshaw Monuments Tour
- Private Central Park Guided Tour by Pedicab
- Private Historic Newport Pedicab Tour
- Central Park Pedicab Tours with New York Pedicab Services
- Private Midtown Reno Mural Tour
- Open-Air Private Pedicab Tour in Provincetown.
When it comes to starting a pedicab transportation company, you just have to get your feasibility studies and market research right before venturing into the business. It is good to mention that pedicab transportation business comes with its own far share of challenges.
Starting this kind of business definitely entails that you raise plenty of capital because you will need capital to purchase the first set of standard pedicabs or at least to finance the purchase of the first set of standard pedicabs. You may want to consider pulling the resources from family and friends. Depending on the scale at which you want to start from, you might require as much as multiple thousands of dollars to strike this off.
You will be expected to hire experts that will help you with comprehensive economic analysis and the profitability of the businesses within the location that you intend launching the business. If you get your economic and cost analysis right before launching the business, you may not have to stay the long before you breakeven.
Decide Whether to Buy a Franchise or Start from Scratch
When it comes to starting a business of this nature, it will pay you to buy the franchise of a successful pedicab transportation services company as against starting from the scratch. Even though it is expensive buying the franchise of a pedicab transportation company, but it will definitely pay you in the long run.
But if you truly want to build your own brand after you must have proved your worth in the industry, then you might just want to start your own pedicab transportation services company from the scratch. The truth is that it will pay you in the long run to start your pedicab transportation service from the scratch.
Starting from the scratch will afford you the opportunity to conduct thorough market survey and feasibility studies before choosing a location to launch the business. Please note that most of the big and successful pedicab transportation companies around started from the scratch and they were able to build a solid business brand. It takes dedications\, hard work and determination to achieve business success.
Know the Possible Threats and Challenges You Will Face
If you decide to start your own pedicab transportation services company today, one of the major challenges you are likely going to face is the presence of well – established pedicab transportation companies and also tour service providers, and other form of executive transportation services who are offering same services that you intend offering.
Some other threats that you are likely going to face as a pedicab transportation company operating in the United States are unfavorable government policies (transportation reforms), maintenance cost, the arrival of a competitor within your location of operation and global economic downturn which usually affects purchasing/spending power on leisure.
Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
When considering starting a pedicab transportation services company, the legal entity you choose will go a long way to determine how big the business can grow. Generally, you have the option of either choosing a general partnership, or limited liability company for your pedicab transportation company.
Ordinarily, general partnership should have been the ideal business structure for a small – scale pedicab transportation services company especially if you are just starting out with a moderate startup capital. But if your intention is to grow the business and have clients from all across the United States of America, then choosing general partnership is not an option for you. Limited Liability Company, LLC will cut it for you.
Choose a Catchy Business Name from the ideas Below
Normally, when it comes to choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Typically, it is the norm for people to follow the trend in the industry they intend operating from when naming their business.
If you are considering starting a pedicab transportation business in the United States of America, here are some catchy names that you can choose from;
- Jesse Black® Pedicab Services Company, Inc.
- Go Green® Pedicab Services, Inc.
- See Through© Pedicab Services, LLC
- Paddle Panders™ Pedicab Services, Inc.
- Onesimus Lincoln® Pedicab Services, LLC
- Green Strides™ Pedicab Transportation Services Group
- Richard Mason© Pedicab Services, LLC
- Tour Guru® Pedicab Services Ltd.
- We Move® Pedicab Services, Inc.
- Universal Trans® Pedicab Services, Inc.
- Red Star© Pedicab Services, Inc.
- Pally Pearson® Pedicab Services, Inc.
Discuss with an Agent to Know the Best Insurance Policies for You
In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policies that are required by the industry you want to operate from. Thus, it is imperative to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your business.
Here are some of the basic insurance policies that you should consider purchasing if you want to start your own pedicab transportation services company in the United States of America;
- General insurance
- Health insurance
- Liability insurance
- Risk Insurance
- Workers’ compensation
- Commercial Hull Insurance
- Physical Damage Insurance
- Uninsured or Underinsured Motorist
- Motor vehicle insurance (comprehensive insurance)
- Overhead expense disability insurance
- Business owner’s policy group insurance
- Payment protection insurance
You can contact the following leading insurance companies in the United States of America to purchase the needed insurance policies for your pedicab transportation business;
- Allstate Insurance Group
- Liberty Mutual
- Progressive Insurance Group (PGR)
- Health Care Service Corporation (HCSC)
- New York Life Insurance Company
- Lincoln National Life Insurance Company
- MassMutual (Massachusetts Mutual Life Insurance Company)
- Northwestern Mutual Life Insurance Company
Protect your Intellectual Property with Trademark, Copyrights, Patents
If you are considering starting your own pedicab transportation services company, usually you may or may not have any need to file for intellectual property protection/trademark. This is because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
But if you just want to protect your company’s logo and other documents or software that are unique to you or even jingles and media production concepts, then you can go ahead to file for intellectual property protection. If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO. The final approval of your trademark is subjected to the review of attorneys as required by USPTO.
Get the Necessary Professional Certification
When it comes to operating a pedicab transportation service, you do not need to have any formal training or special certification. All you need is informal training that will expose you to the ins and out of managing a pedicab transportation services company.
On the other hand, if you come across any form of certification that can aid you to manage your pedicab transportation company pretty well, then by all means try and pursue such certification.
Get the Necessary Legal Documents You Need to Operate
It is a fact that you cannot successfully run any business in the United States without the proper documentations. If you do, it won’t be too long before the long hands of the law catch up with you. These are some of the basic legal documents that you are expected to have in place if you want to legally run your own business in the United States of America;
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit
- Certificate of Incorporation
- Business License
- Pedicab Operator’s Registration
- Appropriate driver’s licenses for drivers (Commercial driver’s license (CDL)
- Assistant’s licenses for assistants
- Proof of ownership, proper identification and vehicle license
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Company Bylaws
- Memorandum of Understanding (MoU)
Raise the Needed Startup Capital
Starting a pedicab transportation company is a relatively capital-intensive business hence entrepreneurs willing to start the business ensures that they raise the required startup capital from all available legal means. No doubt when it comes to financing a business, one of the first things you should consider is to write a good business plan.
If you have a good and workable business plan document in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business. Here are some of the options you can explore when sourcing for startup capital for your pedicab transportation services company;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for loan from your bank
- Source for soft loans from your family members and your friends.
Choose a Suitable Location for your Business
Choosing a location for a pedicab transportation services company can be in two phases. First, it must be located in a city that has need for such services and also in a city that a good number of tourist attraction sites and also good road network. So also, you are expected to secure administrative office in a visible and busy location.
Indeed, location has great influence on the success of a pedicab transportation service. If you have taken your time to study the industry, you will realize that pedicab transportation services are willing to pay expensive rents in order to stay in a metropolitan city and a busy tourist attraction; a place where business activities and financial activities are at its peak.
It cannot be overemphasized that the location you chose to open your pedicab transportation services company is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of people and organization with the require purchasing power and lifestyle.
If you make the mistake of renting or leasing a facility for your pedicab transportation services company in a not too visible or hidden location simply because it is cheap, then you must be prepared to spend more in promoting the business and perhaps giving direction to potential clients.
It is important to note that a business facility in good location does not come cheap hence you should be able to allocate enough fund for leasing/renting in your budget. If you are new to the dynamics of choosing a location for your business, then you should feel free to talk to a business consultant or a realtor.
Having said that, these are some of the cities in the United States of America where you can locate your pedicab transportation services company;
- New Orleans, Louisiana
- Los Angeles, California
- New York City, New York
- Nevada, Las Vegas
- Seattle, Washington
- Dallas, Texas
- Oregon, Florida
- Washington, District of Columbia
- Boston, Massachusetts
Hire Employees for your Technical and Manpower Needs
On the average, there are no special technology or equipment needed to run this type of business except for well-equipped pedicabs, and software applications. You will also need computers/laptops, internet facility, telephone, fax machine and office furniture (chairs, tables, and shelves) amongst others and all these can be gotten as fairly used.
When it comes to choosing between renting and leasing an office space, the size of the pedicab transportation services company you want to build, and your entire budget for the business should influence your choice. If you have enough capital to run a standard pedicab transportation services company, then you should consider the option of leasing a facility for your office; when you lease, you will be able to work with long – term planning, structuring and expansion.
As regards the number of employees that you are expected to kick start the business with, you would need to consider your finance before making the decision. Averagely, you would need a Chief Executive Officer or President (you can occupy this role), an Admin and Human Resource Manager, Professional Drivers (Pedicab Drivers), Accounting Officer, Marketing Executive, and Customer Service Officer or Front Desk Officer.
Over and above, you would need a minimum of 10 to 20 key staff to effectively run a medium scale but standard pedicab transportation services company. Please note that you would need to the services of maintenance engineers. If you are just starting out you may not have the financial capacity or required business structure to retain all the professionals that are expected to work with you. Hence you are expected to contract out some roles.
The Service Delivery Process of the Business
The way pedicab transportation services company works varies from one company to another, but ideally, a pedicab transportation services company is expected to first and foremost secure well-equipped pedicabs, and then once a client books any of their pedicabs, they pick and then drop off the clients to the desired destination; it could be short distance within a city or state or it could be long distance. In most cases, it is usually to and fro.
It is important to state that a pedicab transportation services company may decide to improvise or adopt any business process and structure that will guarantee them good return on investment (ROI), efficiency and flexibility; the above stated business cum services process is not cast on stone.
Write a Marketing Plan Packed With Ideas & Strategies
As a pedicab transportation services company, you would have to prove your worth over and over again before attracting high profile clients. So, if you have plans to start your own pedicab transportation services company it will pay you to build first build a successful career in the taxicab and limousine transportation industry.
People and organizations will hire your pedicab if they know that they are going to take them safely to their destination. So, when you are drafting your marketing plans, make sure that you create a compelling company profile.
Aside from your qualifications and experience in pedicab transportation services industry, it is important to clearly state what you have been able to achieve in time past. This will help boost your chances in the market place. Here are some of the platforms you can utilize to market your pedicab transportation services company;
- Introduce your business by sending introductory letters alongside your brochure to park operators, corporate organizations, households, events planners, travel and tour firms and players in key industries amongst others within your location of operation
- Advertise your services in community-based newspapers, local TV and radio stations
- List your business and products on yellow pages ads (local directories)
- Leverage on the internet to promote your pedicab transportation services company
- Engage in direct marketing and sales
- Encourage the use of word-of-mouth marketing (referrals)
- Leverage on the internet to promote your business
- Join local chambers of commerce and industries around you with the main aim of networking and marketing your services; you are likely going to get referrals from such networks.
- Engage the services of marketing executives and business developers to carry out direct marketing for you.
Work Out a Reasonable Pricing for your Services & Products
One key factor that will help you offer your pedicab transportation services at a price that is highly attractive is to ensure that you source your capital from sources that will give you reasonable interest and payment plans and also purchase cheaper and reliable pedicabs.
Another strategy that will help you offer your pedicab transportation services at the right price is to ensure that you cut operational cost to the barest minimum and channel your efforts towards marketing and promoting your brand name.
Aside from the fact that this strategy will help you save cost, it will also help you get the right pricing for your products and services. So also, if you are able to secure business partnership as it relates to getting referrals, then you will be able to get the right pricing and of course maximize profits from your business.
Develop Iron-clad Competitive Strategies to Help You Win
The pedicab transportation services industry is a competitive industry, and you must come up with a unique and highly creative strategy to be able to outsmart your competitors in the industry. Part of what you need to do in order to stay competitive in the industry is to continue to provide well-equipped and easy to paddle pedicabs and highly trained staff.
In other to stay competitive in this industry, you must ensure that your pedicabs are welcoming and always ensure that you pay attention to details when carrying out your job. The truth is that if there are fluctuations in the services you provide, customers can choose to shift allegiance and settle for other options available.
Brainstorm Possible Ways to Retain Clients & Customers
When it comes to business, no matter the industry that you choose to pitch your tent in, one of the easiest ways to increase customer retention and perhaps attract new customers is to produce results and satisfy your customers always. If your customers are satisfied with your products and service delivery, they can hardly source for alternative service providers.
If your services and customer service fluctuate, you are likely going to struggle to get your customers retaining your services. Ensure that you offer your customers incentives if you want to retain them and of course continue to generate repeated sales from them and also to attract new customers.
Part of what you need to do to achieve this is to track progress, results or outputs with the aim of improving on them quickly as the case demands. When it comes to managing your customers and building a loyal clientele base, you should purchase a customized CRM software.
With a customized CRM system, you can easily stay in touch with your clients (you can carry out quick surveys, you can introduce new products and prices to them without any hitch, you can felicitate with them on their birthdays and other anniversaries, you can keep track of their progress, you can send bulk sms and customized e – mails and above all, you can easily receive compliant and feedback from them).
Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
If you are in business and you are not conscious about boosting your brand awareness and communicating your corporate identity, then you should be ready to take on whatever the society portrays your business to be. One of the secrets of larger corporations is that they are willing to spend good money to boost their brand awareness and to continue to communicate their corporate identity the way they want people to perceive them to be.
No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and brand boosting cum promotion to continue to appeal to your target market. Here are the platforms you can leverage on to boost your brand and create a corporate identity for your pedicab transportation services company;
- Place adverts on both print (newspapers and travels and tours related magazines) and electronic media platforms
- Sponsor relevant community – based events/programs
- Leverage on the internet and social media platforms like; Instagram, Facebook, Twitter, YouTube, Google + et al to promote your pedicab transportation services company
- Install your Bill Boards in strategic locations all around the locations where you operate
- Distribute your fliers and handbills in target areas
- List your pedicab transportation services company in local directories / yellow pages
- Advertise your pedicab transportation services company in your official website and employ strategies that will help you pull traffic to the site.
- Position your Flexi Banners at strategic positions in the locations where your pedicab transportation services company operates.
- Ensure that all your staff members wear your branded shirts and all your pedicabs and carts are well branded with your company logo et al.