A taxi business is a very interesting business, you get to meet a lot of interesting people and of course, the not-so-interesting ones, you get to go places and most importantly, you get to make money. Taxi business can sometimes be tough and tiring but the income and profit would wipe away the frown from your face in a few minutes.
To succeed in your Taxi business, the most important thing you ought to know is that you need to employ positive attitude because taxi business is a service-based business. A business that is a part of the hospitality industry and to succeed, you have to be hospitable, you have to make people feel comfortable, at ease and satisfied. I found out that many taxi drivers are not aware of how important the service they are rendering is.
As a visitor in a place for the first time, it doesn’t matter if you came by road, sea or air, there is a high probability that the first person you will meet in the new city is a taxi driver whom you must have employed to take you to your destination and the attitude and carriage of the taxi driver automatically creates a general first impression of the attitude and culture of the residents of that area on your mind.
So, taxi drivers are like image makers and because of this, if you are starting your taxi company, you have to make extra efforts to do it right.
Starting a Taxi or Cab Company with One Car – Sample Business Plan Template
1. Get in the right mindset
The first step to succeed and beat your competitors is to make customer service a priority. You should ensure that every ride in your cab is a pleasant and memorable experience. This can be achieved if your car is always kept in good condition.
A stuffy car that isn’t roomy and comfortable or breaks down from time to time, making clients late or miss appointments is a very bad idea. Your taxi business is just as good as the car you are using to run the business. To start your taxi company, here are some of the things you have to put in place-:
2. Purchase a good vehicle-: Invest in the best car you can afford for this business. It would help if your car is attractive and clean both on the inside and outside, has enough space and leg room to make the passengers comfortable and has a large enough trunk for luggage.
3. Get Insurance Covering
This depends on the area you plan to operate your business. You should find out what the rules concerning insurance for commercial taxis are in your locality. For your safety, it is advisable that you get comprehensive insurance for all of your vehicles. This is the most likely the biggest expense you would incur on the business apart from the cost of purchasing the cars.
4. Buy and install taxi meters
You would also need a taxi meter to be able to bill and charge your clients. A taxi meter makes the whole billing process fair and transparent. You can purchase taxi meters easily on the internet. Just make sure you are buying one that has a certificate of compliance and is legal for use in your country.
5. Top lights & Checkers-: Checkers help to differentiate private vehicles from commercial taxis. You should get one so that people can easily recognize your vehicle as a taxi. Top lights also perform the same function of helping people identify your vehicle as a taxi.
6. Licenses and Fees-: The licenses you would need to obtain and the fees required to be paid also depend on where you reside, so you should take time to find out what is required to make your business legal in your state.
7. Employ drivers-: If you would be running your taxi business on a large scale, you would also need to employ drivers. However, you must make sure you take your driver’s through a test to ascertain that they are skilled and qualified to drive commercially. Your drivers should also have valid driving license.
8. Get an Office Space-: An office space would also help a lot because you would need a cashier and a customer service officer who can take calls from customers when everyone else is out on the field. The customer service officer would also be in charge of directing the next available driver to customer’s locations.
9. Toll Free Line-: You should talk to your telephone service provider about getting a toll free line for your business. A toll free line would help you beat your competitors. Customers would be encouraged to call for your services knowing that they won’t have to pay phone bills. You can also set up an online portal or app, where clients can connect with you and book your services.
This is basically what you need to get your taxi company running. You should also consider looking into other sources of income like car hire and luxury car services. This would help to increase your business profitability.
4 Challenges of Starting a Taxi / Cab Company
a. Cost of gas
The high cost of petrol, diesel or whatever it is vehicles run on these days, is high. And this is the first complaint you are likely to hear from a taxi driver. However, the situation is not totally hopeless as there are now products known as ‘fuel savers’ that help to reduce fuel consumption in vehicles. You should be careful when choosing a fuel saver as some of them can damage your engine.
b. Fees & Taxes
Another major problem facing taxi drivers is the fees and taxes that they sometimes have to pay. Some of these fees include parking tickets, toll fees, licensing fees and several other fees and taxes required by the government. A good way to solve this challenge is to incorporate these expenses in the prices you would be charging your customers.
c. Maintenance, repairs & insurance
To keep the car running and in good condition, you would have to maintain it regularly and this costs money. In the same vein, cars break down unexpectedly sometimes and this might just mean goodbye to that day’s income. Insurance is also another issue as most countries would require you to have motor vehicle insurance before you can run a taxi business.
d. Dishonest drivers
This is a challenge you are likely to face if you are going to employ drivers to run your business for you. Some drivers are simply not straight-forward and would look for ways to short change you with every chance they get.
There have even been cases of drivers running away with their employer’s vehicles. To guard against such events, you must make sure each driver you employ has a guarantor who would be held responsible for any damages. You can also install car tracking devices on all your taxis.