Despite the popularity of ride-sharing apps such as Uber, taxi services remain a viable way for people to get around. In fact, the number of taxicabs is expected to increase in the foreseeable future with revenue jumping to $2 billion by 2022.
That being said, now is better a time than any to establish your very own cab company. Especially if you’re living in larger urban centers that keep on growing, you will find that managing your own taxi fleet is immensely lucrative.
However, considering the cost of setting up such a business, you will need all the knowledge you can get to build your very own transport empire. Start with these crucial steps:
- Research the field and set your expectations
Like any other business, a taxi company is something you wouldn’t want to dive into at once. You will need to conduct extensive research before you set everything up. In other words, you will need to test the waters before jumping in. This will help you determine the risks of managing such a venture and develop a business strategy for sustainable growth.
Market analysis should be first and foremost on your checklist before you even make a decision. For starters, you can ask other business owners. You can also hit up the local directory and write down your competitors. Next, make sure to determine the rates and operational costs that cab companies incur on an annual basis.
- Gather your resources
Forming your fleet of cabs doesn’t come cheap. If you’re going to purchase new cars, you may as well spend around $10,000 to $20,000 for each unit. Of course, you can reduce your expenses by purchasing second-hand cars. Either way, setting up your fleet can still be expensive.
For this reason alone, it’s important that you have enough resources to form your initial fleet. You can look along the lines of ten units, which is a preferred starter for any newbie to the taxi game. This is also manageable when it comes down to your finances. Even so, you will still need to get the right funding for this setup. One thing’s for sure, you can always ask your friends and family to invest in the idea. You can also consider applying for a business loan that could cover the cost of your fleet as well as other equipment.
- Consider proper maintenance
To keep your cab company highly profitable, you should be able to take care of your taxi fleet. Regular maintenance is vital to keeping your cabs in good condition and reducing repair costs. For second-hand acquisitions, you may as well consider restoring these units. Onsite Detail is one such company that can help you maintain your fleet and keep your cabs in proper working order so that your business operates smoothly.
- Get registered and insured
Finally, before launching your taxi business, you will need to get a license from local transport authorities. You can ask at City Hall for the requirements and whether or not your fleet and metering equipment should be inspected. You should also shop around for the right commercial insurance for your business.