You are looking to make money by starting a car rental business, this is perhaps the best idea you could come up with. And you are in the right place as we’ll guide you on how to set up a perfect business. The idea of contemplating a business something like this might have come to you when you were struggling with the road’s that your city has along with amount if vehicles these days.
If you are new to this business or the start you have is a slow one, then this article will help you deal with it. This business is a long-term investment and it has and always will garner customers from different parts of the world enjoying the services of your company.
Looking to start a car rental business, but are short of investments you can always take help from car rental software which will help you in cutting costs of investments.
If you go back and look at the type of cab services that were providing rides for passengers: Hackney carriages, hansoms to the modern day taxicabs which in the 1980s came with computer-assisted dispatching. And in various countries like India, Bangladesh and Thailand rickshaws, animal powered vehicles are used as taxis.
More about car rental industry
A car rental agency allows an individual to hire a car and drive it all by themselves, or a chauffeur service where a driver is employed to drive a passenger. Now the renting business has grown so much as that there are rickshaws and two-wheelers offering rides to passengers. These businesses have increased more rapidly in metro cities and are currently not favoring the small towns where the presence of both technology and audience is pretty low.
To set up a car rental business requires less investment when compared to giants in this industry like Ola and Uber who work with heavy fundings and support. And as the investment is less, it is gaining the interest of entrepreneurs who are looking to build a profitable startup.
Alone Uber, accounts for 85-90% of the U.S Hailing market, and around 50,000 monthly average new drivers join the company.
Plan in accordance with these steps to create a successful car rental industry:
#1 Analyze the market
The very first step in creating a car rental business is to study the potentials of the market in order to stay in the business for the long run. Generally, this business is derived into two portions: Airport and Off-Airport services. The Airport services involve transport to and from the airport, whereas the off-airport services include rides like outstation and local usage.
The business is great for generating heavy income and the customers use these services as it is time-consuming and the routes taken are convenient. With the growing number of air-travelers, both international and national travelers demand for these services has increased.
#2 Types of Vehicles
Another crucial step when starting a business like this is to consider what are all the types of vehicles that you have in your fleet. The cars you own should signify your business model like are the cars for daily use or the cars you own are up for luxurious traveling.
The price completely relies on the type of cars available to you as they come with different price ranges. The type of car includes Hatchbacks, Sports Utility Vehicles(SUVs), Sedans and luxury cars like Limousine.
Sedans and Hatchbacks are the most preferred type of cars to a customer as they are convenient and economical at the same time. Customers generally opt for rides like these as they are cheaper and require it for a shorter span. Luxury vehicles are also in a high demand as business travelers expect great service and reliability when they are out traveling. While SUVs are commonly used when traveling for outstations.
#3 Choose a location
A business like this is tapping all locations and competitors are making money by tapping the untapped areas. Choose a location which is quite busy, where the tourism and employment are generally higher. Consider a good parking spot for all your cars which is better accessible by all your drivers.
#4 Promote the Business
This steps comes under the marketing category and needs to be seriously addressed when creating a budget. Get in touch with hotels and travel companies from where you can borrow customers and generate new clients. And the previous point we talked about is to be considered here as the people in your locality help in improving your business.