We know that starting a taxi business is much more than just having the will and being excited. You have to have enough vision to achieve what you think you can bring to the market, but above all, to please customers. Being clear about the new expectations that a company must have in terms of being sustainable both financially and ecologically.
Lay the foundation with a good plan
Starting a transport company should start with a well-structured business plan so that it has a solid foundation. Unfortunately, not many aspiring entrepreneurs plan as they should. In order to proceed successfully, your project must have the following questions clearly answered:
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What kind of clients do you want to attract to your services? Why should they prefer your services? It is important to define the services you will provide and who your target audience will be.
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What is your business’s pricing schedule? How much will travel cost for different types of services, locations, bookings, etc.? Being clear about this is vital for planning your financial outlook.
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What is the market for your services? Research and market analysis are crucial to visualize the competition and define the most appropriate sales proposition for the company.
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How will you promote your business? Once you know who your potential customers are, you need to find the best way to communicate with them. Answering this question is also a great starting point for putting together your marketing plans.
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What resources do you need to start a taxi service? Financial and HR planning is essential, as it allows you to evaluate various options.
Your first step in creating a solid taxi service business plan is to give clear answers to all of these questions. A business plan makes presenting to potential investors and business partners easier or more convincing.
Which business model is right for your taxi business?
For a transportation service, rides are the basis of its revenue stream. So you need to calculate the average cost of each bookable ride. In this calculation, include drivers’ salaries, taxes, all fixed and variable costs, plus your taxi app. Last but not least, you need to add in the initial marketing and promotion expenses.
We'll tell you a secret that sometimes people forget when they start out in the taxi business . It's very common to not be able to cover all of the expenses from the beginning. To start making a profit, the business first has to grow a little. However, you should always plan when it could approximately reach a break-even point.
The need for taxi software
The smartest decision you can make today to scale from the start is to get taxi software. Before contacting the company, you should make an inventory of the essential software features that your company requires. Some of the most recommended and used by ToolRides customers are:
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Passenger, driver or partner apps that are available for iOS and Android. To attract many more bookings, making the work of drivers easier.
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Direct payments from the app, which do not result in huge amounts of money being billed to your company's bank account.
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Automated business processes, such as billing drivers for each of their trips.
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Real-time or part-time reporting and statistics on bookings, routes and earnings.
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Features that facilitate business partnerships, such as web applications, apps, and custom location names.
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Operating zone function for easier management of rates and service types.
Your software doesn't have to meet these characteristics, but they are the ones we consider essential for a taxi business to grow. At ToolRides we can provide you with all these features since we offer personalized service. Where you can have a white label, multi-device application that represents your brand, with your colors and logo.
Don't leave your paperwork unorganized
Once you have all of the above ready, it will be time to register your business and make it official. This obviously depends on the regulations that each city or country has. But in general, you have to obtain the required documents, licenses and permits. Also, since you are working with cars driven by people, it is mandatory to look for all the necessary insurance contracts.
In some countries, the transport market is highly regulated. Therefore, you should know what the relevant requirements are so as not to receive unpleasant news later. Also find out what documents are required from your employees, and form a good HR team that will make your task easier.
Hands on marketing
For startups, marketing often seems like a waste of money. This is completely false, and a common mistake. Well-developed and tailored marketing is the only way for a business to survive after launch. There are specialists and ways to approach your business to suit all budgets.
Well-planned marketing campaigns help you first gain loyal customers. Then you can scale up to a user base with referral marketing, online and offline advertising. You don't need a full team of marketing specialists at the start. To save money, you can, for example, outsource until you have enough revenue for your own team.
Always be open to learning
There you have it, a small but consistent guide to get started right. As your taxi business grows, you and your team will learn more about your customers and their needs. Remember that good business plans are not static, all growth requires flexibility.
