How to start a taxi business- Part Two

by Startacus Admin

Finance

No doubt this is not the part of setting up a business which you are jumping up and down with anticipation about… we know its sinfully dull, but getting your head round the figures at this early stage can save quite a bit of head-scratching later on when should be focussing on other things. Whilst we are no experts in the fiscal specifics of setting up a taxi firm, it seems to us that there are a few things that you would be well advised to consider:

• Do you have a general idea how much money it is going to take in order to set up your taxi firm? Remember to factor in all costs which are likely to arise including rent, vehicle costs, licensing, staff, fuel, advertising and any renovation and any equipment which will need to be purchased/rented. Getting together a rough estimate of what the project will cost in total will give you a clear indication of your financial situation and motivate you to source more funds if need be.

• Do you know what your monthly overheads will be? As before, you must remember to factor in all costs associated with the business.

• Do you plan on taking a guaranteed salary each month from the beginning or will you only be taking money from the business as and when it is available?

• From working out your over all cost you should be able to ascertain out how much money you will need to be bringing in per week in order to make a profit.

• Will you have a contingency fund in place for any unexpected costs or incase you do not meet your targets?

• Do you plan on managing the business finances yourself or will you be using the services of an accountant? How much will this service cost?

• Have you considered what you will be able to charge for your services? Now may be the time to undertake some sneaky investigative work to find out what the going rate is in your local area. If you will be operating a hackney style cab contact your local licencing authority to find out what the fare regulations in your area are.

Marketing

You will probably be of the opinion that the marketing for a taxi firm is something of a no brainer…and whilst it is true that traditionally taxi firms aren't known from the cutting-edge innovation of their marketing, that certainly doesn't mean that you should simply ‘wing it’. Start thinking about some of these:

• Have you put together a marketing plan yet? If not is there anyone who could give you a hand with it?

• Many taxi firms rely upon the business of one particular demographic, for example students, the elderly, families and so forth. You should work out as early as possible who your target market will be and tailor your marketing strategy to appeal to this group.

• Why not take a look at how other similar businesses are marketing themselves - not necessarily to pinch their ideas but to come up with some ways that you could make yourself stand out from the crowd.

• Are there any local businesses with which you could have mutual recommendations with? Try and think of places where the clientele will also be in need of taxi services for example hotels, restaurants, bars, clubs and so forth.

• Most taxi firms will have business cards - can you think of any places which these could be distributed?

• Will you be listing your business on online directories to make your number easily accessible to the public? Which directories will you choose and how much will this cost?

• Do you plan on introducing a customer loyalty scheme to encourage repeat business? For example you could have a card (or some other item which is easily carried such as a keyring) which entitles the user to a 10% discount on journeys for the first 6 months.

• Many taxi firms make use of traditional local advertising spaces such as newspapers, notice boards and so forth, if you plan on going down this route, how will you ensure that your firm stands out against the rest?

• Have you thought about the telephone number that your taxi firm will have? Taxi firms are often selected by the customer based on which number is easiest to locate at a given moment, so having a number which is easily recognised to make a huge difference to the number of calls that you receive.

In fairness, each of these sections could go on and on - it can sometimes feel that there is a neverending list of things which need to be taken into consideration when starting a business. Hopefully this information along with How to start a taxi firm part 1 have provided you with much of the general information and advice that you will need.

If you reckon that setting up a taxi firm would drive you up the wall then take a look at some of these other guides;

How to start a Sweetshop

How to start a Restaurant

How to start a cleaning business

If you like what you see here on Startacus, why not become a member of our growing community? It's free! And you'll get all this - exclusive access to our Business Toolkit, discounts and offers galore for your business via our member only business deals, the chance to network and connect with loads of fellow self-starters, and maybe even become our celebrated 'Self-Starter of the Week' and tell the world your startup tale! Join right here for free...

Subscribe to our newsletter

If you would like to receive our startup themed newsletter, full of the latest startup opportunities, events, news, stories, tips and advice, then sign up here.

• #
• #planning
• #development
• #finance
• #market research

Published on: 31st March 2014