A person living in a strategic place of a high density of population with business centers and entertainment outfits, car rental business would be a lucrative and profitable venture for him. If you are interested in starting a car rental business, read this post for detailed information.
The renting of the car business is getting competitive with every passing day. In the coming years, the automotive industry is expected to grow both in developing as well as in developed countries. The reason for growth mainly attributes to the growth in per capita income and an increase of passengers preferring flights to travel.
The primary requirement of starting a car rental business is scheduling customer reservations and supplying rental car. A car rental business can be started with low investment provided you come out with extensive research and networking plan. In addition to this, you must have a well thought out business plan before starting a renting car business.
Here are the 8 Steps to Follow to Start a Car Rental Business
1. Do Some Research
Understanding the local market is the key to success in this business. Go for detailed market research and collect information regarding the market potential of the car rental market. Information like what kind of cars are in demand, what are the existing rental rates, who are the dominant players, etc will help you in formulating your business in a better way.
2, Car Rental Business Plan
Create a detailed plan for your car rental business. In writing a business plan you must include the target market, your start-up investment, supplies. How you access the market considering the demand, projected annual revenues, and expenses.
3. Choose the Right Business Model
The most important part of the process of starting this business is fixing the right model of your business. What kind of specific service will you offer your customers? What are the types and features of the car you are going to offer? Will you focus on regular cars or sedan class? Based on these factors you need to create an appropriate business model.
4. Register Your Business
Every country and state has different options for registering a company. Talk to a professional and decide upon the best-suited business structure under which you are going to run your business. If you are from the United States, an LLC registered company will provide you with some extra benefits.
5. Make Car Rental Business Legal
Check requirement of licenses and other legal necessities in starting this business. Different states and countries have their own legal requirements. Check with local appropriate authority about the legalities required. Another important issue is insurance.
Another important issue is insurance. In fact the most important one. In some countries and states insurance is mandatory. Check for insurance companies and find the one giving the best cover with affordable price. You will need to pay special attention to insurance that also covers workman’s compensation. It will protect your vehicle as well as your business from the losses caused by road accidents.
6. Name Your Business
The name of your business has a tremendous impact on how clients view you. Choose a comfortable, familiar and easy to pronounce for your business and get it registered.
7. Car Rental Pricing
Decide the rental pricing rate. You can go for an hourly basis, kilometer wise or daily basis. The class of the car, that you are offering, will also determine the pricing. As an example, the rental charge for a regular model car’s charge will be different than a luxury car.
8. Promote Your Car Rental Business
Identifying, anticipating and satisfying consumer requirements are the keys to more profitability in this business. You can start contacting corporate clients and hotels who have bulk requirements for rental cars. Go for some local classified advertisements to promote the business. Create a website for your car rental business company to make an online presence with an online booking system.