How to start a car hire business
Car hire businesses are slowly overtaking the traditional taxi arrangement. Car hire is the arrangement done by the hiring person and the leasing company, where the hirer pays an amount for the vehicle and drives themselves.
The contract usually states a duration which the car will be leased out, and the price is decided in comparison to the time the spent with the car as opposed to the number of people carried.
There are a number of factors to consider before starting a car hire business, most of which are not monetary. Below is a breakdown of a guide on tips to follow.
- Decide on what to specialize on
This is the initial part of starting a car hire business. There are many options available for the business starter, and these include having a car hire for travelers, for special occasions like weddings and anniversary celebrations. The last option being the renting of exotic cars, which people would not afford buying, but wish to drive around. A car hire business is profitable especially for guys planning for a holiday.
- Obtain the cars
After deciding on what to specialize in, the business owner is expected to buy a number of vehicles to start off the business. It is advisable to start with only a few vehicles, which will be easy to manage. The fleet can continue growing as the company creates awareness, and as the business grows.
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- Acquire insurance for the cars
In any jurisdiction, car hire businesses are supposed to have an insurance arrangement for the cars. Car hire companies can give the hirers an option to organize for their own insurance cover, but it is advisable for the rental company to have a general insurance for all the vehicles. This makes it easier to get compensation for a claim, and the insurance company can afford to give out a cheaper tailor-made insurance plan for a certain number of cars.
- Get incorporated
Like any other companies, incorporation is mandatory by law. Regardless of the area, before the start of business under the business name, the business starter should seek local legal counsel on the document they need to acquire. Incorporation also includes the acquisition of permits from council government, to prove the company has met the minimum requirements. There should be company regulations, especially for those renting a car under the age of 25
- Sort out parking spaces and arrangements
The fleet of cars needs to have a parking space for the duration they are not in use. In the case of the company not having a private parking space, there is the option of subscribing to local government annual parking plans. These allow the vehicles to be parked anywhere in the region but on designated parking spaces. This step reduces the chance for friction with city or county council government.
Starting a car hire business’ main thinking point should be the budget. Service provision companies need fair investments since people will only hire a car they think is well maintained. Potential car hire company owners should have their capital ready when planning on startup, which will help them decide on the choice of the car hire business to undertake.