taxi service business plan startup cost in india

How To Start Taxi Business In India?

Radha Dhaked | March 14, 2022 | Company Formation

Public transit in most Indian cities is inconvenient, with congestion and poor hygiene facilities the most typical issues. Taxis are in high demand because of this. Additionally, with the rise of apps like Ola and Uber, anybody with a smartphone can now hail a cab from the comfort of their own home. Taking advantage of this expanding demand has proven to be a rewarding investment for many taxi business owners. In this article, you will learn stepwise methods to start taxi business in India.

What is the Taxi Business in India?

Typically, there are two sorts of taxi businesses: traditional taxis and radio taxis.

• Individual taxis
• Radio Taxis or  Businesses holding a lot of vehicles & consequently conducting taxi business. Currently, many choose to use Radio Taxis rather than regular taxis since they are more convenient to use and more accessible.

Radio taxis have GPS systems so that the taxis can be booked online and the taxi driver’s route can be traced. The taxis can also be tracked. For example, Ola Cabs, Uber, and other app-based services are examples of Radio Taxis.

Detailed Procedure to start taxi business in India

Decide the Business Structure

To start, the corporate strategy of the Taxi business must be worked out. Business structure influences your legal responsibility, documentation, and taxes of the business. You can have company registration from any of the following options to start taxi business in India:

• Private Limited Company Registration
• Public Limited Company Registration
• One Person Company Registration

Financing and Purchasing Cars or Taxis

Budgeting is a primary priority if you wish to start taxi business in India. If you look at the country’s rules and regulations, you’ll see that starting a cab company is difficult if you don’t already have the necessary cars.

A business loan may also be required to fund the acquisition of additional vehicles as part of the growth plan.

Furthermore, When acquiring vehicles for taxi business purposes, one must guarantee that the vehicles are taxi-type and economically viable.

Get Mandatory Registrations and Licenses

• Driving License

Any individual who owns and operates a car must possess a valid driver’s license to demonstrate their ownership and skill to drive a taxi or car.

If the vehicle is being used for business purposes, the individual behind the wheel must hold a commercial driver’s license to demonstrate his right to operate the vehicle.

A driver’s license is granted by a regional transportation authority (RTO) of a certain state, and it is required under the Motor Vehicle Act.

• Registration with Regional Transport Office

Section 39 of the Motor Vehicles Act, 1988 mandates that a vehicle must be registered within seven days after the date of purchase.

Transport authorities offer owners a certificate of registration. Driving an unregistered car is a criminal offense punishable by a fine of Rs.2000/-.

• Fitness Certificate and Insurance

An official certificate of fitness for the vehicle must be obtained before it may be used anywhere in India. Furthermore, Third-party liability insurance should also be purchased for the cars.

In the event of an accident caused by the owner or driver of the vehicle, the third-party riders are protected through insurance.

Similarly, it is also beneficial for you if you additionally insured the cars, since they serve as a source of income for you.

Apply for GST Registration in India

Taxi services are considered taxable services under the GST Act. Furthermore, Taxi aggregators like Uber and Ola are subject to GST when they provide services. Hence, if you start taxi business in India, you must get a GST Registration and do GST Return Filing .

Benefits of GST Registration for Taxi Business

• In the month of purchase, taxi owners are eligible for ITC on their vehicles. After registering for GST, many of these multiple-stage taxes are abolished, and you may be required to pay only one multi-stage, all-inclusive tax, the GST.
• You may effortlessly create e-way bills and e-invoices online.
• GST registration simplifies the process of submitting tax returns since there are fewer taxes and therefore fewer compliances to worry about.
• GST registration can help your organization develop a more effective and efficient logistics system.

Take your Business Online & Do Online Marketing

These days many people book or search for taxi services online. Hence, if you wish to start taxi business in India, you must have an online presence.

You can take your business online through the Business website . However, make sure to have Trademark Registration Online to protect your branding.

Trademark Registration is the best way to protect the branding of your website development and overall brand.

Once completing this, you must choose either SEO or PPC to attract the relevant audience and expand your business effectively.

Explore the 7 Types of Company Registration in India

Moreover, If you want any other guidance relating to  Company Formation . Please feel free to talk to our business advisors at  8881-069-069 .

Download  E-Startup Mobile App  and  Never miss the latest updates narrating to your business.

Benefits Of Company Registration In Uk From India

Online company registration in delhi- benefits, process, 2 thoughts on “how to start taxi business in india”.

क्या मैं अपनी टैक्सी कार को ऑनलाइन अटैच कर सकता हूं और मुझे pickup and ड्रॉप, roundtrip ,etx काम मिलता रहेगा, अगर एसा हे तो मैं अपनी टैक्सी कार आपकी कंपनी मैं अटैच करने के लिए तैयार हूँ

please contact our experts : 8881-069-069

Leave a Comment Cancel reply

Save my name, email, and website in this browser for the next time I comment.

Popular Posts

• 5 Proven Methods to Streamline Your Reconciliation Process

• How Automation Solves Reconciliation Challenges in Finance

• Master Reconciliations: Reduce Risk, Increase Data Trust

• Importance of Automated Reconciliation in Finance Businesses

• Top 10 Automated Account Reconciliation Software and Tools

Know All About How To Start A Taxi Business In India

Surabhi Guleria

• May 24, 2023
• 12 Min Read

Want to know how to start a taxi business in India? All you have to do is read along and know all about starting this business.

The number of taxis has increased in the country and more and more people are making use of taxis than their personal vehicles. Therefore, the taxi business is one of the most booming business ideas in India .

So if you are looking to start your own venture then this is the right business for you. Once done properly, you can grow it and earn a lot of profit from it.

Interested to know more about it? We bring you a detailed write-up about everything you need to know about this venture and how must one go about it.

Having the Right Taxi Business Plan

Every business needs a good plan without which any business would not be able to flourish. The plan should not be just for the coming 1 month, 6 months, or a year but you should have a thorough knowledge of the coming 4-5 years of your business and where you want to go with your business. 

Similarly, it is crucial for you to have a good business plan and you can follow these steps for the same:

Establish the business plan

Understand the area and the region you would be working in. Know the vehicles you can own directly or hire from others and the drivers you want to hire. Have a good and strong financial plan so that you have enough for the initial few years.

Establish tariffs and route plans

Make a tariff plan that is based on different locations, distances, day or night travelling. Set the regional limits within which you would run your taxi service.

Another important aspect of the planning is the mode of payment. With so many modes of payment available today, choose how you want to go about it.

Create, Share, Collaborate

Work with your team in real-time. create documents together and share the same on Whatsapp, Gmail, etc.

FREE OF COST

Plan for vehicle acquisition and driver hire

There are two ways to go about this business. You can either purchase your own vehicle or hire someone else’s and drive around that. Another way is you give your fleet of cars or a car to other drivers who you can hire.

These drivers can either be full-time or part-time.  Since this requires a big part of investment in the initial days, hence make sure your figure this out before your company is registered.

Establish the funding

Funding is one of the most crucial parts of your budding business. Once your initial capital requirement is planned, you must start to work on arranging for funds.

Go for a bank loan which would require documents of your business. If you are going ahead with a bank loan, make sure it takes care of all aspects like operation, infrastructure, insurance, marketing, legal and statutory aspects.

Acquire office space

The next step of this plan would be acquiring the office space which you can use as a point to coordinate and control the taxi services . The office premises need to have parking space for vehicles. You can get this space for rent or use one that already belongs to you.

Register the business

Registering the company is important that must be done with required regional or national authorities which can include the registrar of companies, taxation authorities, environmental & safety clearances, and labour authorities.

Steps and Requirements for a Taxi Business

How to fund your startup costs.

There are several ways for one to go about funding and they are that you can either look for a loan from a bank or ask any family or friend to help you with the initial funding. 

Related: Our Favorite eCommerce Business Ideas for Indians

Types of Taxi Business

Traditional taxi.

Traditional taxis are individual taxis and organizations owning a number of cars and running a taxi business (Example: Meru cabs) 

Available in 10+ Languages

Hindi, English, Bangla, Urdu, Malayalam, etc. Now Work Comfortably in Your native language.

Radio taxis have GPS installed where taxis are booked online and one can easily trace the route of the taxi. Some of the examples are Uber, Ola, etc and they run on an application through which they get the bookings.

The Motor Vehicles Act in India governs the taxi business in our country. In the radio taxi, the drivers of the taxi usually own the vehicle and whatever amount they earn they pay some percentage to the company.

Registration & Obtaining Permits for Vehicles

Registration process and required compliances.

This is going to be a big task at the initial stage of setting up a business. 

Step 1: While buying cars for your business, make sure that the taxis are taxi-type and within your budget.

Step 2: After purchasing the vehicle, get it registered before the regional Transport Office / Districts Transport Office within 7 days from the date of the purchase which is a mandate for all under section 39 of the Motors Vehicles Act, 1988.

Here, the office would provide you, the owner, with the registration certificate. Remember, it is an offence to drive an unregistered vehicle with the penalty of INR 2000/-.

Step 3: In the third step, it’s time to get the insurance done for your taxi which is very important and useful in case of any harm or damage is caused to a third party by the taxi.

There are many insurance companies that can help you with the same and that comply with important procedures as stated by the insurance companies.

Step 4: Now, make sure that your vehicle has compiled all the environmental clearances as required by the state authorities. 

Vehicle Permits

It is important to know that not all cars can be used for the taxi business in India hence proper permits must be obtained to transport people from one place to another.

This permit can be obtained from the regional transport office or state transport office by submitting forms as required. 

Also Read: Some Business Ideas For Indians in Bihar

Contract of carriage of passengers

Now, you must work on an application with respect to contract carriage of passengers which states that the owner/ driver carries the passengers under a contract for a particular sum to a particular place.

The application must be filed in accordance with Section 73 of the Motor Vehicles Act, 1988 as per the seating capacity & type of the taxi, the area in which the taxi is going to run and other such details as prescribed by the State Authorities.

Fitness Certificate

In accordance with Section 84 of the Motor Vehicles Act, 1988, all vehicles must have and carry a fitness certificate from an Authorized Testing Station. As mandated under the provisions of the Motor Vehicles Act, all vehicles must be maintained properly.

Usually, the speed limit for taxis vary from state to state and is about 50 to 65 km/hr. The name and the address of the operator of the vehicle shall be painted or affixed on the taxi.

Your Data Is Safe As A House

With daily backups, we ensure your data is safe and secure whether you lose your phone or it breaks down.

All india tourist permit.

If the taxi is to ply from state to state, then this permit is required for the said taxi. It can be obtained by making the necessary application before the Transport Authority after properly analyzing the same.

The number plate of the taxi granted should contain that the taxi has an All India Tourist Permit and it cannot be used for local purposes i.e. it cannot carry passengers locally.

Drivers, their Licenses & their Work Hours

All taxi drivers should have a commercial vehicle driving license which one can obtain from the Regional Transport Office of that particular state.

For the license, there are basic requirements that must be met. A medical certificate also needs to be submitted regarding his/ her physical and mental fitness. The license will be given by the Regional Transport Authority after going through all the above factors and consideration of the Application.

The work hours for a taxi driver shall be as provided under Motor Transport Workers Act, 1961. Section 13 of the Motor Transport Workers Act, 1961 provides that an adult motor transport worker shall not work for more than 8 hours per day or 48 hours in a week.

You can easily track your working hours using the time tracker register for taxis on Lio. If the taxi business involves driving long distances, etc., then the employer shall obtain permission from the prescribed authority.

With this permission, the driver may be allowed to work for an extended period but not more than 10 hours a day and 54 hours a week.

Getting the Driving Team Ready

Hiring taxi drivers for your taxi business in India is a tricky job and needs you to be very vigilant. 

Background Checks

You need to go to lengths to know all the backgrounds of all the candidates you are interviewing for the job. Conduct a detailed check of the habits, previous work, personal records, and conduct in general. 

While interviewing the driver, check his patience, driving skills, sincerity, and politeness. Check all the necessary and valid documents and their validations time. Taking a thriving test would also be a great way to test their skills. 

Company Ethics

Make sure that they abide by all the company rules and regulations. Remember that if you hire a driver who does not represent the company well, this will directly impact your customer relations and then your company. Brand value and reputation is the most important aspect of the business.

A dress code will reflect the values of the company and oneness. This would also show uniformity and let us be honest, everyone looks more disciplined in a uniform. 

Operating Times

Make sure you make judicious schedule changes and provide balanced and flexibility to all drivers. You can plan additional remuneration for your drivers who drive during odd or hectic hours.

All drives must follow all the rules of the company and there should be no other way about it. Do not overlook incidents of drivers involved in drunken driving, over-speeding, rude behaviours, violating of traffic rules, etc.

Drivers are the face of the company therefore it is best that they understand to stay at the best of their behaviour at all times.

Related: Business Ideas in For People In Tamil Nadu

Advertising the Business

Today, the growth of any business is dependent on advertising and marketing. Have a good budget to invest in it and get yourself some people who are good at advertising and social media marketing.

Choose platforms like Instagram, Facebook, YouTube, etc, and market your business to people. When it comes to digital marketing , for both paid and free advertising on search engines, you need to get someone who is good at campaigns, email marketing and is able to connect with all kinds of users and customers.

Another great way of promoting your business would be by advertising it in selected locations like airports, buses, railway stations, shopping complexes, etc. To encourage customers to get your services you can give exclusive offers and loyalty-based rewards, discount coupons, etc. This would definitely help in kick-starting your business.

One of the most important tips for a good business advertisement is providing your customers with great service and having good business ethics. The consistent and pleasant customers will throw good light at your business.

This is only achievable with timely rides, easy bookings, clean and hygienic taxis, top lights and logos, easy money transactions, polite and decent behaviour, competitive rates, and many other similar things.

So, it is clear that to start a taxi business in India one firstly needs to be clear on the business structure they want the business to run on, purchase the cars suitable for the business based on which acquire the license and permits.

If you are going to hire drivers, then ensure they have a valid driving license for driving taxis. It is also clear that it is the radio taxi business which is thriving and growing currently in the world and most important in our country. Hence, make a wise decision and start a taxi business in India of your own. I am sure that you if do thorough and detailed research of the business, you would end up excelling in it.

F requently Asked Questions(FAQs)

How to get a loan for a taxi business.

Banks in India offer different loans and schemes for all those interested in starting their own taxi business. Ine must do thorough research and get in touch with an agent to al=know about all the specific details.

What is a Radio Taxi?

A radio taxi can be requested on call by specific phone numbers. They are either assigned on spot or hired and cannot be booked online.

How can Taxi Owners get an All India Permit?

An All India Permit can be acquired through the Transport Authority by applying with a legal fee. This is the All India Tourist Permit (AITP) which gives your vehicles the recognition of “Tourist Vehicle”.

They are mostly meant for tourists who are travelling inter-state and not the regular commuters. There should be proper registration of the vehicle and all the other certificates, just like any regular taxi.

How can one innovate in the taxi business?

You must have a good client base, and there are various ways that you can ensure that.

Consider offering discounts and extra coupons for regular clients. You may also offer discounts for clients who take fixed routes daily. Use the best car for the taxi business, that is the vehicles are in the best condition and are well maintained.

You can ensure better safety for vulnerable groups.

There should be steps to increase safety for women and other marginalized sections of society. You can hire female drivers for women to feel safer as a USP of your business.

How to Start Electronic Shop Business In India

Marketing Automation: How It Streamlines Business Processes and Improves Customer Engagement

10 comments.

Thank you very much for this useful information. I have a few friends in this industry. I will certainly share this, and it will be helpful for them.

Hello Narendra,

Thank you so much for your kind words. I am pleased to hear that you found this article instructive. Happy reading!

Please tell me how to get a taxi permit in Tamil Nadu?. Lots of love from TN!

Hello Sharon,

Thank you for all the love.

The following documents are necessary for you to obtain a taxi permit: Submission of Form-CCPA,  Certificate of Registration (If the vehicle is registered one),  Insurance Document (If the vehicle is a registered one),  Proof of age, Address verification.

Online applications can be submitted. Application forms can also be obtained at the respective RTO offices and must be completed and submitted with the required payments. The officials will begin processing your application after you present the completed forms and payment at one of the counters. Kindly research more and proceed accordingly.

I recently discovered that taxis are referred to as hacks. Please explain to me why that is the case.

Hello Sanskar,

Thank you for asking such an interesting question.

Before the invention of the motor vehicle, during the era of horse-drawn carriages, the term “hackney carriage” was used to refer to a cab. Short for hackney is hack! It may still be used in slang today.

Can you please list the best taxi apps available in India? Thank you..

Hello Neethu,

The top taxi applications in India include Uber, Ola Cabs, Rapido Bike Taxi, Make My Trip, and Meru Cabs.

Can you pls list out a few types of taxi business, if you dont mind.. Deepest thanks.

Hello Maanya,

Airport taxis, off-road taxis, bicycle rentals, and medical taxis are just a few examples of taxi businesses .

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

• Shuttle Services

Why is the Taxi Business Booming in India?

Convenience and Accessibility: In the hustle and bustle of metropolitan cities, individuals often prefer the convenience of taxis over the challenges of owning a private vehicle. Taxis provide a hassle-free commuting experience, saving commuters from the stress of driving in congested traffic and looking for parking spaces.

1: Affordability:

Owning a car in India can be a significant financial burden due to the high costs associated with purchase, maintenance, and insurance. Taxis offer an affordable alternative, allowing people to travel comfortably without long-term financial commitment.

2: Flexibility and Time-Saving:

Taxis provide flexible transportation options, available round the clock. With quick and reliable service, commuters can save valuable time, particularly during peak hours or when public transportation options are limited.

3: Growing Tourism Industry:

India, being a country of immense diversity and cultural wealth, entices millions of tourists annually. These visitors frequently depend on taxi services to conveniently explore diverse destinations. The thriving tourism industry serves as a catalyst for the growth and expansion of the taxi business, presenting abundant opportunities.

4: Employment Opportunities:

The flourishing taxi business in India has created numerous job opportunities for individuals, ranging from taxi drivers to fleet managers, customer support representatives, and app developers. It serves as a viable source of employment, particularly for those seeking flexible work hours.

Advantages of Starting a Taxi Business in Metropolitan Cities like Bangalore

1. wide customer base.

Metropolitan cities like Bangalore are known for their dense population and thriving urban infrastructure. By starting a taxi business in such cities, you gain access to a vast customer base comprising residents, daily commuters, tourists, and business travelers. This ensures a steady demand for your services, increasing the potential for profitability and growth.

2. Technological Advancements

Metropolitan cities in India are at the forefront of technological advancements, and the taxi business has greatly benefited from this progress. Innovative taxi-hailing apps and GPS technology enable efficient fleet management, real-time tracking, and seamless customer experience. By embracing these technological solutions, your taxi business can leverage a competitive edge within the market.

3. Ride-Sharing and Carpooling Opportunities

Metropolitan cities often witness traffic congestion and limited parking spaces, making ride-sharing and carpooling popular options for commuters. By incorporating ride-sharing features into your taxi business model, you can attract a broader customer base, increase efficiency, and contribute to reducing traffic congestion and pollution.

4. Government Initiatives and Support

Metropolitan cities in India, including Bangalore, have recognized the importance of the taxi industry and have introduced favorable policies and regulations to support its growth. These initiatives include simplified licensing procedures, infrastructure development, and financial incentives, making it easier for aspiring entrepreneurs to enter the taxi business and establish a successful venture.

5. Potential for Scalability

Starting a taxi business in a metropolitan city provides a platform for scalability and expansion. With a strong foundation and efficient operations, you can explore opportunities to diversify your services, such as intercity travel, corporate transportation, or specialized taxi services for events and weddings. This scalability potential opens doors to increased revenue streams and long-term sustainability.

The demand for convenient and reliable transportation in India’s metropolitan cities, such as Bangalore, has led to a significant boom in the taxi business. Starting a taxi business in India has numerous advantages, including a broad customer base, technological advancements, ride-sharing opportunities, government support, and scalability potential.

Aspiring entrepreneurs can embrace this booming opportunity to create a successful and profitable venture in the dynamic world of taxi services. For the ultimate cab service experience, choose Karunadu Services. We offer unrivaled quality, reliability, and customer satisfaction, ensuring a seamless transportation experience. Karunadu is the ultimate choice for a journey where comfort, safety, and efficiency converge for an exceptional experience.

No, it is not necessary, to begin with a large fleet of taxis. You can commence with a modest fleet of vehicles and progressively scale up as per the demand and profitability of your business.

Certainly, it is essential to adhere to local regulations by acquiring the requisite licenses and permits. This entails obtaining a commercial driving license, registering your vehicles as taxis, and ensuring compliance with relevant tax and insurance obligations.

To attract customers, focus on providing excellent customer service, maintaining clean and comfortable vehicles, offering competitive pricing, and leveraging digital marketing strategies to increase your online visibility.

When setting fares, consider factors such as distance traveled, waiting time, fuel costs, maintenance expenses, competition, and desired profit margins. Perform thorough market research and meticulously analyze the pricing strategies employed by your competitors to establish fares that are both competitive and profitable.

You can differentiate your taxi business by providing additional services such as in-car Wi-Fi, music streaming, or refreshments. Emphasize safety and reliability, offer loyalty programs or discounts, and prioritize driver training to ensure a superior customer experience.

Leave a Comment Cancel Reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

How to Start a Cab Business With Uber & Ola in 2022?

Shruti Jalan

Knowing your potential is not enough unless you act on it. You have always known you could be an entrepreneur but hesitated, doubted your capabilities?. Do not, because India has entered the age of free enterprise, private businesses if you have not already noticed.

World Bank has predicted 11+% GDP growth rate for India in Year 2021-22 far higher than any major world economy. Is it possible without the start-ups/entrepreneurial spirit? No, it is not. So why not dismiss your fears and be a part of India’s growth story.

Have you been dreaming to get into transport/cab business . This write-up covers everything you need to know.

Ola & UBER are two mega multi-national transportation companies of the world that though provide public transport but give the benefits & feel of a private transport to its commuters. That was the main motivation for people to choose their services and they succeeded in meeting their customers basic needs - Quick, cheap, ease & round-the-clock hassle free service that was.

Business Model of Ola and Uber How to Start a Business with Uber? How to Start a Business with Ola? Things to Consider Before Starting business with Ola or Uber

Business Model of Ola and Uber

The fundamental business model of these cab aggregators is simple. That is connecting commuters (customers) seeking on-demand cabs with the company’s driver-partners through a company owned mobile app.

The company earns its revenue by way of commission or fees levied on each ride hailed. (Both these taxi services can be booked through their respective websites too.). So in how many ways can one do business with UBER and Ola. In addition, what is the process from start to finish. Let us find out.

How to Start a Business with Uber?

There are three Ways to Earn With Uber Drive Business:

Driver cum owner

You have a car, are willing to attach it with Uber and you also drive your own car.

Commercial driver under partner

You do not own the car but wish to drive under the Uber platform . You get to drive a vehicle owned by an Uber non-driving partner.

Note: You can even choose to drive a commercial auto-rickshaw or motorbike/scooter if that service is available in your city.

Non-driving partner

You own the car, attach it with the Uber platform without self-driving any but have to manage at least one driver.

There you go. Choose any of the three depending upon your resources and earning needs.

Step-by-Step Process

Step 1. Sign up on the Uber platform through its website, by entering your basic details like name, phone no, email, city.

Step 2. If you choose first or third option from above, you’ll land up on this page

If you choose the second option, you’ll land up on this page

Step 3. Now set up your account as directed i.e. by submitting all of the above document files online. If you do not have them online, click a picture from your mobile or scan it using a cam-scanner app and upload. You can upload all the docs in the same manner. It is much easier & faster than submitting hard copies by queuing up in the office.

Step 4. To Activate your account, Bring your car to a local green light hub. These hubs are locations in a city where you must bring your car for inspection and other things. Requirements vary by city, so sign up to know.

Step 5. Once your account is set up, you can look up all the necessary information you need to know about doing business with Uber. You can even get help by contacting their phone support number.

How to Start a Business with Ola?

Three ways you can do business with Ola:

Partner with a Car

You have a car that you want to attach with Ola platform . You also drive your own car.

Register yourself in less than a minute by entering your name, phone no. and your city. Ola team will get in touch with you within 24 hours. Additionally, be ready with these basic documents.

Benefits of this plan are:

• Choose your own working hours
• Choose from 100 cities to work in
• Daily payments 365 days a year
• Get a booking on your way home
• 24/7 helpline for support

Lease a Car

You know driving and need a car to drive. Ola provides you with a car without you having to worry about maintenance and insurance . Register yourself in less than a minute by entering your name, phone no. and your city. Ola team will get in touch with you within 24 hours.

Following documents are all you require to begin driving independently with Ola.

Other benefits you will derive with this plan:

• Get a car at zero risk
• Free accidental insurance of 2 lakhs
• Zero maintenance cost
• Drive a new car of your choice
• Two paid holidays each month
• 24/7 helpline for your support

Note: If you are an auto driver, you can also attach your auto by submitting the documents, downloading the app and start to drive with Ola.

Become a fleet operator

You own a fleet of cars and you want to attach it with Ola. You just need to track & control your fleet through specialised app.

Register yourself in less than a minute by entering your name, phone no. and your city. Ola team will get in touch with you within 24 hours.

Following basic documents are required. These are also the exact same documents you will need under option one i.e. to become a ‘partner with a car’.

Benefits under this scheme:

• Get detailed reports of total earnings
• Monitor driver logins and other trip details
• Live tracking of all your drivers and cars
• Get alerts like payments, logouts, etc.
• Check your fleet’s performance anytime
• Receive 24/7 phone support

Sure you will have further queries like ‘registration charge, initial payment if any to lease a car or two drivers for a single car’ etc. For this, you just have to visit the Ola Partner Portal.

Note: You can also attach your Rickshaw or Bike with Ola. To know more, visit the above web page & send your enquiry through a quick action tab.

Things to Consider Before Starting business with Ola or Uber

There is no definite answer but there is an answer definitely that can help you decide whether to do business with either/both of them or not. Here are two Factors to consider.

Profitability

You will surely get a ‘fare’ share of the rent but will you also get a ‘fair’ share? Is it profitable to attach car with Ola or Uber? To find an answer to this, you need to know the cost structure of both companies. Here’s the cost break-up if you rent a car:

According to the source site, you have to work 3-4 hours just to break even i.e. to earn enough to not make a loss. Therefore, in order to make any profit, you will need to work more than 3 hours a day.

And what if you attach your own car. You already have all the cost & pricing details, so just pick up a pen-paper and calculate your likely earnings, deducting all the costs.

This is a very crude analysis , which you can take as a starting point. However, it can certainly help you build a business/earning plan that suits your specific requirements.

Ease of operation & technological superiority

These two factors directly add to your job satisfaction. Consider each carefully. App features-wise & its daily payment feature make Ola look superior to Uber. Even though some may contest that Uber is cheaper in general.

However, according to user experiences, Ola & Uber fare differently in different cities. Hence, a ground study & research is the best approach before you decide to choose one of the two.

Both Ola & Uber have ambitious plans for the future. While Uber has a vision of becoming the top urban mobility platform, Ola is striving toward building mobility for a billion people. Whoa! Why dream small, right!

Can I do business with Ola & Uber both?

Yes, you can do Cab business with both Ola and Uber.

Are there fixed work hours or timings for Cab drivers in Ola and Uber?

No, there is no fixed time or hours of business with either Ola or Uber. You can choose when & how much you want to work.

What are future service offerings of Ola & Uber?

For Uber few of the future business offerings could be electric scooters, bike-sharing & autonomous (driver-less) vehicles. Apart from its wide range of cab booking services, Ola plans to launch its own line of electric scooters via its ‘Ola electric mobility’ subsidiary.

Is putting the car in Ola profitable?

You can easily profit over Rs. 15,000 a month by giving car to Ola.

What percentage does Ola/uber take?

Both Ola and Uber take 25–40% of the amount as their commission.

How profitable is Uber business for drivers?

A driver can earn up to 35/40k a week.

Must have tools for startups - Recommended by StartupTalky

• Convert Visitors into Leads- SeizeLead
• Manage your business smoothly- Google Workspace
• International Money transfer- XE Money Transfer

Show-Cause Notices Issued to Firstcry Over Esop Expenditures Totalling INR 80 Crore

Show-cause notices have been issued to Brainbees Solutions, the parent company of FirstCry, in relation to employee stock ownership plan (ESOP) expenses that were close to INR 80 crore and were incurred during the fiscal years 2018-19 and 2021-22. The notices have been sent by the Income Tax Department in

Introducing Heph, InsuranceDekho's New SaaS Platform for Insurance Providers

Insurtech startup InsuranceDekho, based in Gurugram, has established Heph, a new software-as-a-service (SaaS) company that is affiliated with InsuranceDekho. The company's mission is to provide digital solutions that would ease the operations of insurance distributors around the country. This coming Monday, August 26th, will mark the formal launch

Uber Is Considering Reintroducing Its Premium Service, “Black,” to the Indian Market

At a time when customers in India are willing to spend more on high-end experiences, ride-hailing platform Uber is reintroducing its flagship product, Uber Black, to the nation. According to a media report, the service is set to be launched in the coming weeks, initially targeting certain areas in Mumbai.

Best Business Movies in Bollywood & Hollywood for Entrepreneurs

There's no dearth of inspiring movies if one considers cinematic contributions across the globe each year. Movies like “The wolf of wall street” have given rise to a new genre: entrepreneurial cinema. India is second to none when it comes to producing movies promoting entrepreneurship and the startup

How To Start a Cab Service Business?

How To Start a Cab Service Business – Small Business Plan

Like most businesses, the business to set up a cab service business can be an expensive one to start with, requiring big investments on purchasing new cars and all. However, once set, it can give easy and lucrative returns without much of an effort. However, there are some pointers that must be borne in mind and followed for the  successful running of this business .

Starting Carefully

To set up a business of this kind, you can initially start small by just a few cars and drivers, and gradually expand to more cars once the profits start pouring in. It must be ensured that the area where you plan to set up your office has sufficient demand for cars and has daily commuters .

In today’s competitive corporate and business world, with the number of job opportunities and new enterprises rising, the number of employees and, thereby, people using public transport have substantially gone up. However, many people find it inconvenient and troublesome to use public transport on a daily basis. This is especially true when the distances to be traveled are long. A cab-sharing service comes in handy in situations like these, wherein up to four commuters can travel in the same car and share the cost of daily travel. It is not only convenient but can also be quite economical for passengers.

H andle Legal and Financial Issues with Care

Applying for business and driver’s licenses is a necessary prerequisite for the start-up. Also, you must check with all local legal matters. Since this business involves costly infrastructure, getting insured would save you from unnecessary and unwanted financial loss. Another issue that should be handled before starting this business is to figure out your financial plan for it. Hire a financial consultant who can guide you through this . Financial consultants work with clients to develop individualized financial plans for savings, retirement, investments and insurance.

Know Your Market and Plan Your Resources Accordingly

A necessary research must also be conducted to find out about the competitors in the market and to know what rates these other providers offer. It must also be kept in mind that such service works best in metropolitan cities instead of small towns. Also, plan which cars are you buying according to the requirements. Whether you opt for small cars or SUVs, Diesel, petrol or CNG, choosing the right car will play a big role in your business. Selecting drivers can be especially challenging. Proper background verification must be conducted before finalizing . It must be ensured that the person has had proper experience in driving. Maintaining cordial behavior with customers is a must and should be properly inculcated in your business system.

Advertise W ell

Once the resources are obtained, the name of your cab service and contact information must be advertised in local newspapers so that enough people get to see it. Advertise through e-zines, classified ads, and blogs. This can also attract the attention of the customers to a great extent. You must also ensure to be on major networking sites such as Facebook, Twitter, YouTube etc. A great and clutter-free website will also add to your brand and increase sales.

  Tip – During start-up, the investment amount can be brought down by preferring a secondhand vehicle (in good condition) over a new vehicle will help you in entering the profit mode much earlier. But don’t compromise on the condition of the car.

Contact ourbusinessladder for Gamification example and Consulting for your business.

Recent Posts

What is the secret formula for business success, how can businesses create an effective tiktok content calendar, the role of pre-engineered buildings in meeting modern space requirements.

• How Direct-to-Consumer Brands Are Disrupting Traditional Retail Models
• Challenges and Opportunities in Reefer Container Logistics

Related Posts

• Business Ideas
• Business news

The Role of a Strong Legal Team in Business Success

• Enterpreneurs
• Enterpreneurship

Mindset-Transforming Literature for Entrepreneurs: Must-Read Books for a Paradigm Shift

Hp ready to slash 30,000 jobs en route to split.

• Communication
• Digital Marketing

Indispensable Resources for Business Success: Must-Have Tools for Entrepreneurs

How Can Your Business Achieve Success : Inspired by Disney Plus Deals?

Unlocking the Secrets: Businesses with Maximum ROI for Smart Investors

How Businesses Can Survive During Market Slowdown?

Sunpharma’s acquisition of gsk’s opiates business in australia finalized.

Beginner Introduction to Consumer loan and How to Benefit from Them?

• Farming & Agriculture

The Farmhouse Business: Transform Your Unused Farmhouse into a Thriving Business

Aug 26, 2024

I very like your site and I recomend it to my parents.

I am thinking of starting a Cab service buisness in Pune.But don’t know from where to start. Do reply me in this case

Greetings from Ourbusinessladder! Thanks for your comment. We are more than happy to assist you in your query. Pls, Could you share your details in our contact form at http://ourbusinessladder.com/contact/ ?. we will get back to you for detailed discussion and take it forward shortly. You can also reach us at +91 9655498877.

It’s Very nice information for new Cab service start-up. You define all business plans clearly. Keep it up!

Thank You 🙂

Submit a Comment Cancel reply

You must be logged in to post a comment.

• Scroll to top

Cart review

No products in the cart.

• Business Ideas
• Let’s Connect

Launch a Successful Taxi Service Business in India: A Comprehensive Guide

• Published 18/09/2023

Are you on the lookout for a business opportunity in India that offers promising monthly returns without the need for a substantial initial investment? Starting a taxi service business might be the solution you’ve been seeking.

In this guide tailored for Tier 3 audiences in India, we will provide you with a detailed step-by-step process and estimated costs to help you kickstart your taxi service venture within a budget of INR 2 Lakhs.

Here are the steps to start a Taxi Service Business in India:

Step 1: Market Research

Begin by conducting thorough market research in your target area. Identify the demand for taxi services, assess your competitors, and determine peak hours of demand. This information will help you make informed decisions regarding your services and pricing.

Step 2: Business Plan

Create a detailed business plan outlining your goals, budget, target customer base, and marketing strategy. Calculate how much you need to earn monthly to cover expenses and generate a profit.

Step 3: Legal Requirements

Register your business and obtain the necessary licenses and permits for operating a taxi service. This may include a commercial vehicle permit, a driver’s license, and compliance with local transportation regulations.

Step 4: Vehicle Acquisition

Allocate a significant portion of your budget to purchasing a suitable vehicle for your taxi service. Depending on your budget and preference, you can choose between new and used vehicles. Ensure the vehicle is in excellent condition and complies with local safety and emissions standards.

Step 5: Vehicle Branding

Invest in professional branding for your taxi, including a company logo and contact information. Ensure your taxi is clean, well-maintained, and equipped with GPS navigation and safety features.

Step 6: Driver Hiring and Training

Recruit experienced and licensed drivers with knowledge of the local area. Provide training on customer service, safety protocols, and efficient route planning. Conduct background checks and verify their driving records.

Step 7: Pricing Strategy

Determine your pricing strategy based on factors like distance, time, and vehicle category. Offer competitive rates while ensuring you can cover your costs and generate a profit. Consider offering promotions or discounts to attract initial customers.

Step 8: Marketing and Promotion

Create an online presence through social media profiles, a website, and a booking app if possible. Utilize local advertising methods like flyers, posters, and partnerships with local businesses to promote your taxi service. Emphasize safety, reliability, and prompt service in your marketing.

Step 9: Customer Service

Prioritize exceptional customer service by ensuring that your taxi is clean, comfortable, and well-maintained. Train drivers to be courteous and punctual, and encourage customer feedback and reviews.

Step 10: Operations and Safety

Implement efficient booking and dispatch systems for smooth operations. Enforce safety protocols and conduct regular vehicle inspections to ensure passenger safety.

Estimated Costs

Here’s an approximate breakdown of costs to start a taxi service business in India with INR 2 Lakhs:

• Vehicle Purchase: INR 1,20,000 – INR 1,50,000 (for a used vehicle)
• Legal Registration and Licenses: INR 10,000 – INR 20,000
• Vehicle Branding: INR 5,000 – INR 10,000
• Driver Recruitment and Training: INR 10,000 – INR 20,000
• Marketing and Promotion: INR 10,000 – INR 15,000
• Miscellaneous Expenses: INR 10,000 – INR 15,000
• Working Capital: INR 25,000 – INR 30,000 (for the first month)

Business Pitch

Are you ready to embark on a business journey that offers substantial monthly returns without a massive upfront investment? Launching a taxi service business can be your path to financial success. With just INR 2 Lakhs, you can enter a growing market, cater to the local transportation needs, and build a loyal customer base.

Tier 3 towns and smaller cities often lack reliable and safe taxi services. By providing clean, well-maintained vehicles driven by courteous drivers, you can meet this demand and offer a valuable service to your community.

Don’t let budget constraints deter you from pursuing this lucrative business opportunity. With careful planning, dedication to customer satisfaction, and a focus on safety, your taxi service venture can thrive and become an essential part of your community, all while generating a significant return on your modest investment.

So, why wait? Take the first step toward financial independence and start your taxi service business today!

Disclaimer: The estimated costs mentioned here are approximate and may vary based on your specific location, vehicle choice, and other factors. Success in the taxi service business depends on various factors, including market demand and customer satisfaction. Earnings can vary significantly.

Are you ready to hustle?

Get started with minimum investment and grow your business today! Don’t worry if you have no idea where to begin, our expert team at Ideas Galaxy will guide you every step of the way from ideation to commercialization. Whether you have an idea in mind or need help generating one. With our collaborative innovation, prototyping, and market entry strategy, we can help you launch a successful business at a low cost. Whether you’re a housewife, unemployed, job seeker,  entrepreneur , business professional, business owner, or investor. We have something for everyone.

Let’s  connect  now to unlock the opportunities waiting for you in the Indian market and receive a free business consulting session. Don’t miss this opportunity to start your own business. Here’s your chance to begin your  entrepreneurial  journey today!

Looking for more  new business ideas  ?

Explore  Galaxy of Ideas  – A world of many perspectives & the cosmos of innovative thinking.

Got Any Idea That’s Missing?

Share It with Us and Let’s Fill the Gap Together.

Your feedback and suggestions are valuable to Ideas Galaxy. If you have any questions or need additional information about the topic, please feel free to comment below. We are here to help and provide you with the best possible guidance. Your comments will also help us improve our content and better serve our audience. So, don’t hesitate to share your thoughts with us. We appreciate your input and look forward to hearing from you!

Related Posts

Starting a Zero Waste Grocery Store: A Comprehensive Guide

Starting a Language Immersion Retreat in India: A Budget-Friendly Guide

• +91 77908-64716
• [email protected]
• An ISO 9001:2015 Certified Company
• ADVISOR BOARD
• partner with us

• CONTRIBUTE ARTICLE
• Business Consultant
• Legal Recruitment Consultant
• Connect Consultant
• Go to aapkaconsultant.com
• Company Law

How to Start a Taxi Business in India

Want to start a taxi business in India? A taxi business is one of the attractive and profitable businesses of the present scenario. So, before starting a taxi business in India, the individual must be well aware of every detail related to the starting of the Taxi business. Here are some factors that are essential in order to start a Taxi Business in India.

• 1 . Business Structure – Firstly, the business structure of the Taxi business must be decided. It can be based on sole proprietorship , private limited company , partnership or limited liability partnership model as business structure affects your personal liability, paperwork, taxation of the business etc.
• 2 . Commercial Driving License – Any person, who owns a vehicle and drives it, must have a Driving license to prove his authorization to use it. In case the vehicle used by the person is for commercial purpose, then the person using it, must have commercial driving license to prove his authorization to drive it. A Driving license is issued by a Regional Transport Authority (RTO) of a particular state, and it is absolutely necessary to have the license, as per the Motor Vehicle Act.

Criteria for obtaining Commercial Driving License

Documents required for the application of the Commercial Driving License

• Identity Proof
• Address Proof
• Multiple passport size photos
• Application fee
• Obtaining Permit as per the Provisions of the Motor Vehicle Act.
• Makes Compulsory for the owner of the transport vehicle to obtain a permit from the Regional or State Transport Authority.
• It mandates a taxi owner to submit an application to the Regional Transport Authority to grant a permit to carry passengers under a contract to a fixed destination within or outside the state.
• Taxi owners can choose to obtain an All India Permit under which, there is the All India Tourist Permit (AITP). An application must be made to The Transport Authority along with the prescribed legal fee.
• It is mandatory for every motor vehicle to register his motor vehicle before driving it.
• It mandates procurement of a fitness certificate for every transport vehicle. The certificate may be issued by an authorized testing station or a prescribed authority after ensuring that the transport vehicle complies with all the requirement of the act.
• It necessitates insurance of the motor vehicle in use against any third party risk.
• Taxation Norms- After the enforcement of GST , the meter taxis will not be liable for GST. If you a cab owner then, 5% GST would be applicable on the passenger fares.
• Environmental Regulations- As a taxi business owner, he must be aware of all the norms imposed by the state as well as centre with regard with the Environment. It is very important to run taxis as per the environmental regulations to not run into a legal dilemma.
• Finances- Financing the business all on own would be taxing and frustrating tax. Therefore, the company should look forward to take loans from the banks. Nowadays, the banks are taking initiatives to support the upcoming businesses in India.

Therefore, recently two taxi businesses have profited a lot by their unique of business structure. Ola and Uber are the upcoming taxi businesses that are fulfilling the needs of the people by their varieties of services. So, when all the above factors are taken into consideration, then the taxi business could be started smoothly.

OUR SERVICES

Company Registration  I  Trademark  I  Copyright  I  Patent  I  GST  I  MSME

 ISO Certification  I  Website/App Policy  I  Legal Documentation

Annual Compliance  I  Connect Consultant

Visit:  Aapka Consultant  to get  Online Services  of  CA CS  &  Lawyers

RELATED ARTICLES MORE FROM AUTHOR

How to Start Restaurant/Food Business in India

How to Start a Logistic Business in India

7 Mistakes to avoid under GST Composition Scheme

No comments, leave a reply cancel reply.

Log in to leave a comment

EVEN MORE NEWS

Landmark Judgement by Supreme Court on Adverse possession

Landmark Judgement of Supreme Court on Bail

Landmark judgment of Supreme Court on Child Custody

Popular category.

• Legal Documentation 441
• Drafting 415
• Agreements 283
• Legal Article 260
• Agreement 172
• Trademark 130

• Go to AapkaConsulant

Posted on July 25, 2021 at 7:09 pm

Featured Lifestyle

A Concise Guide On How to Start a Taxi Business in India

Over the past few years, the taxi industry has witnessed huge growth in India. More and more people are turning to cab services to get the comfort and ease of travelling. This means, if you have been planning to start your own taxi business, now is the time. 

To help you start your journey, here is a short and concise guide on how you can start a taxi business in India. From the business plans and papers to taxi insurance and hiring, we have tried to cover it all to give you an overview. Read on:

Also Read – Top 17 Tips To Get A Cheap Car Insurance

• Research and Make A Plan

Before jumping into any business, it is very important that you must gather insights and relevant data into the current market size and its potential. This will help you decide whether you should start a big taxi business or test the waters first with a few vehicles. This research part also helps you in charting out a taxi business plan and note down the requirements. 

Here are some things that should become clear to you during the research and planning process: 

• How many taxis should you buy and where should you buy them from? 
• What type of business would it be – sole proprietorship, partnership, limited liability partnership or a private limited company?
• What should be the region or route for the business?
• How to gather funds and prepare the paperwork?

Also Read – How to Run a Business Successfully So You Can Have a Lifestyle You Love

• Gather Funds

This is another crucial step you just can’t take lightly when planning to start your taxi business. You need to determine the sources from which your funding will come and how you can get it. While calculating the fund required, make sure you consider all the aspects such as operations, infrastructure, marketing, insurance, and even advertising aspects. 

• Find Your Vehicle

To make sure your business booms, invest in cars that have been modified for public taxi service. If you are buying second-hand vehicles, do check their condition, and see if they are clean and comfortable. 

You should also check the car documents like taxi insurance, and registration certification (RC) properly. Nowadays, you can also check vehicle RC details online . Once you are sure of the vehicles, apply for transfer of the policy and new RC under your name.

Also Read – Five Features Every Business Needs  

• Apply For Licence & Insurance: 

When you have to start a taxi business, you must apply for a taxi business licence and a commercial license for the drivers. You should also get taxi insurance from a reputed insurance agency. 

If you want to make your vehicles “Tourist vehicles”, you also need to get an All India Permit from the Transport Authority by applying with a legal fee. You can run the business only after you have received the proper approvals.

Also Read – How Can You Start Your Small Online Business

• Hire People 

While hiring drivers, make sure they are experienced. You can also hire commercially licensed cabbies for the work. Other than that, you will also need to hire employees who can help in operating the business efficiently. But before hiring anyone, check all the background details and the original license of the drivers too.  

• Promote Your Business:

Promotion is a crucial part of any business’ success. So, advertise as much as you can through various channels. From word-of-mouth marketing and advertising in local newspapers to going online, create a strong marketing strategy to reach your potential audience. 

Now that you have the blueprint, start the business plan. Put in your best efforts and the taxi business will offer you impressive returns of investments quickly.

Also Read – 3 Ways To Reach More Customers

Other Popular Stories

UrbanAsian.com

View Profile

For press, you can contact me at [email protected]

• +91 7821055537, +91 9982201414
• +1-603-275-9923
• +1-650-727-6690

How to Start a Taxi Business in India?

App development, dec 21, 2023.

One of the most prominent questions investors are asking is “ How to start a taxi business in India?” Are you also looking to invest in this lucrative industry and enjoy hefty returns? Fret not, this blog will provide an in-depth guide on how you can start an online booking taxi business and provide information on a cab business plan in India. 

With ongoing technological advancements, the taxi venture market is buzzing all around the world. The ever-increasing demand for the taxi market has led the taxi venture to grow by leaps and bounds. 

With the emergence of taxi giants like Ola, Uber, and Lyft, anyone in any corner of the world can now hail a taxi from their smartphone. This massive paradigm shift from traditional taxis to the taxi-hailing model is very profitable and has urged entrepreneurs to invest in this lucrative industry. 

Table of Contents

India’s Taxi Booking App Revenue

In 2015, there were two major taxi online booking service providers in the country: Ola and Uber. That year people started booking online taxis and started gaining knowledge about taxi booking app development . The taxi app revenue in 2015 was $3.8 billion and continued to grow and in 2023 it stands at $6.6 billion. Have a look at the table below to understand the taxi app revenue growth (Source) :

How to Start a Taxi Business in India? Steps to Follow

In order to start a taxi business in India, you must have a well-structured plan and roadmap so that you can establish your taxi venture effectively and efficiently. A well-structured plan is essential for the proper workflow of business elements such as taxation, documentation, etc. Additionally, if you have a robust taxi booking app development solution, you can boost your business of taxi-haling to new heights. 

Here are the steps that must be followed to start a taxi business in India:

• Market Analysis

The first thing is to analyse the market and target customers. Acquire information about the routes, fares, and cab demands by passengers in particular areas.

• Plan Development

Develop a Taxi-led business plan that covers every aspect of the taxi business including routes, cab fares, how you can attract customers, your business goals, etc.

• Business Registration & License

After making a complete business plan, get your business registered and obtain a license which is a permit that allows your business to run in the country legally.

• Fleet Establishment

Purchase cars of segments that are mostly preferred by passengers. You should have hatchbacks, sedans, and MUVs in your taxi fleet as these segments are the most preferred mode of transportation by passengers.

• Hire Taxi Drivers

After you have a fleet of taxi cars, you should hire experienced drivers who have legal licenses. You can hire them as full-time or part-time taxi drivers as per your requirements.

• Plan Routes and Set Fares

Plan your routes and set fares according to the taxi market. Also, have a multiple mode of payment so that drivers and passengers have convenience in payment.

• Develop a Taxi App

Before the promotion, make sure to develop a Taxi online app for your taxi business as nowadays most taxis are booked through mobile apps. If you want an expert taxi app developer team for your business you can contact a leading taxi app development company.

• Marketing & Promotion

You can hire the best taxi app development services provider to promote your business through various promotional strategies including, pamphlets, digital marketing, social media marketing, newspaper advertisements, etc, which will be beneficial to your business to reach a number of people.

• Customer Feedback

Listen to your customer’s needs and suggestions, and work on the feedback to improve customer satisfaction and business performance. 

Also Read: Taxi Booking App Solutions For Your Business- A Detailed Guide

Why To Invest In A Taxi Business?

India has over 1.4 billion population which creates great potential and a huge opportunity for taxi booking app development . The advancement in technology has changed the way we commute in our daily lives from short routes to long routes while also changing the way of book taxis. Taxis are going to stay and the requirement will increase with the population.

As the taxi venture is highly lucrative, it makes sense to invest in a taxi business. Here is a list that will help you understand why it is profitable to invest in a taxi business:

• High ROI The need for taxis will only increase day by day and there is a high scope in this business. This is why the online booking taxi venture helps you generate a high return on investment along with maximized revenue.
• Wide Network The taxi booking app development helps you expand your taxi network as you will reach a wider audience with an online taxi app. Earlier, people used to book taxis by visiting the taxi stands but now with the taxi online app, you can book with a single tap.
• Brand Awareness With the help of the best taxi booking app development company , you can promote your taxi venture to remote areas, villages, and three-tier cities. As a large population uses smartphones, you can promote your brand pan India.
• Low Development & Maintenance Cost Building multiplatform taxi software will also lower your expenses as the development cost of the taxi app is less and it will also reduce maintenance costs in many ways like live driver tracking, daily kilometers covered, GPS tracking of taxis, etc.

Also Read: Everything You Need to Know about On-Demand Taxi App Development

Features of a Taxi Booking App Development

Here are some emerging and unique features of the taxi booking app development that are integral in offering an enhanced user experience to users as well as drivers. Let’s take a look- 

User Panel Features

Driver Panel Features

How Much Does it Cost to Start a Taxi Booking Business?

The overall costs revolve around multiple factors above mentioned. While estimating how much it costs to start a taxi business, it can be around $25,000 to $30,000 with the availability of cars that can easily fulfill customer requirements. Starting a taxi business remains a feasible option that holds great potential in this leading market. Proper cost, effective strategies, and other adaptive plans lead to imperative opportunities for successful taxi online booking venture growth.

The factors which affect the cost of starting a taxi business depend on several factors including:

• Business Registration & Getting a License: Registering your business and obtaining a license permit comes at a cost but you can legally run your business throughout the country.
• Development of Taxi Online App: A top taxi booking app development company can help you in this phase. The overall development costs depend on features with core values. If you want to taxi app developer team to incorporate more features into the app, it will increase the project cost.
• Integrating with Offline Vendors: Communicating with offline vendors for using their vehicles to use as taxis under your taxi venture. You will need to register them as taxis which will add a cost to your business.
• Purchasing cars for building a Fleet: To have a full-fledged fleet that fulfills that caters to a large customer base you have to purchase a number of cars which increases business expenses.  
• Hiring experienced Drivers: You have to pay more for Hiring drivers who are skilled and experienced. They will also help in running the business efficiently.

Final Words

The t axi industry is rapidly growing, so investing in taxi app growth is a wise move. Travelling by taxi has become a lot more affordable since the introduction of online taxi apps, compared to when these apps were not available. These are popular because of the low rates, instant bookings, and large variety of cabs. 

If you want to develop a cutting-edge taxi online booking app BR Softech is a leading taxi app development services provider that can help you streamline the process. Our highly skilled taxi app developer team utilise their in-depth knowledge and expertise to develop cutting-edge and feature-rich Taxi online apps that have the potential to attract millions. 

Frequently Asked Questions(FAQs)

Yes, this is booming right now and it is very profitable to invest in the taxi industry right now.

Yes, we offer completely customized taxi booking app development solutions that are tailored to our client’s requirements. 

Initially, the business of taxi booking involves a lot of money as you would be purchasing many cars, and paying driver salaries, and other expenses. However, the taxi-hailing business is highly lucrative.

Yes, the Taxi App is highly profitable for your business as a large number of people book taxis through taxi mobile apps  and generates a high ROI. 

Quick Contact Us :  Call/WhatsApp:  +91-998-220-1414, +971 527313556 Email:  [email protected]

I am Nitin Garg Founder of BR Softech PVT LTD - an Award-winning mobile game development company. We are armed with 180+ geeks & 2753 clients worldwide, I have driven by the spirit of entrepreneurship and dream to build a billion-dollar-company.

You may also like

Top 10 Apps to Play Chess and Earn Money in 2024

Top 10 Carrom Earning Apps to Win Real Cash in 2024

Top 10 Online Paisa Kamane Wale Apps in 2024

Scan QR Code

For immediate contact.

Get in Touch

Country Name *

Mobile No *

Get In Touch

Subscribe BR Newsletter for trending blogs, tips, and latest photos. Let’s stay updated!

• +91-9999-42-92-72
• [email protected]
• Taxi Software like uber
• Taxi Software
• Car Rental Software
• Cab Software

How to start a taxi business in India

How to start a taxi business in India with less than 10,000 INR and make it big somewhere ola uber

Hardly three-four years back since 2013-14, cabs and taxis were used by the ordinary man as a style of lavishness and comfort, not as a requirement like what we have these days in 2017-18.

Cabs or taxis were not affordable for the lower middle-class community.. I say it a community because this is a reality. . . they are the actual decision maker of every big thing to survive or accepted as the new business pathway of working.

Due to the cheaper smartphone and fast internet, several mobile apps are easily accepted by the masses, this is reasons shape of many business has been changed as the connecting process has been changed.

These day masses are not interested to make calls and understand the facts; they now wanna very and process most of the required things using mobile apps, this is the reasons for taxi business in India you need a taxi software with mobile apps

Uber OLA became success with more than 16 lakhs of booking as day as the pricing was cheaper and service was quicker as compared to taxis cabs available at that time. As charges were based on per km and through the technology of taxi dispatch software nearest available taxis could be located and sent to the customers.

Types of Taxi Business

To start on taxi business in India, one has to earliest looked into the business kind fit for him/ her I mean there are typically two types of taxi businesses – B2C & B2B.

If you think that you need to start a taxi business with less than Rs. 10,000 please start with B2C taxi service.

FIRST STAGE – (ONLY ENTRY IN TAXI BUSINESS – NO COMPETITION – NO FOLLOWING)

Items Required:

• Mobile Number – get the fancy number
• 3-5 pages Websites – define the taxi service cities and rates
• Google Ad words Account / free account Just Dial / free account Sulekha or any classified
• Associate with some Drivers and Vendors with the promise of good rate and services
• [LEAD GENERATION by Google Ad words – {ON CALL MAXIMISE AUTO} [Negotiate the Price with a customer over call – if possible charge some advance]
• [Convey the customer details to driver / vendor and vice versa to customer – Ask driver to collect the remaining amount]
• With thanks the customer and driver – vendor after the journey and settle the amount with the driver – vendor weekly or as per choice.

SECOND STAGE – (Register your BUSINESS – YES for COMPETITION – YES FOLLOWING)

You can register your business as OPC / LLP or PVT LTD as per your team, location and current earning. I will suggest start with OPC – or LLP as per team strength

Add the Process

• [Promote Your taxi booking app] thru Google Adwords and other social media platform.
• [Build Network with Vendor Mobile App] – Ask your vendor or taxi operator register thru app as booking is process directly to then only on VENDOR MOBILE APP. It will help you in understand the availability of vehicle on the real time. Offer FREE DRIVER APP to your direct driver and vendor.

Ask us to provide software DEMO [Demonstration] that Grow with your franchising model and optimise the multi office business process.

INTERESTED In going LIVE CAB SOFTWARE DEMONSTRATION.

Get In Touch We welcome you to MobilitySUM Technologies for your business potential & growth. We have a strong team of analysts & innovators who can help you build your ideas into reality. Registered Address: MobilitySUM Technologies Private Limited. Basement, Millennium business centre, 34 Corner Market, Malviya Nagar, New Delhi 110017 Business Development Centre: MobilitySUM Technologies Private Limited. 409, 3rd Floor, Rajendra Mahaveera Tower, Opposite Aurobindo College, MMTC ROAD, Shivalik, Malviya Nagar, New Delhi-110017 Phone : +91 9999 42 92 72 , +1-302-306-1005 Email ID : [email protected] | Contact Us Form

Car Rental Software | Car Rental Software India | Free Car Rental Software

© 2017, MobilitySUM Technologies Private Limited. All Rights Reserved.

• Law of torts – Complete Reading Material
• Weekly Competition – Week 4 – September 2019
• Weekly Competition – Week 1 October 2019
• Weekly Competition – Week 2 – October 2019
• Weekly Competition – Week 3 – October 2019
• Weekly Competition – Week 4 – October 2019
• Weekly Competition – Week 5 October 2019
• Weekly Competition – Week 1 – November 2019
• Weekly Competition – Week 2 – November 2019
• Weekly Competition – Week 3 – November 2019
• Weekly Competition – Week 4 – November 2019
• Weekly Competition – Week 1 – December 2019
• Sign in / Join

How To Start Taxi Business In India

In this article, Nandhini Ramakrishnan pursuing Diploma in Entrepreneurship Administration and Business Laws from NUJS, Kolkata discusses on how to start a taxi business in India.

Introduction

Until a few years back, Taxis were used by the common man as a mode of luxury not necessity. Taxis were not affordable for the poor and lower middle class people until recently. Due to modernization and digitalization, almost every other man in the country possesses a smart mobile phone. Availing this opportunity, and making use of the technology, companies like Ola, Uber, Taxiforsure, etc. have entered into the market through the hands of the common man, making taxi rides easier and affordable to all classes. To avoid the congestion of public transport and to gain comfort, the common man prefers the taxis/ cabs, thereby making it one of the beaming markets in the country. The citizens, who are rich enough to own a car, prefer taxis for the sake of convenience and non requirement to appoint a driver separately. The technology has made us avail a taxi at the ease of home, a phone call away/ use of app/ other options.

Structuring the Business

To begin taxi business in India, one has to first look into the business type suitable for him/ her.

• If it is going to be sole proprietorship, then the compliances to follow for setting up are much less. But the risk of loss in the business will sound scary as one single person has to bear all the losses.
• If the business structure is partnership, then one has to ensure that a registered partnership agreement with detailed clauses as to everything including liability, share of profit and loss, etc is in place. A partnership firm may be registered with the Registrar of Companies by making an Application under Section 58 of the Indian Partnership Act.
• If the business structure is a Limited Liability Partnership, wherein the liability of partners is limited, the same requires registration with the Registrar of Companies. The process of incorporation of a limited liability partnership is entirely online. An LLP agreement must also be executed during the registration process.
• If the business structure is a Company, then it requires a detailed registration and incorporation process. The company must have its own Memorandum of Association and Articles of Association which also must be filed with the Registrar of Companies. A Public Limited Company can raise funds from the public whereas the investor has to make the entire investment in a Private Limited Company. One – Person Company is also a gradually developing trend which was introduced in the Companies Act, 2013.

Hence, one has to make a detailed analysis on the structure of business to be chosen for starting taxi business. The factors that one must look upon include the size of business, capital availability, risk sharing capability, compliance requirements, etc., while structuring the taxi business.

Types of Taxi Business

There are typically two types of taxi businesses – Traditional & Radio Taxis.

Traditional Taxi business is losing its hold in India. Examples of traditional taxis business include (1) individual taxis & (2) organizations owning a number of cars & thereby running taxi business (Eg. Fast Track Call Taxis, Meru Cabs, etc.). This kind of traditional taxi business is not preferable at this point in time and people tend to prefer the modern type i.e. Radio Taxis due to ease of access.

Radio Taxis contain GPS installed systems wherein the taxis are booked online and the taxi driving route is traceable. Examples of Radio Taxis include Ola Cabs, Uber, etc. which uses the online platform/ app based platform for booking.

It is the Motor Vehicles Act which governs the taxi business in the country. However, with the advent of technology, since the taxi business is making it possible for people to book taxis online, it would be better if the scope of Information Technology Act is widened and the radio taxis come under the preview of the Information Technology Act. Usually in Radio Taxi type, it is the drivers of the taxi who own the vehicle, unlike the traditional type. The drivers will receive the consideration for the taxi ride and pay a percentage of the same to the company which co-ordinated and scheduled the taxi rides.

Registration & Obtaining Permits for Vehicles

Registration process and required compliances.

Purchase, registration and obtaining permits for the taxis/ vehicles will be a herculean task during the initial stages of setting up the taxi business.

While purchasing cars for the purpose of taxi business, one has to ensure that the cars are of taxi-type and economically affordable.

Once purchased, the vehicle needs registration before the District Transport Office/ Regional Transport Office (as it is called in that particular State) within 7 days from the date of purchase of the vehicle as mandated under Section 39 of Motor Vehicles Act, 1988.

The transport authority provides the owner with the registration certificate. It is an offence to drive unregistered vehicles which attracts a penalty of Rs.2000/-.

The portals and Application forms differ with respect to the Transport Authority in the particular state where the vehicle was purchased.

The taxi needs to be insured with, so that it will be useful if any harm or damage is caused to a third party by the taxi. Vehicle insurance can be obtained from various insurance companies by filling in their Application forms and complying with the various mandatory procedures as stated by the insurance companies.

It is to be seen to it that the car has complied with all the environmental clearances as required by the State Authorities.

Vehicle Permits

Not all cars can be used for taxi business. Certain vehicle permits are required to transport people/goods from one place to another. Hence, permit for transporting people must be obtained from the Regional Transport Office/ State Transport Office by submitting forms as required under the respective procedures.

Contract of carriage of passengers

Further, an Application must be made with respect to contract carriage of passengers i.e. the owner/ driver carries the passengers under a contract to a particular place for a particular sum. The Application has to be filed in accordance with Section 73 of Motor Vehicles Act, 1988 as per which the type & seating capacity of the taxi, the area in which the taxi is going to operate and other such details as prescribed by the State Authorities.

Fitness Certificate

Further, in accordance with Section 84 of the Motor Vehicles Act, 1988, every vehicle should carry a fitness certificate from an Authorized Testing Station. The vehicle should be maintained properly as mandated under the provisions of the Motor Vehicles Act. The speed limit of the taxi varies from state to state. Usually, the speed limit for taxis is about 50 to 65 km/hr. The name and the address of the operator of the vehicle shall be painted or affixed on the taxi.

All India Tourist Permit

If the taxi is to ply from state to state, then a permit called All India Tourist Permit is required for the said taxi. The All India Permit may be obtained by making necessary application before the Transport Authority after properly analyzing the same. The number plate of taxi for which All India Permit is granted should contain that the taxi has All India Tourist Permit. The taxi which has been provided with All India Transport Permit cannot be used for local purposes i.e. it cannot carry passengers locally.

Drivers, their Licenses & their Work Hours

The driver of taxis should obtain commercial vehicle driving license from the Regional Transport Office of that particular state. In order to obtain commercial driving license, the taxi driver should qualify certain basic requirements such as 18 years of age, should have completed at least Class 8, should get training from a Government Motor School and should pass a written test and driving test. The taxi driver should also submit a medical certificate regarding his/ her physical and mental fitness. The commercial driving license will be granted by the Regional Transport Authority after analyzing all the above factors and consideration of the Application.

The work hours for a taxi driver shall be as provided under Motor Transport Workers Act, 1961. Section 13 of Motor Transport Workers Act, 1961 provides that an adult motor transport worker shall not work for more than 8 hours per day or 48 hours in a week. If the taxi business involves driving long distances, etc., then the employer shall obtain permission from the prescribed authority, with whose permission the driver may be allowed to work for an extended period but not more than 10 hours a day and 54 hours a week.

To be precise, if any new startup is looking forward to start taxi business in the country, they have to first choose the business structure, then purchase cars suitable for taxi business, subsequent to which one has acquire permits for the cars (if the cars are to be owned by the company), ensure if the drivers have obtained commercial driving licenses for driving taxis and thereafter step into the field of taxi business. It is advisable that, any new venture into the taxi business may take the route of Radio Taxis, since the same is thriving in the market presently and looks like it will have a booming market in the near future as well and to state further, it is being highly preferred by the common man, due to ease of access.

http://www.thesaurus.com/

http://www.tn.gov.in/sta/go.html

Is It Legal To Drive A Vehicle With Temporary Registration Plate In India?

Motor Vehicles Act 1988

The Motor Transport Workers Act, 1961

http://www.mondaq.com/india/x/278154/Corporate+Commercial+Law/One+Person+Company+A+Concept+For+New+Age+Business+Ownership

RELATED ARTICLES MORE FROM AUTHOR

Khazan singh and ors. vs. state of uttar pradesh and ors. (air 1974 sc 669), illegitimate children under muslim law, radhakanta deb & anr vs. commissioner of hindu religious endowments, orissa (1981).

Hello There, This one is good article for taxi business. I started by taxi business in 2018 and it is running fine. Thanks for sharing this article with everyone.

I would like to say the thanks for the very valuable content. I appreciate your taxi business idea and excited to discus with my team and start work on taxi app development.

Great article!!!

Really Helpful for startup business in this industry.

Very helpful Post for me. Thanks for sharing.

Thank you for posting this. This blog very help full for me this is Ashwini from

Can you help me write a business plan? I am thinking about starting a Limited Liability Partnership Company?

LEAVE A REPLY Cancel reply

Save my name, email, and website in this browser for the next time I comment.

3-Day Bootcamp (LIVE only) on

How you can use labour law skills to go from HR manager to business leader

Register now

Thank you for registering with us, you made the right choice.

Congratulations! You have successfully registered for the webinar. See you there.

Traffic Tail

Updated on :, july 20, 2023, how to start a taxi business in india.

Table of Contents

Top 10 Expense Management Software

10 Best Medical Billing Software

How Do Rotating Proxies Enhance SEO Strategies?

The taxi business in India is becoming one of the lucrative and profitable businesses because nowadays everybody prefers to go with taxis as it shows the symbol of status. Also in the present climate, the fuel prices are going through the roof this also increases people to preference for taxes rather than their own vehicles. This increases the competition in the taxi industry as well but getting into this industry is one of the best ideas to put up your services at a low and reasonable price because it is a vendor-driven market and it does not have to invest much. 

So before starting a taxi business in India you should know about what factors influence the taxi business and how you can manage it.

Find the potential for taxi business  

The first and foremost thing you need to understand for starting your taxi business is there are many prospects to start a taxi business and you can earn more even if you have a lot of competitions. For this, you need to know whether people in your region are willing to have a taxi business or not or if it is yes then what are their needs for the same. 

For this at first, try to find out what your competitors are giving to your targeted customers and what you can give them new according to their willingness. Because studying your competitors can give you more knowledge about what is required in the market and how you can give better. Also, explore the market to find out what unique for extraordinary you can give to your clients for or their trust and how you can make your brand value this can be done with the help of planning keeping in view the demand of your targeted market. 

TYPES OF TAXI BUSINESS  

There are different types of taxi businesses depending upon the niche of customers you targeted. Firstly you need to find out which type of business you would like to do after you find the potential in the market. 

One is a traditional type and the other one is modern type. 

• Traditional type : it includes two types 1 individual taxis which are run by an individual and 2 are organizational organizations taxis where an organization number of cars and taxis and they run them as taxis.  
• Modern type : as the period of modernization now people do not prefer to have a traditional type of taxis but a modern taxis called radio taxis this type of taxi has GPS service system install in it and can be booked online even the route of a taxi is traceable do people feel more trustable and secured in this type does prefer it. 

DEVELOPING A BUSINESS PLAN  

Now after realizing which type of business you need to start as a taxi business from the current size of the market and their preferences. Develop a plan about your business how can you run it where you can run net how you can make customers attracted to your business. How many vehicles you will own, how many and which kind of drivers will be required, which vehicles you will own, how will you invest your finance and how will you manage it all, provide you brief and perfect knowledge through planning. And this planning I will help you to make a profit by making your brand value. 

ESTABLISH TRAFFIC AND ROUTE PLANS  

After developing a plan think about which route you would like to choose and vary your tariff according to day and night also according to the different parts of regions and also provide some plants for customers within the regional limit. Also, make sure you have different options for your customers to pay so that you can make a flexible link between you and your customer between you and your company, and between you and your driver. 

LEGAL FORMALITIES  

Registration process and required compliances  .

To purchase, register, and obtain permits for vehicles and the business is one of the most important and difficult tasks for a business during its initial stage. All these legal formalities are to be done before starting the business itself so that you could not get any complications in starting the business. Here are some of the steps which will help you in registering your business without complications: 

• Firstly purchase the car or taxis for the business which are for the purpose of a taxi business and are economically affordable for it. 
• After purchasing the vehicle you need to get it registered under the district transport office or regional transport office related to your state and it is mandatory to register your vehicles in 7 days from its purchase under the motor vehicle act 1988. After this, the transport authority provides you a legal certificate or registration of your vehicle but if you run your vehicles without registration you will have to pay a penalty of 2,000 rupees. 
• The vehicles need to be registered so that when there is a third party issue or damage it can be useful. This insurance can be taken from any kind of insurance company by filling the application form and following the mandatory details. 
• After that check ok that all your taxis are being cleared with all the environmental issues that are guided by the state. 

COMMERCIAL DRIVING LICENCE  

The person who has a car or any vehicle needs to have a driving license to show its authorization. It’s up to him to use it. But if that vehicle is used for commercial purposes then a person needs to have a commercial driving license for it. That driving license is issued by the RTO regional transport office of a particular state and this license is mandatory for all the vehicle owner and the one who is driving it. 

SPECIFIC CRITERIA FOR OBTAINING COMMERCIAL DRIVING LICENCE ARE: 

• Drivers must be at least 18 years of age. 
• Drivers must be at least educated to class 8. 
• Learning license is necessary for at least 6 months 
• A driving test is necessary to assess whether he can drive. 
• A medical fitness certificate of a driver is necessary. 
• Application of LICENSE can be done on an offline basis 
• Should have trained from government motor school. 

A taxi driver needs to submit a medical certificate about his medical and mental fitness. After analyzing all the factors above then only the license will be provided by the RTO office. 

Also, working hour of drivers are fixed that as an adult a person can work for not more than 8 hours a day or 48 hours a week it is also given under motor transport workers act 1961 but if the transportation distance is long-distance then a person needs to take permission from the proper authority who can grant permission for it but the permission cannot be granted for more than 10 hours a day or 54 hours a week. 

Documents required for the application of the Commercial Driving License  

• Identity Proof 
• Address Proof 
• Multiple passport size photos 
• Application fee 

Vehicle permit  

  Vehicles need to have a permit to use it as a taxi because not all vehicles can be used as taxis to transport goods or people. This permit of transportation is being obtained by RTO regional transport authority or state transport authority by submitting a form for a permit.it is mandatory for all vehicles to register it before using it or driving it. 

In this taxi owner can choose to get a permit for all India transportation which can be obtained by giving summiting of form to All India Tourist Permit(AITP) along with the prescribed legal fees. 

Contract of carriage passenger  

If a person carries the passenger he needs to be registered under a contract of carriage passenger where a contract is made for the Number of persons in each to be carried for a particular sum to a particular place. Here you need to fill an application for a particular type of vehicle and the number of sittings in that vehicle also the area in which that particular vehicle is going to be operated with some more details likewise this is to be done under motor vehicle act 1988 section 73 

Fitness certificate  

Every vehicle needs to be maintained regularly on a periodic basis so as to keep it and passengers safe. Under the motor vehicle act 1988 section 84, every vehicle needs to have a fitness certificate from Thora in testing stations. Every vehicle needs to be run at a particular speed which varies from state to state. Usually, this speed is from 50 to 65 kilometers per hour. Also in this section, it is compulsory to have printed the name and the address of the operator of the taxi on it. 

All India Tourist Permit  

If if you need to go from state to state you need to have an all India tourist permit for your taxi. It can be done by filling in an application for it with particular fees even the number plate of all India permit should have written all India permit taxi on it. It is also mentioned in the act that these vehicles cannot be used for local purposes that is you can not carry any goods or passengers local with this Taxi. 

GET A DRIVING TEAM READY  

Drivers are one of the main components or factors of taxi companies. You need to take care of each and everything why hiring drivers for your taxi whether they are part time or full time drivers you need to check their backgrounds carefully before selecting them. There are some points to kept in mind which are as follows: 

1. Background check  

The first and the foremost thing you need to do is to check the background of drivers you are going to select, check their previous job records, their family background, their habits, and personal records. Try to find out whether the person is reliable and honest or not. 

2. Interview   

In an interview try to check their driving skills, their sincerity, their politeness because they need to deal with customers every single second even if you can go with the driving test of the candidate before selecting him. 

3. Company ethics  

After selecting a candidate you need to abide by his or her company rules, regulations, codes, and conducts that are to be maintained so as to increase the brand value of the company with a reliable transport provider. 

4. Dress code  

One of the most important ways to increase your brand value and to become unique on your own is to have a dress code of your drivers that will help you to recognize yourself and this will maintain the ethics of the company as well. Show arrange a well-designed and colored uniform for your drivers. 

5. Operating time  

They need to have a particular timetable for your drivers but that timetable should be flexible enough to manage during emergencies. A driver can make judicious schedule changes in emergencies for this you can even give some kind of additional remuneration for the one who works in the tough times like peak time or at night. 

6. Rules  

A driver should be provided with the rules and regulations that are to be followed during his service like being polite to the customers no drinking during driving no smoking, no overspeeding, no extra money from customers, no breaking of traffic rules, etc. tell your driver that all these rules are compulsory to be followed or he will be fired immediately if you did not follow any of the rules. 

Guides For Growing Your Business

• Why Digital Marketing Is Important For Small Businesses?
• Importance Of Digital Marketing For Startups
• How Traffic Tail Can Help You Grow Your Business Online!
• What Is ORM In Digital Marketing – How Is It Important In Businesses

Taxation norms  

After implementation of GST goods and service tax, it is being compulsory for a taxi driver owner to give 5% GST for services provided to the passenger, that is he needs to give 5% GST for the fare he is taking from the passengers. But a meter taxis will not be liable for the same. 

Environmental regulations  

As a taxi driver or the owner of the taxi one should know about each and every rules and regulation that are being implemented by the state government for environmental protection and they need to follow them if anybody finds them without following them and they are charged with penalties. Because it will be a legal dilemma if they don’t follow it. 

TOOLS AND REQUIREMENTS FOR TAXI BUSINESS  

Every business required some of the other tools and equipment for running the business. In the same way taxi business also required some of the tools the main tool of it is vehicles that you need to run as Taxis, the other requirement  is of drivers who can run the taxis., Also required office space for running your business with that you need to have a space for parking your vehicles. You also need to have software to manage the bookings as well as managing all the route tracking of drivers with the pay they get. You need to hire a receptionist for managing administration work. 

FINANCE FOR YOUR TAXI BUSINESS  

You may be ready to launch your own taxi business with a lot of creative ideas. But for all this, you need to have proper finance to make your organization grow. Even it is suggested that keep your finances in such a way that your ¼ of finance is always safe. Sometimes you have all your finance on your own but sometimes you need to rely upon others for financing your business as a creditor or a partner. In such cases, you can rely on multiple financing options available in your place. 

Some of them include: 

• Personal Savings 
• Applying for loans from banks, financial institutions, or even from your family or friends. 
• Investors 
• Microloans 

PROMOTIONAL ACTIVITIES  

One of the main activities of the business is its promotional activities. If you set up your business but you did not promote it to anybody no one will know about it and all your time and investment will be wasted. 

The advertisement part entirely depends on the budget that you may earmark, With that your location work on There are some promotional methods that can be adopted with minimum budgets: 

• Advertising in newspapers or radios:  

This is one of the oldest and reliable methods of promoting your business whenever it is new because many people read newspapers on a daily basis and it will increase your sales if you promote your business on newspapers or on radios. 

• Word of mouth publicity:  

Mainly every business is promoted by the persons who have taken your services in the same way if a person likes your taxi services and likes your fear charges then he or she will promote your services, choose the other required candidates and will help you to build brand value. 

• Social media marketing  

Today’s era is all about the internet . Every single person on one or more social media does to promote your business on social media is one of the best ways to get your targeted audience by your side. 

You can choose either free or sponsored advertising on social media such as Facebook, LinkedIn, Instagram, YouTube, and others depending on the impact and the coverage sought. 

• Digital media marketing  

One does a lot to be there on the first 10 searches of the search engine thus Advertising (free or paid) on search engines, marketing campaigns conducted via the internet, emails, and mobile devices can also reap rich rewards from you. 

• Select locations  

try to find out your target customers and where you can get these targeted customers so as to advertise your business according to it. Choose a selected locations 

For Advertising your business of Taxis where you can get more and more customers such as airports, bus & railway stations, and shopping complexes could also yield considerable visibility for your company. 

• Promotions  

You can even encourage customers to get your services through different rewards like 

You could start loyalty based rewards, encouragement to avail repeat trips, providing discount coupons or e-Coupons, lucky dips and certain other promotional schemes could encourage the existing customers to prefer your services over others. This will not only help you to gain the customer but also will help you to maintain your brand value and bring your image up. 

• Business ethics  

Most important advertising means that will show you in a better light is the consistent and pleasant customer experience while using your services; the various experiences such as spotting the taxi top lights/logo, easy booking, timely ride, competitive rates, and pleasant travel experience, and polite/decent driver behavior speak a lot more about your company than the other forms of advertisements. 

ECONOMIC ANALYSIS  

The taxi business is an essential part of a country’s economy. As a visitor to a country for the first time, it does not matter if you came by air, road or sea, there is a high chance that the first person you will encounter in any new city is a taxi driver, whom you need to hire to take you to your hotel or your chosen destination. The carriage and attitude of the taxi driver instantly make somewhat of a first impression of the attitude of the people of that place in your mind. 

The economy of a country, in turn, impacts the taxi business by fares, good roads, and fuel prices. Like if the economy is increasing the TAXI fare also increases and if the economy decreases the taxi fare also decreases.  

Due to the unregulated market and the fierce competition for lucrative routes and passengers taxi operators team up to form national and local associations. These associations soon begin showing mafia-like tactics, including hiring hitmen and instigating gang warfare .  

 DO’S AND DON’TS OF TAXI BUSINESS  

The taxi business continues to progress and establish its bankability in the market, there remains no argument in venturing into this highly lucrative industry. Nonetheless, not every taxi business can survive the intense competition. Here are five do’s and don’ts that will guide your company to success. 

Do’s  

1.Do analyze your competitors.  

Try to examine the taxi services provider in your region and what kind of services they are providing and also try to understand the customer’s and their requirements whether they are fulfilling it or not then provide your services according to the niche of the customers and also engage some kind of uniqueness into it to be different from your competitors. These factors will define the vehicles to be added to your fleet, target audience, and pricing strategy. 

2. Do comply with all lawful guidelines. 

Taking lawful action is one of the best ways to start your business so find out all the necessary legal requirements for your business in the starting itself so as to become a lawful organization. This begins right from obtaining your business permit and license to necessary vehicle documents such as insurance, vehicle registration, permit, and more. 

3. Do consider your audience before investing in your fleet. 

After deciding what type of business you want to start from the above type the name considers your audience niche and also your targeted audience. Like if your target audience exclusively includes corporate employees, they may seek luxury and add-ons like wifi.  But if your targeted audience includes housewives they will require cheap, fast, and comfortable rides rather than luxury add ons. So by considering these fleets try to take up your business. 

4. Do set guidelines for the commission and revenue policy for individual drivers and partners. 

 If your taxi business has adopted the partnership model, it is highly recommended to elucidate the earning policies. This can be a game-changer in streamlining your processes and avoiding any confusion. 

5. Do watch out for emerging trends in the taxi business industry. 

As the world is a technological world, Every now and then, innovative technology introduces new features and the market opens up new opportunities. To continue growing, make sure your taxi software and application incorporates such enhancements. 

Don’ts  

1.Don’t overlook your local market. 

 Most taxi businesses understand the industry but fall short of analysing their locality. You need to find out your niche and where you can make it successful.so think the idea out of the box rather than going with all because there is not one idea for it .  

2. Don’t stop re-evaluating your business.  

If your business is running well don’t think that you will go like this only and earn more because every now and then changes are being brought up by this technological world thus working on one plan will not work without re-evaluating it.so analysis your business expenditure and area where taxi generate more revenue and try to uncover hidden opportunities and improve drastically 

3. Don’t ignore customer grievances.  

Always ask your customer about the feedback of your taxi services through any kind of mobile app so that you can get the true image of your services and you can improve it you also will able to find what your customers needed and what you are providing to them does you can improve your services through it and worked on the niche of your customers 

4. Don’t neglect driver monitoring.  

You also need to monitor your drivers because it is crucial that they need to follow all the safety standards with all your company standards and rules so that they can be liked by their customers with that for monitoring your drivers ask a feedback about the drivers from the customer and ask them to give drivers Bee rating on which basis you can identify their behaviour with customers 

5. Don’t expect results without marketing your business.  

The industry is highly competitive and unless your taxi business doesn’t have a strong presence and brand identity, it will become difficult for your customers to trust your services. Spread the word, improve customer engagement and grow your business 

IMPORTANT TIPS:  

• Do not get into a price war. It would not be profitable and it would take a lot of time to break even. 
• Do not expect very high revenue within the first year. If you are able to break even within the first year, it means you are on a fast growing track. 
• If you are able to get fifty loyal customers by the end of the first year, you are doing well in terms of customer base. 
• If you are able to concentrate on tier I and tier II areas, you would be able to see a three digit growth rate. 
• Your growth is highly connected to the way you advertise your business. 
• Online booking services and mobile apps would increase the flexibility of the business and attract more customers. 

CONCLUSION  

As a taxi business is one of the best businesses nowadays because everyone due to the increase in the fuel rates now and then preferring to have a potential taxi service. So by analyzing your market with the niche of your customers you can start up a taxi business but you need to look up the proper steps if you want to enter the taxi market like firstly plan the business then select the financial areas also select the traffic and route plans then do all the legal formalities required by taking up all the LICENSE and registration for starting up a taxi business with ease.

It is also important to have the best driving team to provide the best services thus get your team ready also make yourself ready with all the latest tools and equipment. Now the best and the most important thing is to make your business promoted in such a way that you can generate a large number of customers thus making sure to invest wisely in advertising your business. These all tips will help you to lead the taxi services industry with a benchmark. 

Join our dynamic team and amplify your career with exciting opportunities and growth.

Interested in working with us?

• [email protected]
• Digital Marketing: +91 87702 47277
• News Portal: +91 79057 27451

• SEO company in Gwalior
• Digital Marketing Agency in Gwalior
• Website Designing Company in Gwalior
• SEO company in Allahabad
• Digital Marketing Agency in Allahabad
• Website Designing Company in Allahabad
• SEO company in Lucknow
• Digital Marketing Agency in Lucknow
• Website Designing Company in Lucknow
• SEO company in East Delhi
• Digital Marketing Agency in East Delhi
• Website Designing Company in East Delhi
• SEO company in Gorakhpur
• Digital Marketing Agency in Gorakhpur
• Website Designing Company in Gorakhpur
• SEO company in Himachal Pradesh
• Digital Marketing Agency in Himachal Pradesh
• Website Designing Company in Himachal Pradesh
• SEO company in Surat
• Digital Marketing Agency in Surat
• Website Designing Company in Surat
• SEO company in Chandigarh
• Digital Marketing Agency in Chandigarh
• Website Designing Company in Chandigarh
• Website designing company in Delhi
• Digital marketing agency in Delhi
• SEO Company in Delhi
• SEO company in Meerut

Starting Taxi Business Plan (PDF)

A taxi is a vehicle that may be hired for single journeys by members of the public. It is also commonly referred to as a cab or taxicab. There has been a notable market disruption emanating from digital solutions. A whole new industry of online taxi services has grown over the years. For instance, in the USA, Uber facilitates over 40 million rides every month. Even as online taxi services continue to grow, traditional taxi services are still relevant. It is still worth it and profitable to start a taxi business. Taxi cabs play a significant role in the transportation industry. People opt for taxis due to a variety of reasons including convenience and exclusiveness. Starting a taxi business is a very profitable venture, which is highly rewarding. This article will outline how to start the taxi cab business, and the taxi business plan – PDF, Word and Excel.

The possible sets of destinations for the various customers make it apparent that the demand is huge. The fact that more and more players are starting taxi businesses speaks to how lucrative the business is. Once properly setup this is one type of business where you will be assured to realise revenue on a daily basis. This article will help in informing you with vital information you need to know on starting your own taxi cab business.

Market Research

Already we have stated that an increasing number of players are entering this space. This spells out ‘competition’ and whenever competition is involved you can’t overlook the importance of market research. Just by taking a look at how existing players conduct their businesses you’ll notice that they serve different target markets. Some solely focus on people commuting to and fro work. Some specifically target airports and termini. Others have strategic spots they operate from in central business districts to cater for wide-ranging customers. So in order for you to ascertain that you’re on course, you must research to find out which markets are available, penetrable and sustainably scalable. It’s a must to take a look at existing players. Essentially this means you must closely study them to draw invaluable insights that’ll help you start strong and even eventually topple your competition. Some of those insights will be on popular services offered, rates charged, types of vehicles and payment methods amongst others. This makes it a must to have a good taxi cab business plan.

Taxi Business Model

The traditional business model for a taxi business is simple. It entails having an area where you operate from and in. You park somewhere and clients can come up to you in need of a taxi ride. You can be an owner-driver or you can have a fleet of taxis you own. You can charge fixed rates for specific routes or you can use the metered approach. The metered approach (i.e. charging per mile) is best because client needs can be so random. Another approach is charge per duration of a trip e.g. per hour.

You could charge per day as you would for a car rental. This can apply for a client who wants to be taken to several locations consecutively in a day. Charging can also be dynamic where you simply negotiate with a client. You could also have a retainer arrangement with wide-ranging clients. The online aspect is somewhat the same. The major difference is that when using an online approach, clients book a ride online. This is doable by developing a mobile app for your taxi business. The fares you charge can differ given the costs elements you would want to offset.

Vehicles and Equipment

The major procurement you must make is vehicles. The vehicles can be imported from other countries where they are cheap or you can buy them locally from your country. The number and type of taxi cabs required will depend on the amount of capital which you have and your target market. You will also have to make a decision of whether to buy brand new vehicles or used taxi cabs. When starting the business with limited capital, you may opt to purchase used cars. The advantage of having new taxi cabs is that you have lower maintenance costs and better reliability on the road.

There are several factors to take into consideration when purchasing the taxi vehicles. Some of the factors include: purchase price, fuel consumption, transmission mode (automatic vs manual), gross vehicle mass, model, new taxi cab vs used taxi cab. If you have limited capital, you can always start your meter taxi business with just one vehicle. Taxi cab business is very profitable and if you reinvest your profits, you will be able to purchase more taxis.

Equipment required for the meter taxi business include garage equipment, taxi meters, taxi partitions, top lights, communication radios (for communication with the dispatch centre). The taxi drivers should always travel with basic repair tools such that if they encounter minor problems along the way, they can always fix the taxis. The taxi business plan should include the costs of purchasing the vehicles and equipment.

Taxi Servicing And Repairs

When running a taxi business you can never compromise and expect to thrive. Customers are most concerned about convenience. This means your taxis must always perform optimally. They must always be fully serviced and devoid of any operational issues. That is why you must always take your taxi(s) for service. It is advisable to have a reputable servicing and repairs provider that you work with. Always keeping your taxi(s) clean and doing daily checks before, during, and after daily operations is key here. If these elements are all kept in check it is rare for your taxi(s) to malfunction. Servicing and repair costs should be accounted for in your taxi business plan.

Taxi Business Insurance and Licences

One of the critical requirements that can potentially have catastrophic consequences for the public as well as the business is insurance. It is advisable to have a comprehensive insurance plan for all the taxi cabs. The costs of such a package are more than offset by the potential losses if you were to have an accident. As a business; the taxi cab company may be liable for very significant punitive damages particularly if there is a loss of life. Without adequate insurance, the taxi cab business could be bankrupted by compensation claims.

The taxi industry is regulated and the specific licences depends with the country. First of all, your drivers must be properly licensed with up to date records including health checks and driver licences.  Your local council will have a list of regulatory requirements which must be diligently followed lest you lose your license to operate the taxi cab business. The taxi cab business plan should include costs for the insurance and licenses.

Staff and Management

Operations staff is a necessity. Operations staff are responsible for handling the operations of the taxi cab business. They include drivers, assistants, logistics personnel, mechanics and operations manager. You will need a taxi driver as the minimum starting employee for the taxi business.

Finance and accounting employees are also required. For a small taxi cab business, the duty can be handled by the owner of the business or a part time accountant. However as the taxi transport business grows, there will be need for full time employees who will be responsible for the finance and accounting needs of the business. Their duties will include usual day to day transaction accounting for business, managing the cash flow of the taxi cab business, and always ensuring the enough funds are available for the day to day needs of the taxi business.

Marketing is essential for you to be successful in the taxi business. To have a stable financial position, your taxis should get sufficient number of trips every day. This is only possible if you are marketing your taxi cab business. Thus your taxi business will also need marketing and sales staff. If you have a dispatch centre then you also need staff so the dispatch centre. Your taxi cab business plan should cater for the wages and salaries of all your staff.

Competitive Analysis

The taxi business is marked by intense competition. For instance, you have to compete with unregulated taxi operators. You also have to compete with ride-sharing brands e.g. Uber. Competitive analysis in a taxi business is to establish differentiators that can make you stand out. Customers when they hire taxis they have certain expectations. How are other taxi operators faring in terms of meeting those expectations? Answers to that can show you how best you can provide superior services.

You must in great detail know about all your direct competitors. Look at their profiles, their target markets, and generally how they conduct business. Look for verified information or conduct observations by trying out competitors’ taxi services. Once you establish all that you can know where and how to strategically place your taxi business. One of the most effective ways to do your competitive analysis is by doing a comprehensive SWOT analysis.

Capital for Starting Taxi Business

The amount of capital required for starting the taxi business depends on the size of the business. It all depends on what you want to achieve and the resources that you have. When starting a taxi cab business, most of the capital goes to acquiring the taxi cabs. You can get a loan from the bank, or funding from investors, to use as capital to start your meter taxi business. If you plan to raise capital from investors and a loan from the bank, you need a good meter taxi business plan. If you don’t have access to investors and bank loan, you can use your personal savings and start small, and grow your taxi business overtime. Taxi business is very profitable, so if you reinvest the profits you get, you can grow over time. Even if you are not planning to get a loan, you should still get a taxi project plan to guide you in starting and operating the business. It is essential for you to have a meter taxi business plan before you venture into the taxi cab business, so that you know all the costs involved and you make an informed decision.

Market for the Taxi Cab Business

The market for taxi cab services is very huge. There are a lot of potential customers for taxi services. Companies may outsource transportation of their employees to taxi cab companies. Parents require taxi cabs to transport their children to and from school. Individuals may need taxi services for routes within a specific location which are not plied by public transport or within the city centre. Some individuals prefer to use taxi cabs even if alternate public transport is available. This is because taxis are more convenient, fast, offer privacy, and exclusiveness. Potential sites to find clients include hospitals, universities, schools, airports, night clubs, city centre, hotels & lodges, shopping centres among others. A proper marketing strategy should be included in your taxi business plan. 

Marketing Plan

Engaging vehicle branding.

There are countless marketing approaches you can employ for your taxi business. The taxi business involves the use of moving vehicles. That makes the actual vehicles a central feature of marketing. Have the vehicles colourfully branded with subliminal marketing content. People merely seeing the taxis passing by will have their subconscious minds conditioned.

Attending Strategic Events

The thrust is to attend events that can strategically generate leads for your taxi business. Examples of such events are trade shows, concerts, conferences, and the like. One way is to actually exhibit and showcase your taxi offerings, if possible. The other way is to simply be in the vicinity of such events. There is most likely always going to be people who will need your services.

Sponsoring Or Supporting Worthy Causes

Running a taxi business offers you easy ways to sponsor or support worthy causes. All it can take is you providing your taxi(s) for free for some event or cause. Your presence during that event or cause will draw so much attention to your taxi brand. You could also materially contribute to causes such as helping the underprivileged. Your association with notable events or causes is a potent marketing strategy. Remember, your taxi(s) being branded will be doing the work for you.

Internet And Social Media Initiatives

This should be at the core of the marketing plan for your taxi business. You must have a website and set up active accounts on social media. Use high definition visuals to draw people in. Regularly do online contests; these are highly effective in building your audience. All your social media initiatives should encourage word of mouth and referrals.

Another faster and more effective strategy is to work with social media influencers. Work especially with macro influencers (between 40000 and 1 million followers) and m icro influencers (between 1000 and 40000 followers). Such influencers are often characterised by highly engaged audiences.

Keys To Taxi Business Profitability

You are supposed to be big on quality in your operations. This refers to aspects such as cleanliness, timeliness, cordialness, and convenience. Customers will always settle for taxi businesses that have these qualities. That is why customers will not hesitate to switch to other taxi operators if you are lacking. Using vehicles with good fuel economy is a vital key to profitability in a taxi business. Regular servicing and using fuel from reputable sources also feeds into good fuel economy. This significantly reduces your operating costs. The first ever taxi service or business was started in 1897. It has been more than a century since then and taxis still continue to proliferate. This is because the market is inexhaustible. You can start your own taxi business today and still make significant money.

Pre-Written Taxi Business Plan (PDF, Word And Excel): Comprehensive Version, Short Funding/Bank Loan Version and Automated Financial Statements

For an in-depth analysis of the taxi cab business, we encourage you to purchase our well-researched and comprehensive taxi cab business plan. We introduced the business plans after discovering that many were venturing into the taxi transport business without enough knowledge and understanding of how to run the meter taxi business, lack of understanding of the financial side of the business, lack of understanding of : the industry, the risks involved , costs and profitability of the business; which often leads to disastrous losses.

The StartupBiz Global taxi transport business plan will make it easier for you to launch and run your meter taxi business successfully, fully knowing what you are going into, and what’s needed to succeed in the business. It will be easier to plan and budget as you will be aware of all the costs involved in setting up and running the taxi cab business.

Uses of the Taxi Business Plan (PDF, Word And Excel)

The taxi cab business plan can be used for many purposes including:

• Raising capital from investors/friends/relatives
• Applying for a bank loan
• Start-up guide to launch your taxi business
• As a taxi business proposal
• Assessing profitability of the meter taxi business
• Finding a business partner
• Assessing the initial start-up costs so that you know how much to save
• Manual for current business owners to help in business and strategy formulation

Contents of the Taxi Cab Business Plan (PDF, Word And Excel)

The meter taxi business plan include, but not limited to:

• Marketing Strategy
• Financial Statements (monthly cash flow projections, income statements, cash flow statements, balance sheets, break even analysis, payback period analysis, start-up costs, financial graphs, revenue and expenses, Bank Loan Amortization)
• Risk Analysis
• Industry Analysis
• Market Analysis
• SWOT & PEST Analysis
• Operational Requirements
• Operational Strategy
• Why some people in taxi cab business fail, so that you can avoid their mistakes
• Ways to raise capital to start your meter taxi business

The Pre-written taxi cab business plan package consist of 4 files

• Taxi Cab Business Plan – PDF file (Comprehensive Version – 71 Pages)
• Taxi Business Plan – Editable Word File (Comprehensive Version – 71 Pages)
• Taxi Cab Business Plan Funding/Bank Loan Version- Editable Word File (Short version for applying for a loan/funding – 42 pages)
• Taxi Business Plan Automated Financial Statements – (Editable Excel File)

The business plan can be used in any country and can be easily edited. The financial statements are automated. This implies that you can change eg the number of taxis, pricing rate per KM etc, and all the other financial statements will automatically adjust to reflect the change.

Click below to download the Contents Page of the Taxi Business Plan (PDF)

Testimonial 4

The business plan which I purchased from your website saved me TIME and MONEY! The layout of the business plan was excellent. The financial statements were detailed and easy for me to edit. I will come back to purchase another business plan soon.

Testimonial 6

I purchased a business plan from you, and I’m glad to inform you that I was able to get my loan, and I’m starting my poultry farming business on the 1 st of July. This was made possible because of your business plan. Thank you very much, you made my dream come true.

Testimonial 1

StartupBiz Global provided a very professional and comprehensive business plan which I used for my business. The business plan was easy to edit, and I was able to get the funding which I wanted. I highly recommend their business plans.

Testimonial 8

Just wanted to say I am very happy with the business plan and I will gladly recommend your products, thank you very much and have a great day.

Testimonial 3

I was extremely lucky to come across StartupBiz Global. Their business plan exceeded my expectations, and most importantly I was able to secure a loan from my bank. Thank you guys, now my dreams are coming true!

Testimonial 2

Many thanks for your incredibly efficient service and thorough business plan. I am very impressed with the business plan. Before I bought the business plan, I tried to do my own business plan – it was such a nightmare and it turned out badly, also not to mention the stress it caused me. I wish I knew about your website earlier!

Testimonial 7

I found Startupbiz Global online when I was in desperate need of a business plan. I was overwhelmed by the quality of the business plan, it’s comprehensive and well researched! I did not have to wait to get the business plan, I got it instantly after payment. I highly recommend Startupbiz Global, and would happily use them again in the future.

Testimonial 5

I was able to understand the business side of farming because of your business plan. You did extensive research; the business plan was well prepared and fully detailed.  It made everything clear, and I have somewhere to start now. I am confident that I am going to succeed in my business because of the guidance from your business plan.

Get the Taxi Business Plan (PDF, Word And Excel)

Click Buy Now  below to purchase using Paypal, Credit Card, or Debit Card. After you have purchased, you will immediately see the download link for the business plan package on the screen. You will also immediately get an email with the business plan download link. The Pre-written business plan package (PDF, Word, and Excel) costs $30 only!

If you want to purchase multiple business plans at once then click here: Business Plans Store.

The business plan package is a zipped compressed file containing the PDF, Word and Excel documents. To open the package after downloading it, just right click, and select Extract All. If you have any problems in downloading and opening the files, email us on [email protected] and we will assist you.

We wish you the best in your taxi business! Check out our collection of business plans  , and more business ideas .

Related Posts

Top 10 Profitable Welding Projects

Starting Solar Installation Business Plan (PDF)

Top 8 Profitable Solar Energy Business Ideas

Starting Free Range Chicken Farming Business Plan (PDF)

Join our mailing list to receive the latest posts and updates from our website.

You have Successfully Subscribed!

We earn commissions if you shop through the links below.  Read more

Back to All Business Ideas

How to Start a Taxi Business: A Step-by-Step Guide

Written by: Carolyn Young

Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.

Edited by: David Lepeska

David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.

Published on March 3, 2022 Updated on August 23, 2024

Investment range

$3,250 - $7,400

Revenue potential

$47,000 - $275,000 p.a.

Time to build

0 – 3 months

Profit potential

$38,000 - $55,000 p.a.

Industry trend

Key considerations to keep in mind when starting your taxi business:

• Taxi operating license — Apply for a taxi operating license or permit from your local transportation authority. Requirements vary by location.
• Vehicle registration and inspection — Ensure all vehicles are properly registered and inspected and meet local safety standards.
• Choose your vehicles — Select reliable and fuel-efficient vehicles that are comfortable for passengers. Consider a mix of vehicle types to cater to different customer needs, such as sedans, minivans, and luxury cars.
• Vehicle maintenance — Implement a regular maintenance schedule to ensure all vehicles are in good working condition. This includes routine checks, servicing, and cleaning.
• Commercial auto insurance — Obtain commercial auto insurance to cover your vehicles and drivers. This should include liability coverage, collision coverage, and comprehensive coverage.
• Register your business — A limited liability company (LLC) is the best legal structure for new businesses because it is fast and simple. Form your business immediately using ZenBusiness LLC formation service or hire one of the best LLC services on the market.
• Legal business aspects — Register for taxes, open a business bank account, and get an EIN .
• Dispatch system — Implement a reliable dispatch system to manage bookings, track vehicles, and communicate with drivers. This could be a traditional dispatch center or an app-based system.
• GPS and navigation — Equip all vehicles with GPS systems to ensure efficient routing and real-time tracking.

Interactive Checklist at your fingertips—begin your taxi business today!

You May Also Wonder:

Can a taxi business still be profitable?

Yes! Believe it or not, the taxi industry is still worth over $60 billion in spite of competition from ride-sharing apps. If you market yourself well and provide great customer service, you can definitely make money with a taxi business.

What types of vehicles can I use for my taxi business?

For a taxi business, you can use various types of vehicles depending on your target market and local regulations. Common options include sedans, minivans, SUVs, or even specialized vehicles for specific purposes like wheelchair-accessible taxis.

What makes a good taxi company?

First and foremost, reliability is crucial. Ensuring that taxis are available promptly and operate on time is essential. Excellent customer service, including courteous and knowledgeable drivers, clean and well-maintained vehicles, transparent and fair pricing, and easy booking and payment options, also play a significant role.

How can I ensure the safety and comfort of passengers in my taxis?

To ensure the safety and comfort of passengers in your taxis, prioritize regular maintenance and inspections of your vehicles to ensure they are in good working condition. Implement safety features such as functioning seatbelts, GPS tracking systems, and security cameras. Train your drivers in defensive driving techniques, customer service, and safety protocols. Keep the interior of the taxis clean and comfortable, with adequate legroom and temperature control options.

How do you attract taxi customers?

Utilize online platforms and mobile apps to make booking convenient and accessible for passengers. Offer competitive pricing, promotions, or loyalty programs to incentivize repeat business. Partner with local businesses, hotels, or airports to establish referral networks. 

Step 1: Decide if the Business Is Right for You

Pros and cons.

Starting a taxi business has pros and cons to consider before deciding if it’s right for you. 

• Low Startup Costs – One car and you’re off to the races
• Flexibility – Pick your own hours, run the business from home
• Large Market – Demand for taxis is still high, particularly in large cities
• Tough Market – Compete with apps like Uber and Lyft
• Long Hours – To make money, you need to be a workhorse

Taxi industry trends

Industry size and growth.

• Industry size and past growth – The US taxi and limousine market is worth $66.6 billion in 2022 and has grown nearly 3% annually for the last five years.(( https://www.ibisworld.com/industry-statistics/market-size/taxi-limousine-services-united-states/ ))
• Growth forecast –  The global taxi industry is expected to grow an impressive 66% by 2026.(( https://www.mordorintelligence.com/industry-reports/taxi-market ))
• Number of businesses – In 2022, 2,568,140 taxi and limousine businesses were operating in the US.(( https://www.ibisworld.com/industry-statistics/number-of-businesses/taxi-limousine-services-united-states/ ))
• Number of people employed – In 2022, the US taxi and limousine industry employed 2,379,410 people.(( https://www.ibisworld.com/industry-statistics/employment/taxi-limousine-services-united-states/ ))

Trends and challenges

Trends in the taxi industry include:

• Customers are seeking apps to book taxis, so taxi services need to embrace this trend to be successful.
• Eco-friendly hybrid or all-electric taxis are also in demand. This presents a huge opportunity for an eco-friendly taxi business to differentiate itself.

Challenges in the taxi industry include:

• A continuous challenge in the taxi business is finding and keeping good drivers who provide excellent customer service.
• Rising fuel prices are cutting into the profit margins of taxi businesses.

Demand hotspots

• Most popular states – The most popular states for taxi drivers are Rhode Island, Connecticut, and New Hampshire.(( https://www.zippia.com/cab-driver-jobs/best-states/#rhode-island ))
• Least popular states – The least popular states for taxi drivers are Colorado, Utah, and Montana.

What kind of people work in taxi businesses?

• Gender – 23.5% of taxi drivers are female, while 73.3% are male.(( https://www.zippia.com/taxi-cab-driver-jobs/demographics/ ))
• Average level of education – The average taxi driver is high school educated.
• Average age – The average taxi driver in the US is 48 years old.

How much does it cost to start a taxi business?

Startup costs for a taxi business range from $3,200 to $7,400. Costs include a down payment on a vehicle and signage for the vehicle. You’ll also need to get a car for hire license from your city. In some cities, this can be a significant cost. For example, in New York City a taxi medallion costs about $80,000, while in Columbus, Ohio it only costs a few hundred dollars. 

How much can you earn from a taxi business?

Taxi fare rates vary by city but usually include a flat base charge, a charge per mile, and an hourly wait time rate. These calculations will assume that your average fare will be about $15. Your profit margin after fuel and insurance costs should be about 80%.

In your first year or two, you could work as a solopreneur and do 10 trips per day 6 days per week, bringing in $47,000 in annual revenue. This would mean nearly $38,000 in profit, assuming that 80% margin. As your brand gains recognition, you could have five taxis and hire drivers, and sales could climb to 50 trips per day 7 days per week. At this stage, you’d rent a commercial space and hire staff, reducing your profit margin to 20%. With annual revenue of almost $275,000, you’d make a tidy profit of more than $55,000.

What barriers to entry are there?

There are a few barriers to entry for a taxi business. Your biggest challenges will be:

• A clean driving record is required, and you may have to pass an exam
• Competition from other taxis plus apps like Uber and Lyft

Related Business Ideas

How to Start a Limo Business: Cost and Profit Potential

A Step-by-Step Guide to Starting a Roadside Assistance Business

How to Start a Profitable Rideshare Company

Step 2: hone your idea.

Now that you know what’s involved in starting a taxi business, it’s a good idea to hone your concept in preparation to enter a competitive market.

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an opportunity

Research taxi businesses in your area to examine their services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a limousine taxi service, or an electric taxi service.

You might consider targeting a niche market by specializing in a certain aspect of your industry, such as bike taxis in urban areas.

This could jumpstart your word-of-mouth marketing and attract clients right away.

What? Determine your services

You’ll need to determine what kind of taxi service you want to have. You could have a limousine taxi service, a black car taxi, a minibus taxi service, an eco-friendly taxi cab, a bike taxi, or even a water taxi. You also need to decide if you want to have a taxi booking app.

Who? Identify your target market

When determining the target market for your taxi business, it’s important to recognize that your audience will vary depending on the type of services you offer. For instance, tourists needing transportation from airports or hotels represent a different segment compared to those requiring event transportation or specialized services like taxis for the disabled.

It’s advisable to have a broad target market to cater to a wide range of needs. This approach allows you to maximize your customer base and adapt to various demands in the transportation industry.

Acquire vehicles for your taxi business

Starting a taxi business requires a reliable and efficient fleet of vehicles. Here’s how to make the best choices for your fleet:

1. Assess Your Needs:

• Capacity: Determine the size of the vehicle needed based on the typical number of passengers. Consider sedans for up to 4 passengers or minivans for larger groups.
• Fuel Efficiency: Choose vehicles with good mileage to minimize fuel costs, an important factor in your business’s profitability.
• Comfort: Opt for models that offer a comfortable ride, as this can significantly impact customer satisfaction.

2. New vs. Used Vehicles:

• New Vehicles: Offer the latest features and are less likely to require repairs, but are more expensive.
• Used Vehicles: More cost-effective but may have higher maintenance costs. Opt for certified pre-owned cars for better reliability.

3. Leasing vs. Purchasing:

• Leasing: Provides the option to upgrade vehicles regularly and avoids the depreciation cost, but may come with mileage limitations.
• Purchasing: Results in owning the asset outright, offering more control but requires a larger upfront investment.

4. Maintenance Plans:

• Consider maintenance costs in your budget. Regular maintenance is crucial for safety and prolonging the life of your vehicles.
• Establish relationships with trusted mechanics or consider service contracts with dealerships.

5. Regulatory Compliance:

• Ensure that the vehicles meet all local regulatory requirements, such as emissions standards and safety features.

6. Technology Integration:

• Install necessary technology such as GPS systems, fare meters, and card payment terminals.

How much should you charge for taxi fares?

Your fare rates will be dictated by the rates in your city. When you’re working by yourself, your costs will be limited to fuel and insurance. You should aim for a profit margin of 80%.

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Where? Choose a location for your vehicles

Selecting the right locations for both storing your taxi fleet and identifying hot spots for operation is crucial for the efficiency and profitability of your taxi business. Here’s how to approach these two aspects:

1. Storing Vehicles When Not Active

Centralized Garage or Parking Facility:

• Proximity: Choose a location central to your service area to minimize the time and fuel costs for vehicles to reach their first customers.
• Cost-Effectiveness: Look for affordable parking options to keep overhead low.
• Security: Ensure the area is secure to prevent theft and vandalism.
• Accessibility: Easy access for drivers, especially during shift changes.
• Maintenance Facilities: Nearby maintenance services are beneficial for quick repairs.

2. Identifying Hot Spots for Active Service

High-Demand Areas:

• Airports and Train Stations: Constant flow of travelers needing transportation.
• Business Districts: High demand during rush hours for commuting professionals.
• Tourist Attractions: Tourists frequently require taxis to explore the city.
• Entertainment and Nightlife Areas: Demand peaks during evenings and weekends.
• Hospitals and Medical Centers: Regular need for transport by patients and visitors.
• Shopping Centers and Malls: Popular destinations, especially during weekends and holidays.
• Residential Areas: Targeting suburbs can capture daily commuters and those without personal vehicles.
• Event Venues: Concerts, sports events, and conventions draw large crowds needing transportation.

Step 3: Brainstorm a Taxi Company Name

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “taxi” or “taxi service”, boosts SEO
• Name should allow for expansion, for ex: “RapidRide Cabs” over “Airport Cabs”
• A location-based name can help establish a strong connection with your local community and help with the SEO but might hinder future expansion

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these.

Find a Domain

Powered by GoDaddy.com

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Taxi Business Plan

Here are the key components of a business plan:

• Executive Summary: Provide a brief overview of your taxi business, highlighting its focus on reliable and efficient transportation services within a specific geographic area.
• Business Overview: Describe your taxi service, including the provision of on-demand transportation for individuals and groups in urban and suburban areas.
• Product and Services: Detail the transportation services offered, such as standard taxi rides, airport transfers, and potentially app-based ride-hailing options.
• Market Analysis: Evaluate the demand for taxi services in your area, taking into account factors like population density, public transportation availability, and peak travel times.
• Competitive Analysis: Compare your service to other local transportation options, focusing on your competitive advantages like quicker response times, customer service, or technological integration.
• Sales and Marketing: Outline your strategy for attracting customers, such as through local advertising, partnerships with businesses, or online platforms.
• Management Team: Highlight the experience and skills of your management team, especially in areas like transportation, logistics, and customer service.
• Operations Plan: Describe the operational process of your taxi service, including vehicle management, driver scheduling, and ride dispatching.
• Financial Plan: Provide an overview of the financial aspects, including start-up costs, pricing strategy, and revenue projections.
• Appendix: Include additional documents like vehicle maintenance records, driver training manuals, or market research data that support your business plan.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business!

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to taxi businesses.

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state.

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your taxi business will shape your taxes, personal liability, and business registration requirements, so choose wisely.

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC , which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization , and answer any questions you might have. 

Form Your LLC

Choose Your State

We recommend ZenBusiness as the Best LLC Service for 2024

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number , or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN.

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a tax-payers checklist , and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans : This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans : The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan .
• Government grants : A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family : Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding : Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal : Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a taxi business. You might also try crowdfunding if you have an innovative concept.

Step 8: Apply for Taxi Business Licenses and Permits

Starting a taxi business requires obtaining a number of licenses and permits from local, state, and federal governments. You’ll need to get a car for hire license or taxi medallion from your city.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration ( OSHA ), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits.

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more.

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package . They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account .

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your taxi business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account.

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability : The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property : Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance : Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation : Provides compensation to employees injured on the job.
• Property : Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto : Protection for your company-owned vehicle.
• Professional liability : Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP) : This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.

 You may want to use industry-specific software, such as Cab Treasure , EverTransit , or TaxiMobility , to manage your bookings, dispatching, fares, and payments. 

• Popular web-based accounting programs for smaller businesses include Quickbooks , Freshbooks , and Xero . 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial. 

Develop your website

Developing a website and a mobile app is essential for a modern taxi business, serving as digital gateways for customers to access your services. A user-friendly website should provide clear information about your services, pricing, and contact details, along with an easy-to-use booking system. Complementing the website, a mobile app offers convenience for on-the-go customers, allowing them to book rides, track their taxi in real-time, and make secure payments. Both platforms should reflect your brand’s identity, be intuitive to navigate, and include features like fare calculators, customer reviews, and support options.

Launching a successful taxi business requires a robust marketing strategy that ensures visibility and customer engagement. Here are effective tactics to consider:

• Optimize for Local SEO: Ensure your website ranks high in local search results by incorporating relevant keywords, location-based content, and maintaining an up-to-date Google My Business profile.
• Get Listed in Local Directories: Register your business on local directories and review sites like Yelp, TripAdvisor, and Yellow Pages to increase your online presence and credibility.
• Leverage Social Media Marketing: Regularly post engaging content on platforms like Facebook, Instagram, and Twitter to connect with your community and offer promotions.
• Engage in Community Events: Participate in local events and sponsor community activities to build brand awareness and goodwill.
• Develop Partnerships: Collaborate with local businesses, hotels, and event organizers for mutual referral programs.
• Offer Promotions and Loyalty Programs: Introduce discounts for first-time users and loyalty rewards for frequent customers to encourage repeat business.
• Utilize Email Marketing: Send out newsletters and promotional offers to keep your audience informed and engaged.
• Invest in Vehicle Branding: Wrap your taxis with your business logo and contact information to serve as mobile billboards.
• Encourage Customer Reviews: Prompt customers to leave reviews online to build trust and attract new clients.
• Advertise in Local Media: Use local newspapers, radio stations, and community bulletin boards for targeted advertising.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your taxi business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire.

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your taxi business could be: 

• Eco-friendly taxi service – all-electric cars
• Bike taxis so you can see the sights of the city
• 24-hour limousines to travel in style anytime

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a taxi business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in taxis for years and can offer invaluable insight and industry connections.

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in taxis. You’ll probably generate new customers or find companies with which you could establish a partnership.

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a taxi business include:

• Taxi drivers – take fares, customer service
• Dispatcher – take bookings, dispatch drivers
• General Manager – staff management, accounting
• Marketing Lead – SEO strategies, social media

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need.

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed , Glassdoor , or ZipRecruiter . Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Taxi Business – Start Making Money!

A taxi business is probably one of the easiest kinds of businesses to start. You just need a vehicle, some signage, and a taxi license. You can make good money, even just working by yourself with one car, but you can also grow your company until you have a fleet of taxis. 

Taxis are an industry worth over $60 billion, so why not grab a share of that fare? You understand the business side of things now, so go ahead and get on the road to entrepreneurial success! 

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

• Decide if the Business Is Right for You
• Hone Your Idea
• Brainstorm a Taxi Company Name
• Create a Taxi Business Plan
• Register Your Business
• Register for Taxes
• Fund your Business
• Apply for Taxi Business Licenses and Permits
• Open a Business Bank Account
• Get Business Insurance
• Prepare to Launch
• Build Your Team
• Run a Taxi Business - Start Making Money!

Subscribe to Our Newsletter

Featured resources.

57 In-Demand Service Business Ideas You Can Launch Today

David Lepeska

Published on December 1, 2022

The services sector is undoubtedly the biggest economic sector in the US as it accounts for nearly 70% of the country’s gross domestic product. It ...

21 Tourism and Travel Business Ideas

Carolyn Young

Published on July 21, 2022

The tourism industry is massive and diverse, offering many opportunities for sharp entrepreneurs. You could start a travel agency, a campground, ah ...

32 Logistics and Transportation Business Ideas

Published on July 14, 2022

Logistics is a crucial element of the economy — and much more than moving goods from one place to another. The industry also includespackaging ...

No thanks, I don't want to stay up to date on industry trends and news.

Need a business plan? Call now:

Talk to our experts:

• Business Plan for Investors
• Bank/SBA Business Plan
• Operational/Strategic Planning
• L1 Visa Business Plan
• E1 Treaty Trader Visa Business Plan
• E2 Treaty Investor Visa Business Plan
• EB1 Business Plan
• EB2 Visa Business Plan
• EB5 Business Plan
• Innovator Founder Visa Business Plan
• UK Start-Up Visa Business Plan
• UK Expansion Worker Visa Business Plan
• Manitoba MPNP Visa Business Plan
• Start-Up Visa Business Plan
• Nova Scotia NSNP Visa Business Plan
• British Columbia BC PNP Visa Business Plan
• Self-Employed Visa Business Plan
• OINP Entrepreneur Stream Business Plan
• LMIA Owner Operator Business Plan
• ICT Work Permit Business Plan
• LMIA Mobility Program – C11 Entrepreneur Business Plan
• USMCA (ex-NAFTA) Business Plan
• Franchise Business Planning 
• Landlord Business Plan 
• Nonprofit Start-Up Business Plan 
• USDA Business Plan
• Cannabis business plan 
• eCommerce business plan
• Online Boutique Business Plan
• Daycare business plan
• Mobile Application Business Plan
• Restaurant business plan
• Food Delivery Business Plan
• Real Estate Business Plan
• Business Continuity Plan
• Buy Side Due Diligence Services
• ICO whitepaper
• ICO consulting services
• Confidential Information Memorandum
• Private Placement Memorandum
• Feasibility study
• Fractional CFO
• How it works
• Business Plan Templates

Taxi Business Plan Sample

Published Mar.14, 2017

Updated Apr.24, 2024

By: Jakub Babkins

Average rating 3.9 / 5. Vote count: 8

No votes so far! Be the first to rate this post.

Table of Content

Taxi business plan for starting your own business 

Are you looking for how to start taxi service ? If yes, then this taxi service business plan is all you need. The taxi service business can be a great choice if you have a good budget for buying and maintaining vehicles. Starting a taxi services business doesn’t require you to be an expert in the transportation field. The business can be started with just a few cars and drivers. Moreover, it can easily be expanded whenever you want. 

To start a business, it is important to follow a certain procedure. You need to draft a  transport business plan   for your taxi service business as the first step. For that, you can look at associated plans such as  tipper truck company business plan . If you also want to launch a mobile app to let your customers book a taxi online, you should also analyze  mobile apps business plan .

Executive Summary

2.1 about the business.

Grab A Cab will be a taxi service business owned by Benjamin Williams. The business will be based in San Francisco. The main aim of this taxi service business will be to provide trustworthy, well-timed, and safe cabs whenever and wherever someone needs them. Grab A Cab taxi service will provide cab services while integrating the operations with technology to facilitate individuals even more.

2.2 Management of Taxi business

After you have learned how to start a taxi service, it is important to figure out how to manage the taxi business operations successfully. There is no better way to plan out every aspect of your taxi service than developing a  business plan for taxi service pdf . To know how what your business plan should include, you can read the strategic plan provided here. In this taxi business plan example, we will guide you about all the components of a strong business plan so that you can develop your call taxi business plan.

It is better to hire business planning services to get a professional business plan for your startup. However, if you have the business knowledge and you want to create the business plan on your own, you can do so after doing adequate research. In that case, it is recommended to also go through a logistics company business plan .

2.3 Customers of Taxi business

Through our market survey and feasibility studies, we identified those customers that are most likely to benefit from our services. The recurring customers of the taxi service business will be:

• Schools 
• Event planners
• Retirement and care homes
• Hotel and airport transfers

2.4 Business Target

The main goal of our taxi service business is to become the most-liked transportation company in the San Francisco Metro Area within three years. We aim at doing so by continuously evaluating, monitoring, and following up on customer call-ins.

Company Summary

3.1 grab a cab owner.

Benjamin Williams will be the owner of Grab A Cab taxi service business. Williams completed his MBA two years ago. After that, he pursued a position as a manager in a noteworthy company. He was quite fascinated by the cab service in his state. After a few months, he left the post to fulfill his lifelong passion of starting his own taxi service business.  

3.2 Why Grab A Cab is being started

Benjamin Williams noticed that the other cab services businesses around him used traditional and outdated methods to serve their customers. He decided to use the latest technological features to bring innovation to the business domain.

3.3 How Grab A Cab business will be started

Step1: Plan Everything

Good planning is crucial when you are going to start a business. To ensure that you plan well for your startup, you should explore how to open a taxi company in the United States.

A business plan for taxi service can best aid in planning and managing a business. To write your taxi driver business plan, you can take help from this sample taxi business plan. You can also go through other examples like truck driving business plan to get an idea of what to include when planning for a startup.

Step2: Develop a Brand

The next step in starting up a taxi companyis to highlight your business and its unique offerings. This can be achieved by creating a brand around your business idea. This will include everything from your principles to your competitive advantages.

Step3: Establish Your Office 

The next important step is to establish your business. For this purpose, Benjamin Williams decided to buy a large parking space in the main San Francisco commercial area. He made sure that the place was spacious enough to park all his cabs. Moreover, he also got a workshop constructed inside that place to maintain and repair the cabs. In this way, he reduced the expense of sending damaged cabs to other workshops. 

Step4: Establish a Web Presence

Since we are living in the Information Age, it is necessary to establish a web presence to get known. Therefore, Williams decided to develop a website for the business and establish social media presence for marketing to attract a wider audience. 

Step5: Promote and Market

The last step is developing and executing an effective marketing plan to promote your services.

Services of taxi business 

Before setting up a taxi business, you need to decide on your business’s services. You may have a taxi business plan tempelate, but it might not have everything you need for your sample plan. 

You can follow this guide on how to open a taxi service to figure out what the market for the business looks like and what services are ideal to be included in your startup. 

The cost factor is necessary to keep in mind while considering your services, so you can develop a taxi service business plan startup costs pdf to keep an estimate. Since Williams started with various services, this format can be used to develop even a uber taxi business plan or an airport taxi business plan.

• Door-to-Door Taxi Service 

We will provide door-to-door taxi service to our customers as it is more convenient to use. Our capable drivers will pick up customers from their homes and drop them off directly at their destinations. Our customers will be able to book a cab through our mobile app or website.

• Wheelchair Accessible Cabs

Our specialized service will provide wheelchair user passengers with a ramp or a passenger lift to assist them with getting into the vehicle. This approach is used as it is far easier than transferring from a wheelchair to a car seat and dismantling the wheelchair for the journey. 

• Seniors on the Go

We’ll also provide our professional, skilled, and highly patient cab drivers to assist seniors with their chores. Our company will provide senior citizens taxicab coupon booklets to maximize senior citizens’ benefits. We will aim to provide maximum customer satisfaction. 

• Hourly Service

We will offer our clients affordable discounts that pay off in the long run with our hourly packages.

Marketing Analysis of Taxi business

Excellent work.

excellent work, competent advice. Alex is very friendly, great communication. 100% I recommend CGS capital. Thank you so much for your hard work!

When starting a taxi service business, you should have an excellent understanding of your target market. You can gain this understanding by doing an extensive market analysis as a part of your taxi business plan sample. 

Your business plan for a taxi business should also analyze the price of similar services in the market. This data should be used to forecast the prices you will set for starting your own taxi business. 

If you don’t know how to open a taxi company, you can take help of this taxi cab business plan. A complete market analysis is necessary for running a taxi business. 

If you want to learn how to setup your own taxi business, then this business plan taxi service will be of great use. 

5.1 Market Trends

Taxi operations provide over 60 billion dollars a year to the general US economy. The industry employs 2,026,478 people. The growth rate of this industry has remained in step with the general growth of the country’s GDP. Management feels that by maintaining a local client base, the company can continue to generate revenues despite the current deleterious economic conditions in the United States.

5.2 Marketing Segmentation

The potential customers of Grab A Cab are divided into the following groups:

Business plan for investors

5.2.1 schools  .

Our primary customers will be the school students. They are expected to avail of our regular services to go to school, travel to sports matches or class trips. 

5.2.2 Event Planners

Our second target customer will be event planners. They need to organize events, and for this purpose, they have to travel to different places. They will utilize our cab service to get maximum comfort. Our cabs will pick them up from their pickup location and drop them at their destination. 

5.2.3 Retirement and Care Homes

This will be our third target group of customers. Our taxi company will provide services to people in retirement and care homes since they may no longer be confident to drive. Our wheelchair-assessable cabs are specially designed for these customers. 

5.2.4 Hotel and Airport Transfers

Lastly, our potential customers include families and individuals on holiday and business travels. These groups don’t typically mind paying a bit more for a solution that takes care of transportation in an all-in-one way. Therefore, we expect to earn a handsome amount from them.

5.3 Business Target

• To become the number one taxi service throughout San Francisco and adjoining areas. 
• The main target of our taxi service business is to pursue an aggressive marketing campaign and penetrate at least 75% of the market share.
• To earn a net profit margin of $50.5k per month by the end of the third year.

5.4 Product Pricing

Our business plan for transportation service ensures that our prices will be economical compared to our competitors. The prices are set at a minimum to get introduced to a wider audience from the very beginning.

Marketing Strategy of Taxi business

To open taxi business, you must develop the best business plan for a taxi business. In addition, before starting up a taxi company, you also need to develop a strong marketing strategy to attract more customers.

In this taxi cab company business plan, we’re providing the sales strategy of Grab A Cab. You can learn a lot from here if you aspire to make a city taxi business plan.

6.1 Competitive Analysis

• We have quick customer care services. We respond to customer queries efficiently and respect their feedback to improve our services.
• We have excellent customer support staff that guides our customers in choosing the best traveling package according to their budget. 
• Through our 24/7 online presence, customers can inquire about our services. 
• We will also implement ideas from roadside assistance business plan to prevent any inconvenience to our customers. 

6.2 Sales Strategy

• We’ll advertise our services through social media platforms like Facebook and Instagram.
• We’ll give a free ride to our first 50 customers
• We’ll offer a 25% discount to school and college students.

6.3 Sales Monthly

6.4 Sales Yearly

6.5 Sales Forecast

Personnel plan of taxi business

There are a lot of taxi services in the world. But only those are popular that make customers happy and satisfied. This taxi service business plan sample has all the details regarding the startup of the taxi service business. 

Understanding the importance of good staff, William included some essential features as a part of employee hiring criteria in the taxi cab advertising business plans. He also formed a list of employees necessary for running his business. This list can be seen in this taxi business plan pdf.

7.1 Company Staff

• 1 Operations Manager
• 1 Customer Support Officer
• 1 Marketing Officer
• 10 Drivers 
• 2 Mechanics
• 1 Web Developer to manage online sites

7.2 Average Salary of Employees

Financial Plan of taxi business

It is essential to manage your operations timely to earn profits. A detailed financial analysis is necessary to ensure that your business is not getting into a loss. To ensure that you make a detailed financial plan, you should include all the components that we have mentioned in this taxi business sample plan pdf.

The  taxi service business plan startup costs are also important for your financial plan. Moreover, in your financial plan, you must identify when and how you’ll cover your investment amount with the earned profits. This approach would also help to analyze your yearly expenses to determine the possibilities of reducing them.

Here we’re providing the detailed financial plan made for Grab A Cab so that you can get an idea of the business finances.

8.1 Important Assumptions

8.2 Break-even Analysis

8.3 Projected Profit and Loss

8.3.1 Profit Monthly

8.3.2 Profit Yearly

8.3.3 Gross Margin Monthly

8.3.4 Gross Margin Yearly

8.4 Projected Cash Flow

  8.5 Projected Balance Sheet

8.6 Business Ratios

• How do I start a taxi business?

To start a taxi business, you need to develop a good sample business plan for taxi service. The above business plan taxi company will detail how to do that.

• How does the taxi business work?

The taxi business works by purchasing some taxis, procuring a large parking area, and hiring staff to run and manage services. In this taxi top advertising business plan we have explained all these three aspects in detail. If you want to set up this business, you can take help from this taxi service business plan. 

• How would you describe a taxi service?

The taxi service provides transportation facilities to people without facing public transport problems. Business plan taxi provides details for setting up taxi business.

Download Taxi Business Plan Sample in pdf

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

Bowling Alley Business Plan Sample

Nightclub Business Plan (2024): A Comprehensive Guide

Rabbit Farming Business Plan

Beverages Business Plan

Private Schools Business Plan

Business Plan for a Lounge

Any questions? Get in Touch!

We have been mentioned in the press:

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

Search the site:

• Passenger Application
• Driver Application
• Admin Panel
• Dispatcher Panel
• Account Manager Panel
• Corporate Panel
• Sub Company Panel
• Hotel Panel
• Customer Care Panel
• Delivery and Logistics
• Paratransit
• Limo Dispatch
• Fleet Management
• Cabify Clone
• Bitaksi Clone
• Uber for Truck Clone
• Uber for Delivery Clone
• Uber for Logistics Clone
• Lecab Clone
• Riide Clone
• Careem Clone
• Gocatch Clone
• Uride Clone
• Talixo Clone
• Kakao Clone
• Gett Taxi Clone
• Easy Taxi Clone
• Taxieu Clone

7 Tips To Start-Up A Small Taxi Cab Business in 2022

“Overall quite a clean cab or taxi. Pleasant driver. Phenomenal taxi service.” All these make for a perfect taxi cab service industry, that one taxi business you have been needing to have in 2022 & beyond.

In this pandemic season, you have doubt that, How would you start your taxi business and keep running successfully?

That is presumably just one of the lots of doubts that strike a chord when you are genuinely considering; beginning a taxi cab service business with Taxi Cab Dispatch System . Before you begin to think unwantedly, here are a few hints to remember but these may not address every one of your inquiries, but they are ensured to help persuade you that it’s an ideal opportunity to check out it.

Read More: Tips to Start Your Car Rental Business

Table of Content

1. see who’s your competitors, 2. make sense of the trip, 3. get your papers all together, 4. plan your work place, 5. build up your team, 6. implement your marketing strategy.

7. Observe, Do Mistakes, Learn

As in any venture, it’s so much important to see your opposition and we are not simply discussing other and nearby taxi cab service companies. Discover in your area what number of competitors are working. Look out their official websites, social media accounts and promotions, or make an inquiry about their taxi services and rates.

We make your Taxi booking app idea into reality?

It’s wise for you to see whether there is a requirement for taxi cab service in your locality. Or on the other hand whether there is space for one more. Your region may most likely be too little to even think about accommodating a few companies, or more regrettable, there isn't a lot of interest for taxis.

What number of vehicles would you be able to manage? Whatever your financial plan is, consider the following when searching for taxis for your fleet if you need to own a Cab Dispatch Software to provide ride-hailing services.

Outwardly appealing and clean taxis

In great condition

Effectively altered for taxi cab use (if accessible)

Space availability for luggage

Picking effectively altered vehicles will be useful because you’ll no so long need to purchase signs, paints and taxi meters.

Licenses to operate and great protection coverage are your absolute necessities before you kick-off business activities in light of the fact that there will consistently be managing bodies that will lead inspections, randomly. To abstain from paying unwanted fines, have these things prepared and updated.

Are you looking for a SaaS based solution?

Have your enlisted and protected vehicles. Insurance policies are expensive, however you should have them before you start to work. Check your operators who are as of now in the taxi cab business with Cab Dispatch System for referrals and concerns.

You have to search for sufficient work space enough to oblige your taxis, and have a property that will fill in as your workplace. Consider closeness to your favoured service zones in selecting the place for your ‘carport’ office.

You will require the work space to accommodate some staff whose assignments will be to guarantee that your service is proficient.

Recruit required workers and pick them good. Get a bunch of drivers and staff. Recall that rider security and convenience should be your major contemplations in selecting your future workers. Know How to Attract More Taxi Drivers to Expand Your Taxi Business

While recruiting drivers, verify whether they have a legal license, request past records, and do personal investigations if you have time. You may also need to remember hiring additional drivers, even dependent upon the situation, in the event that one of your full-time drivers is inaccessible.

Get everyone to act as dispatchers for your incline office workers. They should be effective and prepared to deal with demand-made Cab Dispatch Software .

Everything’s been prepared and you have to do now to get the news out. You can start your marketing for your Taxi Cab Dispatch System with conventional channels like handouts, phone registry, paper advertisements and more. Publicize your taxi cab service however make a point to put something that will get the reader’s consideration. Coupons, maybe? Or then again limited fare on their first trip? Whatever won’t disturb your financial plan can work.

What’s more, obviously, go digital marketing. If you can and provide a taxi service with Cab Dispatch Software where the public can book online, set up a website. Next, go social; Make social media accounts that are modest and it’s a certain method of getting a crowd of people. At the point when you have set up every one of these marketing strategies, consistently make a point to react rapidly.

Related Posts:

Marketing Strategies for Taxi Rental Business

How to Improve Marketing Strategies in a Uber-Like Taxi Business

7. Observe, Make Mistakes, Learn

Beginning a business is rarely simple with a Cab Dispatch System. Will undoubtedly make mistakes, particularly if it’s your first undertaking. Simply show restraint and give yourself an opportunity to watch the tasks and do improvements as you come. know How Does Car Rental Software Benefit Your Car Rental Business

Try Unicotaxi taxi dispatch platform with complete system? Don't take a decision before try it - let's try our free demo

Related blogs to watch:.

7 Key Benefits of White Label Taxi App

How Your Car Rental Business Can Thrive After COVID - 19 Pandemic?

A Step-by-step Guide For Successful Taxi Booking App Development For Your Taxi Business

9 Tips on How to Start a Business in Paratransit Services

A Complete Guide on Taxi Cab App Development

A Guide to Startup a Small Taxi Cab Business in the UK

How to Start a Small Cab Business in London?

Liked our Blogs ?

How to determine realistic startup costs for starting in india.

Estimating your startup expenditures is a crucial step in creating a business roadmap, just like your business plan.

Table of Contents

How much would starting your startup cost? Although it's difficult to say for sure, it's critical to get planning as soon as possible to prevent any unanticipated costs.

A successful business launch demands planning. Even though you might not be able to predict these costs precisely, you can and should start doing some research to get a rough idea of how much it will cost to launch your company.

What are Startup Costs?

Startup expenses are those incurred prior to the start of the business. These are the invoices and costs you'll have to pay before your business officially launches. Your company will often come under one of three categories: a service-based company , an online busines s, or a brick-and-mortar company, however every business will have unique startup costs to consider.

Why Founder should calculate Startup Costs?

Estimating your startup expenditures is a crucial step in creating a business roadmap, just like your business plan. Even a reasonable estimate might help you keep on track during more volatile months and avoid taking needless risks.

You're still not persuaded to investigate your beginning costs, are you? Here are a few more justifications for why you ought to figure out your startup costs.

1. Every Startup is different

There is no easy formula to calculate beginning costs because each sector and firm requires a wide range of expenses. However, that doesn't preclude you from making an educated assumption that faithfully reflects the requirements of your company.

For example, a SaaS company may need to budget for extra online resources or server costs to maintain the functionality of its website. However, a clothing store, whether physical or online, must budget for physical inventory and transportation costs.

2. To establish a Firm Foundation

Many people misjudge the costs of starting a business and do so in an impulsive, unplanned manner. This might be effective in the short term, but maintaining it is usually considerably more challenging. Customers are frequently cautious of new enterprises with improvised logistics, making it nearly impossible to manage initial costs until you correctly calculate them.

3. To Build your Business Plan

A summary of your present financials and growth projections can be found in your business plan. One of the essential components of creating a workable financial strategy is having realistic startup launch costs, even if they are only estimations. Knowing the requirements to launch your business can help you:

• Estimate profits
• Conduct a breakeven analysis
• Extend the runway of your business
• Identify potential tax deductions

You must regularly evaluate your business / financial plan during the course of your company's existence in order to successfully leverage it. These early startup estimates will give you a starting point to use as a guide during these assessments. You'll be able to tell if your calculations are accurate or if you need to make any revisions after a few months of operation.

4. To Secure Loans and attract investors

Investors and lenders want to understand the roadmap you have in place for your business. You’ll need to be ready to answer questions about your business model, sources of revenue, growth forecasts, and initial startup costs. They need to see that your business is viable and that you’ve thoroughly explored what it will take to start, operate and grow.

Having realistic startup costs laid out is a necessity in this case. And being able to show how you believe expenses will change or remain similar over time will give them a better idea of how you intend to manage your business.

How to Identify your Startup Expenses

It involves a combination of market research, testing, an deducated guessing, just like when creating your business plan or estimating your initial sales. It's up to you to make the necessary adjustments in light of ongoing findings.

For specific spending categories, you can use your competitors' and the industry's benchmarks as a starting point. Instead of copying the costs you find verbatim, see if your predictions are reasonable in light of the market's current conditions. If you have a good working relationship with your vendors or your company strategy allows you to avoid atypical expense, you can find that you have a competitive cost advantage.

1. Startup Expenses

These are charges that must be paid up front before you launch and begin to make money. These ought to be divided into one-time and recurring costs. You can give yourself a more precise estimate of how much it will cost to begin your firm by dividing them up in this manner. Here are some frequent expenses to consider in both categories:

A) One-Time Expenses

• Permits and licenses
• Incorporation fees
• Logo design
• Website design
• Brochure and business card printing
• Down payment on rental property
• Improvements to the chosen location

B) Ongoing expenses

• Legal services
• Loan payments
• Insurance payments
• Marketing costs

These are but a few of the various expenses you might have to take into account. Some costs will fluctuate between being fixed and variable, while others will operate as fixed costs. You'll be able to keep better track of your spending and spot any organic cost-cutting opportunities over time if you have them laid out in this manner from the beginning.

2. Startup Assets

These are outflows related to long-term assets you bought to launch your business. Although money in the bank is the most fundamental startup asset (and we'll talk more about that later), you might also need to invest in the following:

• Starting inventory
• Computers or other tech equipment
• Office Equipment
• Office Furniture

Why it is important to separate Assets and Expenses?

Now you know why it's important to divide costs into assets and expenses. Because expenses are deducted from income, they lower taxable income. On the other hand, assets cannot be deducted from income.

You may be able to save money on taxes by first separating the two. Additionally, you can prevent overstating your assets on the balance sheet by appropriately recording expenses. While having more assets generally gives you a better appearance, having assets that are pointless or unsubstantiated merely adds to the size of your books and may even cause them to be wrong.

When starting a firm, it is a good idea to list these separately, which leads to the final factor to take into account when estimating startup costs.

How to identify Capital Required to star your Startup

An estimate of the amount of cash your startup business needs to have on hand in its bank account upon launch. The money you raised through investments or loans less the cash you spent on expenses and assets is generally your cash balance on the commencement date.

You still need this to complete the picture in order to get going. Watch your cash flow estimates as you develop your plan. If your cash balance falls below zero, you'll need to either raise funding or cut costs.

How Much Money Do You Need?

Many business owners make the decision to raise more money than they actually need in order to have extra cash on hand for unforeseen circumstances. While that makes sense when you can implement it, it can be challenging to explain to investors. Since it is their money, outside investors don't want to offer you more than you require.

Experts may advise you to start with enough money to cover your expenses for anywhere between six months and a year. Though it sounds good in theory and would be fantastic for peace of mind, it is rarely feasible. Additionally, it tampers with your estimates and lessens their significance.

Calculate the deficit spending you'll probably incur in the first few months of the company to get a clearer idea of how much cash you actually need in the bank. After that, make an estimation of how much money you'll require each month or year until you reach a consistent break-even point.

Benefits of startup india

Startup India Registration - Defination, Benifits and Documents | Jordensky

How to Estimate? How Much your Expenses Will Cost

It's essential to add up your possible assets, costs, and starting capital in order to estimate your total startup costs. You can create these estimations using one of two possible approaches.

The most conventional approach, which I refer to as the worksheet method, is making separate worksheets for starting financing and starting charges.

1. The traditional method — Startup worksheet

The traditional method uses a startup worksheet, as shown in the illustration here below, to plan your initial financing. The example here is for a retail bicycle shop. It includes lists of startup expenses in the upper left, startup assets in the lower left, and startup funding on the right.

2. The Live Plan method — Consolidated estimates

Live Plan proposes a different and perhaps more intuitive technique to evaluate beginning costs. Live Plan's estimates begin when a business starts spending rather than when it debuts and begins to generate income, which is the main distinction between it and conventional techniques. The launch date and pre-launch spending are not separated. Therefore, no particular startup table exists.

Here are common financing options to consider:

Investment : what you or another person invests in the business. It appears on the balance sheet as paid-in capital in the end. This is the traditional idea of a business investment: buying stock in a firm and taking a financial risk in the goal of making a profit afterwards.

Accounts payable : debts that are unpaid or have a deadline for repayment based on your balance sheet. This typically refers to credit card debt. Your balance sheet's opening balance is determined by this sum.

Current borrowing: Standard debt, bank borrowing, Small business administration borrowing, or other current borrowing are all examples of current borrowing.

Other current liabilities : additional liabilities that are not subject to interest. This is where you should enter any loans you received from friends, family, or founders. By the way, we don't advise using interest-free loans for funding, but when they do, they go here.

Long-term liabilities: Long-term debt or long-term loans.

Aim for Long-Term Success with Realistic Startup Costs

Make sure you've thought of every part of your business and incorporated relevant charges when estimating your startup costs, whether you utilize the Live Plan method or the conventional approach. You'll stand a better chance of obtaining loans, luring investors, calculating profitability, and comprehending your company's cash runway.

You'll have a more accurate perspective of your company's immediate future if you precisely set out startup costs and make revisions as you incur them.

About Jordensky

At Jordensky, we are committed to providing an experience of the highest caliber while specializing in accounting, taxes, MIS, and CFO services for startups and expanding businesses .

When you work with Jordensky, you get a team of finance experts who take the finance work off your plate– ”so you can focus on your business.

Top 5 Financial Challenges faced by Startups in India - Jordensky

How to Value Startup - 9 Real World Valuation Method used by Investors in India

Akash Bagrecha

Latest articles.

Comprehensive Compliance Checklist for Private Limited Companies in India

How to Setup an LLP in India: A Comprehensive Guide

The Importance of Bookkeeping and Accuracy in Accounting