Renting vehicles is a quite lucrative business but it is also a very
competitive sector. If you want to get involved in such business, you have to
get strongly prepared: to define a serious business strategy, to have at
disposal the necessary funds to build your fleet and to care of your cars, to
obtain business permits, follow insurance and regulatory requirements and over
more.
Is it a risky project? Of course, it is a business like any other, it
involves risks but the opportunities for success are there, as far as you get
yourself fully involved and adequately prepared. Here are steps you need to
follow in order to build a successful, lucrative and quickly growing car rental
business.
Carry out a serious market survey in your area of establishment
As mentioned above,
car rental activity can be very competitive. Before you get started, it is very
important to carry out market surveys in the area where you want to settle
down. You have to gather important information if you don’t want to be
completely off the mark and experiment failure. As far as car rental is concerned,
there are few but important things you have to figure out: is there enough
demands for car rentals in your area? How many competitors? Rates ? What type
of vehicles rent out well? Where to set up your agency in order to target the
largest number of customers?
You can conduct the
survey yourself, but don't hesitate to ask your questions to professionals who
have been working in this field for a long time.
Define the services you wish to offer and fix your rates: fixed period contract rental or daily rental.
When you have completed your initial research, you now know if the
business can be lucrative or not. It’s time to define which type of car rental
contracts you will go for, whether contract hire rental or daily hire rental.
According to your target customers, you can opt for the one or the
other. If you want to touch the general public, daily rental is the best
option. If you aim to reach businesses, contract hires are better.
The study you made previously will help you figure out what is working for
your competitors so as you can position yourself in the same market or seek to
conquer new ones.
It’s up to you to fix your rates but you’d better make comparison
before. Check out the average rates of your top competitors align with them.
Choose a name for your car rental business and obtain business license.
Choose a catchy name for your car rental business. It is important in
order to give your customers an idea of your services. The point with the name
is to attract customers and to make them dream, to make them think that you are
the best rental company ever.
Once you have chosen the name, register your business with the state
government. Submit your application for obtaining your license. According to
the local legislation, it may take about two or three weeks to obtain all your
paperwork. Don’t neglect this step because if you are not in good standing, you
won’t be able to hire employees and worse, you won’t be able to work.
Build your fleet, hire experimented employees and market your business.
You will need to buy several types of cars but no need buy them all at
once. Build first a fleet of 4-5 vehicles.
The most important point is that you should own different types of cars
in order to meet every demand of you target customers. For the general public,
economy cars are more wanted. For businessmen, luxury cars are better options.
Once you get the vehicles, never forget to insure them all. This is part of the
legal requirements for car rental companies.
Hire then auto experts to work in your car rental agency: rental service
manager, mechanics, carwashers. You can also choose to outsource these jobs but
ensure a thorough follow-up of your service providers and be vigilant about
costs.
Last but not least, market your business. Set up a website for your car
rental company in order to target more customers, use print and social media,
get yourself visible on video-sharing sites such as YouTube or Dailymotion,
look up for eventual partnership with other owners of car rental agencies, etc.
