Car rental business is the most popular, profitable business and most challenging of startups. But if you handle it well, you’ll make a mark.
Neil Abrams, president of Abrams Consulting Group Inc., says the car rental business is full of tough challenges and great opportunities. And he’s confident that it’s a great way to make money even in times of economic insecurity.
Tourists and business people want to rent a car rather than use public transport. Locals also hire cars. For example, when their personal car is under repair or for weekends out of town.
The vehicle rental industry involves two chief business sectors
- General use (counting air terminal and nearby market offices) and protection substitution. General use organisations commonly serve airport terminal and neighbourhood markets, and they represent roughly 73% of rental income in the US,
- while the Insurance substitution section represents around 27% of rental income.
In this blog we have shared a few tips and ideas to inspire you to take a chance.
What will be the requirements for starting a car rental business ?
- Purchasing car rental script
- White labelling
- Attract Property / hotel owners to list their properties on your website
- Market your website to reach more people.
Purchasing car rental script
Before starting a business, we need a separate and unique website / mobile app for connecting Riders and Car owners/drivers which allows Riders to book the trip.
If we are thinking about developing this website / mobile apps from scratch, it will not be a good idea. Because it needs more time / more investment. If we can purchase the best car rental script from the market, with multiple features and at good cost, that will be more profitable for us.
White Labelling
White Labelling is the process of making the purchased script as our company property.
If we can display the website / mobile apps with our company name it will be more perfect to reach more audiences.
There are more companies in the market, that white labelling can be done without any additional costs.
Attract car owners / fleet to list their cars on your website
Before launching your business, we need to give a set of car lists that gives a space to Riders / users to book the trip on their desired location.
Business owners need to make an agreement with car owners / fleet owners to list their cars and about service / commission fees.
Market your website to reach more people
In an online business, digital marketing plays a vital role in advertising the brand.
If one makes a perfect digital marketing, they will reach enormous potential customers.
There are a lot of airbnb car rental businesses on the internet, initially we can attract customers to our website through digital marketing, but after that business owners ensure the service / quality of the website and customer support. This will boost up their business beyond that initial point.
How much will be the profit by running a car rental business ?
If Car owner / fleet list a car and if he rents the car for minimum of 200 $ / trip per day, if it means for one booking admin (who runs the website) will get as below,
Service fee charged from guest – Min 5 % of 200 $ = 10 $
Commission fee from car owner – Min 10 % of 200 $ = 20 $
For one day for one car, Admin will get 30 $ as a commission.
If he gets at least of 25 days booking at one car, 25 * 30 = 750 $ / car.
If minimum of 100 cars, get 25 day booking the commission amount will be, 750 * 100 = 75,000 $ / month
If the admin wants to increase the service / commission fee he can change it. If car counts increase, the commission also increases.
Approximately, 75,000 $ USD will be the revenue for the admin in terms of commission without any additional costs.
Admin can do the business easily and earn high profit with the less work..
Thank you for reading this.