How to Start a Limo Business

Starting a limousine service requires the same types of start-up requirements as other businesses. Decide what form of business you will be operating (e.g., corporation, sole proprietorship, or general or limited partnership). Be sure that you have a business license, home occupation permit (if you are operating out of your home), trade name and trademark registrations, fictitious business name statement filing and recording, as well as know all state-specific laws relative to operation limousine services.

Difficulty:

Moderately Challenging

Instructions

Things You'll Need

• Limousine (new or used)
• Telephone
• Cellular phone (recommended)
• Car insurance
• Commercial driver’s license
• Yellow Pages directory advertising (recommended)
• Safe driving history
• Fund for repairs and maintenance
• Chauffeur uniform (optional)
• Current auto registration
• Cleaning supplies
• Street maps
• Storage site
• Credit card account (recommended)
• Business plan
• Drinking glasses

Start a Limo Service

1. Develop a realistic formal business plan including financial statements, especially if you intend to apply for business loans. Most businesses fail due to undercapitalization. You should plan ahead for unexpected contingencies.

2. Buying a new or used limousine can be expensive and you need to find a clean, safe, recent model. People who ride in limousines have serious luxury expectations so you can’t be too cheap. You’ll also need a safe place to store your limousine when it is not in use.

3. Customizing features which you should consider adding are a sun roof, attached car phone, wet bar with liquor and champagne (a service available only to clients of legal drinking age), sodas, ice bucket, TV, DVD player, radio, satellite radio, and storage drawers.

4. Insuring a commercial limousine is not as simple as meeting usual required policy limits. Many states require that limos maintain at least $1,000,000 liability coverage. Auto registration can also be a large start-up expense.

5. Driving a limousine usually requires that the chauffeur be at least 25 years old with a good driving record. A chauffeur’s salary usually is billed hourly and good chauffeurs earn frequent tips. Many limo services have a minimum required tip for the chauffeur of 15% of the total bill. Driver duties include maintaining strict client confidentiality, gas filling, repairs, maintenance, car washes and waxes, cleaning the car’s interior, maintaining business records, and putting away liquor if clients are under the age limit. Duties as a chauffeur includes cleaning the limo interior and refilling ice buckets while waiting for clients to return; parking, pickup courtesy; opening car doors for clients; non-smoking policy option; abiding by all traffic laws; and using side mirrors and turn signals to drive cautiously.

6. Stimulating business involves advertising in such media as high school yearbooks and high school newspapers, Yellow Pages advertising and the use of other promotional materials such as business cards.

Tips & Warnings

• Go well beyond the call of duty as a chauffeur if you want to get bigger tips from clients. That means keeping the limousine meticulously clean at all times.

• There will be many occasions when chauffeurs should intervene with clients to prevent serious problems. These events include clients taking drugs in the limo, clients engaging in sex in the limo and young people asking the chauffeur to buy liquor for them. Often, clients will stay out all night. Make sure that you are rested enough to handle this scenario.