How to Start Up aTaxi Service Business
The old television sit-com, "Taxi," made running a taxi service business look fun and easy. In real life, a taxi service is just like any other small business. It takes hard work, patience and some start-up cash. But if you live in a big city, especially one with a large airport, it can be a rewarding and profitable business.
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Instructions
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Acquire some experience with an established taxi business. Work as a driver for a few months. This will also give you the chance to see if there is a need in your community for a new taxi business. If you're working for an existing company, but sit around much of the time, your town probably can't support another taxi business.
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Register your business with your state's Secretary of State, and get a local business license from your city. Each town has a different way of doing this, so call city hall to learn about the process. In most cities, it's quick and easy. You will have to pay a fee and renew your license on a regular basis. The fee is usually not large. At the same time, determine if your city regulates taxi services. If so, you may need to pay an additional fee.
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Test for a driver's licence for taxi drivers. You may have to take a special driving test, depending on the requirements in your state. Call the Department of Motor Vehicles to find out how to do this.
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Apply for a business loan, if you need to borrow money for start-up costs. Your local bank will be happy to work with you if you have a good credit score. The bank will probably request to see a detailed business plan before loaning any money, so have that ready. SCORE, a non-profit organization that helps small businesses, can assit you with determining your financial requirements. SCORE counselors will also help you write a business plan.
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Buy your first car for your taxi service. Some cities that regulate taxi businesses require a taxi to be a certain kind of car, so check with your local government before making such a large purchase. You will need to equip the car with a meter to determine charges and a sign on the outside.
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Hire a driver, or be the first driver yourself to save money. Once you build up some equity in your company, you can purchase more cars and hire more drivers. As your business grows, look for a garage to house the cars.
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Get a telephone number for customers to call when they need a ride. Try to get one that is easy for customers to remember. Make sure the number is manned 24 hours a day.
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Tips & Warnings
If you incorporate your business, there will be some protection for your personal property if an accident happens and you are sued. Get incorporation information from your state's Secretary of State.
Buy adequate insurance. Driving customers poses a real liability threat. Consult your insurance agent about the type of coverage you need. If you hire drivers, get worker's compensation insurance. If someone gets hurt, you can end up paying thousands of dollars in medical bills if you don't have insurance. Don't forget about some reserve cash for vehicle maintenance.
