BusinessHAB13 Top Requirement for Car Rental Business
This is a business that you have to be careful going into.
You would need to have carried out detailed research as to how much budget you have to start the business with and how realistic your budget is in achieving your plans.
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If you intend to launch a car rental business.
There are certain items and requirements that you would need to have fulfilled, and they are as follows;
- Incorporation fees for car rental business.
- Licensing, permit and liability insurance.
- The cost of leasing a facility for at least one year.
- The cost for equipping the office with computers, CCTV cameras, printers, filing gadgets, telephones, and so on.
- The cost of acquiring the cars needed to run the business.
- Cost of launching of an official website.
- Additional expenditure such as business cards, signage.
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Requirement for Car Rental Business
1. Budgeting the Business
The car rental business can be started with little, average or high funds, depending on the scale you intend to start off the business with.
If you intend to target the luxury clients and start hiring out limousines for instance.
Then you might need more funds than someone that intends to start with regular clients, and is renting out SUVs.
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2. Financing Your Car Rental Business
Everyone knows the importance of finance in carrying out their daily activities.
And every entrepreneur knows the importance of finance in their businesses as well.
No business can start, or continue in its operation without finance.
The car rental business is not an easy one, and so raising capital might not be so easy.
This is why the importance of the business plan cannot be over-emphasized.
Your business plan helps point you to likely sources that will invest in your business.
A good business plan will also help convince investors of your seriousness at making your business work to make money for its growth and to pay them back as well.
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Requirement for Car Rental Business
Some of the options that you can explore to finance your car rental business includes;
- Approaching angel investors and intimating them of your plan.
- Raising money from venture capitalists
- Applying for loan from financial institutions and banks
- Financing part of the business from personal finance and sale of properties
- Approaching specific investors
3. Choosing a Suitable Location for your Car Rental Business
As an entrepreneur, you should know that the location of your business is extremely an important factor to be.
Considered when starting out your business, as it could affect the growth of your business.
There are many issues you would need to consider when choosing a location for your car rental business.
The location of your car rental business must not only be instrumental to the success of your business.
The leasing of the facility must be what you can afford, and also it must be appropriate for a car rental business.
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Requirement for Car Rental Business
While the location for some businesses might not be so much important as just finding any affordable facility.
Anywhere, that of a car rental is mighty important as it needs to be accessed conveniently by your clients.
This is not a business you can run from the comfort of your house.
Except your operation is based on one car, and your target market is just your local neighborhood.
In that case you can operate the business from home.
If you however, intend to run a standard car rental business then you would need to get a facility in a place that will favor your business.
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The facility you should aim for should be that which can allow you to expand comfortably.
This is why a business plan is important.
It allows you know your intentions towards your business.
If you plan to expand or will be more comfortable on a particular scale.
As this will be a guiding decision to choosing a location for your car rental business.
Your location has to be one that highly considers your clients.
And where they will be coming from to hire the cars for their own use.
In essence, your location has to be a well-traveled route that has lots of traffic.
Requirement for Car Rental Business
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4. Equipment & Manpower
There really isn’t much equipment that you would need to start your car rental business.
As your cars are the main equipment that is necessary for your business to grow.
Since the cars are the main equipment, it is not advisable to buy them for fairly used.
As you might spend more in maintaining them than when you purchase new cars.
Other equipment needed are light work tools for the cars.
Some of the equipment that you would need to fully launch your car rental business includes:
- Cars
- Safety tools
- CCTV Security Cars
- Maintenance tools
- Computers
- Phones
- Filing Cabinets
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The nature of this business might not allow most people operate their business from home.
And so an office facility with a large space parking lot for the cars must be taken into consideration.
It also makes clients both potential and existing to take your business seriously.
Regarding the number of staff that you would need to run your car rental business is at least 5 to 7 people.
You would need at least a manager, front desk officer, security, maintenance staff, and accountant.
5. The Service Delivery
The process involved in the delivery of rental services to customers depends on the needs of the customers.
The processes involved ranges from providing regular services to providing premium services.
Other process involves ensuring that customers stay satisfied.
And providing other services that might be needed.
Requirement for Car Rental Business
6. Marketing ideas and Strategies:
Any business that wants to make money would need to ensure that their marketing strategies are sound.
Marketing ensures that you advertise your products and services in an aim to make money.
Every marketing strategy should leverage on all conventional and unconventional sources to be able to make money.
If your car rental business is medium or large scale.
You can ensure that you bid for contracts at every opportunity available and at the right time.
Running a large scale car rental business means that you can partner with smaller car rental companies.
This would give you a far and wider reach, whilst still garnering brand awareness for your company.
Requirement for Car Rental Business
Some of the marketing ideas and strategies for the car rental business in Nigeria include;
- Promptly bidding for contracts from corporate organizations, airline sector, and also relevant government agencies
- Ensuring that the affected clients know about your business by sending brochures as well as introductory letters to them
- Advertising your business in relevant magazines and newspapers
- Making use of your official website to engage your customers, and allowing them to carry out their bookings
- Ensuring that your car rental business is located on local directories
- Ensuring that the social media – LinkedIn, Facebook, Twitter, Instagram, are used to generate traffic to your website and revenue as well
- Advertising your business on online directories
- Pasting your notices on boards and places close to your target market
- Employing word of mouth marketing
- Use direct marketing
Read also: Strategies to succeed in car rental business in Nigeria.
7. Car pricing:
Getting the right factors that will ensure that you give the best pricing for your car rental business.
This is the one that would ensure that your rates are affordable to your clients.
While not allowing you operate on a loss.
This can be achieved if you scale back unnecessary expenses and concentrate more on the ones that cannot be avoided.
Requirement for Car Rental Business
8. Competitive Strategies
Competitors would always exist in every industry and sector.
And any entrepreneur going into business knows this.
Customers always go to businesses that offer them an affordable package with excellent services.
And so if you must rise above your competition you would need to find out unique packages for your customers for prices that would be affordable to them.
You could design your competitive strategy in a way that your low paying customers could also have access to a segment of your luxurious fleet but with certain conditions.
This might lead to you renting out your luxurious fleet.
While your competitors struggle with ensuring that theirs make revenue for them.
Another way to rise above your competitors is to ensure that you offer areas of specialization that are related to your car rental business.
You must ensure that your competitors aren’t offering these same related services.
And if they are, find a way to ensure that your services beat theirs.
Requirement for Car Rental Business
9. Client Retention
Customers always stay with companies that meet their needs and wants.
This means that for you to retain your customers.
You would need to be able to anticipate what they need and want.
Anticipation plus the provision of excellent services is guaranteed to keep customers happy and not leave your business for competitors.
Customers usually leave businesses who they feel do not care about them.
Another way at increasing customer retention is to ensure that you offer incentives either on the car type or discount on certain days, or for long contract hires.
You could also ensure that your services are designed in different packages.
So that high premium customers get more services for paying more and yet lower-paying customers do not feel cheated at paying less.
Since there are services that would cater to their ‘affordability’ as well.
Requirement for Car Rental Business
10. Awareness and Corporate identity
The strategies needed to boost the brand awareness and create a corporate identity for your car rental business is one that would ensure that the bottom line of your business improves and becomes a force to be reckoned with.
If you want to start off with running a large scale car rental business.
Then you might consider getting expert help as regards creating strategies to boost your brand.
- Some of the strategies that can be used to promote the brand of the business while also boosting the company’s publicity and creating awareness are:
- Using the car wrap technique, where your business and its information are used on all your fleet of cars, covertly or overtly.
- Ensuring that you seriously promote your business on your official website
- Advertising you car rental business in appropriate places like traveler’s magazines, local newspapers, radio, television stations, as well as other mean
- Leveraging on social media platforms such as Instagram, Facebook, Twitter etc; and offering incentives through these that would boost your company’s brand
- Ensuring that you use the testimonials of your satisfied customers to get potential customers
- Employing the mailing approach to garner attention to potential customers
- Taking advantage of online directories as well as yellow pages
- Using the referral system to help gain new customers and increase your brand awareness.
Requirement for Car Rental Business
11. Suppliers/Distribution Network:
Running a standard car rental business means that you will need to liaise with car manufacturers and dealers.
So as to get your cars when you need them and other such services as well.
This means that you would need to be in a good relationship with your car dealers.
Local maintenance companies, and other such that would ensure that your business runs efficiently and effectively.
Being in a good relationship with these suppliers and distributors.
Would ensure that you get tips on the best cars or brands.
That would be best for you and your car rental business.
Regardless of the car type segment you intend to go into.
12. Managerial Skills:
Ensuring that your car rental business becomes successful means that you would require managerial skills in managing your resources.
Otherwise you might lose your valuable assets – fleet of cars.
As an entrepreneur that is just starting out.
You would to find a way to rise above your competition.
By ensuring that you offer fair prices and are always available to your customers.
Requirement for Car Rental Business
Another way to ensure that you remain successful is in paying attention to which segments of your business will give you more profit.
This means that you would need to keep an eye on the items that are likely to affect the bottom line of your business.
This way you can adjust your business model according to the changes in the business environment.
Finally, you would need to thrive on opportunity.
And ensure that the logistics associated by your business is simple enough for your customers to understand.
This is as you offer your customers a high end experience that is guaranteed at retaining your customers.
And improving the bottom line of your company.
BusinessHAB