BusinessHABTop 13 Succeeding Car Rental Business Strategies in Nigeria
Top 13 Succeeding Car Rental Business Strategies in Nigeria.
A person living in a strategic place of a high density of population with business centers and entertainment outfits.
Car rental business would be a lucrative and profitable venture for him.
If you are interested in starting car rental business, read the following strategies:.
The car rental industry is getting competitive with every passing day.
In coming years the industry is expected to grow both in developing as well as in developed countries.
The reason for growth mainly attributes to the growth in per capital income and an increase of passengers preferring flights to travel.
See also: Top 20 tips about Car Rental Business
Succeeding Car Rental Business Strategies in Nigeria
The primary requirement of starting a car rental business are scheduling customer reservations and supplying rental car.
A car rental business can be started with low investment provided you come out with extensive research and networking.
In addition to this, you must have a well thought out business plan before starting car rental business.
Read on: 13 Top Requirement for Car Rental Business
1. Car Rental Business Plan:
Create a detailed plan of your car rental business.
In writing a business plan you must include the target market, your start-up investment, supplies.
How you access the market considering the demand, projected annual revenues, and expenses.
A business plan is an important part of the foundation of a business.
Succeeding Car Rental Business Strategies in Nigeria
All businesses of whatever sort require a business plan.
This is not to say that all businesses eventually use a business plan.
However, those that do are usually regarded more seriously than those that don’t.
So, if you intend to start your car rental business, and want to be taken seriously by investors.
You would need to get a comprehensive business plan.
Starting a car rental business means that without proper planning, your business could fail before it even starts.
And so your business plan helps you draft clear strategies that are intended to make the business better in the long run.
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The business plan is a very important document and is a blueprint that intends to influence the actions and decisions that you would take in your business later.
These actions and decisions –
How to source for capital.
How you intend to attract and retain clients.
And how the business will be managed.
Would be guided by well thought out strategies.
Which will all be components of your business plan.
Because writing a business plan is cumbersome
Succeeding Car Rental Business Strategies
Most people hastily draft out a plan without carrying out feasibility studies.
And so when they fail, decide to consider the business plan as ineffective towards the business.
The business plan is not meant to be a document of fiction where figures will be concocted to make you feel good.
The business plan is usually a document that shows you hard facts.
And in the end might save you from throwing money away in starting a new business venture that would not have been worthwhile in your area or region.
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Succeeding Car Rental Business Strategies
2. Car Rental Business Model:
The most important part in the process of starting this business is fixing the right model of your business.
What kind of specific service will you offer your customers?
What are the types and features of the car you are going to offer?
Will you focus regular cars or sedan class?
Based on these factors you need to create an appropriate business model.
Succeeding Car Rental Business Strategies
3. Compliance Requirement in Car Rental Business
Check requirement of licenses and other legal necessities in starting this business.
Different states and countries have their own legal requirements.
Check with local appropriate authority about the legalities required.
Another important issue is insurance.
In fact the most important one
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Succeeding Car Rental Business Strategies
In some countries and states insurance is mandatory.
Check for insurance companies and find the one giving best cover with affordable price.
You will need to pay special attention in insurance that also covers workman’s compensation.
It will protect your vehicle as well as your business from the losses caused by road accidents.
The name of your business has a tremendous impact on how clients view you.
Choose a comfortable, familiar and easy to pronounce for your car rental business and get it registered.
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4. Car Rental Business Pricing:
Decide the rental pricing rate.
You can go for hourly basis, kilometer wise or daily basis.
The class of the car, that you are offering, will also determine the pricing.
As an example, rental charge for a regular model car’s charge will be different than a luxury car.
5. Promote Your Car Rental Business:
Identifying, anticipating and satisfying consumer requirements are the keys to more profitability in this business.
You can start contacting corporate clients and hotels who has bulk requirements of rental cars.
Go for some local classified advertisements to promote the business.
Create an informative detailed website of your car rental business company to make an online presence with an online booking system.
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Succeeding Car Rental Business Strategies
6. How to Start the Business
Starting the business in whatever way can have its advantages and disadvantages.
And this means that you would need to have gotten your plans in place before starting off the business.
Starting your business from scratch will help you grow as an entrepreneur.
And will give you the experience that a franchise would not give you.
Starting from the scratch means you will have to deal with paperwork and also draft strategies on how to get your customers, while running the business.
This does not in any way mean that all businesses that start from the scratch succeed.
Buying a franchise is for those who do not want to deal with paperwork and having to worry about customers.
When buying a franchise, you buy all the strategies, equipment, structure, and techniques in place, and only have to worry about rendering service to your clients.
If you are only concerned with services and have no head for other technicalities, then you should buy a franchise.
However, before buying a franchise carry out a thorough research on the company that would best be suited to you business-wise and one that would generate revenue.
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6. Threats and Challenges Car Rental Business
There is no business without its challenges.
Some of the likely threats and challenges you would face when starting or running your car rental business are usually a bad economy.
A bad economy leads to a lower income per capita and disposable income, leading to fewer people needing the services of a car rental.
Succeeding Car Rental Business Strategies in Nigeria
Another challenge that you might face might be in getting the required finance either to start the business or expand your fleet.
Finance is an important part of any business, and the lack of it can cause your business to crumble or not even start up at all.
Another challenge could be in your location, as getting a poor location that would inconvenience your customers is likely to see you out of business.
Read on:13 Top Requirement for Car Rental Business in Nigeria
Succeeding Car Rental Business Strategies
7. Legal entity
The nature of the car rental business is one that makes it difficult to start the business with just any type of legal entity.
Most people that usually start this business usually go for Limited Liability Companies (LLC).
The LLC is popular due to the fact that it is a hybrid of a partnership legal structure and that of a corporation.
And so gives anyone using the LLC the benefit of both.
Succeeding Car Rental Business Strategies
Incorporating an LLC as a car rental company will lead to you having advantages as regards management flexibility and taxation.
Also, with LLCs you get a limited personal liability for the actions of the LLC.
Choosing an LLC will give you the benefit of filing your tax returns as a sole proprietorship, partnership, or corporation chiefly.
Because the federal government doesn’t recognize the LLC under a federal tax classification.
Which is why as an LLC; you get to use pass-through taxation.
You will also get to avoid double taxation.
If you are starting off small however, with just one car at first and catering to your local clients.
You could start off with a simple legal structure such as a sole proprietorship and work your way up to becoming an LLC for the benefit of your business.
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- Luxury Rentals
- Dixie Cars Inc
- Auto Rentals Corp.
- Granite Rentals
- Gatsby Cars Rentals
Succeeding Car Rental Business Strategies
9. Best Insurance
Insurance is a very important part of any business.
Not getting insurance or the correct one could spell doom for your business.
As insurance protects you from probable and unforeseen circumstances.
Succeeding Car Rental Business Strategies
10. Basic Policy:
As you would need to meet with a professional insurance agent or broker that would guide you on the best policies that are suitable for your business.
Some of the basic insurance policies that you should put into consideration when starting your own car rental business include;
- Liability Insurance
- Collision Damage Waiver
- Personal Accident Insurance
- Personal Effects Coverage
- Commercial Auto Liability
- General Liability
- Workers’ Compensation
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11. Property Protection
This is a service based business and usually does not require an intellectual property protection.
And so if you are considering starting this business, you will not need to acquire an IPP. Some entrepreneurs usually secure an IPP for the company’s slogan or logo especially if they have gotten brand recognition.
If however you feel you are going to be among top brands or you see it as a priority.
Then, by all means you should secure one.
However, you should note that most people in this business do not consider getting an IPP a priority.
See also: Top Ten Businesses You Can Start With Small Capital
Succeeding Car Rental Business Strategies
12 Professional Certification:
If you decide to get into this business in the Nigeria.
You would not need a professional certificate to be able to run this business.
Regardless of this, you would need to ensure that you find out from your state or municipality the requirements you would need to start the car rental business.
Succeeding Car Rental Business Strategies
See also: Injury Prevention And Safety
13. Legal Documents Needed:
Listed below are some of the legal documents that are required to run a car rental business successfully in Nigeria.
- Certificate of Incorporation
- Business Plan
- Business License
- Insurance Policy
- Contract Document
- Operating Agreement
- Offer Letters
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