For entrepreneurs who have decided to enter the car rental market, a car rental system is a foolproof option. Cars have been, are, and will be around in the near future. Therefore, everything related to them is a potentially profitable direction: production, repair, maintenance, and especially renting. Like any business, this one also requires preliminary preparation and careful market analysis. In this article, we will examine the stages of starting a car rental business and what is needed for its implementation.
What and how many cars to buy
If you organize a car rental business through a franchise agreement, all the rights and obligations of the parties are outlined in it – you receive instructions that allow you to open a company. The franchise provides you with cars or indicates a place where you can rent them at a decent price. If you run the business independently, the number and class of cars will depend on your budget. You can lease cars, which implies long-term rental of a vehicle with the option to purchase it at the end of the contract.
When forming a car fleet, it is desirable to cover all classes of cars:
- Economy class – a budget option. These are small cars with a comfortable cabin and compact dimensions. Representatives of the economy class include Daewoo Matiz, Hyundai i10, Chevrolet Spark, Citroen C1.
- Business class – cars in sedan and station wagon bodies with powerful technical equipment. Such cars include Audi A6, Mercedes-Benz E-class, BMW 5-series, Hyundai Grandeur, Honda Legend, Volvo S80.
- Executive cars – large sedans that are 4.8-5 meters long. Cars with the latest developments and a divided rear seat: Audi A8, BMW 7-series, Mercedes-Benz S-class, Volkswagen Phaeton, Bentley Flying Spur, Rolls Royce Phantom, Lexus LS.
- Off-road vehicles – all crossovers and SUVs with any type of drive. These are Jeep Liberty, Toyota RAV4, Honda CR-V, BMW X6, Volkswagen Touareg, Range Rover, Cadillac Escalade, Toyota Land Cruiser, SsangYong Rexton, Chevrolet Suburban.
- Minivans – cars with a higher body than hatchbacks or wagons, which makes them practical. These include Skoda Yetti, Fiat Doblo, Renault Kangoo.
Personnel, parking, office
Important components of a car rental business include personnel, parking, and office space. Without them, it is impossible to guarantee the success of the company. However, finding suitable employees, parking spaces, and offices can be a challenging task. To make the best possible choices, it is essential to devote sufficient time to each stage of the process.
Personnel. When searching for employees for your car rental company, pay special attention to their qualifications and experience in the field. This is crucial. You will need managers to work with customers, accountants, mechanics, and marketers.
Parking. When looking for parking spaces, it is essential to consider not only the number of cars you plan to have, but also the specific location. Study the area, local regulations, and safety. It will be advantageous if there are companies nearby that offer related services such as maintenance, repairs, and gas stations. This will provide additional comfort for you and your customers.
Office space. Make sure that the space has enough room for both customers and employees, as well as office equipment. Access to the office should be easy and convenient, to avoid creating additional difficulties for customers. Consider investing in modern office technologies such as computers, tablets, and car rental management software. This will allow you to see all the processes in the company and manage it from anywhere in the world.
The first step in finding potential customers is to identify your target audience. To do this, you should study the local market, taking into account the following factors: age, income level, lifestyle, and preferred places where they have already rented a car. You should also consider local events or activities that may attract potential customers in need of short-term transportation solutions.
Your target audience may include:
- People with their own car that is currently being repaired;
- People on business trips in need of a rental vehicle;
- Those who need to rent a car for an event;
- People who have passed their driving test but have not yet saved up for their own car.
As a professional car rental business, it is important to accurately identify and target your potential customers in order to maximize your profits and build a strong reputation in the market.
Starting investment and expected returns
Investments in quality cars are key to a car rental company. It is important to choose economical cars in good condition that are easy to maintain. Additionally, invest in a car rental management system. With its help, customers can choose and reserve cars online, pay for the service, and even find answers to questions without contacting you for any reason. In turn, the car rental owner gets a system that shows all the processes happening with the company in real-time. Even if you are not physically present at work, you can download reports, analyze transactions, and resolve work situations.
By setting reasonable rental prices, as well as offering discounts and additional services such as roadside assistance, you can attract more customers and thus increase your income. Don’t forget about advertising and promotion, even if you have excellent products at reasonable prices.
Car rental business is a profitable and fail-safe option. Of course, if you follow the steps of its implementation. Buying cars, finding a place for an office, parking, hiring staff, purchasing office equipment and car rental management systems are all the foundations and, by following them, you can achieve success in your business. Set decent rates, implement a loyalty program, promote your business with various advertising tools, and then a large flow of customers is guaranteed for you.