Nothing says luxury like a limousine. If you’re researching how to start a car service business, a limo is the cornerstone of your company. Learn how to get started in this versatile and lucrative industry, and take the first eight steps to creating a successful business.
Create a Business Plan
No business can succeed without a plan. A limousine business plan should include all the usual business details, such as financial estimates and market research, as well as details about the type of vehicles you wish to purchase.
Establish a Legal Business
Before you contact any customers or hire any employees you need to create a business identity. This not only ensures you have the right protection, but it allows you to pay taxes, protect your name and purchase business insurance. There are a number of legal business identities to choose from, including
- Limited Liability Company, or LLC
- S-corp
- C-corp
- Partnership
Compare and contrast each one carefully to find the best strategy for your car service. Many businesses start as LLCs, which offers you protection by separating your personal and business assets.
Set Up a Business Account
In order to limit liability, you must keep your business assets separate from your personal assets. The best way to start is with a separate business bank account. All your spending should come out of this account. This also allows you to start earning business credit and taking out a business credit card or line of credit.
Define Your Marketing Strategy
Many small businesses fail every year because of poor marketing. When you’re starting a black car service business, you need people to know what they can expect. From high school proms to VIP services, promote the many ways your business can support your community.
Once you’ve highlighted your potential audience, create a website for your company. Consider hiring a professional web designer to keep it accessible, up-to-date and optimized for search engines. Other marketing channels can include passing out flyers, leasing billboards, purchasing commercial time on TV or radio, or contacting businesses directly.
Purchase Your Vehicle
A common concern in the industry is what type of vehicle works best for a limo service. When you’re researching how to start a car service business, you may come across many makes and models that are promoted as the best sedans, SUVs, limousines etc.
There are many makes and models that can be used successfully in a black car service business. While focusing on particular brands, many small businesses forget the importance of the financial aspect. Choose a vehicle that you can easily finance in three years or less, and choose a vehicle that is under warranty, if possible.
Hire Professional and Passionate Employees
Unless you purchase a single car and drive on your own, you’ll need to hire employees. Before you hire an employee, be confident you can commit to either a full-time or part-time schedule. Employees who aren’t giving a relatively consistent schedule will be much more willing to look elsewhere for employment. Once you are ready to hire, choose employees who not only have excellent driving experience but have an eye for professionalism and customer service. Your drivers and your vehicles are the face of your company, so it’s a good idea to train your drivers in customer service techniques.
Know Your Location
Do you know the local schools, businesses and funeral homes that might be searching for your services? A key to any successful small business is understanding location. Your specific location, including any nearby competitors, will have a huge impact on your business model. Understand your typical clientele, estimate the busy and slow seasons, and be prepared to market aggressively if there are other black car services in your area.
Don’t Forget Insurance
The final step before you open your doors for business is to purchase insurance. As a limousine service, you face many layers of liability. Employees, customers and your vehicles all need comprehensive insurance in order to protect your business assets and keep your business operational. An accident on the road, whether you’re at fault or not, can cripple your limo service without proper insurance. Shop for the best rates, and be sure to choose a provider that offers complete coverage of all your business assets.
