Business plan for taxi service

Business plan for taxi service​
Вusiness plan for taxi service allows you to deliberately approach the opening of a taxi company, calculating the investment and payback period of the project. The plan should reflect what processes you need to build to launch a viable and profitable business.

To launch a company that will work effectively from the first days and bring you money, you need to research the business environment and market in the region, including analyzing:
  • how will you stay ahead of your competitors;
  • how will you meet the needs of potential customers;
  • how you will attract employees.

Take a look at the picture below. It shows how the five key elements responsible for your success interact with each other. Think about how these components and the connections between them affect each other in the city where you want to launch a taxi business. These ideas will form the basis of your business model.

business plan for taxi service - the five key elements

5 Important steps for developing a taxi business plan

To develop a taxi business plan, you will also need to follow a series of sequential steps:

  1. Define the business concept.
  2. Do a competitor analysis.
  3. Calculate the market capacity in your city.
  4. Calculate the costs of starting a business.
  5. Calculate the payback period of investments.

Step 1. Define the business concept

Answer the questions:

― What city or area do you plan to work in?
― How many people live there?
― Which market segment are you targeting: economy, business, corporate clients, freight delivery?
― What is the budget for starting a taxi business?

Step 2. Do a competitor analysis

Gather as much information as you can about companies in operation, including your direct competitors. You can conduct competitive intelligence ― use the services of other companies to gain user experience and understand what you should adopt and what you should improve on.

What key information about competitors will you need:
  • how much the services cost;
  • how fast the vehicle is served;
  • what vehicle are in the fleet: make, appearance, year of manufacture;
  • how professional and polite the drivers are;
  • whether the drivers like their working conditions;
  • how customers are attracted;
  • what channels are used to advertise services.

Step 3. Calculate the market capacity in your city

Estimate how many people could potentially become taxi customers. You will need the population data of your city and our table.

Next, you need to estimate how many people already use taxi services and how many orders your competitors receive.

Step 4. Calculate the cost of starting a business

To do this, add up all the estimated costs: renting a dispatch center, purchase of a software package, telephony, purchase of taxi equipment, advertising to attract drivers and passengers, salaries to employees, and so on.

Step 5. Calculate the expected profit and payback period

Profit and payback are calculated according to certain formulas.
Formulas for calculating revenue

Months 1-3:

Revenue (1) = Number of orders per month x Average check per order x Percentage from each order
Months 4—5 and on:
Revenue = Number of orders per month x Average check per order x Percentage from each
order + number of drivers x Number of shifts x Amount of payment per shift
Formula for ROI calculation:
Payback (2) = Revenue - (Costs for the current month + Costs since the start of the business)
Please note that the payback period depends on the number of drivers working in your company: the more drivers, the higher the rate of return on investment. You need to gradually increase turnover and attract new drivers.

How to pay the drivers? Some services pay drivers by the shift or offer hourly pay. The driver's fee may also be 10-20% of the cost of the order. In some companies, drivers pay a certain amount of money for access to orders before they start their shift, then it's in their best interest to work in a way that pays off their money.

How to calculate how many drivers you need to handle a certain number of orders? The average number of orders per driver can be found using the following statistics:
If you reach the bar of 20 orders per day, you will have more than 500 orders per month. Increase this figure systematically, so that your business pays off faster: it's good if next month you will have already 1,000 orders, and so on.

Taxi business plan sample

It is quite convenient to use the taxi business plan sample in your work, so we suggest you download a template from Taxi Master experts.

Over the years, we have thoroughly studied how the taxi business works. We know which tools to attract and retain customers are most effective, how to motivate employees of taxi companies to work better, how to reduce costs and which solutions to optimize business processes help to become market leaders.

  1. We have been working in the taxi market for more than 20 years and have become real experts in our field.
  2. We help companies around the world to start a taxi business.
  3. We support customers at every stage of the launch.
  4. We regularly analyze the work of different companies and help them optimize processes.
  5. We implement technical solutions that allow our customers to automate their work and. successfully compete with major aggregators.

Start a taxi business with us! More than 3,500 companies around the world have already entrusted us with launching their business.

Taxi business plan sample pdf

Fill out the form and get a sample of the taxi business plan in pdf.

It contains:
  • Description of the taxi company's business model;
  • Calculation of the market capacity;
  • Calculation of the initial costs;
  • List of the initial expenses;
  • Calculation of the return on investment and payback period;
  • Information on how to attract customers;
  • Information on how to attract drivers;
  • Information about the automation of business processes in a start-up company.

Taxi business plan xls

You can also download a taxi business plan in the excel format. These are ready-to-fill-in forms, where you just need to enter the data relevant to you. They will help you quickly calculate the costs you will need to run your taxi company and the return on investment.

To get the file, please fill out the form:

Get a working taxi business plan template from Taxi Master

Our business plan is convenient because it is a taxi business plan template that can be adapted to your company. You can download it by filling out the forms above. Just substitute the actual numbers and get useful calculations. And our tools for attracting employees and customers will help you get off to a successful start by building a competitive and profitable company.
BIT-Master is a Taxi-Master software developer, an international IT company with over 19 years of experience, a leader in the development of taxi software and services. BIT-Master is the creator of the Taxi-Master software, mobile applications for passengers and drivers, as well as dozens of services, thanks to which dispatchers and taxi companies can use the best solutions.