Starting a new private hire mini bus business

[D9ber1]

hi, I've recently set up a company which I want to run private hire minibuses focussing on the luxury market. I have in mind, tours, events, weddings, day trips etc. I'm after some good general advice, what is the best steps to take. Do I start with a 9 seater and trial this before buying a larger 16 seater for instance. I'm London based, so reviewing the legislation from TFL also. I welcome any advice on this, I just don't know where to start. I was considering getting a PCV license first and perhaps work for an operator to understand the market, but then if I start to grow myself, how do I know what to charge, where to locate, vehicles to use, target market etc. please help.

 

[The Byre]

I was considering getting a PCV license first and perhaps work for an operator to understand the market,

That would be the sensible thing to do!

 

[UKcentric]

I know a little bit about the luxury minibus hire market. Here are some things I have learned:

- It tends to be very seasonal with a big dip in the winter months;
- You need to work out how you will keep the vehicle on the road for as many hours as possible, not standing idle in the yard - the same applies for drivers;
- Another challenge is dealing with the cost of having the vehicles standing around between drop-offs and pickups;
- Repeat business is the key to success - get repeating contracts with your customers;
- Research the market - who wants to go where and when - this will dictate the choice of vehicle;
- Charges for luxury and low end are very different and are charged accordingly - could you ring up a few companies doing a similar thing and find out what they charge?
- Your drivers are the key to getting repeat business as they are your representatives;

 

[D9ber1]

Thanks for the feedback, on the charging customers aspects, is there an industry standard preferred application that you use that determines the routing, allocation of vehicle etc and works out the price to charge? Also, do you think it is worth starting with a 9 seater and see how I get on or go for something bigger? Also, I was thinking about where do you park the vehicle up so premises, should you go in with someone else, I guess what are the next steps to take. All advice most welcome.

 

[D9ber1]

To keep costs down I would initially look to drive a vehicle myself.

 

[The Byre]

Your questions are (IMO) too broad and wide-ranging to be able to answer. It's a bit like saying "I want to open a hotel and restaurant; what do I need to know?" To which the only answer can be "Everything!"

I just don't know where to start.

There are people out there - and this forum is heaving with them! - that think that if you open some species of physical facility, people will be so kind as to line up at the door, waving their cheque books and/or credit cards.

Be it a restaurant, recording studio or rabbit farm, acquiring the physical facility, complete with equipment is the very easiest part of the whole enterprise. Non-business people think that having the money to buy the land/building/equipment/whatever is the biggest barrier to entry. That is not true!

The biggest barrier to entry is your knowledge of the industry and the market and the industry's and the market's knowledge of you.

All those outsiders to the movie business that are desperately trying to get traction and a foothold in the business are running about like headless chicken, trying to catch that mysterious animal called 'Funding'. Every city in the UK has some 'bawheid' trying to start a film studio and they all say "But I can't get the funding!" and expect the hard-pressed tax-payer or some movie mogul to realise their dreams for them.

Yer, right!

The same madness applies to all and every physical facility to a greater or lesser extent. Hardly a day goes past, without somebody wanting to open a recording or video studio. A couple of years later, they fold in private disaster, often taking the houses and savings of their former owners with them.

Now look at what you are trying to do dispassionately - why do you think you are the right person to start a bus-hire company?

Supposing you had a million pounds to start a small bus company (trust me - one million would be a very small bus company!) would you hire yourself or an experienced fleet manager to run this new beast?

Remember - the bus-for-hire business is wildly over-subscribed. It is what is commonly known as a post-mature market. There was a time, when Ann Gloag and her brother Brian Souter started 'Stagecoach' with one old bus going from Dundee to London, it was the beginning of bus-deregulation. i.e. it was 'Wild West' time, 'Oklahoma land-rush' time!

That was 1980 and it ain't 1980 no more!

If you want to start a business and you are hoping for a 'Stagecoach' future, find your Oklahoma Land Rush now!

Busses it am not!