So, you have been thinking of embarking on a new business and your friend suggested that since you have a van and some extra cash, a van rental service would be the way to go. Before you jump into any decisions, here are a few things you need to know. This is not a comprehensive list and so don’t be surprised if you encounter things I haven’t written here.
KNOW YOUR INDUSTRY
Your knowledge of the business is critical. You should do thorough market research. The market for van rentals is big but there is a lot of competition. You must find out who your competitors are and their strengths and weaknesses. Profitable Venture encourages that your economic analysis of your competitors enables you to develop a strategy that carves a niche for yourself. Your fact finding should be focused on the location you want to begin operations.
KNOW YOUR ABILITIES
If you are not good with numbers, or you have challenges with managing systems, that is a problem. You will need someone to do that for you. This Workspace post warns that the business is dependent on efficient utilization and scaling. You should also be persuasive and oriented to serving people. You would be competing with already established business, so every new customer counts and probably left their former rental service. Using online resources can help you ensure your drivers know the rules of the road.
KNOW YOUR PLAN OR STRATEGY
Without a plan, you are bound to fail. Business Line suggests that you have a business plan. This should have a sales prediction, cash flow projection and forecast how much capital would be utilized. Your strategy should detail, how you want to go about the business: your target customers, how you plan to target them, your marketing portfolio, your fleet management plan and a lot of other considerations. For many businesses, having an online presence is vital. You would need to invest in a website. Also, the vans would need maintenance. You might not have a maintenance team so you would need a good repair shop to handle that. You would also decide the type of rental service. You can either do the contract hire or the daily hire. Don’t go in blind, have a plan.
KNOW YOUR LEGAL REQUIREMENTS
There are some legal concerns before starting your rental service. An important one is insurance. You are legally required to insure your vehicles and your premises. Fleet insurance is a specialist area, so you may not easily find insurers. You should shop around for the best price. Without insurance coverage, you expose yourself to unnecessary risk.
In summary, to start, here’s what you do:
- Research your market
- Create a business plan and strategy
- Purchase or assemble your fleet
- Get insurance cover
- Market your service (online and offline)
- Start your rental business
When you have begun, you still need to:
- Keep marketing your service (online and offline)
- Maintain your fleet
- Assess your business finance
- Update your business plan and strategy
That’s all for now. See you at the top.