How to Cut Costs in Your Taxi Business
Whether you are running a taxi business or have an office block filled with staff, you’ll find that it can be hard to make sure that you don’t go over budget.
Many people make the mistake of thinking that owning a business can be easy and that you’ll make a lot of money from it. The truth is that as a business owner, you need to be constantly looking for ways to reduce costs in order to make a profit. So, how can those who are operating a taxi business in the UK save some money each month? We have put together some tips to help you achieve this so read on to find out more.
Use an App
In 2020, more taxi firms across the country are switching their operations to apps. This first began with the introduction of Uber, but now we are seeing more local taxi firms allowing customers to book a taxi and pay for their ride with a customised app.
When you have an app for your taxi booking system, you can reduce the number of staff that you need to have in the office taking calls. Sure, some people will want to book a taxi over the phone but once the app starts to take off, you can cut down on the number of staff that are working over the course of the day. Creating your own app will be costly but there are some taxi app companies that can offer a white label service.
Cut Down on Insurance
Another great way that you can cut costs in your taxi business is to cut down on the cost of the insurance.
Taxi insurance can be expensive, especially if you are covering the cost of the insurance for the entire fleet. If you want to cut down on your insurance costs, you should compare some quotes online and find the cheapest price. Taxi drivers can compare quotes here so make sure to have a look and see if you can reduce the overall cost.
Use Social Media
Marketing your taxi business can be expensive, especially if you are trying to compete with larger firms in your area. Some firms create flyers, billboards and even radio ads to try and promote their taxi business. This kind of marketing will be very expensive and will eat into your budget. For this reason, we would suggest that you try out some social media marketing. Marketing your business on social channels such as Facebook or Twitter can be done without spending a penny. Of course, if you want to reach a larger audience, you can try out some social media ads and spend within your budget. This is a great way of reaching new customers.
Set Pickup Limits
Another tip that we have for taxi companies who want to cut costs is to set some limits on where you will pick up fares. If you are based in a certain area and a customer books a taxi that requires a 20 minute drive each way, the profit might not be that great. While longer fares can be more profitable, if you have to drive there without someone in the cab first, you will spend a lot of money on petrol. Some firms get around this problem be implementing pickup limits or increases in fares once the distance increases. This is not something that always goes down well with customers but if you can increase the prices for the longer journeys that you need to travel to just to pick up, you can balance things out.
Monitor Your Drivers
Finally, if you want to cut costs in your taxi business, you should try to monitor your drivers a bit more. You could find that they are driving around and wasting petrol when they are not taking any fares. This can then be charged to your business and this will increase your monthly costs. Any driving that they do on their personal time with their car should not affect your business. You should also make sure to check up on any fares that they are getting and make sure that you are getting an accurate cut of the price. While it isn’t nice to have to closely monitor your staff, a quick check-up every month or two can go a long way.
If you are running a taxi business and are spending too much money, you should try to take on board some of the tips that we have given you. This way, you can cut costs and start to make some more money.