5 Steps to Starting a Passenger Transportation Company

The passenger transportation business is a lucrative venture any entrepreneur can consider to invest in today. The commercial transportation industry can be a game-changer for you if you execute the idea with the right approach and perfect time.

There are many people today that use commercial transport as a means to their destiny, and the opportunity to enter into the industry is ripe at any time. Also, people using private vehicle mostly prefer to leave their cars to public means as alternative transportation. Therefore, planning to leverage this trend and start your transportation business would be a great business choice.

Even that, before you enter into the industry, you need to fix several things to avoid many blunders starters in commercial transportation make.

Choose the Right Model of Transportation

Before you rush to write a business plan, ensure you understand the commercial transportation industry inside out. It should never be a trial and error thing, especially where money plus time is involved. The market is more than taxi services, cruises, airport shuttles, passenger airlines, buses and others which all are an integral part of the transportation industry.

If you consider going the bus way, are you planning to go for a new fleet of buses or second-hand buses? And if you opt for the taxi services, have you identified your target customers? These are some of the questions, and many more you should exhaust before rolling out your business plan.

Create a Business Plan

After you are comfortable with your business idea, you can proceed to create a comprehensive business plan that describes your target, services, market, plus goals. The business plan should also outline important aspects of your transportation business, such as legal structure, name of the business, industry description, location, financial projections, mission statement, analysis of competitors and more.

Some of the key questions that you need to answer in your business plan are as follows:

What is the number of employees do you require?

What challenges do you expect to face in the transportation industry?

What is your marketing plan for the business?

What areas are you planning to run your business?

What type of services do you plan to provide?

Will you purchase your vehicles or take a lease?

What are your earning projections?

What costs are involved in the business?

What are the risks are you willing to take?

It will be good if you can answer the questions above, to help you as an action plan. This is a critical stage where you identify what you plan to achieve in your new business venture for both short and long term goal. Plan how you intend to do the business and if possible, spend most of your time researching the market.

Financial Plan

The proper execution of your transportation business depends on how prepared you are financial. In case you have reserved money to start the business, you need to make sure everything is considered from the start wisely. But, if you are planning to raise fund for your business, think through the approach below.

Ask Friends & Family

Your family and friends that readily support your idea can be instrumental in raising extra funds needed to run the business, besides your savings. The easier approach is to ask for a loan from them or allow them to invest in your business in return for a stake. This is a workable plan, especially where too much is expected from them.


Crowdfunding is an approach whereby you reach to a wider community ready to support the idea. So, you can get into such a setting to request the interested party to invest in your business idea, and you can imagine the impact when the majority of the people subscribe to your idea.

When you secure enough finance to run your business, follow the earlier set procedure to spend the money. It is advisable to minimize expenses now that the business is still new. For instance, rather than buying places to set your offices, you can start from your garage, low-rentals and start from there.

License and Registration

If you are yet to license and register your business, connect with the Department of Motor Vehicles and make sure you meet all legal requirements. Contacting the relevant authority dealing with licensing and registration may help you to know the type of legal structures you need to put into place before starting your business.

For instance, the license for running ten and above commercial vans is different from the one for running a taxi transportation company. Also, some states require your employees to undergo a drug test and background scrutiny to make sure they fit working in the transportation sector.

Promote Your Business

The commercial transportation industry is very competitive, and to see your financial projections translate to your plan marketing is inevitable. Do not start and expect things to flow; instead, take advantage when the business is still new to popularize it to target customers.

Since marketing means spending money, using an old school approach to reach your customers can minimize expenses. Some of the popular ideas to consider are to paint your vehicles with company colors, logo, and contact details on the body to appeal to your customers.

The second old school idea is to list your business with local directories such as Yelp, Google my Business, Yellow pages and more. Also, do not neglect the power of Social Media advertisement such as Facebook to target your customers.

Starting a passenger transportation company is not challenging, provided you do your due diligence. It is a market that is constantly in demand, but your dominance will depend on your preparedness.

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