For years, the Indian taxi industry was fragmented and unorganised. But, with the introduction of TaxiForSure in 2013 and Uber’s entry in the same year, a drastic change was in sight. Today, the apprehensions surrounding on-demand taxi transportation have almost disappeared and the existing traditional taxi players have ventured into the digital world.
Retracing the on-demand industry
Where Uber was disrupting the taxi industry all over the world, things seemed slow in the Indian soil. While TaxiForSure and Uber tried their luck in cracking the market, the entry of Ola in 2015 changed the pace. However, 20% of Ola’s bookings came through desktops and laptops.
Slowly, the availability of cheaper data packages increased smartphone penetration in the country. With this, there was a sudden improvement in booking rides via a mobile application. Factors such as increasing fuel prices and reduced car ownership further pushed the popularity of on-demand taxi. The culmination of all the external aspects has led the on-demand industry on a path of steady growth.
Data Source: Mobility Foresights
The ride-hailing industry continues to look promising as the revenue is expected to grow at a 15.5% CAGR with a market volume of US$54,097m by 2023.
When it comes to the competitive landscape, Ola and Uber may have captured most of the fragmented, small players, there are still opportunities for other taxi companies.
Surge pricing policy, burdening of driver partners and stringent government regulations against the ride-hailing giants have shaken up the customer base of these favourites. While the effect may seem minuscule, taxi companies can capitalize upon this by adopting the on-demand taxi trend.
Starting your own taxi business
If you are one of the budding taxi owners looking to seize the growing opportunities of the on-demand transportation industry, then here are some quick tips to start your own business.
- First, define your service, i.e., whether you would focus on niche services such as corporate shuttle or operate a regular taxi service.
- Next, analyze your market to identify the gaps and potential opportunities.
- Based on this research, it is imperative to define your customers. This makes it easier to understand their needs and attract them with the right strategy.
- Once your groundwork is completed, move on to the stage of obtaining all required documents such as business license, vehicle registration, permits, insurance and so on. In case you are hiring drivers, an individual license is mandatory. In the case of taxi partners, draw up an agreement.
- Next comes the technology aspect. Owing to the ride-hailing industry, a taxi dispatch system is a prerequisite. Invest in a technology platform that helps in streamlining your processes.
- Building your taxi business is just the beginning. Help customers find you by building an effective marketing strategy. From traditional promotional activities to digital marketing, identify your strategy and leverage your market research to attract your audience.
- Once you step into the market, always continue revisiting and reinventing your business plan – right from partnering with service providers, expansion, driver recognition and retention strategies to engaging your customers with promotional activities.
These above tips are a quick, concise guide to build your taxi business. For more taxi industry insights and technology support, talk to our industry consultants today.