Taxi Dispatch ,

A step-by-step guide to build a taxi company

A step-by-step guide to build a taxi company

Updated on July 19, 2022
7 min read

If you’re reading this blog I believe you have made-up your mind and can’t wait to see your own fleet of taxis picking up and dropping off customers across the city. Before you proceed let me give you an indication, starting a taxi business is everything, but easy. It’s going to be an uphill, roller-coaster ride. To be battle ready, you have a lot to learn from your competitors, friends, industry veterans, taxi drivers, Uber drivers, and taxi union leaders.


I won’t suggest entering the battlefield without learning a lesson or two from the people associated with the industry, particularly when you have no previous experience in the industry.

How about an Uber trip across the city and engaging in an informative conversation with the driver?

Nonetheless, I have presented you a step-by-step guide.

Draft a feasible business plan

This is going to be tricky. You got to be asking a lot of question to yourself. What I must include, more importantly, exclude? And the million-dollar question; how long it must be? How many words should I put?

This excerpt from an article on Entrepreneur should help.

“A useful business plan can be any length, from that scrawl on the back of an envelope to more than 100 pages for an especially detailed plan describing a complex enterprise. A typical business plan runs 15 to 25 pages.

Miniplans of five to 10 pages are the popular concise models that may stand on their own for smaller businesses. Larger businesses seeking major funding will often have miniplans as well, but the full business plan will be waiting in the wings. It’s to your advantage to run long when creating your plan, then narrow it down for presentation purposes.”

I came across an actual 27-pages long business plan of a taxi business based in Toronto while doing research for this blog, which should be a great starting point if you have absolutely no idea what a business plan looks like.

Even if you’re seeking help of an expert to create a business plan or outsourcing the entire exercise, it always better to look doubtful than act like a complete jackass.

Moreover, Bplans has free resource on Taxi and Limo Sample Business Plans.

Find investor to gather initial funding

Even if your granddad left you a fortune, it is always better do business on someone else’s money, someone you don’t know. You must refrain from taking money from your family and friends unless they are your business partners or actively seeking an investment opportunity.

Forbes contributor Murray Newlands lists ten places to go to seek investors and get the first round of funding for your business.

  • Start-up Launch Platforms
  • Angel Networks
  • Crowdfunding sites
  • Incubators and accelerators
  • Small Business Administration
  • Professional Social Networking Sites
  • Private Equity Firms
  • Online Lending platforms
  • Personal marketing effort
  • Friends and family don’t!

I know you are aware of most of ways mentioned above. But by god’s grace, they are the only places to find an investor. Another reason why seeking funding is tough.

Read More: Traditional Limo companies face these key challenges

Startups will have an edge when it comes to funding as they come up with innovative solution for existing problems which piques investors interest.

Build partnerships with drivers

This is going to be simple you must find licensed, commercial, experienced drivers in your locality and convince them to join your taxi agency. This includes making them understand your business plan, building trust and giving them a long-term commitment. You must have the draft of your incentive plan for drivers ready to lure them to drive for your taxi company. You may also need to train those drivers from time to time.

Befriend a local bank

Not every driver you bring to drive taxi for you will have their own car with commercial license. Banks are generally not very willing to give unsecure loan to local drivers to buy their own vehicle. If enter a partnership with a local bank and build repo, your drivers will have an easy time getting a loan to buy their own vehicles.

Hire a technology consultant

You don’t know nothing about technology. However, be it the stock market exchanges, banks, restaurants, banks or taxi agencies, today’s service industry is build on a digital backbone which requires hardware and software components to work in harmony, produce desired results and give way to a desired set of actions.

Likewise, you must bring your taxi business on a digital platform to enable interoperability. Without which, you can’t develop a software platform to enable consumer, and business and mobility applications. Concisely, you need a custom taxi booking app solution.

A simple Google “technology consultants” will give you countless results. But I suggest going after a reference or a recommendation from family, friend, or colleague. If you can’t afford a fast-moving technology company in the Fortune 500 bracket, I suggest being very careful whom you hire as a consultant. Look for reviews and number of stars on Google.

Build the software platform

Every taxi company needs a couple of web and mobile applications to enable consumer, business and other transactions and services on its business platform.

Our own solution YelowTaxi, for example, is a white-label taxi dispatch system that includes a taxi booking system, which is realized by means of driver and passenger apps for Android and iOS.

Hire smart people

To enable and manage the operations efficiently and grow your business, you just don’t need people, you need smart people. As most of the repeated tasks are taken care of by the software itself, you need staff only to improve the existing operation, bring new ideas, and grow your company. So there is no room for redundant staff.

In addition, you would need support staff. However, I would suggest against it and ask the technology company that you hired to give technical support to your staff and customers. If most of your deployments are under SaaS implementations, your customers will seldom seek support.

Build online presence

That’s simple, build a business web app to list your services, start a taxi blog, and update it regularly.

You also need to be presence on Facebook and Twitter. For new business connection, I would suggest LinkedIn for Business.

Moreover, you need to do app marketing for your apps on the app stores. Initial paid marketing will give your business apps the much-needed boost.

Think Brand

Once you’re up and running in the market, you need to tell your business partners and customers that you’re more than a taxi service. You’re a brand. This will give you an edge in the market and make you immune from local taxi services.

I read it somewhere

“A brand identity is more than a logo. It’s more than a brand style guide. It’s an essential way to differentiate yourself from your competition. A brand identity influences your customers’ experience at every touchpoint. It subconsciously affects how they view everything from your industry, to your relevance, to your trustworthiness.

It is the sum total of how your brand looks, feels, and speaks to them—the elements that help them decide if they want to engage with you.”

You can also draw inspiration from Uber and other successful startups success stories.


Mushahid Khatri

Mushahid Khatri is the Chief Executive Officer of Yelowsoft, one of the leading taxi dispatch and on-demand delivery solution providers. He is a visionary leader who believes in imparting his profound knowledge that is leaned on business and entrepreneurship.

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