Taxi Dispatch ,

How to Start a Taxi / Private Hire Business in the UK?

Still wondering how to start a taxi business? Here is our guide with all necessary details to help you start your taxi / private hire business successfully.

How to Start a Taxi / Private Hire Business in the UK?

Updated on June 13, 2024
14 min read

Starting a taxi or private hire business in the UK requires careful research, planning, compliance with local regulations, and much more. Along with this, you also have to follow other essential steps that you may or may not know.

If you want to start a taxi service in the UK, there are great opportunities in cities like London, Essex, Manchester, Edinburgh, Birmingham, Bradford, and many more...

This blog post carries every necessary step that you should know and follow in order to start a successful taxi business in the UK.

Moreover, from the latest statistics to planning to launching your taxi business on the App Store or Play Store, you will discover everything in brief.

And by the end of this blog, you will get a clear roadmap to start your own taxi business hassle-free.

What help does your business need?

Let’s begin.

Latest statistics: The new taxi market industry in the UK and at global level

  • The global market for online taxi services is estimated to reach $56.37 billion by 2027 at a CAGR of 10%.

  • As per the survey of businessofapps, the taxi app market is expected to reach $283 billion by 2028.

  • More than 300 million people use taxi apps across the world. And about 150 million use DiDi and Uber apps. (Source)

Think. Evaluate. Launch. Grow.

At the end of this blog, you will find three surprise gifts waiting for you. Yelowsoft has a team of industry and technology experts to support startups, entrepreneurs, and existing taxi businesses or private hire service providers like yours from inception to success. No matter if you are planning to start a taxi business or looking to scale to meet demand - we help you connect with the right experts and products to help you grow uninterruptedly.

Contact us now!

How to start a taxi business in the UK?

Now that you have discovered the latest statistics about the taxi business, it's time to explore the steps. Starting a taxi or private hire business in the UK requires careful research, planning, compliance with local regulations, and much more. Along with this, you also have to follow other essential steps that you may or may not know.


Below you will discover the steps that you should be following to start a successful taxi business in the UK.

Research and planning

Before diving into the business, thorough research and planning are essential:

  • Market Research

First thing comes first. And that’s market research. Understanding the demand for taxi services in your area is crucial.

Start by analyzing your local market. Identify your target audience – are they daily commuters, tourists, or corporate clients?

Look at existing competitors to see what services they offer, their pricing, and their strengths and weaknesses.

This will help you identify gaps in the market and opportunities for your business.

  • Business Plan

Create a detailed business plan that outlines your business model, startup costs, revenue projections, and marketing strategy.

Your business plan should cover the following questions:

  • What type of service will I be offering (i.e. standard taxis, executive cars, airport transfers, and private hire)?
  • How many hours can I work?
  • How much will my startup costs and what all expenses will it include?
  • How much will I earn based on my market research and business model?
  • How will I attract and retain customers through advertising, partnerships, and promotions?

Abi Hussain, the transport manager at Cabzilla says that: The process of writing a business plan was difficult. We had to consider many factors like:

  • Our premises – where would we be based?
  • Who would drive for us?
  • And where would we find them?

We also had to consider licensing costs and insurance, as well as completing a;

  • Competitor analysis
  • Market analysis
  • And financial forecasting

This comment from the taxi company manager justifies how significant it is for you and every startup to ask questions and follow the process.

  • Choose a business name

Pick a name that is unique, easy to remember, and reflects the nature of your business. Make sure to check that the name isn’t already in use and register it legally.

And if you are planning to launch your startup with online booking, check the name on domain buying platforms.

Check if the name you are registering is available on the domain as well. One of the examples where you can check and buy domain is - ‘’.

  • Choose business location

Experts suggest starting a business where you belong. Means, from your hometown. However, if your research finds some other place as a good opportunity for your business, establish your operations office there.

Consider factors like the;

  1. Demand in different areas
  2. Competition
  3. And accessibility

Your location should be convenient for both – your drivers and your target customers.

Legal and regulatory requirements

Once you are sure about how to run a taxi business and what services to offer, the next step is to complete the legal requirements. This is one of the pillars to start your taxi company.

Complying with the legal and regulatory requirements of the UK is crucial. Here is what you need to ensure;

  • Licensing

To operate legally in the UK, there are several licenses and legal requirements you must fulfill.

Driver's license: You will need a valid UK, NI or EU driving license. And it should be at least 12 months old.

Taxi operator license: You will also have to obtain a taxi business operator’s license from your local council. Remember that, operational conditions may vary based on locations, hence, get your licenses and operational requirements checked thoroughly with your local council.

Business license: This is a common and necessary license that ensures you have a registered business in your area and can legally run your business.

  • Insurance

As you are running a taxi business. You or your drivers will spend more time on the road while carrying passengers.

This means, there is a high risk of accidents. Also, as per the law, your business will require taxi insurance.

Hence, make sure you have the appropriate insurance coverage for your vehicles and drivers.

  • Vehicle Standards

Your vehicles must meet the standards set by the licensing authority. This usually includes regular inspections to ensure they are safe, clean, and suitable for use as taxis.

You’ll also have to keep up with maintenance and repairs to stay compliant.

Setting Up Your Fleet

The next step is setting up your fleet. Your fleets are the backbone of your taxi services.

It determines how effectively you can meet your customer's needs and ensure you comply with regulatory standards.

  • Vehicle Procurement

Decide whether to purchase or lease your vehicles. Buying vehicles gives you full ownership, but leasing can be more flexible and reduce upfront costs.

Choose vehicles that meet regulatory standards and are appropriate for your target market – consider factors like fuel efficiency, comfort, and size.

  • Branding

Brand your vehicles with your company logo and contact information. This not only makes your taxis easily identifiable but also serves as free advertising whenever they are on the road.

Another way, you can offer your service on your brand name like Uber does is by creating an app like Uber.

Yes, with the help of white label taxi dispatch software, you can build your own taxi booking app that will have your;

  1. Brand logo
  2. Brand name
  3. Your choice of color
  4. Selected features from the vast feature list
  5. Launch on Play Store
  6. Launch on App Store

Read More: The trusted taxi dispatch software in 2024

Implementing taxi dispatch software

Till now, you have discovered all about offline activities. Now comes the key factor that has played and is playing a vital role in helping taxi companies like yours grow. No matter if you are in the UK, the USA, Canada, Gulf or any other country.

Implementing taxi dispatch software is key to running a smooth operation.

Here’s how to choose and use the best software for your taxi business needs.

  • Choose the Right Software

Invest in a robust taxi booking software like YelowTaxi. This software offers features such as

  1. Real-time tracking
  2. Automated dispatching
  3. Driver management
  4. Reports & analytics and more

These features help you to improve efficiency, reduce wait times, and enhance your customer satisfaction.

  • Training

Train your staff and drivers on how to use the taxi booking app. Make sure everyone is comfortable with the technology and understands how to use it effectively.

This will ensure smooth operations and improve service quality.

Features to include in your taxi app

Whether you opt for building a taxi dispatch software from scratch, buying a clone script, or partnering with the best cloud-based ready-to-use white label taxi booking software provider, below are the features that make the software or taxi booking solution the best among all.

And these features play a vital role in helping you to beat your competitors.

Hence, when you start a taxi business in the UK or anywhere in the world by having a taxi management software on your side, make sure it has these features.

First of all, your taxi dispatch platform should have these separate solutions;

Once you are sure that the taxi cab dispatch solution has these solutions, make sure it has these advanced features.

  • Reports and analytics
  • 3rd party integrations
  • Advanced scheduling
  • Email and SMS notifications
  • Multi-lingual support
  • Map view
  • eWallet
  • Localization
  • Multi-currency
  • Multi-payment
  • Driver and document management
  • Surge pricing
  • Dynamic fare calculator
  • Route optimization
  • SOS features (security)
  • Auto trip assignment
  • Round-the-clock customer support
  • Ride cancellation
  • Loyalty programs
  • In-app communication
  • Feedbacks & reviews and more

Ready to launch your taxi business in the UK with YelowTaxi?

Marketing and promotion

Making your business reach a wider audience or customers with the help of marketing and promotion is extremely crucial for success in today's digital era.

Here is a simple strategy that you can attracting customers is essential for business growth:

  • Digital Marketing

Use social media, search engine optimization (SEO), and online advertising to reach potential customers.

Create engaging content, run promotions, and maintain an active online presence to attract and retain customers.

  • Partnerships

Partner with local businesses, hotels, and event organizers to offer exclusive services. These partnerships can provide a steady stream of customers and enhance your business’s reputation.

  • Customer Service

Providing excellent customer service is key to encouraging repeat business and generating positive reviews.

Train your drivers to be professional, courteous, and helpful. They should respond promptly to your customer inquiries and resolve complaints efficiently.

Managing operations

Managing your business operations manually is a headache. Below you will know how the software that you will implement can help you manage operations smoothly and keep on track.

  • Driver Management

Hire reliable and professional drivers who have experience in driving and treating passengers. Ensure they are well-trained, motivated, and understand your company’s values and standards. Good drivers are essential for providing a high-quality service.

But, here comes the challenge now. How will you manage drivers? If you are running a business manually, it becomes challenging to manage drivers and other driver-related operations.

Hence, you should have a taxi dispatch software that will empower you to manage drivers from anywhere and perform all the activities online. This will save your time, efforts, and even unwanted expenses.

  • Fleet Maintenance

Regularly maintain your vehicles to avoid breakdowns and ensure safety. This includes routine checks, servicing, and repairs. Keeping your fleet in good condition is crucial for reliability and customer satisfaction.

  • Financial Management

Keep track of your finances carefully. Monitor your income and expenses, manage cash flow, and reinvest profits back into your business. Good financial management is crucial for sustaining and growing your business.

How much does it cost to start a taxi business?

The cost of starting a taxi business is based on various factors. Initially, you can start with minimal equipment and expand as your business grows.


Typically, starting a taxi business in the UK can cost between £7,000 and £60,000. Here’s a detailed breakdown of the costs involved.

  • Equipment & supply expenses
  • Business formation fees
  • Software expenses
  • Office space expenses
  • Vehicle expenses
  • Advertising and marketing expenses


1. Get a free consultation with our experts on how you can start your taxi business with cloud based taxi booking software in the UK.

2. Get up to 40% discount on implementing YelowTaxi’s ready-to-use white label taxi dispatch software. (Offer valid for a limited time)

3. Get a 7-day free trial with all the core features and experience how you can offer Uber-like taxi service to your passengers in the UK.

Isn’t it a fantastic surprise?

In this competitive market with so many companies offering taxi booking app development, we stand out by providing white label software solutions that are future-ready, scalable, and trusted by the local taxi companies across the world. We go beyond just creating apps; we add extra value for our clients.

Why YelowTaxi?

We are not just a typical white label taxi dispatch software provider. We are trusted to provide reliable cab booking app solutions across the globe.

Our software is the best option if you are looking for Uber clone app, Bolt clone app, Lyft clone app, Careem clone app and more…

With over 500 taxi companies using our reliable taxi dispatch software and enjoying the growth and success daily, we want other taxi companies like you to deserve the same.

If you have already started your taxi business in the UK or anywhere in the world, but need help with the technology (advanced taxi dispatch platform), feel free to reach us out.


Starting a taxi or private hire business in the UK requires careful planning, adherence to regulations, efficient management, reliable taxi dispatch software with advanced features, and smart marketing and promotion.

By following this guide and leveraging advanced taxi dispatch software like YelowTaxi, you can establish a successful and profitable taxi service. For more information on how our software can help streamline your operations, contact us today or request a demo.



The key strategies that top taxi companies use to increase revenue are collaboration, branded taxi booking app launch, agreements, proper use of technology and marketing.

The licenses you need to start a taxi business in the UK are;

  • Taxi operator’s license
  • Vehicle license
  • And driver's license from your local council

You can fund your business through personal savings, bank loans, or investors.

The insurance you need for your business are;

  • Public liability insurance
  • Vehicle insurance
  • And possibly the employer’s liability insurance

YelowTaxi offers features like real-time tracking, automated dispatching, and driver management to streamline your operations and improve efficiency.


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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