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Yelowsoft introduces major modifications in their pricing schema

Yelowsoft introduces major modifications in their pricing schema

Updated on April 13, 2020
7 min read

Over the years, we have solved numerous challenges and issues faced by our clients by providing them with effective quick fixes in the form of feature updates in our taxi booking solution.


Solving all these issues made us aware of the problems that many taxi firms face. One of such problems was the pricing schema. Pricing is an important element of a taxi business. It helps the company to define the algorithm for their prices.

The pricing schema is of various types. Different companies use different pricing schema depending upon various factors like their revenue model, geography, demographics, fleet size, and many more.

We also saw that many taxi companies who were in their startup stage had chosen a particular pricing schema. However, once they expanded their business they had to make massive modifications in their pricing structure which posed a huge challenge as the existing taxi booking solution wasn’t able to accommodate those changes.

To address this issue, Yelowsoft decided to update its pricing schema. Let’s see how.

To understand this, it’s important to know about the previous pricing schema of Yelowsoft. Our previous pricing schema consisted of three types of pricing.

  • Normal pricing
  • Surge pricing
  • Zone pricing

Let’s have a look at each type along with the new updates introduced by Yelowsoft.

Normal pricing

Normal pricing is calculated by considering two main factors which are time and distance. The normal pricing also has two types of pricing schemas available under it which are

Time and distance pricing

In this type of pricing the total amount of fare is calculated by the summation of base fare, price per km, waiting charge, and ride time charge. If the summation of all these fares is above the minimum fare, then it is applied else the rider has to pay the predefined minimum fare.

Total fare = Minimum fare or (Base fare + per km + waiting charge + ride time charge) Whichever is higher.


Meter pricing

It’s also called slab pricing due to its pricing structure which is similar to that of tariff pricing. Let’s have a look at an example to understand it better.

  • 1-2 km – $10
  • 3-4 km - $15
  • 5-6 km - $20

The fare is calculated as per this slab pricing. So, if a rider travels 5 km, then he has to pay $20 and so on.

We already had these two pricing schemas under normal pricing, however; our clients wanted a pricing schema which had best of both the worlds. They wanted a mixture of both the pricing structure. To meet the needs of our client, we came up with a new type of pricing schema.

In this, the pricing slabs were bigger than before and the rates defined for each slab were for each kilometre. It meant that to calculate the total fare one had to take into account all respective slab pricings.

Let’s take an example to understand this better.

  • 1-10 – $2 per km
  • 11- 15 - $1.8 per km
  • 16 – 20 - $1.6 per km

Suppose rider traveled 13km, then the total fare will be (2x10) + (1.8x3) = $25.4

We introduced per km pricing in the slab-wise pricing.


This pricing schema offered a great deal of flexibility to our clients.

Surge pricing

Surge pricing is the type of pricing which the taxi companies apply to leverage peak hours, odd time intervals, and many other factors. The surging price is usually 1.2x, 1.5x, 2x of the original fare. Our initial pricing schema allowed our clients for the imposition of day-wise, date-wise, time-slot, and location wise surge pricing.

Our client wanted more flexible options for imposing surge pricing. They wanted to use multiple factors at once to get the desired results. We understood their requirement carefully and made changes in our surge pricing schema.

Now, any of our clients can choose to impose surge pricing for any duration of any day in the month. For example, now it’s possible to impose surge pricing for a time period of 5 PM-7 PM on the first Tuesday of April. Earlier with the older surge pricing schema, this couldn’t have been achieved. These changes made the imposition of surge pricing more precise than ever and offered better results.


The second change that we introduced was of flat surge pricing. In the location-wise surge, the surge pricing is imposed on rides that are booked from places like airports, malls, and other crowded places. Surge pricing imposed in such cases is usually in percentages. But now, clients can impose flat surge prices instead of percentages. For example, a surge of $10 for all the rides booked from airports.

With such flexibility in the surge pricing, the clients can target any location, time slot, day, and date with unprecedented preciseness. Let’s take an example to understand it better. With the current surge pricing schema, clients can impose surge in a particular airport from 5 PM-7 PM on a Tuesday which falls on date 31st March.

Zone pricing

Zone pricing is imposed on specific routes to leverage maximum benefit of its busy nature. For example, the client can identify a specific route which is usually busy and impose zone pricing on it. However, there was a problem with that.


The problem was that whenever the client imposed surge pricing then it also got imposed on the rides which already had zone pricing imposed on it, resulting into a massive fare amount.

So, clients wanted a modification in zone pricing in such a way that there was no surge imposed on rides that already had zone pricing imposed on them.

We understood our client’s issue and made modifications accordingly. Now, the client has choice whether to apply a surge or not on all the rides that have zone price imposed on them.

Extra passenger

Many of our clients expressed to us that they wanted to charge extra for the extra passenger. It was because they wanted to earn more money and utilize the full space of their cabs. For example, many companies had their Sedan cars which had maximum occupancy of four people, however; they had set their pricings for only two passengers, this left the two seats unused.

So, we made changes in our pricing schema which gave an option to our clients to utilize those unused space by charging for the extra passenger. So, now four people can sit in the Sedan car by paying an extra charge of two additional passengers. However, the extra charge amount wouldn’t be directly proportional to the number of extra passengers.

Booking fees

One another major change that we introduced was of the booking fees. In booking fees, the commission charge is paid by the rider instead of the driver. Let’s take an example to understand this better.

Suppose at end of the ride, a rider pays $100 to the driver. The commission rate for the driver here is 20%, which means $20 will be deducted from the driver’s wallet. So, in the end, the net earnings of the driver will be $80. However, in this case, the rider will pay a $20 commission in the form of the booking fee.

It means that the rider has to pay a total amount of $120 to the driver. The commission will still be deducted from the driver’s wallet; however, it won’t affect his net earnings which be of $100.

That was all about the feature update. Stay tuned for further feature and product updates of Yelowsoft.


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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