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Although no industry is totally immune from a down turned economy, the “passenger
ground transportation” niche generally fares better than most when times are tough.
The reasons for this are varied. In some instances, we find that individual citizens
and/or private companies cease using their own vehicles due to the high cost of
fuel. In other examples, we see the industry benefiting indirectly from other forces.
For example, the federal government is currently spending millions of dollars helping
private industry, and many of those initiatives have a transportation component
attached to them. (For more information on federal transit funding for private for-profit
operators, visit www.fta.dot.gov/grants_financing.html)
So how can an entrepreneur take advantage of the opportunities that the passenger
ground transportation industry affords? We are finding that some of the best opportunities
lie in the limousine industry. That statement may surprise some people, given the
fact that the word “limousine” usually conjures up an image of a driver with a dark
suit and cap standing next to a 20 foot long luxury vehicle replete with bottles
of champagne on ice. While that may be one service option available when one dials
up a limousine company, a closer inspection reveals that most modern limo companies
offer a multitude of services, and a variety of vehicle types.
Today’s limousine company often defines itself as a “livery” company, a “premium
car” service, or even a “professional transportation” firm. Today’s limo company
offers many services which provide upscale alternatives to taxicabs and airport
shuttles, while still offering the choice and flexibility of the more traditional
industry offerings. Many limo companies deploy the traditional stretch and super-stretch
limos, while also featuring luxury sedans, luxury SUV’s, corporate coaches, executive
sedans, and even upscale wheelchair-accessible vehicles.
That all said, the prospective business owner needs to gather as much information
as possible, about both the risk and the reward, before going forward. Among the
many issues facing the budding limousine owner are the following:
Solid Investment Capabilities
To attract upscale clientele, a limo company needs to have a quality fleet, featuring
either brand new or late model vehicles. In the limousine industry, you may only
get one chance to impress a client. Along with the behavior of your driver, the
quality of your vehicles is the criteria upon which your company will be judged.
You need strong capitalization, a good credit line, or both. For more information
on this aspect of start-up, all new limo business owners are encouraged to contact
a national industry organization such as the National
Limousine Association. This group provides guidance, mentoring, and idea
sharing with other industry members.
Interior Parking Facility
An upscale fleet of vehicles must be kept immaculate at all times. Unless one’s
business is in a very mild or very dry climate, a limousine fleet needs to be kept
indoors, where they can be cleaned at any time and protected from the weather. The
fleet must be in excellent shape and ready to go at all times. As we said above,
you never know when a new client will call, and you may only get one chance to impress.
Flexible Attitude toward Business Development
While identifying prospective clientele, one still needs to let the clientele identify
their needs. For example, a limo company may try to promote their executive car
service to a hotel client, only to discover that what the hotel really wants is
upscale coach service for airport transfers, sightseeing tours, and shuttles to
the downtown restaurant and entertainment district. Having an open mind and a flexible
attitude will help you find a solution to your client’s need, even if that need
means a having to create a new service offering.
Knowledge of Local, State, and Federal Regulations>
While applying for an operating authority, one needs to understand that different
vehicles often fall under different regulatory classifications. For example, many
states and municipalities provide for-hire operating authority based upon the number
of seats in a particular vehicle. Other factors like vehicle size, weight, and number
of axles sometimes come into play, especially when interstate transportation is
involved. Further, certain vehicles are regulated locally according to their actual
usage, so consult with your local transit regulator before buying vehicles or soliciting
business. Lastly, while putting together a business plan, the entrepreneur should
consult federal motor carrier regulations at www.fmcsa.dot.gov
Strong Insurance Partner
Unlike other transportation companies that have only one type of vehicle and provide
a street access business (taxicabs, buses, shuttles) the limousine business often
features many forms of upscale livery, using vehicles of multiple sizes, multiple
configurations, all serving an upscale clientele. To this type of business owner,
a good insurance company will not just be another vendor, but rather will be an
on-going business partner who will be at the entrepreneur’s side as the business
grows in size, develops different services, and adds different vehicles to its fleet.
To be sure you have the right protection at the best price available
click here for a Fast, Free Limo Insurance Quote.
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