How To Start A Limousine Service In Massachusetts

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The limousine business has grown by an average annual rate of 2.7% over the last 15 years and brings in revenues of over $12 billion in the Usa alone.^[i] While this means there is more and more than competition, it too ways that in that location is money to be fabricated in the correct market. If you're a people person who doesn't mind long hours, starting a limousine business may exist for you, but yous'll want to plan carefully, market effectively, and vary your types of service to ensure your business is a success.

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Know what yous're getting into. The limousine business isn't right for everybody. It is based on client service and availability. If you're not a people person, expect elsewhere. If y'all want a 9-5 task, think again. People rent limos at all hours of the mean solar day, and the most lucrative jobs take place on the weekends. Be sure yous're comfortable with long, erratic hours before getting started in the business.
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Consider the costs of starting a company. If you want to start with your ain automobile, insurance, and website, you're looking at $50-100,000, plus the monthly costs of gas and maintenance.^[2] If you're starting a virtual telephone call center, with only business organization cards, a price-costless number, and a website, you can go started for anywhere from $500-5,000, depending mostly on how much y'all invest in your website.

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Decide the blazon of company you volition start. You don't even need a limousine to start a limousine company. Depending on how much you are willing to invest, you lot tin offset by building a client base every bit a virtual call center, by ownership a vehicle or two, or launching an unabridged fleet.
- Virtual Phone call Centre – All you need for this is a business card, website, and toll-gratis number. You will field calls or net request for rides and subcontract them to limo services, taking upward to a 20% committee. This is an inexpensive way to build a client base and accrue capital.^[3]
- Drive A Vehicle – You will demand to start with a black sedan (ordinarily a Town Automobile) and/or a limousine (white is preferable at first), both of which will require a significant investment. On the other hand, driving your own vehicle will allow you to increase your acquirement substantially.
- Fleet – Launching a fleet is the riskiest way to commencement your business concern, as it requires a big outlay of capital to buy multiple sedans and limousines. Y'all will also have to hire a dispatcher and chauffeurs, who will typically pay a apartment fee to utilise lease your vehicles ($75-$150 a day) or give yous a percent of their fares (ordinarily one third). More than vehicles on the route can mean more coin, simply it can also mean bigger losses if business is slow.
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Write a business plan. Whatever type of limousine service you lot decide to launch, your business organisation volition do good from a strategic program that will guide yous in achieving your goals. Yous can find more details about how to write a programme hither, only broadly, you volition desire to include:
- Your business organisation concept: what you are offering, your strengths and weaknesses, long term goals, and performance indicators, beyond the bottom line, which will let you know yous are succeeding or declining. These last might include important measures like the number of repeat customers and the number of inquiries you convert into sales.
- Market inquiry: the nature of the industry, who are your customers (business men, aerodrome traffic, weddings, etc), who are the other limousine companies you lot will be competing with, what prices are charged. Remember that the goal is to sell service. This is a luxury business; being the inexpensive limousine company is not a good business model.
- A marketing plan: how you volition communicate with customers and abound your customer base of operations.
- An operations plan: identify the individual projects that volition pb to completing your larger goals. To begin with, these might include things like: hiring a designer, registering your domain, and finding a webhost – all to build a website; or finding livery insurance, buying a car, and choosing billing options – all to prepare your vehicle for service.
- Fiscal projections: these include a list of assets earlier you lot start the business; start-up costs such equally building a website, getting insurance, obtaining permits, and purchasing a vehicle; marketing costs; and revenue projections. You will need to know how much concern you need to do at what price in order to show a turn a profit, and how long y'all tin can perform at a loss.
- You can find a sample business plan for a limousine service here.
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Consider hiring a consultant. There are consultants who specialize in the limousine business organisation. They can aid you identify lucrative markets, set rates, and annunciate effectively. Particularly if you are new to the concern, a consultant can brand you money in the long run, despite the initial cost.

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Consider hiring a concern lawyer familiar with the manufacture. A lawyer can aid you make up one's mind on the most advantageous legal structure for your business organization and walk you through revenue enhancement procedures and the necessary licenses and permits in your expanse.^[iv]
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Make up one's mind the legal structure of your business. This volition have implications for how you lot file taxes and how much you will need to pay. Most small businesses are sole proprietorships, which are the easiest to ready and crave the least paperwork. If yous are because another legal structure, y'all may wish to consult a lawyer who can help you choice the structure best for you.^[5]
- Sole proprietorship – An unincorporated concern run by an individual. No special steps are needed to form a sole proprietorship, and since there is no distinction between the business concern and you, the owner, the income from the business is reported equally your income. You pay self employment tax.^[6] Because you will exist personally liable for your business concern, this form is not recommended.
- Partnership – A business where 2 or more than people share ownership. To class one you lot must choose a name and register your business with your state. You must also register with the IRS and get a tax ID. Profits are passed through to the partners, who pay taxes on them on their individual tax return. This includes self employment tax. Partners are liable for their ain actions and those of their partners.^[7]
- Limited liability visitor (LLC) – To start an LLC, you must, at a minimum, cull a proper noun and file articles of organization with your state, oft for a fee. LLC owners pay taxes on profits through their private income revenue enhancement returns and have to pay self employment tax, only are protected from personal liability for the decisions and actions of the company.^[viii]
- Corporation – An independent legal entity owned past shareholders. To register your corporation you must choose a company proper name and file articles of incorporation with your state. Yous volition as well demand to register with the IRS and get a taxation ID. Corporations file taxes separately from their owners. This may evidence advantageous, assuasive owners to take advantage of the corporate revenue enhancement rate, but information technology may also lead to double taxation. You lot should speak with your lawyer or auditor to see if this form of business concern will do good y'all.^[nine]
- S Corporation – An independent legal entity owned by shareholders, similar a typical corporation, except that to avert double taxation, profits and losses are passed through to the owners' personal tax returns, instead of the company paying taxes.^[10]
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Choose your business proper noun and register it with your state government. ^[xi] A DBA (Doing Business As) is needed whenever you are doing business under a name other than your ain. If you are working equally an independent contractor under your own name, you lot don't need ane. But if your limousine business has a name other than your own, yous will need to register that proper name as a DBA.^[12]
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Determine if you demand to get a tax identification number for your business. Corporations that must file tax returns will need one, as well as partnerships, which don't file taxes, only exercise have to file business information annually with the IRS^[xiii] Yous will also need a taxation ID if you take employees. Drivers are usually hired as contained contractors who cover their own payroll taxes, but for a dispatcher or other employees, your company will be responsible for one-half their payroll taxes, and must thus have a taxation ID with which to pay them.
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Annals to pay taxes in your state and empathize local taxation laws. Well-nigh states and some localities levy a business or corporate income tax. If y'all are a sole proprietor, you lot will pay this taxation as office of your personal income return, while LLCs and corporations volition be taxed separately from their individual owners. If y'all have employees, you volition also demand to pay country worker's compensation insurance and unemployment insurance taxes. You can find more than information on tax laws for businesses in your state here.
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Obtain the necessary licenses and permits. Depending on the laws in your area, you will need to obtain permits for your business organisation, vehicle, yourself, or all three in order to operate a limousine or black car, and sometimes another permit to choice upwardly passengers at the airdrome. Depending on the locality and how competitive the market is, these permits will price from effectually $100 to several chiliad dollars.

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Get insurance. Personal auto insurance commonly has a livery exclusion, significant your passengers and car will non be covered if you are using it for hire. Start searching for a business organization auto policy that covers livery service early, as it can have 4 to 6 weeks to go far identify.^[xiv]
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Create a website. Most clients find their limousines online, and so a website is vital.^[15] Unless y'all are an experienced site designer, you will probably want to hire a professional to create a polished website.^[16]
- Web designers volition build your site and accept care of registering your domain name and selecting a webhost. The more than yous pay, the more input you volition have in creating a unique site.
- The price of web design varies depending on whether yous use a solo developer in the US ($25-$100/hr), an offshore web company ($x-$40/60 minutes), or an established US agency ($sixty-$200/60 minutes).^[17]
- Offshore firms tin can design sites starting at around $500,^[18] while the price of a United states of america firm will usually range from $v,000-$10,000, with solo developers falling somewhere in-between.^[19]
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Get a toll-free number and print business cards. You will most frequently be charged by the infinitesimal for your toll-gratuitous numbers. Call around for the best rates. Once you lot take the number, you can impress business cards with it and your website. These cards are a central way to grow your business. You will give them to customers and exit them at clubs and hotels.
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Purchase your vehicle or arrange contracts with other companies. If you are establishing a virtual call heart, you lot will need to negotiate contracts with existing limousine companies that specify the commission you lot volition receive. Otherwise, you will need to buy a vehicle.
- A black Town Car is a good starter for airport transfers and corporate customers. Information technology is less expensive than a stretch limo.
- A stretch limo is necessary for well-nigh of the most lucrative services – weddings, funerals, proms and graduations – then you'll want to add one to your armada equally before long equally possible. Kickoff with a white limo, as these are most popular for weddings, proms, graduations, and other special events.^[20]
- If possible, purchase both a blackness sedan and a limousine so that you can provide the total range of services – airport and corporate business during the week, and special events on the weekends.
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Choose a payment system. You can install a meter in your car, only limousine drivers are increasingly opting for online services that schedule appointments, notify drivers where to choice upwards customers, and handle payment.
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Purchase a navigation system. Fifty-fifty if y'all know your town like the back of your hand, in that location volition be addresses that you've never heard of. A navigation organization volition not only ensure that you don't go lost, it tin can too help y'all avoid traffic, thereby profoundly improving your clients' experience.
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Advertise your service. Advertizing is the key to succeeding in the limousine business. The more inquiries yous receive, and the more of those inquiries you lot convert into sales, the more than money you tin can make. A polished website and business concern cards are a cardinal starting point. Too consider:
- Pay-per-click advertisement – Buying internet traffic is the quickest fashion to bring people to your website. Even so, make sure you are targeting the right audience. Clicks toll you money, and if tons of visitors get out without purchasing your services or product, y'all tin lose money.^[21] The two major advertisers are GoogleAds and Facebook.
- Craigslist, the yellow pages, and radio spots – Make certain you have a professional ad in both the xanthous pages and craigslist, for those who search there. Radio spots tin can exist effective, though they are more expensive than internet advertising.
- Hotels and night clubs – Talk with the manager and driblet off your menu. Consider giving 5% commission to hotel doormen and club staff. If someone needs a limo, you lot want to exist the person they recommend.^[22]
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Do drome transfers for steady business. Profit margins are low on airport clientele, but the business organization tends to be steady over the course of the yr. It thus provides a good base of revenue for your visitor between weekend wedding hires and the prom / graduation season.^[23]
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Seek out specialized hires for greater profits. Aerodrome transfers and corporate hires will help keep you in the blackness, but the real money to be fabricated is in special events, which require a limousine.
- Weddings - Weddings are a good reason to get a stretch limo. They require a college level of service – a tuxedo-ed driver, champagne beverage, coordination with the helpmate – but as well pay very well.^[24]
- Funeral Service - Again, this is a specialized service that takes place generally on weekends. You will need a pressed black suit and a not-ostentatious black limousine.^[25]
- Proms and Graduations – Though the flavour for them but lasts two months, these events provide the greatest profit for limousine companies.^[26] Consider increasing ad before and during the flavour.
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Prepare contracts for special result service. For events that book in advance, you'll want the clients to sign a contract that stipulates a non-refundable 20% eolith to protect you in case they back out for some reason. This is non uncommon, particularly with graduations.^[27]
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Buy more than cars and hire more chauffeurs equally you lot grow your business organisation. The best manner to hire chauffeurs is to get to airports and choice out well-dressed chauffeurs in the baggage expanse. Offer them your card and ask them to call you if they're not happy working where they are.^[28] Have your lawyer write up contracts, and decide on how you will collect money from your drivers: as a monthly fee for leasing your vehicle or as a percentage of their fares.
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Cultivate repeat business. This is the key to success in the limousine concern. Your website should collect client information. Employ it to create email and physical mail lists. Send mail to thank customers and encourage them to employ your service once again. Also, always be sure to manus out your business menu to passengers. Nigh importantly, offer professional, courteous service that makes customers want to return.

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Add together New Question

Question

Tin can I used a custom Cadillac or whatsoever custom vehicle for a limousine service?

You could, but it may non exist financially savvy.
Question

Can I use a 25 passenger mini jitney for my limo service?

You tin can, but yous should have a motion picture of the mini charabanc on your website and/or any brochures you make to annunciate your service to make it articulate that this is what y'all'll exist driving. Then when you take reservations, mention information technology again merely and then no one is surprised by the vehicle they're getting.
Question

What do I need to practice in order to serve alcohol in the limo?

You lot would want to find out what your state and local rules are about obtaining an alcohol license or exemption. The best places to start are your lawyer, your county or metropolis offices, and/or the state agency responsible for regulation of booze licensing.
Question

What is a freelance limousine?

A limousine that the chauffeur owns, that contracts with a virtual telephone call center or larger limo visitor to provide dispatch services.
Question

Where do I start and what registrations are needed?

Check with your city and local town hall. They can direct y'all or may have the forms you demand.