Car Rental Business Plan

Business Plan Articles

If you are starting a car rental business, it is likely that you will require a business plan at some point. The experts at Pro Business Plans have extensive experience working with car rental companies to create plans for strategy and finance. This article provides information on what is generally included in the plan and how it is structured.

Car Rental Business Plan

There are many things to consider if you are starting a car rental company that investors will consider before funding your company. For instance, the precise location of the rental stores can play a large role into your success. The models and styles of cars that you have can also play a role, along the capacity and follow-up marketing strategy. The budget that you have to manage the car rental location must also be relative to the revenue expected. Each unique factor combines to compose the business model and forecast returns.

Business Model

The business model section of a car rental business plan covers many factors from how cars will be sourced, maintained, and the process they will be rented. This is partially based upon the background of the management team that must demonstrate how their background is aligned with operating such a facility. This section may not require as much detail if it is to open a franchise location, which already has a solid business model in place.


Location

The location of the car rental company is based upon several factors including not only the demographics of the vicinity, but also the specific area within it. An airport car rental location is much different than one located several miles away from the city center in a residential area. It is not necessarily the case that the location will sink or swim, but that the business model needs to be adjusted accordingly.


Operations

There are several elements to cover the operations aspects of a car rental company. Most major franchises already have fulfilled the operations requirements with everything from what cars to procure to legal documents and salvage. Therefore, it if you are not opening a franchise, it is important to have an operations structure in place whereby you outlined each element as it relates to the operations of the facility.


Marketing Plan

The marketing section of a car rental business plan is based upon several key factors including having a good reputation, making the process easy for the customer, and promoting when users search for a rental car. The marketing section is not universal for all companies, therefore, using a template or applying a universal response in the strategy will not likely be successful or well received by prospective investors.


Reputation Management

The reputation management is key to any brand as it scales, even if it operates by serving tourists as its primary demographic. Therefore, the company must be able to sustain a positive image in the market through a combination of positive reviews and an outstanding reputation. Consumers search based on the reviews of their peers, so having poor ratings on Yelp! or Google Places will almost certainly lead to long-run profit declines.


Ongoing Promotion

The promotion section within a car wash business plan is presented as a way to provide information about it will acquire long-term customers. The acquisition of customers often requires consistent promotions at a low cost such as organic search traffic, referrals through strategic partnerships, or other channels to build the promotions around.


Financial Projections

The financial forecasts for a Car Rental will essentially diverge under two circumstances based on whether the Car Rental is online or offline. If it is offline, its size will be shaped by its location and capacity. Once this has been determined, the most effective way to form financial projections is based upon prior operation history with an analysis of comparable Car Rentals. For instance, if you have 100 slot machines and 600 hotel rooms, the financial performance of similar sized Car Rentals would be analyzed in order to form an estimation.


Financial Projections

The financial projections of the company are put in place for two reasons. The first reason is to identify key risk areas within the business model that could divert its path to profitability. The second is to determine the company’s ability to generate the desired profit level, be it from banks looking for interest or investors looking for dividends and equity. These factors are combined to form the revenue projections and budget forecasts in the form a three to five-year financial model.


Revenue Forecasts

The revenue projections for a car rental business plan are generally based upon the assumptions provided in the operations section including the number of cars, the capacity level of them being rented, and any other services sold. For instance, the rental car company may also sell insurance or generate a premium from all costs associated with re-filling the vehicle with gasoline.


What is Included in Our Custom Car Rental Business Plan?


  • Marketing Plan
  • SWOT Analysis
  • Competitive Analysis
  • Profitability Analysis
  • Personnel Plan
  • Organizational Chart
  • Company Valuation
  • Executive Summary
  • Company Description
  • Keys to Success
  • Three Year Objectives
  • Product or Service Description
  • Market Research
  • Fundraising Support
  • 12 Month & 3 Year Profit & Loss
  • 3 Year Balance Sheet
  • 12 Month & 3 Year Sales Forecast
  • 12 Month & 3 Year Cash Flows
  • Break-Even Analysis
  • Financial Ratio Analysis
  • Management Team

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