Mistakes When Starting A Car Rental Business


It is difficult to find a person who has never thought about opening his own business. As an entrepreneur, with proper planning and organisation, anyone can reach a good level of income quite quickly.

In the modern world, mobility and speed of movement are important to people. At the same time, not everyone has the opportunity to travel in their own car or always have it with them. For example, when travelling on holiday or abroad, most people prefer to use a rental car. When travelling to a new, diverse country such as the UAE, sports car rental Dubai helps you to visit all the desired places or resolve business issues. Rental companies offer various brands of cars and rental periods at the client’s choice. Depending on the purpose of the trip, the most profitable option may be monthly rent in Dubai if a person is coming for a long period of time, or daily car rental if the trip is for a week. Rental agencies have a wide fleet of vehicles allowing you to rent whether a Mercedes UAE or hire a Maserati.

lack Of Plan And Strategy

Av Study all available information related to the rental business: business plans, books and articles, offers from franchisors, real cases, etc. If you have the opportunity to work at least temporarily in a rental agency, then be sure to use it.

Typical mistakes in business planning include:

  • lack of clear goals in the form of specific figures for sales and profit volumes and deadlines for achieving them;
  • unclear distribution of areas of responsibility between partners or employees;
  • underestimation of estimated business expenses;
  • overly optimistic expected income figures;
  • choosing just one option for business development strategy;
  • lack of a backup plan if the original plan cannot be implemented for some reason;
  • underestimation of business risks and competitors’ activities.

inability To Sell

Even the car rental business is about sales. You will make a profit only after you are able to satisfy the needs of your customers. But the benefits of your service or product still need to be conveyed to the consumer. Think about what advertising channels and marketing techniques you will use.

The development of the marketing field never stops, so the classical concept of advertising is gradually blurring its boundaries. Previously, for example, no one knew about Internet marketing, but now almost all rental agencies use it.

inability To Manage Money

Experience shows that the easiest thing to do when starting a business is not to waste your own money, but to waste someone else’s investments or loans. If you have a solid starting capital in your hands, then the temptation to spend it immediately arises. Some budding entrepreneurs are too carried away by the attributes of business: an office in a prestigious location, an expensive company car, a corporate website with an individual design, etc. The justification given is the fact that such expenses are for the formation of image and reputation, without which there is nothing to do in the car rental business. In fact, start-up capital should be spent on organising first sales, forming a customer base, improving the quality of service, and establishing business connections.


ignoring Competitors

Rental companies are a very popular business nowadays and you will definitely have competitors. And, of course, part of the market will be occupied by those who started before you, invested their money and effort and expect a certain profit. The presence of competitors should not immediately stop you from starting a business, but you also cannot ignore them. To understand how competitive the rental agency niche is and how you can stand out, you can order a marketing study or conduct a quick analysis yourself.

underestimating Risks

The car rental business is high-risk. Risks are associated with operation, failure to meet the planned sales volume, and transfer of property to third parties. In order to minimise risk, it is proposed to improve business processes and develop very strict internal regulations and a system of checklists for each business process; It is recommended to implement a system of checklists and additional checks.

As in any rental business, the biggest risk is transferring property to third parties. A client renting a car may cause an accident or otherwise damage it, steal or replace some parts, thereby causing a considerable loss. If you decide to start a rental business, then the first thing you need to do is study all the nuances of car insurance.


Owning your own car rental business is very profitable. There are a number of reasons for this, and the main one is the popularity and demand for this service. However, opening your own rental company must be approached competently and carefully. In addition to the fact that you will need a detailed and well-written business plan, you also need to evaluate and calculate all the risks. Don’t forget to adequately evaluate expenses and implement advertising that will attract new customers and increase your income.

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