Starting A Taxi Business
Posted 24 Sep 2014 Thinking of starting a taxi firm? If so, you need to have a clear understanding of what it involves, the requirements and the different options available. Here is a brief guide.
The term “taxi” is often used loosely to describe both hackney carriages and private hire vehicles. However, there is a difference between the two.
Hackney carriages can be hailed from the street and also use a taxi rank, while private hire vehicles can only be pre-booked for journeys – usually by telephone. In big cities like London, Birmingham and Manchester and other large towns, hackney carriages are mostly black cabs, but they do come in all kinds of shapes, sizes and colours around the country. Private hire vehicles are often saloon cars but can also be people carriers, minibuses and even limousines and luxury vehicles.
To drive either a hackney carriage or private hire vehicle you’ll need to be licensed by the relevant authority. The requirements vary between local authorities so you need to contact yours to find out exactly what you need to do. Sometimes you just need to show you meet the necessary criteria, demonstrating you’re “fit and proper”, and pay a fee. Medicals are sometimes required.
Other processes are much more stringent. For example, you might need to pass the Driver and Vehicle Standards Agency (DVSA) taxi assessment.
There are three types of assessment you can take:
- The standard driving assessment;
- The enhanced assessment, which includes a wheelchair exercise;
- The upgrade assessment if you’ve done the standard assessment and then want to do the wheelchair exercise.
There are qualification systems that are notoriously difficult, such as the “knowledge” process required for black cab drivers in London, involving three years of intensive study in order to obtain the famous green badge (and there’s also the yellow badge for working in just the suburban areas of the capital).
In addition to your licence to drive a taxi, your firm might also need an operator’s licence from the local authority to accept bookings, as well as a vehicle licence. You’ll need an operating centre to take bookings but you can use your home, providing it meets with the approval of the local authority. Private hire vehicle operator licences last for a maximum of five years, driver licences for up to three years and vehicle licences for up to one year. The driver, vehicle and operator all need to be licensed by the same authority. Make sure you know all the requirements for your area before you start.
You can opt to use your own vehicle or rent one from someone else in the trade. The second option might be appropriate if you are starting out as it would give you the opportunity to learn all about the job before making a larger financial commitment. It might also be your best option if you are working on a tight budget.
If you do intend to buy your own vehicle, you’ll need to check that it will meet the required standard specified by the local authority. Hackney carriage drivers might require purpose-built vehicles, such as the famous black cabs. Wheelchair access is likely to be compulsory.
For private hire vehicles, the choice will depend on the kind of business you’re looking for. Ask other drivers for advice on suitability and reliability, as well as running costs.
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