How long has it been since you took a good look at your business? I bet if your business is quite successful then it's been awhile since you critically analyzed it. The truth is that we tend to ease off when things go well and don’t give enough efforts for improving the business. So, what happens when something changes in the macro-economic environment and the industry experiences even a slight downturn? Due to the fact that turnover and profits go down, business owners start to raise the alarm: cut all possible expenses (customer service suffers and the loyalty of available customers disappears) and reduce marketing budget (leads to decreasing of new customers flow). All of these eventually lead to a stagnation phase and result inbusiness collapse. The safe way here is to think beforehand and never stop moving the business forward increasing of its financial safety margin. The variety of measures might be taken both internally and externally.
To start with, you, as the owner or a manager of a car rental company, have to constantly challenge its business model. This means to evaluate all pieces of the puzzle including staff, vehicle fleet, level of customer service, assets, etc. Besides, you should not forget to analyze all financial aspects of the business, manage risks and revenue, optimize profitability and wisely criticize marketing and sales strategies. When it’s done and the action plan is created you have a great chance to look ahead and think more about the external opportunities and possible market expansion. You have to take care of 2 things at a time: growing customer database and increasing the vehicle fleet. New marketing alliances might be quite helpful in attraction of new customers, for instance tight cooperation with tour operators, hotels, residential areas, etc. As for the expanding a vehicle fleet buying a similar company might be an option for you. In this case you get the fleet, adjusted workflow, all assets, qualified staff, customer database and all partner networks of the company. In case the company you are going to buy is located in different region or even country, you’ll get the fully functioning branch that is going to help you to raise the awareness of your company as a brand and make first steps of going international.
As far as the main source of customers for a car rental company is the tourist flow that arrives to the city and a cluster of people who need a car for a limited time (1-3 years) such as expatriates that tend to take cars in lease, one of the most promising cities for such business activities is Dubai.
During the past decade, Dubai has become a global tourism hub. It was able to double the number of tourists from only five million yearly to ten million tourists a year during the past eight years. It is planned, that by 2020, Dubai will be welcoming 20 million visitors per year, and treble the annual contribution made by tourism to the city’s economy, according to the new tourism vision. Owing to the increase in investment and job opportunities in Dubai, there is a considerable number of expatriate population contributing to the total population of the UAE with the majority of the expatriates residing in Dubai. In 2013, the total population of the UAE was recorded to be 9.2 million. Out of the 9.2 million, the expatriates contributed to around 7.8 million with the Emirati Nationals holding a population share of 1.4 million.
So, keep moving your business ahead and don't forget to think out of the box!