Planning to start a driving school? Well! It is a very good idea and is profitable too, but an intimate knowledge about the strict rules and regulations is required. The start-up cost is a factor of concern but it is completely depending on the set up of your school. But surely you can make handsome money at the end. Get to know the few requirements before starting up your driving school.
When someone wants to start the business of a car driving school then there are various things that must be considered. The things to be considered are like,
- the place where to start a business,
- the investment required to open the school,
- schools operating in that area,
- the facilities provided by those schools in that area,
- how many vehicles to be purchased for that purpose, and many more.
All these requirements are to be met by coordinating with the government’s rules and regulations as well.
After you are done with the construction of the business plan, then it is required that you must estimate the budget for your school. If you are already having one vehicle for the business then you must estimate some budget for advertisement, some budget for fuel, and some for the maintenance of the vehicles so that you may not face any problem afterward.
While doing these steps, you need to keep it in mind that you have to follow the proper steps given by respective government authorities.
Steps Involved in Starting a Driving School Business are as Follows:-
#1. Competitor research
There is no use of selling vegetables outside the main vegetable market. Just like this, make sure that there is no such level of competition in the area you are going to start the business in.
Since every person needs to learn how to drive, most locations are already having some way to provide driver education. Assessing the competition will provide you the path to business victory. The things you must know are:
- Which are the other driving schools in that area
- Different services offered by those schools
- What are the prices for the services provided?
Assessing these questions will enable you to make some reforms in your business plan so that your business can stand apart from those who are already running it there.
#2. Choose perfect business location
While starting the business the selection of place plays a very important role. Initially the business can be started on the rented land and afterward can be shifted to a better place. The most common practice is to lease a place for a long time so that it is not difficult to manage the rent, and then move to a new place when the business seems to be stable.
Normal cost of renting in different locations of India can be calculated easily from here.
Some common things to be kept in mind:-
- There must be some space for parking of vehicles
- One classroom and one office
- If the rented plot is near the market area then it will be advantageous
- Make sure that your office is near the residential area so that customers can be attracted to you
#3. Get registered
The business cannot be established until and unless you have completed the registration process. You are required to get your business registered with MCA (Ministry of Corporate Affairs) in India before its commencement. Any business started outside the premises of MCA will be considered illegal.
After going through the relevant steps you are considered to be registered and you will be provided with the license to establish your business.
What is MCA (Ministry of Corporate Affairs)?
It is an Indian government ministry which is primarily concerned with the administration of the Companies Act 2013, the Partnership Act 1956, the Limited Liability Partnership (LLP) Act 2008 and some other allied acts and many rules and regulations which are mainly there for regulating the functions of the corporate sector according to law. It is mainly responsible for regulating Indian enterprises in the Industrial and Services sector.
#4. Know the expenses and business funding
The most important thing while starting any kind of business is the source of finance. If you have a stable source of finance, then starting any kind of business is not troublesome. After you know the registration process you are required to build a start-up budget for your business. You can finance your start-up via many sources like bank loans, credit loans, savings, etc.
Find out Bank Loan costs–
|Interest Rate||13.50% onwards|
|Processing Fee||Up to 3% of loan amount|
|Loan Tenure||Up to 5 years|
|Lowest EMI per laky||₹ 2,301 for 5 years|
If you are having a working vehicle for your start-up business, then you are required to include money for rent in your budget (if you need a location), advertisement cost, and money required for vehicle maintenance, and gas. If you are planning to hire an instructor to start then budget for that as well.
Most important things that you cannot ignore while budgeting your business are
- Insurance costs- All of the vehicles should be insured and third-party insurance is mandatory.
- Fuel costs- Fuel is like food for cars in this business, so a big amount of recurring sources of money is to be kept.
- Advertisements costs– More the people know about the business, more the kick-start it will get, money for making fillings, and boards should be kept in mind while budgeting.
- Labour costs- if you are not intending to drive yourself all of the time and plan to keep an assistant for help, monthly salary has to be thought of while budgeting.
#5. Register the vehicles from RTO
The RTO is an Indian government office responsible for issuing vehicle registration and driving license in India. It is an Indian Government organization responsible for maintaining a database of drivers and vehicles for different states of India.
The department of motor vehicles is established under section 213(1) of the Motor Vehicles Act, 1988. It is the central act that is implemented all over the country. Every state and cities have their own RTO. And each RTO is responsible to carry out the functions and activities laid down in the Motor Vehicles Act, 1988.
Before opening your driving school in your area you must first take permission from RTO and submit all the necessary documents in the office.
Activities performed by RTO:-
- Vehicle registration.
- Tax collection of motor vehicles.
- Issues transport permit (license for motor vehicles)
- Keeping an eye on the validity of insurance of the motor vehicle.
- Inspection of vehicles in an accident.
#6. Get driving instructor license from RTO
Now you should know all the basics about your driving school- the services offered by your school, the location of the business, the area where your customers are located, and the budget you planned to start the business with.
When you will finally receive your driving instructor license then you will be ready to hit the ground hard. As you will have all the necessary things required for starting the business so you can start your business.
Before applying for driving instructor license these 6 things must be kept in mind:
- Age: The person who wants to apply for the same must be at least 21 years old or above.
- Education: It is required that the applicant have a high school diploma or equivalent to this.
- Vision: The person applying for this test must pass the vision test and then only he is liable to apply for a license.
- Physical examination: The applicant is required to pass a physical test and possibly a mental health screening before becoming eligible for a license.
- Background check: Here the criminal history check and an in-depth background check to be passed by the applicant.
- Driving record: Driving record is to be presented at the time of application and excessive traffic offenses might disqualify you.
#7. Estimate administration and insurance charges
When you are already aware of the services provided by the competitors then you can easily figure out the services to be provided to your customers.
For your new driving school, you are required to fix a price which is affordable as well as competitive. As it’s a new business so you have to fix a price with less margin as, if you prefer to choose more profit over customers you will not survive.
While starting any business, you have a risk of failure. So to be on safe side insurance is mandatory. By government’s orders, it is compulsory for motor vehicles to have insurance third party insurance). The standard cost of insurance according to the needs is:-
|Engine capacity||Average Premium (per month)|
|<1000 cc||Rs. 1850|
|1000 cc< and >1500 cc||Rs. 2863|
|>1500 cc||Rs. 7890|
#8. Advertise (Get your first customer)
Now as you are an entrepreneur and the sky is the limit of your new business, and this is the time when you should get your first customer.
There are different ways you can advertise your driving school:-
- You can print pamphlets of your business and distribute them in your area.
- You can hang huge boards on the main roads so that every aspiring driver can see it.
- To advertise your driving school, you must choose a driving school. Marketing is the leading provider in the world for Internet advertising services for driving schools.
- You can also apply posters on your vehicles so that you can advertise your work during working hours also.
The cost of bill board advertising varies intensely. Things that matter are: – size of the board, lit or non-lit (lit is more costly), location (highways or metropolitan roads) and many more.
|City||Size||Starting cost (INR)|
|Ahmadabad||12×8||4800(per square feet)|
For more information, you can click here and check the rates in your region.
#9. Try online ads – You’ll love this
In the past word-of-mouth was enough for growing the business, but now teens and even their parents are constantly using their phones and they stop at Google to find a local business also. The Internet can prove to be the best source of advertisement for any kind of business.
So, you just make sure that your business gets the presence over the internet and if someone tries to find you with your name or driving school + your location then he/she can find you easily. That helps in providing a guarantee for the business opportunity.
It can also help in a huge amount of cost-cutting as advertising over the internet is cheap as considered to advertising on the road. Using this cost-cutting you can offer discounts to your customers and this can be considered as an advertising strategy for your business.
#10. Ask for customers feedback and reviews
As you are trying to build up your brand, so you must keep in mind that online reviews will help you and are very important for your business. Ask your customers your friends and even your parents to leave you a positive review online. Improving your reputation over the internet, it will help you to attract more and more customers to choose you over your competitors.
As your reviews improve over the internet, you will be able to raise your prices easily, as you will be the premium driving school in the town.
It is of great importance as this will help you in realizing what your weak points are and where you need to work hard to beat your already existing competition.