Starting a Taxi Business!

The ins and outs of how to do it, what you’ll need to know,

to get, to arrange.

-by Fred Stock, Co-Owner,

 .            So you’re starting a taxi business. Congratulations! It’s a tough but rewarding
business if you go about it with your eyes open, your attitudes right! A taxi cab is a
small mobile room with features including a full time attendant, you! It is part of the
“hospitality industry” which includes hotels and cruise ships, tour businesses and
golf resorts, convention and business administrations, and of course, transportation.
Your service is one of the first impressions a visitor has when he lands on your town,
certainly one of the more important “entry level” images he/she will take home, about
which the friends and future clients will hear. Your performance will contribute to “make
or break” if your area is a resort or conference center. Your performance will absolutely
determine whether the locals will dial your number or your competitor’s next time!

            You make the business work. Your vehicle should be clean, smoke free,
mended if injured, a pleasant experience for your clients. (They are not just “fares”
or “rides”, they are clients!) Buy the best, most comfortable, attractive car or van you
can afford. Straining a little now will mean fewer interruptions for transmissions, engine
work, dead batteries – the annoyances that prevent a prompt pick-up and delivery for
your customers. There is nothing worse than heading for a major fare, a long ride
which will make your week perhaps, and having to miss it because of car failure.
As the competitor passes to collect your big fare, you’ll be fuming at the side of the
road waiting for the tow truck. Bad plan.

            The complaints we hear from operators everywhere are generally in four
categories; 1) Insurance is too high cost. 2) Gasoline is too expensive. 3) Can’t get
good honest drivers. 4) Regulations and license fees are out of control. Welcome to
the hospitality transportation industry!

Here are some considerations;

 A dependable vehicle, clean, mechanically sound, visually attractive.
(Large sedan, van, limo.) Try to avoid small cars with cramped leg room in the back.
Remember the trunk capacity too. Nothing more frustrating than trying to put 800
pounds of luggage in a 200 pound boot! Read “About Vehicles” on this website,

 A proper insurance policy. The laws vary greatly from location to location.
Ask your insurance agent or another cabby what they use. If there is a regulator in
your area, city government, taxi over-sight committee, joint-powers authority perhaps,
they will likely have information on insurance carriers and providers. Insurance is one
of your greatest expenses. Don’t try to operate without a proper commercial grade
policy in place. Your state or provincial motor-vehicle department may also have good
information for you on insurance requirements and sources. And go through an
insurance broker when you start looking. They are not committed to just one insurance
company, but rather, handle many companies. They usually can get you the best
rate by selecting the right company. Several bids from different brokers can't hurt either.

 A taxi-meter. The federal government regulates equipment features & capabilities
for any measurement devices we own -  scales, gallons at the pump, temperatures of
industrial processes, and of course miles or KM charged to clients in our industry.
(Go to and click on N.I.S.T. Handbook 44 in the second last
column for more info. Section 5.54 is our bible.) Bottom line is this: If you are charging
clients by the mile, you’ll need a proper taxi meter traceable to nationally recognized
standards and regulations. We handle the two top brands, Pulsar and Centrodyne.
Some meters print receipts or check credit card verifications. Go to that same website
and see our column four for info. Oh, be careful about buying meters on-line in "sell-it-here"
websites; New meters always carry a year factory warranty, and dealers (like us) will
be more likely to support your equipment if you have issues, than say "Bubba" who has
one to sell cheap at "") Meters legal for use in the U.S.A. also must
have a federal government approval certificate called a C.O.C. (Certificate of Compliance)
which is readily available from your dealer. If the meter does not have a COC number,
it may be illegal for use in this country. Ours are listed on our home page, last column.

 A toplight sign. Universally recognized as a “CAB” marker, a toplight will display
the fact that your car is for hire and properly outfitted. (Go to
then see the first two columns for over 50 toplight models. This large selection of quality
toplights can almost all be made screw-down magnetic mount. Remember wind can
destroy a magnetic base toplight; read “The Wind Speech” on that page.) We also can
make nearly all our lights as normal light bulb lighted, or with new LED (Light Emitting
Diode) lighting. LED's draw much less current, and have no fragile filaments, and they
are usually waterproof. They are, however, considerably more expensive than bulbs.



 Checker Marking. Checkers are often a good
idea because people equate a checker pattern on a
US or Canadian vehicle with a taxi/livery for-hire
vehicle. For “Checkers”, go to our website,
for several choices
and styles. We have checker printed tape, and
"checkers only" a product which goes directly
on the side of the vehicle and uses the car's own
color as one color in the pattern, Check our website.

  Inspections/Licenses/Medallions: In most areas, you cannot simply outfit a car and
start taking fares. There is often a regulating body at the city or county level, or perhaps
the local police department or sheriff’s department. These are the folks who must inspect
the vehicle, licensing of the car and owner, check for a local business license, insurance
certificates, and the general condition of the service to be provided. There may also
be state-wide regulations regarding non-competition challenges, such as found in New
Mexico. You are best advised to call the local government, look in the yellow pages
for county or state offices. Check on codes, licenses and related regulations. Do your
homework in your locale. The time you spend will make you legal, and even advertise
that you are going to be providing this service. You may find the officials will recommend
you in future if you start out properly. There is also a system in many larger cities called
the “medallion system”. There is a limit on the number of cabs authorized in such an area,
and each operator is assigned a number and a medallion. This is the authorization to
operate, and it becomes a valuable asset to your business when you decide to sell out.
The car may have been wrecked, the drivers may have quit, the insurance may have
been canceled, BUT your medallion can be sold to a new operator for hundreds, perhaps
thousands or tens of thousands of dollars! In some major cities it is not unusual to pay
over 80- or 90-thousand dollars just for the medallion! The advantage of this system is
the limitation on the number of competitors, and the quality of their services. And, as I said,
it creates value for your business.

 Calibration and Seals. National regulations and most state (provincial) and county
(parish) governments require the meter installation be checked by a licensed “weights
and measures” officer before operation. Your responsibility is to install (or have installed)
your meter and toplight, and then have it certified by Weights and Measures before you
take a fare. They will likely install a lead-wire (or newer plastic serialized) seal on the meter
to prevent changes from being made after the inspection. Some situations require two
seals on the meter. Once your meter is sealed, DO NOT cut the seal unless you have
permission from the sealing agency. Seals might need cut in order to change rates,
recalibrate the meter after transmission or wheel work, or to move the meter to a different
vehicle. Fines or operating restrictions imposed may result. Call and get the OK first!

 Extra drivers. You will either set time limits for the services you offer, (perhaps
7:00 A.M. to 8:30 P.M. Monday through Saturday) OR you will need to have a “night
driver” who can answer calls when you sleep. (Regardless of what you may have heard,
taxi drivers DO need to sleep on occasion.) The phone will ring at 4:40 A.M.. A
dependable, honest, courteous operator answering the call, and responding promptly,
will be of infinite value to your business.

 Once you are legal, (shined, showered and shaved we said back in the military)
marketing is of utmost importance. See our website or our handout on “Making Money
in the Taxi Industry
.” It has made money for a lot of people. It’s free, too! On the website
click on “Making Money
!” top of the last column. Keep a trip
log, a maintenance log and good records about your car, your drivers and your entire
business. There are several free forms on our website, see “Free Stuff” in the last column.

 Later on, (or maybe immediately if required by local ordinances,) you may want to
consider such items as taxi camera /DVR systems, back-up alarms, receipt-printing
taxi meters and credit card verification systems. We can help with all of these. Call
760-345-4347 or go to on the web. We'll meet you there!

At we stand ready to help
with quality modern equipment, installation instructions
and meter programming information, helpful tips and
free forms and record keeping ideas. Best of luck
as a new, progressive Hospitality-Transportation
Professional !
. . -Fred and Barbara Stock, co-owners,

Phone us: 760-345-4347 or e-mail:

rev. 7/20/2013 cab P2030