This is a guide on how to start a taxi business in South Africa.
Minibus taxis are very important, they transport the majority of the country to work, schools and towns. The taxi industry is the backbone of South African transport system. This is a very lucrative industry estimated to be worth over R50 billion.
The minibus taxi industry is largely unregulated and conducts operations in a somewhat informal way. Taxi owners make a lot of profit, especially people that own multiple taxis.
Here is what you need to do to start a taxi business in South Africa.
1. A minibus taxi
You can’t get started in the taxi business without a taxi. The first thing you will need is an actual taxi, everything else is easier from that point. The Toyota Quantum that is usually used for transporting commuters ranges from 450 000 (ses’fikile) to 583 000.
2. Financing
A lot of people don’t have the funds to buy a taxi, the best way to go around this is fundraising. There are a lot of routes that you can take to get your taxi financed. You can get financing from Sa Taxi. SA TAXI is a financial services provider that solely focuses on the taxi industry.
3. Registration and licenses
You will need to register your taxi business for R175 through the CIPC. Taxi drivers are required to have a valid driver’s license and a professional driving permit. The PDP allows to transport members of the public.
You can also join organisations like SANTACO. The South African National Taxi council is the biggest representative of the minibus taxi industry.
The next important certificate to have is a route license, according to Student Brands, “The taxi association will upload the driver and vehicle details on a database, which will then in turn show if the route is profitable or not. If there are too many taxis on the same route, then the likelihood of the driver making a profit will be reduced.”
4. Hire drivers
Your drivers should have a valid driver’s license and a professional driving permit. There are mainly two ways which you can use to pay your driver, you can pay them a fixed salary or you can tell them to give you a certain amount per day and take the rest for themselves.
Insurance
The Toyota Hiace is one of the most stolen vehicles in South Africa. Thousands of them are stolen each year. You will need to have insurance in case something bad happens to your vehicle.
Conclusion
This was a guide on how to start a taxi business in South Africa. Do you have any thoughts or questions? Comment below.
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Dinah
8 Jun 2021Thanks for the advice on how to start a taxi business in South Africa. I would like to know if there is a way that I can get finance to acquire a taxi since I have a taxi that was repossed and am still paying the short fall but I want to go back to the business.
sibabalwe
8 Jun 2021Yes, there are companies that give people financing to acquire a taxi. One I can easily think of is SA TAXI, you can find them by doing a Google search.
Cebo
5 Apr 2022I think taxi industry doesn’t pay SARS.
This industry is not professional.so I want to start something based that industry that will be professional and follow all the government protocol