What you need to know before starting an UBER business in Nigeria
Many Nigerians especially those in the corporate world, relish the idea of multiple streams of income. Beyond the relish, there is sometimes the compulsion placed on income earners to find alternative means of meeting the growing financial demands of their families. It is this need that has made many consider the idea of e-hailing services, the likes of UBER and Taxify (now bolt).
What many however fail to drag into consideration when buying the car meant for UBER is what we hope to highlight through this piece. Whether these business models are viable alternatives or simply a comfortable way to engage in rat races, is not what this article seeks to address.
Below are a few things you must know about these celebrated versions of intra-city transportation, from our automotive standpoint.
You Are Not the Rider (Client): One of the pitfalls many aspiriring UBER/Taxify partners fall into is the assumption that they (and those in their socio-economic class) are the riders these taxis will be picking up. They would rather not put on the road, the kind of car they will never be seen in. So they go out shopping for a car with their personal taste as the determinant of what they get. You find cars that are super-clean mid-sized luxuries, making their way into UBER X- the lower end of the UBER classification. While that is a nice thing (to ride in), it also means that the cost of procurement becomes a steep sum to recover and where others would have cashed out in 12months, they might need at least 24months before they begin thinking of profit. For such a business, with the options available on smart ROIs, 24months is quit a wait. If you spend N2.5m to buy this car, and you make (without fail) N35,000 every week, you will need, approximately 18months to breakeven, assuming that all is well with your car, your driver and the policemen who occasional stop them for routine security checks.
A Big Engine Can Mean Big Trouble: The law with most engines is simple: “to whom much is given, much is expected”. The size of your engine determines quite naturally, the amount of fuel it uses up. If you have a 6cylinder (say 3.0L) engine on one of these taxi platforms, you would struggle with fuel efficiency in comparison to a 4cylinder (say 1.6L) engine. Your most recurrent expenditure in this business is fuel spent, so you would agree that standing guard at your fuel tank would pay you a lot in the long run. While, the bigger engines offer great pleasure when driving, you must know by now that it’s hazardous to mix business and pleasure.
Nobody Said They Must Be New or Tokunbo Cars: What you owe UBER with respect to the quality of your car is that it should be in a decent condition, neat exterior, interior and be reliable in performance. This nudges many to believe that the car must be Tokunbo or even brand new so they have absolutely no issues when they take it for inspection and even during its duration of use. Now, that is great! We recommend that. However, the cost of most of these toks would again become an enduring marathon to recover. Finding a sensibly used Nigerian-used car is a more profit-viable option because your entry cost is lowered and your exit period per car is shortened. We understand the scare that accompanies the purchase of used cars, that is why we at www.mynaijacars.com are here to help. But then, if you love marathons, we can’t possible discourage you.
Plan to Take Care of Your Car: While most car owners on UBER/Taxify seem very concerned about the neatness of the interior, the health of the engine and even vitality of the suspension is not prioritized. Engines will go any distance as long as they are empowered to. Due to mileage accrued with the use of these cars on the e-taxi platforms, regular maintenance, especially of the engines is required. You can’t afford to do your maintenance every 3-6months when you are grossing 5,000-6000km every fortnight. You are gradually assassinating that engine and you know murder is a crime. Pray you are not repaid by 10pm, on 3rd Mainland bridge by same car. If you need a maintenance schedule for your vehicle, talk to us at www.mynaijacars.com. It pays to look meticulously after your car, it will pay you back with peace of mind.
While the content of this article was skewed more towards those who use these businesses as an alternate stream of income, there is also much contained herein for the car owner who wants to drive himself on these platforms and for whom this is the only source of income. For such an individual, the points captured above must mean more. If for some reason, the message got lost in transit, do not forget that what you need most when searching for a car to place on UBER is a good car that allows a comparatively low entry cost.
When UBER was launched, as a company that sells used cars, we were approached my quite a number of prospects who want
