We recently interviewed Olacabs, a Mumbai based online car rental service and here is another interesting Bangalore based startup, TaxiGuide.in that offers online car rental service across 75 cities.
The Business Model of TaxiGuide
TaxiGuide’s business model consists of tying up with reputed and experienced car rental operators across cities who carry a range of vehicles and charging a commission from these operators for every confirmed customer booking forwarded to them. Customers either book online or call TaxiGuide for their reservations. Customers have the flexibility and option of choosing from multiple operators and price points.
The company offers range of vehicles (From Indica to BMW/Mercedes) and wants to be the one stop shop for car rental and taxi services across India (for both corporate and retail customers).
Here is an interview with TaxiGuide team on their business model/industry margins
a. How are you managing the offline process? Isn’t that very intensive (building relationships/managing the whole flow)?
Answer- Building relationships with vendors, travel agents and other distribution channels is intensive and one must be prepared for the long haul to do the same on the ground. Offline and online advertising helps generate interest. The fact is that this industry is highly fragmented and has many decent sized operators (running into hundreds/thousands) across India. The only way of aggregating this fragmented industry is a rigorous “one on one” relationship building mode with the owners of these businesses.
The work flow is operationally intensive since we also ensure fulfillment meaning we do not merely connect vendors and customers.After 7 months in this business, we have a firm understanding of where things can go wrong and what processes need to be in place to mitigate the risks. Over a period of time, once the vendors are linked online and a dynamic inventory platform is built, order fulfillment can be automated and the process will be completely online. However, customer support will need to oversee this and ensure that there are no glitches.
b. From an industry perspective, what’s the margin in this business?
Answer – It may average out to 10%. Margin varies across car and vendor type.There is a possibility of standardizing pricing over a period of time. However, the fragmented nature of today’s industry ensures multiple price points to exist for the same vehicle type.
c. Share a bit about Founding team/and their work experience prior to starting taxiguide.
Answer: -We are first generation entrepreneurs with some start up and some large company exposure.
Ashok Ananthakrishnan (BE- Mech, PGDBA and CFA) has an experience of over 11 years at S.B.Billimoria and Co, Vertebrand Management Consulting, ICICI Bank and DBS Bank prior to co-founding taxiguide in Jan 2010.
Built a portfolio in the Mid-Corporate and SME space for DBS Bank and ICICI Bank respectively (from scratch between 2005 to 2009). At ICICI Bank, Ashok was the regional head – ECG Group, SME division, Karnataka. At DBS Bank Ltd he spearheaded their mid corporate business acquisition division in Bangalore. Ashok’s first brush with entrepreneurship was as the Cofounder of Vertebrand Management Consulting (1999 to 2005) where he was responsible for business development, managing consulting assignments across the country, recruitment. Ashok has prior experience withS.B.Billimoria & Co (MGMT Consulting) & Kirloskar Electric Company (post engineering).
Subash Bidare (B.Com, PGDBA) has over 12 years of experience at Quality Research Group, Vertebrand Management Consulting, MTI Consulting and Kaati Zone prior to co -founding taxiguide.in. Subash’s last assignment was as Head of Marketing – Kaati Zone – (2008 to 2010). Prior to this he set up & developed India operations for MTI Consulting as Director & Country Manager (2005 to 2008). Subash was also a key member of Vertebrand Management Consulting (2000 to 2005). He founded QRG, a market research firm out of B School (1998 to 2000)
d. Can you share a few key data, and a mix of how much of within-city vs. outside city travels have people taken using this service?
Answer: -We have a 50% inside city and 50% outside city mix.
Do give Taxiguide a spin and share your feedback with the team.