A golf cart rental business could be an excellent choice for your next small business idea. These businesses can be highly profitable if you’re situated in a good location and run your operation right. With a good golf cart rental business plan in place, you could see your new venture become very profitable very quickly.
How Does a Golf Cart Rental Business Work?
You might think that golf carts are strictly the domain of golf courses, but that couldn’t be further from the truth. Your golf cart rental business ideas aren’t restricted to the sport itself at all. Golf carts are one of the most popular options for transportation in a wide variety of locations.
When figuring out how to start a golf cart rental business, one thing to keep in mind is that you need customers. Your primary revenue will be from renting out golf carts to drivers. In almost every case, those drivers are going to be tourists.
Golf cart rental businesses are predominantly found in areas with high tourist traffic. Most tourist areas will have the necessary density of attractions as well as pathways, boardwalks, and other routes that are perfect for golf carts.
The location is the primary factor in determining “how much does a golf cart rental business make?” If you have a steady stream of tourists and visitors renting your golf carts to enjoy local attractions and scenery, then this could be the perfect rental business idea for you.
What Is a Golf Cart Rental Company’s Business Model?
When it comes down to how to run a golf cart rental business, you need to understand how the business model works. That means you’ll have to understand what your revenue streams and costs will be.
In terms of costs to get started, you’re going to have to buy some golf carts. These can vary widely in price depending on the brand, style, features, and whether you buy new or used.
The other primary consideration is going to be where you keep your carts. You’re going to have to buy or rent property to store your carts and serve as your place of business. Identifying a suitable location will be one of the most considerable challenges because prime locations are expensive.
Your primary source of revenue will be rentals. Most golf cart rental businesses will charge by the hour, half-day, or day. To determine your golf cart rental profitability, you’ll have to weigh this revenue against all of your costs. Some golf cart rental businesses will also offer beverages and snacks.
What Are the Costs of Running a Golf Cart Rental Business?
In addition to the golf cart rental business start-up costs, you’ll also have various ongoing costs that can affect your golf cart rental business model. Understanding all of these costs is essential before committing to your rental business idea.
Maintenance is likely to be a considerable cost for your business. Like any vehicle, golf carts require regular maintenance to stay in working condition. You’ll have both recurring maintenance costs and unexpected maintenance costs when you have to replace broken parts. Customers will expect your carts to be clean and operational.
Your golf cart rental business should also invest in a tracking solution. You need to know where your carts are at any time to prevent theft. GPS tracking is the standard, with various solutions available on the market.
Replacing carts as needed is another significant cost. Eventually, every golf cart reaches a point where it needs to be replaced. Ignoring this cost in your business plan will eliminate any chance of profitability.
In addition to these specific costs, you’ll have the regular expenses of any business. If your business is more than just yourself, you’ll have to pay wages. Your golf cart rental business will need vehicle liability insurance. There will be taxes, utilities, accounting fees, and the costs for any other services or solutions you need.
How Can My Golf Cart Rental Business Reach Customers?
If you’re wondering how to grow a golf cart rental business, you can take advantage of plenty of unique opportunities. For example, if your business is in a tourist location, some effective tools can be traditional brochures and posters.
Hotels and other establishments encourage local attractions to provide brochures for their lobbies to attract tourists. You can also reach out to tourist spots themselves to promote your golf cart rentals. Any business that might receive more traffic if tourists can get around more quickly will be happy to help you.
Of course, there’s no getting around web marketing today. You’ll need a website that’s optimized and easy to find. It’s in your best interests to come up first whenever someone searches for transportation options in your area. Your website can also let customers make reservations directly online.
What Are Some KPIs I Can Use to Understand How Well My Golf Cart Rental Business Performs?
Are golf cart rentals a profitable business? While they often can be, you need a way to know how well your business, in particular, is performing. To do so, you can use some common rental business key performance indicators (KPIs) to evaluate your business.
This metric measures the hours your carts are rented out against the hours they’re available. You can use it to identify your strongest and weakest inventory items.
Customer Acquisition Cost
This data measures how much you pay in marketing to acquire customers. Comparing the cost for different referral methods can guide your marketing strategy.
Return On Investment
This figure represents the total revenue from a cart compared to its purchase and maintenance costs. It shows the lifetime profitability for your various golf cart options.
Of course, there are many more metrics that you can use to gauge how well your business is doing. By applying a wide variety of KPIs, you can get the best picture of your business.
The Importance of Reservation and Inventory Management
Every rental business needs a way to take reservations and manage its inventory. You can make running your golf cart rental business that much easier with Quipli, an integrated reservation and inventory system that automates the entire process and provides additional tools. Contact Quipli today to find out more.