How many cars do you need to start a car rental company?

start a car rental company

Have you been wanting to step into the automobile industry and start a car rental company? A major and the main portion of your investment in a car rental company is how much you spend on purchasing the fleet of cars. Planning your business, your finances, investment in the business and your business strategy moving forward, will help you know the minimum number of cars that are needed to start a car rental company.


Your business plan will matter – Small scale or large scale?

Planning your business will help you determine how much money is needed for investment. Depending on your business plan and investment in hand, plan your risk vs reward in the industry you are choosing. In car rental business there are plenty of ways to handle operations. You can either choose to hire the cars on contract or purchase a fleet for yourself. Minimum of 3-5 cars is a good starting point for a small-scale car rental company.


Your market research will matter

Identify where your competitors are located. It is important to choose what people want in the specific area you choose to locate. If your budget does not cater to the needs of the people in a specific area or if you feel your competitors have an upper hand in that specific locality, you may consider locating elsewhere. Here’s all you need to know when starting a car rental business.


Your capital investment strategy

Utilizing your money wisely is important when starting a car rental business. You cannot afford to make an expensive mistake. Rental car companies generally choose the repurchase or depreciation programs with the vehicle manufacturers. The manufacturers agree to repurchase the vehicles at a specific time or price in the future, subjected and agreed to certain conditions. Rental car companies also have the option of selling used vehicles to whole sellers.

The choice and methods of buying the vehicles is up to the owner of the business. Be it a fleet of new or second-hand cars, you can always manage your fleet with fleet management software, which will guide you and help you maintain the longtivity of every vehicle your business owns. To learn more about fleet management software, read here.


Fleet Size and legal proceedings

Be sure to obtain all licenses and necessary permits for your fleet. Failure to do so might lead to complicated consequences of penalties and fines. Every geo location and states have specific local registrations and licensing that must be followed. Hiring a business attorney will help you protect your business against any legal issues. Obtaining a comprehensive fleet insurance is also beneficial. It will protect your business in case if you face a financial loss. With fleet insurance, your fleet of cars is protected against any physical damage and the best part is that there’s no set number of cars your business needs to qualify for fleet insurance.


In conclusion, in the initial stages of your business, your fleet does not need to be large. Having just 3-5 cars; in which 1 or 2 are luxury vehicles and the others being economic cars, it can be a good head-start for your new venture. A well-maintained fleet of cars gives you profit in return. You can build your fleet according to the demand in the market. If you are willing to expand your business, you can make the smart choice of reinvesting your return on investment on new cars.


At RENTALL we’re on a mission to be the SaaS solution of choice for rental operators looking for growth and stability in a disruptive sector.

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    "Our minimum fleet size required to implement RENTALL is 10 vehicles. However, we do make exceptions in certain cases, such as expected growth in the next 12 months, or other factors in your operation. To discuss your business and see how RENTALL can work for you, please contact and a member of our sales team will reach out to you."