• Dec 17, 2024 12:00
• Proffesional Transportation
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Sedan And Taxi Business Model Differences

Both Sedan Service and Taxi Service are engaged in serving the public, are available 24/7, serve as means of passenger ground transportation. One might assume that there are no differences between the two. Is it truly so ? Let’s have a closer look at it.

Registration and Licensing

Most of the actual cities have a certain licensing in place governing vehicles for hire. Some cities employ more stringent governing systems, where vehicles for hire are exposed to a stricter control, which leads to their better operation. To balance the supply and demand, and improve the quality of the service, some cities employ a closed system, where only a certain amount of vehicles for hire can operate. Other cities employ a more open system, where there is a multitude of operators, no limit imposed upon how many can be registered.

These measures are designed to safeguard their citizen from an unlicensed, inappropriate service provider. At the same time to offer a clear, definite operational framework for service providers, sustaining a fair competitive ground.

Sedan Service and Taxi Service, being registered as public vehicles are subject to a slightly different licensing and operational rules .

One clearly visible difference is the decals and labels on the vehicles. While it is clearly visible on the Taxis, Sedans do not have any decals to be visible from afar, making it a more reserved transportation option. Another visible difference is the method of calculating the cost of transportation. Taxis do have meters, which are being used to calculate the cost of the fare while engaged. Sometimes, upon request a fixed price would be quoted for a certain itinerary, but not guaranteed. Sedans are priced by the hourly rate, or by the distance to be travelled according to the presented itinerary, the total being quoted at the time of the reservation and always guaranteed.

Another difference is the way they operate. Taxi would seldom have an organized, planned schedule, being requested at short notice or hailed on the streets. Taxi drivers are not aware of where their next pick up location will be, who will be the passenger, where the passenger will be going and how long will be the ride. Sedan Service is a pre-arranged transportation service, they are not available for a street hail and they can not be seen parked in a public location or to be available on request. This makes them able to plan and organize their daily schedule, gives the driver more time between the rides, time which is being used to keep the vehicle in cleaner condition, and have less pressure on the driver’s mind, ending in a different approach to the task at hand and a better experience for the passenger.

Vehicle Insurance

It is mandatory in most cities to carry a certain amount of insurance to operate a vehicle. Since they are most of the time on the roads, vehicles for hire must carry commercial insurance, which provides higher amounts of coverage and covers greater risks. Being different in the way they operate, Sedans and Taxis carry different insurance coverage.

Taxis are exposed to higher risks as are all the time on the road, are used by many people every day, have an uncertain element to the way they operate, determining a higher insurance premium. Due to the last minute, short notice requests for transportation it does not cover liability for mismanaged passenger’s time as a result of being late for the pick up, arriving late due to traffic, or not showing up at all.

Sedan Service is different in the way of handling their business. The service is being guaranteed to be on time. They are held liable for their client’s loses if they are the reason of the loss to happen. This requires a different insurance coverage, which serves the passenger.

Reservations and Cost of Transportation

Bookings, reservations or requests for transportation are being received by both, Taxi Service and Sedan Service Companies 24/7. Modern, advanced technology creates software programs, specially crafted to improve the booking experience, making it fast and easy.

Both Taxi Service and Sedan Service can be booked in advance, although the service is guaranteed primarily by Sedan Service Providers. They do take their clients seriously and are always punctual. Their business model is created on repeated requests from their clients, being convenient and satisfactory to them.

The cost of the service between a Taxi and a Sedan does not differ much. The way their internal financial systems are designed differ.

Taxis would have a set, weekly rate, which drivers would be paying to the company for the vehicle, insurance, dispatching and office costs, the difference being in whether the vehicle cost is included or it separately belongs to the driver. This plus the fuel would be their overhead.

Sedan Service Providers would generally have the ownership of the vehicles being used and employ the drivers, having them fully concentrate on the driving and catering to their clients. Or they would outsource their business to other companies or driver owners, who would be representing their company and their clients’ best interests. In both situations driver’s focus is on the passenger and their need to be assisted as good as possible.

Market Segmentation

Various needs of the public created different services accessible to them, each holding a specific share of the marked according to their ability to meet the demand.

Taxi Service holds a larger share of the passenger ground transportation industry market than Sedan Service. More requests are being made for short rides, which employ more Taxis. Sedans are being used for specific transportation needs, which require a longer commute or a longer amount of time to be used. Since it is an upscale, safe, reliable, comfortable, well organized transportation option it’s market share is constantly growing.

Conclusion

Accessible 24/7, available and ready to go, Taxi and Sedan Service are good options to be used when needed. Being different in their purpose and employing different business models, they offer different experiences to their passengers and are used in different situations. Knowledge of their business models allows a person to make a more informed choice of when to choose Taxi Service and when to choose Sedan Service, and sparks a touch of light over what to be expected out of the experience.