Challenges in On-Demand Taxi Booking Business

Businesses are vulnerable to a lot of challenges. On-demand app-based taxi booking business alone is not immune to it. We can see many conventional taxi firms moving towards the on-demand model in the hope of running their business sustainable in the long run. Little do they know that this market is fiercely competitive and being unique by tackling the challenges only can make them sustainable and successful.

Market leaders like Uber and Lyft are successful because they do things that 99% of taxi startups don’t do. Obviously, that is why they are above everyone. I am writing this for small entrepreneurs who run an on-demand taxi booking business and also those who are keen to enter this market.

I have listed some four common challenges in app-based taxi booking business that if sorted carefully can place you unique. 

Reliability and trust among customers

Not until 3-4 years back, people used paper money for all transactions and that they believe it to be safe and trustworthy. Not to mention that the same people quickly moved to digital payments because of some inevitability. At the same time, people’s trust in digital payments which is predominantly used in taxi booking has taken a hit. Various cyber money extortions are a testimony to that. 

So, allowing cash payments along with digital payments can make your service more credible and trustworthy. Market this feature to a wide range of people to quickly build a solid relationship with the users. 

The payment system has a strong relation with the diversity and demographics of the region of operation. For example, taxi users in Asia between the age group of 25-35 prefer digital payments and people over 35 use cash payments. The digital payments can be further divided into various options. Do market research on this before deciding what to offer.

Get Free Demo of Taxi Booking App – WhatsApp | Skype

Competition from peers

Earlier I said about the competition in the app-based taxi business and this itself is a big challenge. The road to sustainability starts with facing this challenge. The first step to outperform them is to follow the Walmart model. Retail giant Walmart first entered the market which was neglected or overlooked by others. For example, they made their presence in even small towns and villages. Before entering a big city, Walmart was already a big firm. So, target the markets overlooked or unexplored by others and gain a stronghold before moving on. 

The second step is to observe and analyze larger competitions. Replicating some of their methods will not amount to any mistake. That large company would have been a novice sometimes back. So, they too must have made mistakes and corrected them. You can learn from them. Apart from it, you can apply any innovative method to face the adversaries.

Inexperienced drivers

Bonus, incentives, and commissions are always the point of problem for drivers in on-demand taxi firms. Large scale protests by the drivers have taken place in many cities against Uber and Lyft over various issues. Because of this, getting a qualified and experienced driver with an impeccable background is a big problem now. 

The direct effect of employing bad drivers is experienced by the riders. Issues of many accidents and harassment in taxis are common nowadays. It is up to you to handpick good drivers by providing better incentives and work environment.

Comply with local labor laws and follow some employee benefits to establish a more friendly relationship to retain skilled drivers.     

Quality taxi app solution

A robust taxi app solution is something underrated and sometimes overlooked by the on-demand taxi owners. A reliable and quality app solution can do half of the work. In a taxi solution, you can seamlessly apply any innovative features with very less cost. For example, Uber introduced carpooling, and split fare feature by making changes only in the app. These features instantly became a hit. Doing this is possible only in certain app solutions.

The solution provider for the app is very important in making a quality app solution. Each of them including the driver app, customer app, admin panel should have the same flexibility to alter when required. 

SpotnRides is a taxi app solution which is made with top coding standards.  This solution is so flexible that even the latest tech advancements can be applied to the app without any distortion in the app quality.

If you are already running a taxi booking firm you can partner with us to apply the latest features and advancements to your app. Newbies who are just about to enter this business can join with us to launch your startup with sure shot success.

Our solution is used by various clients in more than 10+ countries and their success is a testimony to our service. Since what we have is a pre-built solution you don’t have to worry about the cost and customization. 

You can email and also call us to know about SpotnRides. We are here to resolve whatever questions regarding our work, process, and app development. 

Get Free Demo of Taxi Booking App  – WhatsApp | Skype

About the author


I am working as a Senior product developer and have developed and delivered Web and Mobile products for numerous clients.

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