Car rental: is it advantageous or not?

Car rental is becoming increasingly popular not only with tourists but also among the local population. Renting a vehicle eliminates the need to acquire, maintain and service a car. The growth of the car-sharing industry has been positively influenced by the increasing tourist flow, shifting mobility of the population and the growth of business travel.

In today’s highly competitive market, companies must seek new approaches to attracting and retaining customers. It is worth examining in detail the profitability of engaging in the car rental business in current conditions.

Car rental

Overview of the car rental industry

Car rental is a way to get where you need to go in a timely manner and at a reasonable cost. It is a popular choice for travel, business trips, or occasions when your own vehicle is being repaired, as you can rent a car for a short or extended period of time. Renting a car allows you to easily travel wherever you need to go, without relying on public transport or having to call a taxi.

The major car rental companies in the industry have a competitive advantage over smaller firms due to their strategic alliances with airlines and hotels. This provides them with a steady influx of customers using their services.

The global car rental market is divided into three segments: intra-city, intercity, and airport. The “airport” model is the most profitable segment, accounting for nearly half of the total market in recent years, and is expected to remain the most dominant.

Small car rental companies can compete with others on a regional or local level, but they cannot compete with large companies. Smaller businesses should aim to earn the trust of local customers and companies, and collaborate with medium and large car rental providers.

Risks faced by car owners when renting a car

All businesses face risks, and car rental companies are no exception. The car rental industry is particularly vulnerable to fraud, unscrupulous customers, and other challenging situations.

One of the most significant risks in car hire is the theft, damage, or total loss of the vehicle. Business owners should obtain full insurance cover for their vehicles in order to mitigate financial loss. Additionally, there is a high risk of falling victim to fraudulent individuals who may hire a car for use in various scams or other illegal activities. Therefore, it is crucial to draw up a contract in advance that includes passport details, phone number, address, as well as the characteristics and condition of the leased vehicle.

Business owners should consider using dedicated car hire and rental software to monitor the mileage and location of the vehicle. In addition, there are programmes that can provide reminders for technical inspections.

A few tips for running a business

For those considering entering the car rental industry, here are some tips to help you avoid the most common mistakes:

  • Car Insurance. It is important to be aware that there are various situations that can occur on the road, and it is advisable to have insurance coverage for such situations. Opt for comprehensive insurance to guarantee that repairs will be covered in the event of an accident. Additionally, it is recommended to stipulate that the car will be operated by more than one driver, so that there are no disputes.
  • Install a location tracker on the vehicle. Business owners must always be aware of the vehicle’s location.
  • Implement software to optimise operations. A CRM system will not only automate certain work processes, but also provide customers with a personalised approach.
  • It is crucial to establish the car’s location during unbooked time. Designate a suitable spot for the vehicle to idle between orders.
  • Developing a business plan. For successful operations, it is necessary to understand your objectives and structure a plan to fulfil them.
  • Advertising. It is vital to recognise that every business needs to be advertised. Developing a marketing strategy can help attract new customers and increase brand recognition.
  • Setting a maximum mileage per day. In many cases, cars are rented for use as taxis, which can significantly impact their condition. Therefore, it is essential to monitor the mileage of rented vehicles.

Businesses always carry risks, and therefore it is necessary to identify potential obstacles and look for ways to overcome them. 

Manage your business with RentSyst

In a competitive market, it is crucial to provide customers with personalised service and offers and to meet all their needs promptly. Owners often struggle to reconcile how to provide all of the above to their customers, as they have to manage services, equipment and customers, as well as a number of tasks related to overdue payments, machinery and communication between staff. Car rental software can facilitate and optimise business management.

RentSyst is a software that helps manage operations and optimise a company’s business procedures. With RentSyst, businesses can automate workflows and eliminate headaches. The interface of RentSyst car rental software displays detailed information for each booking and includes a calendar for easy reference. The online software contains all the relevant data for each vehicle, as well as reviews and customer ratings. 

It is worth noting that RentSyst’s car hire solutions make it easier to manage outgoing and incoming accounting and forecast future revenue. This will enable the company to scale and grow. 


Owning a car is no longer a luxury, but a necessity. It provides mobility and enables efficient completion of daily tasks. However, not everyone can afford to purchase a car outright or even with a loan. Additionally, some individuals with sufficient income choose not to own a car due to the financial and time commitments required for maintenance.

The demanding nature of the car market has become a catalyst for the development of the vehicle rental business. The vehicle rental market is becoming increasingly saturated. Although there are risks involved and attracting new clients can be challenging, the growing demand for rental services presents opportunities for business development. Therefore, vehicle rental is a lucrative entrepreneurial activity.


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