Project proposal for Car Hire

1. INTERNATIONAL INSTITUTE OF PLANNING & MANAGEMENT
A business plan on carvenience:
Car rental firm
SUBMITTED TO
PROFF. HARSHA
Submitted By
RAHUL GUPTA
VARUN GOTI
TARUN.C

2. Contents
1.0 Concept testing
2.0 Executive Summary
2.1 Objectives
2.2 Mission
2.3 Keys to Success
2.4 Vision
2.5 Company Summary
2.5.1 Company Ownership
2.5.2 Start-Up Plan
2.5.3 Company Locations and Facilities
3.0 Services
3.1 service Description
3.2 Sales Literature
3.3 Future services
4.0 Market Planning
4.1 Current Market Situation
4.2 SWOT Analysis
4.3 Objectives
4.4 Market Trends & Growth
4.5 Market Needs
4.6 Market Strategy
4.6.1 Target Market
4.6.2 Positioning
4.6.3 Location
4.6.4 Market Communication
4.6.5 Market Research & Development
4.6.6 Sales forecast
4.7 Market Programs

3. 5.0 Management Summary
6.1 Organizational Structure
6.2 Personnel Plan
7.0 Financial Plan
7.1 Important Assumptions
7.2 Key Financial Indicators
7.3
7.4 Projected Profit and Loss
7.5
7.6 Projected Balance Sheet
7.7 Business Ratios
7.8 Long-Term PLAN

4. Questionnaire for Concept Testing
1. Do you hire vehicles for all levels of executives?
2. While hiring cars what would you give priority to cost or comforts
(quality service)?
3. How frequently you rent a car
 Occasionally
 Frequently
4. How do you decide from whom to rent a car?
5. Which mode of payment you prefer?
 Cash
 Credit
6. Which class of cars do you prefer to hire?
7. Do you hire cars only for local use or even for long distance?
8. Are you satisfied by the services provided by your current hirer? If
yes, why? And if not why?
9. Do you prefer to hire Air-conditioned cars or non Air-conditioned
cars?
10.For what purpose you rent a car

5. Test Results
In this survey we visited various corporate houses in Bandra Kurla Comlex
like Workhardt, ICICI Bank, Bank Of Baroda,etc. In Andheri we visited
Proctor & Gamble, Glaxo India an many companies in Seepz.
The outcome o the survey was positive for us. We found that there is a
demand in corporate circle for hiring cars. They usually don’t prefer to have
their own cars for all the executives. Instead they hire cars as that is more
economical for them.
We even found out the choice of cars, which they prefer to hire, which gave
us an idea of the composition of cars we should have. The corporate give
more importance to quality service than cost but the cost should be
according to the market rate.
They don’t mind trying a new rental agency if the service offered is better
than the current service provider.
Based on the test results we conclude that starting a car rental agency is a
feasible idea and could lead to a successful business.

6. Executive Summary
Carvenience Provides Corporate Clients with A+ Service!
No matter where your business takes you, the agencies of Carvenience will
be there to take care of all of your needs! Carvenience welcomes all
corporate clients with excellent rates, superb quality, and service you can
count on each and every visit. Whenever you need a compact car for a
quick day of efficient business traveling, the car rentals from Carvenience
are sure to provide an excellent drive during your corporate stay! We aim
to take care of corporate clients to make their business trip as smooth and
as enjoyable as possible.
Corporate Clients
By definition, Carvenience believes that corporate clients are those drivers
whose car rental is meant for the purpose of business needs or used during
a period of corporate travel. This means that if you are traveling to a
destination on business and require a rental car to drive when you get
there, if you are staying in your hometown but need a car rental for
corporate needs during the day, or if you are booking car rentals for visiting
clients or employees, Carvenience considers its customers as corporate
client! If business is involved, whether it be for thier private company or for
a large national firm, we can combine the Carvenience expertise and
guarantee to complement thier corporate driving needs.
We know the specific needs of corporate drivers and what they want - a
quality car rental, fast and efficient service, friendly staff, and special
corporate rates.

7. Objective
 To provide friendly and reliable customer service in order to establish a
loyal customer base.
 To make the customer aware that hiring a car is the next best option to
buy a car.
 To effectively promote our service to a wide range of corporates.
Mission
A value driven customer experience that defines the character of the
company through friendly experience, outstanding service and excellent
value.
Keys to Success
 Optimum utilization of resources
 Customer satisfaction
 Controlling costs
Vision
Our vision is to be a nationwide market share leader in each of the
markets we serve.
We will try to attain this vision by providing our customers cost effective
and quality service. We will add value to these services by providing
legendary customer service through our uncompromising commitment to
customer satisfaction.

8. Company Summary
Company Ownership
Carvenience is a partnership firm owned by seven partners with each
pulling in Rs 3500000 and one pulling in Rs 4000000 as our initial
capital.
Start-Up Plan
The following are the expenses incurred by Carvenience.
Expenses
 Printing & stationery
 Cars on lease
 Fuel
 Rent
 Parking charges
 Salary to staff
 Salary to salesmen
 Telephone charges ( incl mobile to chauffeurs)
 Electricity charges
 Salary to attendant
 Miscellaneous expenses
 Refreshments
Assets
 Air conditioners
 Computers
 Furniture and fittings
 Office premises

9. Company Locations and Facilities
Carvenience’s office will be located at the high profile area namely
begumpet. The area hired is of 1000 sq feet for which a monthly rent
of Rs. 50000 will be paid, the firm has tied up with 3 garages near
petrol pumps to
 Jublee hills
 secunderabad
 mehandipatnam

10. Services
Service Description
Carvenience provides its customers with a facility of hiring cars round
the clock. It aims to provide its customers a mix of cost and comfort.
Carvenience provides latest cars at competitive prices to meet the
various requirements of its valuable customers. It has hired efficient
chauffeurs to provide quality service to its customers as they come in
direct contact with them.
Sales Literature
Main source of sales literature will be through our sales executives
who will visit the corporates individually. All information pertaining
to the company will be provided to our customers through brochures
and direct mailing. It will provide the customer with detailed
information about the different packages available. In the future as
the company grows, we will be able to advertise in travel & auto
magazines, newspapers, etc.
Future Services
Future services will correlate with the growing demand of a wider
returning client base. Carvenience in its coming future can go in for
collaboration with other travel agencies, hotels and expand its
business and diversify into the sale of second hand cars.

11. Market Planning
Current Market Situation
Industry Analysis
The vehicle rental market can be divided in terms of
 Client type
 Location
 Rental schemes- car hire
Car lease
Self drive
Industry Participants
Multi national companies- hertz international
National companies- autoriders and meeru
Local players- mitra, auto cabs & orange
The car rental companies may wholly be concentrated into car
rental services eg: -ketan travels pvt ltd or may be car rental +
allied business eg- autoriders and aqsa
Allied business such as hotel reservations, airline & railway
ticketing, tour packages etc
The Carvenience Difference
Car rentals from Carvenience can meet your corporate needs in a number of
different ways. Whether you need a single car for one employee or an entire
fleet for a convention group let Carvenience show you the best car rental
experience wherever and whenever you need it. There are many, many ways in
which Carvenience rental cars can make your daily business easier and more
efficient and economical. Consider the following different suggestions on how
Carvenience can serve your corporate needs:

12.  Visiting Employees - No matter where your employees are
traveling on business, can rely on car rentals from Carvenience to get them
there safely and on time! Consider Carvenience rental cars for employees
traveling to other cities and employees traveling to your own city. Give your
employees the A+ treatment they deserve by giving them the opportunity
to enjoy driving freedom and pleasure in a quality car rental.
 Potential Clients - If your business will be entertaining any
potential business clients in the near future, seriously consider an
impressive rental car to get your meeting off to the right start. By offering a
Carvenience car, you can show your potential business clients how
important you believe their business is!
 Local Traveling - Don't worry about having to pay employees
miles for using their own car in-town on business travel, instead, reserve
one of our rental cars and get the best of both worlds! If any of your
employees make daily drives around the region, consider a car rental from
Carvenience to make their driving more enjoyable.
 Convention Groups - Your business can benefit by providing
employees with car rentals during conventions or large meetings! Make
your employees feel appreciated and give them the opportunity to enjoy
our car rentals after the business day has ended!
Factors of Competition
The following factors of competition give carvenience a
competitive edge over the other car rental companies.
Quality:
 Quality of cars-carvenience strives to
consistently offer dependable vehicles. Each

13. car is thoroughly cleaned before every trip so
that customers get a perfect car.
 Quality services-carvenience accords highest
priority to fast and friendly customer service,
safety and comfort. It strives to offer prompt,
personal attention to every client. Our
chauffeurs are trained to attend the clients and
always believe in giving service with a smile.
Punctuality and promptness are the key
qualities of our chauffers. Our chauffeurs are
uniformed, well behaved, equipped with
mobile phone ,well versed with the topography
of the city and understand and speak English,
Hindi and Marathi .The company is open for 24
hours throughout the year.
 Price: Carvenience offers its customers car
rental packages at a competitive price without
compromising on quality or sacrificing
company profits.
 Convenience: All American Express, Visa,
MasterCard ,and BOB card are accepted.
Carvenience makes car renting easy and hassle free
for corporates by opening a Carvenience corporate
account.
Competitive Description
Carvenience has an advantage over other the other car dealers due
to its location, which is at the center of its market. Carvenience also
has round the clock facilities to meet the requirements of the
customer. Carvenience offers 4 categories of cars viz Mercedes,
Lancers, Ford Ikon and Tata Indica to its prospective customers

14. Main Competitors
 Airlines tie up : Hertz has a tie up with jet airways under which jet
airways offers its domestic frequent flyers car hire facility of Hertz .
 All India presence: Companies having all India presence e.g. autoriders
enjoy higher patronage of outstation contracts as in case of car
breakdown, alternate cars can be arranged quickly.
 Allied services providers: Car rental companies providing car hire and
also allied services such as hotel reservation, airline and railway
ticketing and tour planning.
SWOT Analysis
Strengths
1. Quality service in terms of time, cost and comfort
2. Proximity of location near to airports, and other corporate
houses.
3. Organized manner of communication with drivers
4. Niche market, initially only to corporates and hence less
competition
Weaknesses
1. The prices are fixed according to the market conditions
(that is demand and supply)
2. Being a new entrant, it is more difficult to capture the
market share

15. Opportunities
1. Online registration and booking
2. Can cater to corporate in other metropolitan cities
3. Providing new facilities like self drive
4. Can cater to travel agencies, banks, hotels etc. apart from
corporates.
Threats
1. The car rental companies may wholly be concentrated into
car rental services e.g.- ketan travels pvt ltd or may be car
rental + allied business e.g.- autoriders and aqsa
2. Rise in lease charges in the market due to inflation
Objectives
Financial Objectives:
1. To reduce the loses in the first two years (introduction stage).
2. To grow at a profitable rate after the introduction stage i.e. the
growth stage.
Marketing Objectives:
1. To create a brand name in the market.
2. To create awareness among corporates.
3. To increase the sales revenue.
4. To clearly define the target market.

16. Market Trends and Growth
There is an increasing demand of easy facility in traveling especially
in a city like Mumbai. Different firms are coming up in the market to
rent a car. Therefore it is important for Carvenience to differentiate
its services from others to attract a larger number of potential
customers. Bringing new ideas in this particular business is very much
important, as customers are keen towards new types of affordable
services.
Market Needs
In corporate world, need of hiring cars for their employees
rather than buying them is more convenient. There are different
levels of employees within a corporate world like top-level
management or second level management. Therefore many
companies will hire different types of cars depending upon the levels
to which a particular employee belongs. Carvenience targets this
variety in need and offers different types of cars depending upon the
requirement. Though the company is hiring different cars for
different employees but still Carvenience is taking care of all customers with a same
concern. I.e. For Carvenience customer’s satisfaction is at highest priority no matter
who they are.

17. Marketing Strategy
Target Market:
Carvenience plans to target corporate world customers, who
expect to travel with good customer service and convenience.
We are segmenting the market on the basis of purchasing
approaches, benefits sought and usage rate. Many companies have
general purchasing policies that prefer hiring or leasing the cars for
their top-level and second level employees rather than purchasing a
car. Also they are benefited in many ways in terms of cost factor and
quality service, which includes time factor and comfort factor.

18. Positioning:
Carvenience will appeal to all types of corporates who require
the services of vehicles for their professional reasons.
Pricing strategy:
This company plans to be very competitive in its pricing
strategy as it relates to other similar rental agencies. We will
carefully establish prices so that they do not seem too high, while at
the same time allowing us to obtain our business goals. We also have
categorized the cars in terms of class.
Price grids
Car category Carvenience Autoriders
Rate per km Rate per km
Economy Rs 15/km Rs 19/km
Intermediate Rs 20/km Rs 23/km
Full size Rs 25/km Rs 35/km
Luxury Rs 75/km Rs 81/km
Car category
Economy Tata Indica
Intermediate Ford Ikon
Full size Lancer
Luxury Mercedes Benz

19. Location
We have tied up with garages near petrol pumps at three
different locations
 Jublee hills which is close to major corporate houses like Taj
hotels, Hitech City ,etc
 Secunderabad near the major crowd travelling markets.
 shamshabad near to the International Airport and major
Hotels.
Our cars will be available with chauffers carrying cell phones so
communication with them is easy as the demand for service arises.
Our office will be open for 24 hours with two operators on shifts so
that customers can avail anytime of our services.
Our parking spots will also have an attendant who will clean the cars
take care.
Market communications:
Initially we are not spending much on advertising but
we have employed smart sales executives who will visit the corporate
houses individually and try to convince them to avail of our services.
Our sales executives will help us in creating awareness among new
customers and getting feedback from the existing customers.
Later on, when profits start rising we can advertise in
business magazines and newspapers etc.
Direct mail-we will be sending pamphlets through direct
mail to our prospective corporate clients.
E-mail- we will be promoting our organization by
sending e-mails to prospective clients.

20. Market Research & Development
A regular feedback is needed from the customers, and an
accurate study of customer satisfaction and identification of
opportunities for future service development is needed from the
feedback received from the customers. For this we have to take our
chauffers into confidence,train them to take regular feed back from
the customers,they arte the one’s who will help us build relationship
with thew customers as they will be in direct contact with the
customers.
Action Programs
Carvenience will utilize a variety of sources to promote their
service. Through the Internet, telemarketing and direct mails,
carvenience will be able to spread their company name to various
people in the focused market segment. With the use of these
sources as advertising agents we will be able to attract potential
customers

21. Organizational Structure
Marketing & sales
manager
Personnel
manager
Accountant Accountant
DSE
Finance manager
Receptionist
Chauffeurs, attendants

22. Management Summary
Organizational Structure
Carvenience is a private partnership equally owned by seven
executive members. A few of the executives of the company
share the responsibility in the decision-making process. Each
member specializes in specific field within the company. The
combination of each member’s skill allows our company to
establish a successful conglomeration.
Personnel Plan
2003 2004 2005 2006 2007
Remuneration to
partners
360000 360000 360000 360000 360000
Salaries to receptionist48000 54000 60000 60000 62400
Salaries to peon 30000 33600 36000 36000 37200
Salaries attendant 54000 72000 82800 82800 30000
Salaries Telephone
operator
60000 72000 79200 79200 81600
Salaries to accountant 48000 54000 27600 27600 60000
Salaries to chauffeurs 420000 960000 1548000 1548000
Salaries to salesmen 192000 216000 230400 230400 240000

23. Long-Term Plan
Our long-term plans are:
To become market leaders in car rental business.
To increase our name recognition
To be recognized for our outstanding service

24. Income Statement - Summary of Years 1 to 5
2009-2010 2010-2011 2011-2012 2012-2013 2013-2014
Lease rental income 8,410,668 16,996,446 30,575,822 34,698,720 38,278,507
Total 8,410,668 16,996,446 30,575,822 34,698,720 38,278,507
Gross Profit 8,410,668 16,996,446 30,575,822 34,698,720 38,278,507
Operating Expenses
Salaries to chauffeurs 420,000 960,000 1,548,000 1,620,000 1,620,000
fuel 1,591,040 2,268,470 5,261,220 6,275,360 6,817,949
lease charges 7,440,000 12,060,000 17,520,000 14,040,000 14,040,000
mobile charges 39,600 79,200 118,800 143,640 143,640
parking charges 100,000 150,000 200,000 200,000 225,000
depreciation on mobile 2,500 2,500 7,500 7,500 7,500
permit charges 18,000 17,000 21,000 14,500 12,000
washing 12,000 12,000 20,000 25,000 25,000
office and administration
Rent 960,000 960,000 960,000 -
salaries 240,000 285600 315,600 315,600 315,600
electricity 102,000 120,000 132,000 136,000 156,000
auditors remuneration 8,000 8,000 8,000 10,000 10,000
Subscription 25,000 25,000 30,000 35000 37,400
Telephone 120,000 144,000 160,000 170,000 180,000
refreshments 15,000 15,000 20,000 25,000 26,200
Office supplies 42,000 60,000 70,000 75,000 81,000
depreciation 46,250 46,250 293,750 2,837,083 2,769,000
remuneration to partners 360,000 360,000 360,000 360,000 360,000
Commission to salesman 16,500 40,000
selling expenses
salaries to salesmen 192,000 216,000 230,400 240,000 240,000
internet charges 12,000 12,000 12,000 12,600 13,000
Advertising 36,000
finance expenses
preliminary expenses 12,000 12,000 12,000 12,000 12,000
bad debts 14,986 14,836 30,283 68,098 77,280

25. Total Operating Expenses 11,772,376 17,827,856 27,330,553 26,638,881 27,244,569
Operating Income (3,361,708) (831,410) 3,245,269 8,059,839 11,033,938
Interest income 575,000 608063 643,026
Other income 330,000 800,000
Total Nonoperating Income 575,000 608,063 643,026 330,000 800,000
Income (Loss) Before Taxes (2,786,708) (223,347) 3,888,295 8,389,839 11,833,938
Income Taxes 0 0 1,394,926 3,009,855 4,245,425
Net Income (Loss) (2,786,708) (223,347) 2,493,369 5,379,984 7,588,513
less partners capital
partner 1 -398102 -31911 356199 768570 1690566
partner 2 -398101 -31906 356195 768569 1690562
partner 3 -398101 -31906 356195 768569 1690562
partner 4 -398101 -31906 356195 768569 1690562
partner 5 -398101 -31906 356195 768569 1690562
partner 6 -398101 -31906 356195 768569 1690562
partner 7 -398101 -31906 356195 768569 1690562

26. Balance Sheet - Summary of Years 1 to 5
Opening 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014
ASSETS
Current Assets, loans, advces
Cash 8,789,468 6,474,062 4,027,230 8,010,486 18,825,789
Debtors 1,483,574 3,028,320 6,809,760 7,728,000 8,525,280
telephone deposits 12,000 12,000 12,000 12,000 12,000
fixed deposits 10,575,000 11,183,063 0
office deposits 1,000,000 1,000,000 0
Total Current Assets 0 21,860,042 21,697,445 10,848,990 15,750,486 27,363,069
Long-Term Assets
Computers 51,750 34,500 17,250 0 0
furniture and fittings 180,000 160,000 140,000 120,000 100,000
air conditioner 51,000 42,000 33,000 24,000 15,000
office premises 14,750,000 13,250,000 11,750,000
Vehicles 3,659,167 2,419,167
Mobiles 22,500 20,000 65,000 57,500 50,000
Total Long-Term Assets 0 73,500 256,500 25,854,240 32,861,153 14,334,167
miscellaneous expenses
preliminary expenses 48,000 36,000 24,000 12,000 0
Other long-term
assets
Total Assets 0 22,213,292 21,989,945 25,878,240 32,873,153 41,697,236
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Income taxes payable 0 0 1,394,926 3,009,855 4,245,425
Total Current Liabilities 0 0 0 1,394,926 3,009,855 4,245,425
capital a/c
partner 1 4,000,000 3,601,898 3,569,987 3,926,186 4,694,756
partner 2 3,500,000 3,101,899 3,069,993 3,426,188 4,194,757
partner 3 3,500,000 3,101,899 3,069,993 3,426,188 4,194,757
partner 4 3,500,000 3,101,899 3,069,993 3,426,188 4,194,757

27. partner 5 3,500,000 3,101,899 3,069,993 3,426,188 4,194,757
partner 6 3,500,000 3,101,899 3,069,993 3,426,188 4,194,757
partner 7 3,500,000 3,101,899 3,069,993 3,426,188 4,194,757
add/less net loss/profits
partner 1 (398,102) (31,911) 356199 768570 1690566
partner 2 (398,101) (31,906) 356195 768569 1690562
partner 3 (398,101) (31,906) 356195 768569 1690562
partner 4 (398,101) (31,906) 356195 768569 1690562
partner 5 (398,101) (31,906) 356195 768569 1690562
partner 6 (398,101) (31,906) 356195 768569 1690562
partner 7 (398,101) (31,906) 356195 768569 1690562
Total Shareholders' Equity 0 22,213,292 21,989,945 25,878,240 32,873,153 41,697,236
Total Liabilities and Shareholders' Equity 0 22,213,292 21,989,945 27,273,166 35,883,008 45,942,661