UBER has become the platform of choice for people who want to step into entrepreneurship and now gives everyone the opportunity to start their own UBER business.
However, as with any business, getting started can be very daunting and even intimidating. Luckily, this little guide will come in handy.
Through the course of the next few chapters, we’ll take you through the eligibility criteria as well as the process of choosing the right car, getting a commercial driving license (CDL), and registering your UBER business in India in 2018. We’ll also give you some useful tips to help minimize your risks and maximize your gains.
Table of Contents :
Click the chapter links to read a specific section.
Chapter 1 – The Eligibility Criteria
Every business has certain eligibility criteria that must be met beforehand and UBER is no different. One of the first steps in starting a business with UBER is understanding and meeting the minimum paperwork criteria. Let’s take a look at the paperwork required:
Chapter 2 – Choosing the Right Car to Start an UBER Business
The next major consideration is choosing what car you should get for your UBER business. However, before you start going through the list of available cars, you must first understand the different UBER types available in your city. Only then can you decide what car you want to go for based on the list of requirements for each type.
Let’s take a look at the most popular types below. There are a few other types as well, depending on your city, but these three types are the most popular.
In addition to these requirements, all cars are required to have working windows and air conditioning.
Chapter 3 – Getting a Commercial Driving License to Start an UBER Business
While the government has announced that, starting June 1, 2018, people will no longer need a CDL to drive taxis or commercial light motor vehicles, UBER still requires a CDL and commercial vehicle registration in certain states for drivers and cars attached to the platform. Here are more details on whether UBER requires a CDL in your state.
Getting a CDL may sound very complicated and time-consuming, but it really isn’t. However, you do need to have had a learner’s license for at least one month, before you can apply for a CDL, and must meet the minimum eligibility criteria. You’ll also need to pay a CDL application fee.
After that, if you are using your own, private car, you’ll have to get it converted into a commercial car. Here’s the detailed list of conversion charges and documentation requirements.
Eligibility Criteria for Applying for a CDL
Once you meet the minimum eligibility criteria, you can start the application process for your CDL. Here’s how you can do that.
How to Apply for a CDL
1. Applicants can apply for the license, using the internet to download and submit Application Form 4 from the Sarathi website. Alternatively, applicants can visit their Regional Transport Office and fill in Form 2.
2. The forms must be completed and submitted with the necessary documents listed below as proof of age, address, health, and training as well as a passport-sized photograph, in case of an online application.
a) A passport, PAN card, birth certificate, Aadhaar card, voter ID, ration card, or utility bill that has been issued in the applicant’s name to verify his or her identity, age, and address. Any one of the above would suffice.
b) A medical certificate (Form 1A) is also mandatory.
c) After the necessary training from a government or affiliated motor school, the school will issue a Form 5 as proof of training, which also needs to be submitted with the application.
Upon successful submission of all the necessary documents, the applicant will receive a serial number and will be informed of his or her scheduled driving test and centre.
Once the test has been successfully cleared, the applicant will be awarded the driving license, which will be sent to him or her to his or her registered address via post.
Chapter 4 – How to Start a Business with UBER and Start Making Money
Now let’s come to the nitty-gritty details of how to start an UBER business, how to register your car with UBER, and how to start making money. It’s a relatively simple, four-step process that takes anywhere between a few days and a few weeks, depending on the availability of your car.
Let’s take a look at these steps in more detail.
Step 1 – Arrange and Organize the Paperwork
Before doing anything else, you must first ensure that you have all the paperwork we mentioned in Chapter 1 ready and organized. You’ll have to scan everything so that you can submit them online or, if you’re applying at an UBER office in your region, you’ll need hardcopies of everything.
Here’s a quick checklist of the documents you should have handy:
- Car’s registration certificate or NOC (if it’s registered in someone else’s name)
- Vehicle insurance
- Tourist permit
- Driver’s license and profile picture
- Up-to-date police verification or PSV badge for the driver
- PAN card or a cancelled cheque
Step 2 – Apply Online or Visit a Regional Office
Applying online is very easy, but it does take a bit longer. UBER’s partner registration portal has a very straightforward form that will ask you some information and let you upload the aforementioned documents directly to UBER’s servers.
Alternatively, if you visit their local Greenlight hubs, take hardcopies of all the documents with you and the staff there will help you get signed up as a partner.
Once you’ve submitted the relevant documents, you can move on to Step 3.
Step 3 – Get a Car and Have It Approved by UBER
If you already have an older car available that meets the requirements, you can choose to use it. However, if you don’t already have a car, you’ll have to buy one, before you can finish the registration process.
Newer cars will be more expensive, but they’ll be easier to maintain and the upkeep won’t cost as much. They’ll also be somewhat more fuel efficient than older cars, because of the new engine and parts. And, it’s interesting to note that most UBER business owners opt for new cars, when starting up.
You can also ask UBER’s regional office to help arrange a good EMI deal for you through partnering banks and manufacturers. But, make sure you don’t go overboard and buy an expensive car or one overloaded with features that makes the EMI harder to pay.
The only thing to remember is that the vehicle you choose needs to fulfill UBER’s requirements for the specific type, as discussed in Chapter 2. So, make sure you get one with the right features for the chosen category.
For example, while uberGO is the cheapest type of ride offered, uberX is the mid-range offering and still sees the most rides and uberXL requires a very expensive car and rides for that type are also harder to come by.
You can also opt for a car that fulfills the requirements for more than one category, enabling you to take rides for both categories. But, you can still choose to restrict your car to one category.
Once you’ve arranged a suitable vehicle, you’ll have to arrange an inspection with UBER, after which they’ll give your registration the final approval and give you a new smartphone with the UBER apps preinstalled. You need to keep that device handy and connected to the internet to receive and service customers or passengers.
Step 4 – Attend the Mandatory Training for New UBER Drivers/Owners
UBER conducts mandatory training sessions for new drivers/owners that give them an overview of the apps and how to use them as well as run them through the general guidelines and tips to increase efficiency and, hence, their earnings.
Once you’ve completed the trainings, you’ll be allowed to take rides and pick up passengers via the UBER app.
Chapter 5 – How Much Money Can You Earn from Your UBER Business
When UBER first launched, it assured drivers of earning between Rs. 100,000 and 150,000 per month. That number has gone down significantly and now stands at a much smaller number because of a number of factors. However, UBER businesses can still make a significant amount of money by increasing the efficiency of their operations.
On average, if an UBER car runs for six days a week and has mixed earnings throughout the six days, with an average income of Rs. 30,000 to 35,000, they’ll still make between Rs. 120,000 and 140,000 per month. Assuming realistic fuel consumption, driver salary, and maintenance, expenses would come to about Rs. 40,000 to 50,000 per month.
This brings the net profit per car to somewhere between Rs. 70,000 and 90,000. However, this number also depends on the city you are in, as different cities will have different traffic conditions as well as differing levels of competition.
Also, to achieve this net profit figure, the car also needs to be running for most of the day, possibly with two drivers, to make sure it gets as many rides as it can during surge times and meet the ride targets for the day.
Unfortunately, with so many cabs on the road now, finding that many rides can be tricky. But, meeting the 10 rides a day target is possible if you place your drivers at the right spots.
For example, every city has certain commercial areas that see lots of commuters at certain times of the day. And, UBER businesses can make the most money, if they pick up enough short and quick rides throughout the day at these areas.
Chapter 6 – How to Minimize Losses before Starting an UBER Business
As is the case with any business, there’s a very real chance of incurring unnecessary losses. While some of these losses are relatively easy to counter, some require more work. Here’s a short list of things you should keep in mind:
Chapter 7 – How Does Surge Pricing Benefit UBER Business Owners
What Is Surge Pricing?
With UBER’s ever-increasing popularity, the number of customers who need cars at any given time is also increasing. Because of this, there are times when the number of ride requests surpasses the number of cars available. UBER increases the ride prices at such times, depending on the number of requests, to make sure that the customers who really need a ride can get one, while those who can wait can do so until the surge pricing has gone back down again.
How Is Surge Pricing Calculated?
Surge pricing is calculated in real time on an area-wise basis. So, different areas of the city could have different or no fare multipliers, depending on the demand for the service. Also, the number tends to change very quickly as people either find rides or stop looking because of the increased rates.
The surge pricing is usually displayed as a multiplier, for example 1.2x, on the map itself. The actual fare of the ride is multiplied by this number to get the surge pricing.
How Does Surge Pricing Benefit UBER Business Owners?
The best part about surge pricing is that, while the prices for customers go up, UBER’s fee percentage remains the same and the driver/owner gets a nice bonus for the ride. Not only that, it also helps drivers identify high demand areas during various times of the day to help them predict where they should be waiting to get the most rides.
Chapter 8 – Shutting down Your UBER Business
While this is a scary thought for a guide that tells you how to start a successful business with UBER, a number of people have run UBER businesses unsuccessfully and then eventually had to shut them down.
If you want or need to shut down your UBER business, UBER has made the process very easy. Just follow these steps:
Step 1 – Deactivate Your UBER Driver/Partner Profile
All you need to do is visit your regional office or visit the UBER Partner website and submit a quick and simple form, requesting them to shut down your partner profile. They’ll process your request and will eventually deactivate your account.
Step 2 – Clear Dues and Divest Extra Vehicles or Assets as Needed
Next, you have to start clearing all your outstanding dues, including payments to your drivers and creditors. If you purchased one or more cars through EMI and still have payments left on them, you have to clear those payments by continuing the EMI or by selling off your assets.
While it’s fairly easy to register an UBER business, running it profitably is becoming an increasingly difficult task, with all the competition cropping up. This guide was meant to show you how to start a business with UBER, but that is just the first step in establishing a successful entrepreneurial endeavor. With determined efforts and efficient operations, profitability is just a ride away!
Chapter 9 – FAQs
Q1. How can I start a business with UBER, if I don’t have an eligible vehicle?
UBER offers a number of facilities for people who want to become partners, one of which is a resource to help them rent or lease vehicles from banks with UBER’s help. Those vehicles meet the minimum UBER car registration requirements and can be registered and used easily. More information on financing to start a UBER business can be found here.
Q2. How can I attach my car with UBER, if it’s an older model?
Cars older than 2010 do not meet UBER’s car registration requirements and, therefore, can’t be attached to UBER. More information on local vehicle requirements is available here.
Q3. How can I become an UBER driver, if I don’t have a car?
You can become an UBER driver even if you don’t have your own car by finding a non-driving partner that has free vehicles that require drivers through one of the driver or partner support forums on the internet. Here’s more information on how to join a fleet through a licensed car.
Q4. Can I attach a car to UBER without a driver?
A. No. You need at least one driver to sign up as a non-driving partner, but finding an UBER driver is fairly easy. You can post vacancies in the numerous online support forums for UBER drivers and partners and can find plenty of reliable drivers that way. Here’s more information on the signup process and on how you can find drivers.