If you are looking to start a car rental business, franchising can be the quickest and easiest way. Franchises often provide help with inventory, setup, and marketing. And they provide a recognizable brand that you can use to build trust with customers. Read on for a guide to the best car rental franchises.
What is a car rental franchise?
A rental car franchise is a company that partners with independent entrepreneurs to offer car rental services in various locations. Franchisees pay an upfront payment and often pay ongoing royalties and marketing costs in exchange for operational support.
The car rental industry in 2022
The car rental industry, like many other businesses, is being hit by supply chain issues and chip shortages. So it can be a challenge to keep up with a large inventory of vehicles. But as more consumers start to travel again, it is expected to become an active time for rental car companies.
Why you should consider a rental car franchise
If you are considering several business opportunities in 2022, franchising a car rental company could be a perfect choice. Here are some specific benefits of opening a car rental business:
- High demand: People are starting to travel again, increasing the demand for rental cars. There is also a shortage of new vehicles due to microchip issues, so some consumers need their ideal vehicles and may need to rent more frequently.
- Being able to start quickly: Starting a business from scratch takes time. When you franchise, the groundwork has already begun. This way you can get off the ground quickly while there is still a lot of demand in your region.
- Built-in trust and brand recognition: Consumers often look for recognizable brands when booking important services such as car rental. Franchising allows you to align your small business with a national brand that they may already be familiar with.
- Supporting a national brand: Besides the brand name, franchising means getting support from corporate offices. This includes help filling your lot and creating your price list.
Top car rental franchise options
If you’re ready to offer car rental services to your community, compare all available franchise opportunities to find the best fit. Here are some top car rental franchises to consider.
1. National car rental
National car rental is a top global car rental brand that also operates Alamo and Enterprise Rent-A-Car. However, National does not currently have a franchise in the US and Canada. Thus, their franchise opportunity is only for international entrepreneurs. Franchise costs, start-up costs and car rental vary widely by country.
2. Hertz Corporation Franchise
Hertz is one of the best car rental brands at the airport. And the Corporation also runs other popular brands Dollar, Thrifty and Firefly. Benefits include a technical system and partnerships with airlines and hotels. The license fee ranges from approximately $25,000 to $100,000, depending on fleet size, location and growth potential.
3. Next car
Next Car launched in 2003 and currently has locations in a handful of states, including California, Maryland and Florida. There is still plenty of room for growth in new markets, including in high-demand areas such as airport locations. Benefits include help with buying a fleet and preferential prices. The franchise fee ranges from about $20,000 to $100,000.
4. Avis Budget Group Franchise
Avis Budget Group operates multiple car rental franchise brands, including Avis, Budget, Payless and Zipcar. They offer a streamlined process to help new franchisees get up and running quickly and provide support throughout the license period. The initial fee varies widely, starting at about $25,000.
5. U-Save car and truck rental
U-Save car and truck rental is a neighborhood franchise that can be run alone or in conjunction with another business, such as a dealer or service center. The initial franchise fee and investment will vary by location and fleet size; franchisees must have at least $60,000 in cash.
6. Sixt Franchise
sixt is a European car rental brand that now has franchise locations around the world, including the US. The company specializes in luxury cars, trucks and limousines. Initial investment and fees vary widely by location and fleet size. The franchise fee can vary from €20,000 to €500,000.
7. Rent-A-Wreck Franchise
Rent-a-wreck specializes in used car rental. It is one of the more affordable car rental franchise options available, due to its less expensive inventory. However, you still need about $40,000 in cash to invest upfront.
8. Priceless car rental
Priceless car rental offers a franchise system with both standalone units and units run in conjunction with other companies. They provide car leasing, training and marketing support along with their recognizable brand. Franchisees must have a minimum of $50,000 in cash. And the franchise fee ranges from $18,000 to $75,000.
9. Bates International RV Rental
Bates Camper Network offers RVs and large travel vehicles instead of basic cars. This is an emerging market as more and more consumers are looking for unique new ways to travel affordably. New franchisees pay an initial franchise fee of between $17,000 and $35,000, not counting other start-up costs such as inventory.
10. Right cars
right cars runs a technology-focused car rental franchise business. Franchisees get access to patented AI technology, comprehensive consumer activity data and car rental apps. Franchise costs and start-up costs vary widely by location.
How to choose the best franchise to set up your car rental business
If you are interested in starting your own car rental franchise business, here are some tips to help you sort through the various business opportunities.
Think about your budget
Setting up car rental franchise opportunities can be quite costly. Potential franchisees with room in their budget can earn more with a well-known franchise brand. But other franchisees can save by sticking to neighborhood rental franchises.
Search for open areas in your area
If you’re only looking to franchise near your hometown, your choice may depend on which franchises want to expand there. For example, your airport may already have a Hertz system, but Right Cars may be open to expanding nearby.
Be open to growth opportunities
In addition, consider how your franchise business might grow over the years. Systems that provide ongoing support and multi-unit franchises can help you scale.
Compare services and offers
Most franchise systems offer a training program and marketing support. But other benefits vary, so consider what’s most important to you, such as buying support or technical offers.
How much does it cost to open a car rental franchise?
Setting up a new car rental franchise location is quite capital intensive. You will need a large lot, probably in a premium area, along with enough quality vehicles to serve customers. Many business franchise opportunities require between $250,000 and $750,000 to get started.
Is a car rental franchise profitable?
Yes, car rental franchisees can make a profit in the early years. The exact amount varies by location and fleet size. But some see profits of up to $150,000 to $200,000 a year.
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