Every year, more and more companies appear on the market that offer car rental services to customers. Usually, this business sector is more developed in large cities, where renting a car becomes an excellent and convenient alternative to public transportation or taxi services.
For renters, this is also a good opportunity to save money by choosing a simple and comfortable way to travel around the city. The car rental company is obliged to provide the customer with a clean, functional, and comfortable car, so the renter does not need to worry about the technical maintenance of the vehicle, refueling, parking, car washing, insurance, and other hassles associated with owning a personal means of transportation.
The dynamic development of the car rental industry proves that this business can bring the owner a good profit. But to open a car rental company that will successfully develop, you need to carefully consider many nuances in advance. And one of the main tasks for an entrepreneur is to compile a list of car rental terms and conditions that will help protect you from unforeseen losses.
The process of choosing, booking, picking up and dropping off a car
The owner of a car rental company needs to pay enough attention to all business processes in order to ensure high-quality customer service and the efficiency of each department’s work. Therefore, before launching such a business, it is necessary to carefully consider the mechanism for renting out cars.
Often, this process goes through several stages:
- Search and selection of a car. Today, there are many digital solutions that significantly simplify the client’s search for the right car. Typically, a prospective renter can register in a car rental system and start choosing a car from the assortment presented on the website. In other cases, the client chooses a vehicle by personally visiting the company’s parking lot.
- Conditions of car rental. After the desired car is selected, the client needs to familiarize themselves with the rental conditions. In order to avoid any risks, the owner of a car rental business needs to consult experienced lawyers who will help to properly and thoroughly describe all the conditions of the transaction.
- Form filling. The renter also needs to fill out a special booking form. They need to provide personal information, select additional car parameters, time and place of rental, and fill out payment method information. Thanks to the fact that many companies integrate car rental software into their system, the booking process can be automated, and the client will have the opportunity to upload the necessary documents online.
- Booking confirmation. If the renter has provided all the necessary information, they should receive a notification confirming the booking. This can be, for example, an automatic email or SMS message, and sometimes it is necessary to accept a call from the call center operator of the car rental company to confirm the booking. These business processes can also be optimized with specialized car rental management software.
- Car pick-up. The customer picks up the selected car at the appointed time from the company’s parking lot or another convenient location. During the car pick-up, the customer must present documents, inspect the car for defects, and check the fuel level. Often, at the moment of handing over the car, the owner charges the client’s credit card with a security deposit amount, the size of which depends on the specific rental company’s terms.
- Car drop-off. When the rental period expires, the renter must return the car in the same condition it was in at the time of pick-up. When returning the car, a representative of the lessor must be present to check the cleanliness of the interior, fuel level, and the presence of any external damage or technical malfunctions. At the end of the rental, the parties sign an acceptance certificate, a copy of which must be provided to the client.
Car rental restrictions
In the car rental industry, there are many obvious risks and pitfalls. Some of these risks can be minimized through the use of special car rental software. By integrating this set of tools, you can, for example, manage fines, collect information about dangerous driving, track the technical condition and location of each vehicle in the fleet, and update insurance information.
However, many car rental companies also impose additional restrictions to avoid certain unforeseen expenses and problematic situations. Among these restrictions, the most common ones are:
- Age restrictions. Typically, a renter is allowed to take a car rental if they meet the minimum age requirements. Sometimes companies have different limits for different categories of cars, but on average, the minimum driver age for renting a car is around 22-25 years.
- Driving experience. To minimize the risk of accidents and dangerous driving situations, you can also impose restrictions on the renter’s driving experience. Often, a client must have at least 1-3 years of driving experience to rent a car.
- Vehicle mileage. If you want to control the wear and tear of each car, it would be rational to introduce restrictions on the maximum mileage per unit of time. For example, if you are renting a midsize car, the mileage limit can be set at 200-300 km per day. A penalty should be provided for exceeding this limit.
- Territorial restrictions. Often car rental companies prohibit leaving the country or city limits with the rented car, otherwise the client will need to request special permission. Therefore, many business owners install car rental management software and connect each vehicle to special trackers to track the location of the cars in real-time mode.
Car rental rules
In addition to various restrictions, car rental companies also establish basic rules that the renter can familiarize themselves with on the website or when signing the rental agreement. Thus, these rules often relate to several important points:
- The renter must provide the lessor with a passport or other identity documents, as well as a driver’s license.
- The client undertakes to strictly comply with all traffic rules. For example, to adhere to the speed limit, which may vary in different cities and on highways. In case of violation of traffic rules, the driver must cover the costs of fines.
- The renter must return the car exactly by the agreed deadline. To avoid additional expenses, you can provide for a penalty for each hour of delay in the car rental agreement.
- It is desirable for the client to have the ability to extend the rental period, especially for short-term rentals. The conditions for extension should be specified as a separate item, indicating the minimum time within which the driver can notify about the need to extend the rental.
- The lessee is responsible for the condition of the interior, exterior, and equipment inside the car. They must return the vehicle in the same clean and undamaged condition as it was at the time of rental. Otherwise, the lessor has the right to demand compensation for the damage caused.
- The lessor must provide conditions for replacing the car in case of a breakdown that is not the driver’s fault or if the client wants to change the chosen car for some reason.
- The rental company has the right to ask the client to leave a deposit, which will serve as a guarantee of covering the expenses related to the lessee’s actions. The amount of the deposit is determined by the internal rules of the company and may differ in different car rental services.
- The lessor is not responsible for traffic jams and road congestion that may affect the time of use of the car and the mileage during the rental period.
During the car rental, the client is responsible for additional expenses incurred by the rental company. Thus, the most common situations in this business sphere include:
- Soiling of the car,
- Fuel consumption,
- Loss or theft of property located in the car,
- Car theft,
- Fines for violating traffic rules,
- Car breakdown,
- Traffic accidents.
Most of these risks can be minimized if the company owner uses car rental management software. However, as an additional measure, companies can impose various restrictions on the renter.
For example, a car rental service customer may be prohibited from:
- Subleasing the car.
- Leaving the car unlocked and unattended.
- Leaving a certain city, region, or country in the rented car.
- Participating in races or other competitions with the car.
- Driving under the influence of alcohol.
- Violating traffic rules.
- Allowing third parties to drive the car.
- Attempting to fix any malfunctions on their own.
In the car rental business, there are many nuances, risks, and pitfalls. However, you can insure yourself against most of them by seeking the help of experienced lawyers who will advise on the conditions of rental and return, stipulate the renter’s liability, and provide a comprehensive list of rules and prohibitions.
It would also be a huge advantage to integrate a specialized car rental system into your business. This software will not only help track the condition and location of cars but also contribute to the optimization of the business, reduction of expenses, and increased efficiency of each employee of the company.