Transportation Business in South Africa & Cost of Starting

The transportation business is one of the most lucrative anywhere in the world. When you consider the fact that people need to move from one location to another, then the whole idea becomes clearer. The transportation business simply involves making it easier for individuals to move around for a fee.

There are different aspects of the transportation business in South Africa. Have you been considering the idea of starting a transportation business in South Africa? In this post, we will show you how to start as well as the cost of starting up in South Africa. Let’s dive straight in.

Transportation Business in South Africa & Cost of Starting

Cost of Starting a Transportation Business in South Africa

The South African transportation industry is one of the most profitable sectors of the economy. This is probably because of the high population of the country and the need to move people and goods around. As we mentioned above, there are different aspects of the transportation business in South Africa. To discover the cost of starting this business, we must consider each of these different aspects. We will focus solely on road transportation in this article.

Motorcycle transportation

  • 200 Capacity motorcycle: From ZAR$7,404
  • Tricycle: From ZAR$18,508

Car transportation

  • Saloon: From ZAR$44,420
  • Hilux: From ZAR$92,540
  • SUV: From ZAR$74,032

Bus transportation

  • Sienna: From ZAR$66,629
  • Mini-bus: From N1.5 millon
  • Coaster bus: From ZAR$185,080
  • 18-seater bus: From ZAR$81,436
  • 15-seater bus: From ZAR$59,226

Note that the prices of these vehicles are quite volatile on the market. You can also get cheaper prices if you purchase second-hand vehicles. However, we suggest that you only purchase second-hand vehicles from trusted sources. Also, when going to purchase such vehicles, go with a trusted mechanic to help you check the quality of the vehicle.

There are other significant costs that you must consider when going into the transportation business. These costs have to do with licenses, permits, registrations, and maintenance. As you will expect, it is impossible to give a specific price here since the different prices depend on several factors. Some of the factors include the type of vehicle, government policies, and location.

Why should you start a transportation business in South Africa?

Many people ask this question because of the rave to go into the transportation business. Of course, no business is perfect and completely profitable. Every business comes with its risks and challenges. It is the responsibility of the entrepreneur to figure out the possible challenges and risks beforehand. This way, they can find the best ways to navigate their business around these challenges and risks.

That being said, there are several reasons why you should consider entering the South African transportation sector. We will discuss a few of these reasons in this section:

The growing South African population

Do you know that the South African population currently sits at an estimated 200 million? However, we all know that the population is higher than this. Experts predict that it should hit 250 million by 2050.

Interestingly, only 31 individuals in every 1,000 own cars. What this implies is that many people depend on public transportation to move around. There is a huge demand for public means of transportation in South Africa. If you have the means, you can take advantage of this demand to make lots of profits.

Transportation is highly lucrative

Transportation is one of the most lucrative businesses in South Africa today. Asides from the figures we discussed in the point above, many car owners still use public transportation. Most people prefer to use public transportation to make intercity travels. This is asides from the people that use the different transportation means within the city.

If you understand the rules of this business and you can play by them, you’d make a lot of money. However, you must decide on whether you want to operate within the city or move from one city to another. The mode of operation that you choose will determine how much profit you will make.

Technology is making it easier

One of the most common modes of operation in the transportation industry today is ride-hailing. Ride-hailing refers to when clients order a means of transportation via a mobile application. There are several ride-hailing apps in South Africa including Bolt, Uber, Opay, etc.

If you sign up to any of these apps, you could make as much as ZAR$5,553 to ZAR$9,254 per month. It all depends on how many hours of work you can put in per week

How to start the transportation business in South Africa

Now that we agree that this business is highly profitable and lucrative, it leads us to a very important question. How do you start the transportation business in South Africa? Just like every other business, there are certain steps that you should take before you start. Here are a few of them:

Decide on your mode of operation

By mode of operation, we mean how you want to run the business. Some individuals prefer to run the business within the town while others are okay with traveling inter-state. If you want to run within the State, then you should figure out which means of transport you prefer. Also, you need to decide whether you want to drive or ride by yourself or you’d be employing a rider or driver.

Raise capital

Once you have figured out your mode of operation, you can then sort out funding. By now, you should know which kind of vehicle that you will be using. We have given you some prices above. You can work with our list to figure out how much you need. Don’t forget to factor in licensing and registration costs as well. There are several ways to raise funds for this business including personal savings and loans.

Complete your registration

After raising funds and purchasing your vehicle, the next step is to register your vehicle. Ensure that you get all the necessary papers to avoid unnecessary embarrassment from law enforcement agents. If you will like to work with a ride-hailing service, then you should also complete their registration process. Once you are done with these processes, you are good to go.