Eager to understand why the on-demand taxi app companies are tremendously profitable and enjoy global presence and recognition? Strom into an MBA class at a premier business school, you’ll find students raving about it; Dash into the discussion table of a top business editorial. You’ll discover Industry experts trying to deduce its origin. Such levels of adulation are possible only for businesses that are both globe-trotting and present high ROI. One such solution is the app-based on-demand taxi-hailing industry. Despite these general perceptions, an entrepreneur willing to take a shot at this business needs to know what the future of the cab-hailing sector will be and what was its past infer.
So, How well does the industry tackle the COVID rampage?
At a superficial level, anybody irrespective of their business knowledge can conclude that the cab-hailing industry is severely damaged by the Covid-19 induced restrictions on economic activities via Lockdowns and Travel curtailments. They cannot be wrong; Afterall, we’ve seen several businesses going bankrupt, unable to sustain during this turbulent period. But like a well-written plot twist, the market share and profitability of the on-demand app-based industry has increased with more customer loyalty. When the future of so-called major economic drivers of the world like electronic, banking, and automobile manufacturing sectors are in trouble, the escalation of revenue of the taxi industry comes as a pleasant surprise to trade pundits.
So, what exactly made the on-demand taxi business immune to COVID recession?
Before plunging into the possible reasons, let’s have a look at the market numbers.
The cab-hailing industry’s overall revenue is set to cross the $200 Billion mark on or before 2025
This is significant because the revenue and profitability of this particular industry skyrocket, indicating that a very favorable trade environment exists.
The taxi ride industry is also forecasted to register a CAGR of 17.5% in 2025, a stark ascension from the earlier numbers.
User penetration is also predicted to hit an all-time high at a percentage of 20.5 in 2025.
It is also fascinating to know that countries’ market contribution in the Asia-Pacific has increased substantially with more customer loyalty.
The Asia-Pacific region accounts for over 70% market share in the cab-hailing industry.
There are some solid reasons for this astounding growth of revenue and market share that mainly describe these companies’ approach.
With Public Transportation not available and Private vehicles becoming costly, on-demand taxi applications come handy to a significant chunk of the population that use them daily to commute to workplaces. The coronavirus induced fear has made public transportation systems redundant worldwide, citing safety reasons. The app-based companies have quickly understood this market change and have implemented safety measures into their fleet, and this becomes an attractive proposition among the public.
Convenience and Connectivity provided by the on-demand app-based taxi services are ones to beat. It is evident that the likes of Uber now dominate the majority of the urban and suburban areas devoid of government-run transportation systems. The entire commutable part of the US is connected by these apps and has begun to proffer long-distance travel, a service once provided only by the biggest taxi corporations.
High profitability is a virtue of the on-demand industry, and taxi-hailing is no exception. It doesn’t require entrepreneurs to own a fleet of cabs but connect cab drivers with customers through their platform. This condensates to low risk and high levels of profitability. This inherent reward of the industry allows fierce competition yet rake skyrocketing revenues at the same time.
So, where do I start now?
Make hay when the sun shines. It’s always better to work on a startup idea instantly, and if it involves taxi-hailing, it’s highly advisable to launch the business as soon as possible. The first step should be finding a mobile development team that provides expertise and value of money at the same time. Appdupe is one such firm and the market leader of developing on-demand taxi-hailing services apps with a decade of experience. Waste no time and incubate your dream Uber-like startup instantly with Appdupe!
Launch Your On-demand Taxi Booking App Like Uber Today!
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