How to Start a Pet Taxi Business

Fur babies are a huge part of the family and require a significant amount of care. From vet appointments and grooming to doggie daycare, pet parents are always on the go. Many people decided to adopt new pets while they spent more time at home during the pandemic. However, as they head back to the office, they’ll likely be looking for alternative ways for their furry family members to get around. 

Starting a pet taxi business is a fun and rewarding career that’s growing in demand. Before you jump in, it’s important to fully understand what it takes to successfully launch your venture. Fortunately, our guide below contains everything you need to know to get started on the right foot.

Step 1: Decide if the Business Is Right for You

Pros and cons

Before starting a pet taxi business, it’s important to weigh the pros and cons.

Pet Grooming and Boarding Industry Trends

A pet taxi business would fall under the pet grooming and boarding industry umbrella.

Industry size and growth

• Industry size and past growth – The US pet grooming and boarding industry grew about 0.7% between 2017 and 2022. Today, it is worth $8.5 billion.((https://www.ibisworld.com/industry-statistics/number-of-businesses/pet-grooming-boarding-united-states/))
• Growth forecast – The Covid-19 pandemic slowed growth over the last couple of years, but it is back on the rise. The US pet grooming and boarding industry is expected to grow by 1.5% in 2022.((https://www.ibisworld.com/industry-statistics/market-size/pet-grooming-boarding-united-states/))
• Number of businesses – In 2022, 133,167 pet grooming and boarding businesses were active in the US.((https://www.ibisworld.com/industry-statistics/employment/pet-grooming-boarding-united-states/))
• Number of people employed – In 2022, the US pet grooming and boarding industry employed 231,928 people.((https://www.ibisworld.com/united-states/market-research-reports/pet-grooming-boarding-industry/))

Trends and challenges

Trends in the pet transportation industry include:

• A boom in pandemic pet ownership over the last couple of years means pet care services like transportation are in greater demand.
• New technological advancements allow pet transportation companies to develop their own apps, allowing customers to keep track of trips and schedule rides.

Challenges in the pet transportation industry include:

• The increase in pet ownership is also saturating the market with new pet care businesses, resulting in increased competition for pet taxi businesses.
• The high costs of gasoline can quickly drive up fuel expenses, especially if prices continue to rise.

What kind of people work in pet care?

• Gender – 71% of those who work in pet care-related jobs are female, while 29% are male.((https://www.zippia.com/pet-caretaker-jobs/demographics/))
• Average level of education – The average pet caretaker has a bachelor’s degree.
• Average age – The average pet caretaker in the US is 32.5 years old.

How much does it cost to start a pet taxi business?

Startup costs for a pet taxi business are between $4,000 and $16,500, assuming you’ll need to lease or purchase a van. In addition to a down payment for a vehicle, costs include marketing expenses, licenses and insurance, and pet supplies.

You’ll need a handful of items to successfully launch your pet taxi business, including: 

• A reliable vehicle with enough room to fit crates
• Pet accessories, like seat belts, treats, and toys
• Pet-safe cleaning supplies
• Website

How much can you earn from a pet taxi business?

Local pet taxi services cost an average of $35 per trip, per pet. However, this could increase to an average of $500 per trip if you’re transporting pets longer distances. Your profit margin should be around 85%.

In your first year or two, you could transport six pets per day, five days a week, at a rate of $35 per pet. This would translate into around $55,000 in annual revenue. Assuming an 85% profit margin, you would generate over $46,000 in profit. As your business grows, you’ll likely hire another employee to help and purchase another vehicle, reducing your profit margin to 65%. With an annual revenue of $109,000, you would still make a handsome profit of almost $71,000. 

What barriers to entry are there?

Barriers to entry for a pet taxi business include building up your client base and obtaining a reliable vehicle to use for services. 

Related Business Ideas

If you’re still not sure whether this business idea is the right choice for you, here are some related business opportunities to help you on your path to entrepreneurial success.

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Step 2: Hone Your Idea

Now that you know what’s involved in starting a pet taxi business, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Why? Identify an opportunity

Research pet taxi businesses in your area to examine their services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing pet transportation services for exotic animals. 

You might consider targeting a niche market by specializing in a certain aspect of your industry, such as combining your transportation services with dog walking, or transporting animals to and from vet appointments.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Determine your products or services

There are several ways to customize your pet taxi business offerings. Here are some ideas:

• Transport to and from veterinary appointments
• Shuttling dogs or cats from animal shelters to their new adoptive owners
• Transport to and from doggie daycare
• Assisting pet owners with relocation or moving to a new home
• Transport to and from grooming appointments

How much should you charge for pet taxi services?

The rates you charge for your pet taxi services will vary depending on how far of a distance you are traveling. For example, if you are transporting pets within a local area, you may charge anywhere between $25 and $40 per pet, per trip. If you are traveling longer distances or crossing state lines, your rates may be anywhere from $100 to $1000. 

Many pet taxi businesses charge a flat rate and then add on rates per mile outside of certain parameters.  Keep in mind that, if your vehicle allows, you can transport multiple pets at once. Your costs will be limited to obtaining a vehicle, insurance and licenses, and marketing expenses, so aim for a profit margin of 85%.

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Your target market will include pet owners in your local area. Consider focusing your marketing efforts on social media channels like Facebook, Instagram, and TikTok. 

Where? Choose your business premises

In the early stages, you may want to run your business from home to keep costs low. But as your business grows, you’ll likely need to hire workers for various roles and may need to rent out an office. You can find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

When choosing a commercial space, you may want to follow these rules of thumb:

• Central location accessible via public transport
• Ventilated and spacious, with good natural light
• Flexible lease that can be extended as your business grows
• Ready-to-use space with no major renovations or repairs needed

Step 3: Brainstorm a Business Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “pet transport” or “pet taxi service”, boosts SEO
• Name should allow for expansion, for ex: “Jim’s Bakery” over “Jim’s Cookies”
• Avoid location-based names that might hinder future expansion
• Use online tools like the Step by Step Business Name Generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

• Executive Summary: Brief overview of the entire business plan; should be written after the plan is complete.
• Business Overview: Overview of the company, vision, mission, ownership, and corporate goals.
• Product and Services: Describe your offerings in detail.
• Market Analysis: Assess market trends such as variations in demand and prospects for growth, and do a SWOT analysis.
• Competitive Analysis: Analyze main competitors, assessing their strengths and weaknesses, and create a list of the advantages of your services.
• Sales and Marketing: Examine your companies’ unique selling propositions (USPs) and develop sales, marketing, and promotional strategies.
• Management Team: Overview of management team, detailing their roles and professional background, along with a corporate hierarchy.
• Operations Plan: Your company’s operational plan includes procurement, office location, key assets and equipment, and other logistical details.
• Financial Plan: Three years of financial planning, including startup costs, break-even analysis, profit and loss estimates, cash flow, and balance sheet.
• Appendix: Include any additional financial or business-related documents.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist at Fiverr to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to pet transportation businesses. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your pet taxi business will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using ZenBusiness’s online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have. 

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a tax-payers checklist, and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a pet taxi business. You might also try crowdfunding if you have an innovative concept.  

Step 8: Apply for Licenses/Permits

Starting a pet taxi business requires obtaining a number of licenses and permits from local, state, and federal governments.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your pet taxi business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.  

You may want to use industry-specific software, such as Time To Pet, Pet Pocketbook, or Pawfinity to manage clients and staff, schedule appointments, and receive online payments.

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.

Marketing

Some of your business will come from referrals or online visitors, but you should still invest in digital marketing! Getting the word out is especially important for new businesses, as it’ll boost customer and brand awareness. 

Once your website is up and running, link it to your social media accounts and vice versa. Social media is a great tool for promoting your business because you can create engaging posts that advertise your products: 

• Facebook: Great platform for paid advertising, allows you to target specific demographics, like men under age 50 in the Cleveland area. 
• Instagram: Same benefits as Facebook but with different target audiences.
• Website: SEO will help your website appear closer to the top in relevant search results, a crucial element for increasing sales. Make sure that you optimize calls to action on your website. Experiment with text, color, size, and position of calls to action such as “Schedule Now”. This can sharply increase purchases.
• Google and Yelp: For businesses that rely on local clientele, getting listed on Yelp and Google My Business can be crucial to generating awareness and customers.

Kickstart Marketing

Take advantage of your website, social media presence and real-life activities to increase awareness of your offerings and build your brand. Some suggestions include:

• Competitions and giveaways – Generate interest by offering prizes for customers who complete a certain action, such as liking and resharing a social media post from your business page. 
• Sponsor events – You can pay to be a sponsor at events that are relevant to your target market
• Post a video – Post a video about your pet taxi business. Use humor and maybe it will go viral!
• Email marketing/newsletter – Send regular emails to customers and prospects. Make them personal. 
• Start a blog – Start a blog and post regularly. Change up your content and share on multiple sites.
• Seek out referrals – Offer incentives to generate customer referrals to new clients. 
• Paid ads on social media – Choose sites that will reach your target market and do targeted ads.
• Testimonials – Share customer testimonials about how your pet transportation service helped them

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism. They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

You can create your own website using services like WordPress, Wix, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your pet taxi business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your pet taxi business could be:

• Transporting your furry friend in style
• Safe, reliable rides for dogs and cats
• Speedy pet taxi service for busy pet parents

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a pet taxi business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in pet transportation for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in pet transport. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a pet taxi business include:

• General Manager: schedule appointments, accounting
• Pet Taxi Drivers: transport pets to and from locations
• Marketing Manager: manage social media accounts, generate leads 

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Start Making Money!

From transporting furry friends to vet appointments to delivering rescue pets to their fur-ever homes, pet transportation is a rewarding business venture. The increase in demand for pet services means your business is likely to experience massive growth over the next several years. It’s the perfect opportunity for animal lovers to live their passion while becoming financially successful. 

You’ve done your homework. Now it’s time to get started on creating the pet taxi business of your dreams!