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Ask Liz, The Limo Chick

The LIMO CHICK will answer all serious questions regarding business issues. This forum is intended for those operators who need business advice. The LIMO CHICK is not a lawyer or  accountant, and cannot answer legal or accounting questions.  The LIMO CHICK is not intended to be the source for finding the best prices on limos or the best places to get the exterior or interior of a car redone. 


Dear Liz: I needed to know how could I go about leasing a limo? what the price would be and what needs to be done. I need the limo to be able to hold 31 people if possible. So what do you think my first step should be. -Glenda Jackson

Dear Glenda:
Your first step is to get your head examined! First off, I know of no limos that are LEGAL in any state that will carry that amount of people. And, even if there were any, how can you expect to actually talk, socialize, or even more in a vehicle with that amount of people. In fact, most of the limo buses I know of don't even carry that large amount of people, most are in the 24 to 28 person range. Hey Glenda, if this is for a wedding, believe me, no one had that many friends! And if it is for a wedding, then get several vehicles, and they can pick up in different locations. Or, your last resort, is to rent a tour bus. They can carry up to 55 or so depending on the bus size or the state. But, then, most tour buses don't allow booze, and I guess that might be important to you. Hey, Glenda, I think you're swearing at the limo chick right now, but frankly, I think this is a joke or nuts.
Lastly, if you don't know how to go about renting a limo, you may be one of the few people in the world who doesn't, and obviously, you have not read anything I have written.
(The Caustic, as Usual)
Limo Chick!

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Dear Liz: I am doing the philadelphia parking authority permit to be able to get customers to and from airport, restaurants ,etc. The thing I am having a problem with is that they want a $5000 application fee. .I know its worth it for this business.

BUT what do you think?

The other limo companies will fight me and it could be a hearing to decide if I get the permit or not. The other thing is do you know how hard it may be to get permits for NY, NJ.

Dear Hector:
My first response when I read this was to tell the parking authority to go F--- them selves! That $5000.00 fee seems to be WAY too much, and since it's throw away money, and no guarantee of getting a permit, what's up with that? Who do these people think they are? Even in Boston airport, the King of Bend Over and We're Going To Stick It Where It Hurts, only charges a fee to get the permit, (one time) and around a few hundred dollars and then a monthly fee and then a per trip fee. They don't expect you to audition for the privilege! They are greedy, and only want their money, they will take it from anyone! You can run into there every day, all day, and it won't cost you $5000.00 in a year! And what's with "Other Limo Companies" having a right to fight you from getting one?
They should only be able to tell them if you're a crummy business person, and leave people at the curb and rip people off, not to keep you out of the airport. I think the money could be better spent on a GREAT lawyer to fight these self righteous bastards who think they are full of themselves with a "restriction of trade" lawsuit. I guess my other thought is I would bet there are a LOT of other companies who refuse to go to the airport due to these ridiculous fees. You know, the over ages hippy in me who thinks that authorities are sticking their nose into WAY too much of my business says, what are they doing to restrict the average person, such a Aunt Matilda to go into the airport? Maybe you should just take people to the airport in an unmarked car with unmarked plates and driven by an Aunt Matilda or Uncle Ralph and then they have nothing to say about it! I'm thinking radical here, but I think the "Philadelphia Parking Authority" should just go stuff it!

However, that being said, I know that some areas are trying really hard to put restrictions and permits in place to restrict "gypsy" operators taking business from locals. I know that New York City did thing to keep out the New Jersey drivers who were picking up in the city. I think New Jersey retaliated with something at Newark airport. You have to do your own research, everything it different by state, and sometimes by city and airport.

One last thing, I never was big into doing airport transports. Usually, they are short trips, hard on cars, not big pay back, you make it on quantity, not quality, but you burn up a lot of miles on the car. At one time I had all the permits and sucked up the fees, even if I didn't go in enough to cover the entry fee. Then I got smart. I raised my rates, and it someone was willing to pay the fee, I went in. I also dumped the permits. I drove into the parking garage with everyone else. Surprise, I was now no longer forced to stand in the cold and wait for my customer to find the limo area. I went to the baggage pick up and found them there. They were happier. They didn't mind either walking to the parking garage, or waiting at the curb until I go the car and came to them. No one got lost, and you knew where the place was a all times. The info on the computers or call in lines is never right, but the info at the gate is official. I guess I'm telling you to do whatever you need to do to either work around these fees and permits, or to tell your customers you don't go there. Personally, I made a very good living for a long time without the hassle of airports.

Good Luck!
Liz the Limo Chick
Elizabeth Cyran

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Dear Liz: My name is Al and I plan on starting a limo service within the next couple of months. I plan to lease a 2000 ford suv 200 inches. The vehicle has 64,000 miles on it and it is a beauty. My monthly payments are 900 dollars, does that seem a little high or low or is that price in the ball park of what a first limo would cost me. Also I plan to advertise in magazines, newspaper, a radio spot that cost about 15.00 dollars for every 30 seconds its a little radio station just starting out. I also plan to have gift certificates made in increments of 50 or 75 dollars to be used towards the limo service. I mean they can only use one certificate at a time. Im thinking that could get some business coming in from the start. There's a company that will print up 500 of those gift certificates for around 200 dollar and I see that would be another way to advertise. I also have a friend that works for a chrysler dealership in town and I want to give him some certificates to give to some of his customers that purchases cars. I also plan to get an advertisement in a hotel directory for 450 dollars for 1 year. The hotel has 61 rooms and they start at 90 dollars a night so its a pretty nice hotel. The guy who owns it also owns the hotel next to it that hotel is for people on a budget so he said for that price he will also let me advertise in that hotel for no extra charge it has 130 rooms. PLEASE READ AND GIVE ME SOME ADVICE ON THE INFO I'VE GIVEN YOU THANKS

Dear Al:
I have no idea if you are getting a great deal on your "beauty". I don't lease, and I wouldn't get what you are getting anyway, so I am not the person to ask. If you read my articles, you know my catch phrase: DO YOUR HOMEWORK , so if you did and you think it's a great deal, than maybe it is. A radio spot on a little radio station that is cheap may or may not be worth the money. Chances are it isn't. Gift certificates are a cute idea, but who gets them? And if people are so cheap that they will only rent with a gift Crete, then they aren't the clients you need, are they. Giving a Crete to someone who buys a Chrysler, is more interesting, but what's the demographics of the people buying? Older people don't hire limos, because they are too frugal, never grew up with them and don't see the value. You want to buy a really long SUV, older people won't go for that, that a young persons vehicle, and more guys than girls. Not your daddy's Chrysler. Maybe if you had a friend that sold BMW's if would work better. Hotel directory, well, I have never seen the value of any of these local in house books, they all seem to want a lot of money and the people who get these books are limited in number. And they you add that for the same money, you can advertise at the "budget" hotel next door. Again, if someone goes to a budget hotel, they aren't the super stretch SUV kind of folks.
Again, do your homework. You never told me what your market was or what type of business you want to attract. Obviously not the wedding or business traveler, but the "let's party hearty with the mood light SUV" Hope you're near a football stadium. Hotel people are more business travelers or tourists. More town cars then stretches. And travelers usually don't have another 12 people to go with them in that large SUV. I think you care more about getting into this business for the "thrills, money and prestige." Boy, have you a lot to learn about the business!
The Limo Chick

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Dear Liz: I am interested in starting a limo business with one lincoln town car. Should I start with the local hotels and airports in lakeland florida. I'm 45 minutes from Tampa International and 50 minutes from Orlando International. I did my research and found that the hotels only have transit transportation cab and vans, should my price be under those transit companies. Thank you, Martin.

Dear Martin:
Your price should NEVER be lower than the competition. They will think of you as cheap, and not worth the value. If the general public is paying $X dollars for a trip to the airport, and they get it all day long, why would you lower the prices? That will just get the whole area on a downhill spiral (you cut their price, they cut yours, and now no one can afford to operate) and will also get the competition Pissed at you, and they will slit your throat when they have a chance. If a cab ride costs say, $20.00, then a ride in a private, CLEAN, town car with a professional, well dressed chauffeur at the wheel should cost say, $25.00. You need to give them a reason to see why a cab is not the way to go. Hotel work is good, if you can get in with a concierge (oh, hell, I don't know how to spell that, so let's just say the guy at the desk) who will refer you or call you first or let you put your cards out. I would suggest you trying to get to the managers and head desk personnel of all the hotels you want to use. Remember, much of this will be last minute work, so if you don't want to sit by the cell phone around the corner waiting for a job, I would rethink this avenue.

The Limo Chick

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Dear Liz: I would like to know, what is a good number of limos to start off with when starting a limo company?

Liz:
My advice is pretty simple, start with the least amount you can. If you read my articles, you know that I tell everyone to do their homework. Find out the most popular cars in your marketplace, and get one of those. Then see if there is a need for a second, or if you have business for a second. Start slowly, that way, if there are any problems, you don't have lots of money invested. Actually, you can run a nice little company making money with just one car. However, most small companies I know of run two cars, of the most popular styles in their area. You might find that you make the most money running town cars to the airport! Or that you only do weddings, and need larger cars. Don't follow trends, and don't buy something just because you want it. Buy what rents!

The Limo Chick

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Dear Liz: We are a newer company struggling to stay in business. In your divine wisdom would you recommend becoming affiliated with the top 75 limo company's around the country. Like Music Express, Dav El, Diva. Hope this was a valid question for you. Thanks

Dear BO:
Aren't we all struggling to survive. My divine wisdom, oh, I like you!
I have found one thing over the years, and that is affiliates, on the whole do not work. That goes for the guy down the street who promises to "throw you his extra business" to the big guys such as you listed. I have actually applied to some of them to become an affiliate. I approached Boston Coach (big in New England) and also Dav El. I approached them several times, in fact. Most of the time I got "We're not taking on any new affiliates at this time" to sending me a long and involved application. After filling out the long and involved application, that included my blood type, I sent it and got no response. So much for getting those medical records copied! That x ray was expensive! I found out a few things along the way. They are VERY particular about what type of cars you need to be part of their network. Age, color, type. In other words, if you run one town car that happens to be a silver Mercury Marquis, Boston Coach doesn't want to talk to you, since they only want black Lincoln town cars. And, if you happen to have a 1999 black town car, they don't want to hear it, as they want a car that is only 2-3 years old. Now, when you get into limos, again, places like Music Express, well, they want special types of limos. If you don't have what they want, again, no go. The other thing you need to be aware of with any affiliates is their time in paying you. Some of these want you to wait 30, 60, 90 days for payment. You're doing this to get money, not to wait for it. If you want to get more out of town business, or even business from all over the world and country, my best suggestion is to have a VERY STRONG AND INFORMATIVE WEBSITE! I get lots of business from around the country that are coming into my area from the website. I also do some business with other companies that are looking to make a connection on the other end for a client, as well as travel planners, corporate planners, etc.
I think that affiliating with some of these companies is a good idea, they can give you a lot of business if you can fit into their criteria.
One last thing to thing about also, if you get to be one of their affiliates, you better make sure you can accommodate EVERYTHING they throw your way, or they will ace you out. As in you will have one or more cars just sitting waiting for them. If you can afford that, fine, but I think the original question was to get more business for cars that may be sitting, not more reasons for them to sit. My suggestion is to try to find creative ways to use the cars you have. Medical runs?
Delivery? I don't know what area you are in, so I can't give anything more specific, but maybe you can come up with something unusual that will work. Lastly, there is always the "change your marketing strategy" avenue. Maybe you're just not getting seen to the right people in the right areas. I find that parking your car at Wal Mart while you shop is a great way to get business! (Where does everyone go in your area?)
Good luck. The economy is poor, we are a luxury item, and Greenspan, you're nuts to keep raising rates! Why don't you just stick the stake through our hearts?

Good Luck!
The Limo Chick

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Dear Liz: My name is Ricardo, I am 30 years old, I got in the funeral business a couple of years ago and ended up building the biggest funeral group in Central America. I was in L.A. last November, saw all those limos, and decided I should get in the business. I made some phone calls and just bought two limos. They will arrive to my country, El Salvador , Central America, to start the FIRST LIMO BUSINESS in the region. Could you please tell me where can I get a look at the typical paper work or paper formats used in this industry by  dispatchers or chauffeurs? Is there any software out there that you recomend I buy to better manage my new operation? Also magazine subcriptions? Thank you very much,
Ricardo Quiros

Dear Ricardo:
Ricardo, good for you!  You'll find your new clients to be much more fun than your old ones!  First of all, if you subscribe to a publication, you can find just about anything in the ads.  I subscribe to "Limousine Digest", (www.limodigest.com) which is one of the standards of the industry, but I know there are others out there like "Limousine & Chauffeur".  Any one of them has informative articles, cars for sale, (webmaster's note - Limos-On-Line has tons of vehicles and other items for sale!) and ads for all sorts of things, such as the other part of your question, software for dispatching and basic bookkeeping.  I would also check with your accountant, or who ever does your taxes.  They can put you in touch with good bookkeeping programs. 

I don't use anything special for paperwork.  Actually, I made up my own job sheets, based on sheets I had seen from other companies, what I needed to know for any type of job, and put it on my computer.  I have a job sheet for weddings, one for airports, nights out, proms and a general one.  Each one is similar, but has specifics for that job, such as where are the pictures being taken for the wedding contract.  I run them off on my computer, and it's cheap!  If I find something isn't working, I can just change it.  I don't use tracking slips or software, I don't have so many cars that it makes a difference.  Limos-On-Line (This website) has computer software that you can purchase for just this use.  Check it out!  (webmaster's note - be sure it works with your currency) Just  remember, even if you have all the latest software, and all the books, you'll still have to do some adapting to your own needs, and, above all, you'll still have to learn by trial and error.  Good Luck!
The Limo Chick

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Dear Liz: I need help in finding information on limo business. I would like to start with two limos (10 passenger) and one Lincoln Town Car. Can you tell me about any companies that would lease me the limos and if they sell the insurance?

Liz:
Well, usually, leasing companies are just alternative financing programs. In other words, you buy a car, and then go to the leasing company to get them to put up the dough. Remember, like with any other type of loans, every company is different.  If you want to talk to them, I suggest you pick up a copy of either "The Limo Digest" or "Limousine and Chauffeur" and look through the ads. (webmaster's note - look on Limos-On-Line) I can not, in all fairness, recommend a company. I have dealt with leasing companies in the past, and I have a love/hate relationship with them. I needed them and they got me the financing, but I paid for it, and I can't say it was a good deal (was for them!), but they do finance some people that aren't as credit worthy as others. I strongly suggest that if you have good credit and the down payment that you go to a bank. 

The same with insurance, start with your local agent or one who you already do business with. Join a local or state limo association, many of them offer insurance plans that are better than what you can get off the street.  This site can hook you up with good cars, and I have a really mint one for sale (hey, it's my page, you know, so I can self promote)! Make sure you do your homework on the cars you buy. 

By the way, you're going to open with three cars - are you nuts? What makes you think you can get the amount of money out of the gate to support those three cars????  As the  but-in-your-life person that I am, (and that everyone loves so much) I think you should start with ONE car, and then work your way up. You can always add cars when you get busy. You have NO IDEA the problems and ins and outs of running a business, and you're going to jump in with three cars?  Rethink your business plan. If you don't know where to go for financing and insurance, and those are the biggest pitfalls, then you can open an entire can of worms that will sink you quickly.  Read my articles on start ups and starting small!!!!!!! (The Limo Chick is reeling here)

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Dear Liz: I just bought my first limo. It's a Lincoln built by US Coachworks. I'm having some lighting problems and can't seem to find anyone to help. I live in NH. Could you refer me to someone who could help me with lighting problems (circuit board)? Thanks, Ted

Dear Ted:
How old is this car you bought?  That could be it's problem?  Where did you buy it?  Am I going to yell at you for buying someone else's headaches?  Maybe, but read my story about getting what you pay for.  If it's a fairly new car, and you know where it came from, then it still could be costly.  Circuit boards could be very expensive.  I suggest you contact the manufacturer, and talk to their maintenance staff. (Check the door for info, address, date of manufacturer.) Give them the info on the car, and the trouble, and they should help.  I know if I have a problem, my manufacturer always helps me out.  They should also be able to tell you where to go to get it fixed.  Some of these things can be taken care of easily if you have the specs.  Try there first, that's the best way to go!  

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Dear Liz: I have been given this industry a lot of thought within the past 2 years.  My goal for 2002 is to open shop with 1 new 10 pass. limo.  I have been researching the industry on various ways to succeed. 

My question:  Can I be successful doing the following:

Incorporate my business as a limo company in January 2001(for example).  Secondly, begin the process of obtaining a client base(with no limousines), merely putting my name out there(through advertising) and then out sourcing the business to a company based on an agreement with that company to not solicit my clients. After 1 year of soliciting my company, I will then buy a new car and will minimize the amount of work I'm out sourcing.(only over-flow at that point)

Basically, get the clients, then buy the car, then operate as a full fledge company.

Can this way of entering the industry be successful?

Please advise to your thoughts.
Kevin Daniels 

Dear Kevin:
This is a great idea!  Now before you run off and do it, let me tell you what's wrong with this idea of yours.
1. If it worked, a lot of us would have tried it.  Alas, maybe it doesn't work!2.  You're going to spend a lot of money in advertising. 3. You're going to get little income, because you're going to have to pay most of the job value to the company that actually does it.4.  Do you actually think that a company is going to honor your "don't steal my customers request if you're sending them all your clients?5.  Do you think that maybe the clients will figure out you don't have a car, are just subbing the work to company B and call company B directly?6.  Do you think that when the client calls company B that they are going to refuse the job and tell them to call you first?7. Do you think that the customer is going to figure out that they get no guarantee from you and go to company B directly (since that's who is producing anyway).8. Do you actually think that the $25 - 50 you get in commission is even going to cover your phone bill, never mind advertising? 9.  Do you think I can come up with about a dozen more reasons why this won't work?10.  Would you like the name of two or three companies in my area that tried to do this type of think (for one reason or another) and that are out of business?Kevin, it won't work.  Why don't you continue with whatever you're doing, save your money for a down payment, and buy the car next year?  I would suggest that you find out the closing dates for the local phone books, so that you know when you have to put an ad in (usually 2-4 months prior to the book coming out) and time your opening to that.  The other smart way is to open right before, say a month to 6 weeks prior to prom season.  Market strong to the prom kids, the schools, etc., with flyers, do some small shows, bridal shows, or business to business shows, street fairs, etc.  If you buy your car right, and you put some cash down, you only need one or two jobs a week to support the car.  Add another job to support everything else.  If you can't do two to three jobs a week, then, this is not for you!  That way, the bills are covered, and then you can build business.  You driver yourself, you get the tips, that is your pay.  You can maybe make $75 to 100 a job in tips, and you do a couple of those, it's way better pay then Micky D's.  At that point you go to the competition, and (read my articles) you beg THEIR extra work!  You're going about it backwards, there, Kevin!  

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Dear Liz: My wife and I are looking at getting in the limo bussiness. Can you tell us the best Insurance Co.(cheap) that we can call. We live in N.C., E-mail address is (deleted) ............... Also we are looking to buy a used 1998 10 pass, white Lincoln, with low mileage ,Thanks again, Sam Cox 

Dear Sam:
Sorry, Sam, but this is totally out of the help box we can offer.  Each state has their own rules and regulations, and companies that are licensed to operate in your state.  I can only suggest that you either call the state insurance bureau and get a list of companies that insure limos in your state, or you contact a local or state limo association if you have one.  Other than that, you just have to let your fingers do the work and call agents, (webmaster's note: look on Limos-On-Line site) get info, and then investigate the companies and their claims.  As for looking for a limo, check with this sites "for sale" listing, or put a "wanted" ad onto this site! 

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Dear Liz: What kind of licensing is required to start a limo business and do you have to have a special drivers license to drive one?  How much does it usually cost I know every state is probable different but there must be an average. Also what coach builder do you recommend?  Also about what do you pay for your cars?  Is it worth getting Navigators and other exotic limos?  Thanks for your time and all the articles are great for those of us just trying to get started!

Liz:
You're going to get me in trouble here!  You're going to have to go to the registry of Motor Vehicles in your own state to find out what licenses are needed to drive in your state.  Every state is different.  Then you have to go to your own town/county/state to see what licenses are needed.  I can't help you out there!  As to what coachbuilder, well, again, it's personal preference.  I happen to rally like Royale's but I know other companies that swear by other coach builders.  Every company has their fans and detractors. One reason I like Royale because I can drive to them if there's a problem.  Again, cost depends on what's in the car, size, age, coach builder.  Call the companies, (webmaster's note - look on limos-on-line.com) they will send you price lists!  Exotics are nice if you can afford them and have the business for them.  Remember, most of your business comes from one type of car, and that's what you should have to make it in this business.  If all your calls are for 10 passengers and you only have 6 passengers, you're going to loose business and sit home.  Do your homework!  Thanks for the compliment.  I'm glad you like my articles.  Are you a relative????? Did you get my bribe???

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Dear Liz: From 1984-1990 I operated three limos in San Francisco as a side line to my airline pilot job.  I still have the airline job and a lot of free time. I'm wondering if I could approach coach builders about delivering cars for them.  Do you know if they drive them to the buyers or ship them some other way?  When I got mine, I picked them up myself and drove them home. 

The beauty of this scheme is I can fly anywhere, pick up a car, drive it anywhere, and fly back home.  It would only cost the builder (or the buyer) forty cents a mile plus gas from the coach builders shop to the buyer's garage. 

What do you think? 

Liz:
You're a pilot an you drive limo on the side.  Are you nuts??????  Don't you put in enough overtime on your regular job, you want to spend more hours behind a wheel????  And now you want to deliver cars????  You're offering a great deal to a manufacturer.  They pay drivers time and expenses to deliver. I'm sure that would cost them much more than what you can do it for. So why are you willing to give it away to them???  You won't be appreciated!!!!  I know my coach builder drives all over the place (1000 plus miles) to deliver cars.  I know from past experience from working at a car auction that the pay for drivers to deliver was not great.  Appealed to people with time on hands, retired, etc.  I personally think you should keep the frequent/free flier miles and take the family on a vacation.  Actually, I am available, and I would LOVE to go to Hawaii!  Can I take my husband?  I think if you want to do something with your free time you should maybe just find a good company in your area and work part time with them.  Hell, if you really want to do penance, you can work funerals!  I think you had a great idea, but you'll get taken.  I'm serious about the trip to Hawaii, though.

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Dear Liz: I am looking for information about 60's-70's stretch SUV style vehicles. They have between 4-6 doors on either side.  I have seen a couple on TV and also in junkyards but never in running condition.  Help me, are they Limos or what?  Who made them and what are they called?  Thanx.

Liz:
Stretch SUV's.  You've been watching TNN and Speedvision, haven't you???? Yes, they make limos out of everything.  Look in the back of any limo trade magazine (webmaster's note - they are listed on limos-on-line.com) and you will find makers/ ones for sale.  If you're going to rent these out, remember, they are not as popular as you think, and they definitely attract the crowd that had arms that reach to their ankles!  Don't expect to increase your wedding business with them!  Trust me, they make everything, and you can find someone somewhere that will build it for you.  Good luck. 

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Dear Liz: I have a few questions for Liz.  Myself and a freind are trying to start a local limousine service in our area. We have done some research and feel we could compete. There seems to be only a few in our area and the most recent person started with 1 older model car and has grown to 3 in around a years time, but that is not where our idea came from. We live in Southwest VA and my partner had to use a service out of DC for his wedding. This will be a small homebased business. We are basically ready to give it a try. So here are my questions; 

We have financial backing about $30,000 ( this is in form of a CD as collateral in a local bank , we will probably go with a line of credit so we only use what we need to get started and avaliable funds when needed) do you think buy a car, lease a car or finance a car w/ around $5,000 down? ($18-25,000 seems to be our range if we buy). We will only start with 1 car, we want to grow but at a good pace. We both have jobs and we know this is not something we are going to be able to do over night but we have put effort in our research and we have thought about other things such as ins, matainence, startup fees including partnership   agreement, lawyers fee etc. We also know enough people that we could get a price break on somethings. In a nutshell we have $30,000 that we will have to pay back, how do we get the most out of it? Thank you for any advice. 
Robert Clark 

Dear Robert:
I applaud you!  You did some homework!  If you have $30,000 and you can borrow against that, not a bad place to be.  Weigh the amount of interest you're getting on the 30K compared to what you'll have to pay when you borrow against it.  You may want to just use the 30K and go cash.  A good place to be in.  Read my articles!  (shameless pat on the back for me!)  Get the newest, best, 10pass/120" car you can afford and the two of you bust your little butts.  (By the way, if you spend a lot of time behind the wheel eating junk food, your butts will no longer be little!) Don't use all that 30K for a car if you can!  There are some
1997 repos out there that you should look at or 1998 repos. I've seen these cars around $12K!   Drive everything yourself, live off the tips, and build your business.  If you can show good numbers to a bank after a year, and no debt, they will talk to you!  Give service!!!!!! Now, some people will say you should just put some bucks down and keep the cash, but, why pay 12% on the loan payments, when the $$ in the bank is only getting you 5%????  (You're loosing $$ here!) Check the auctions for deals, and if you are mechanically inclined, you can save even more. Good Luck! 

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Dear Liz: What are the different types of licenses and permits needed to open a limo company? When purchasing your first limo, show you puurchase a brand new one or a fairly new one with a limited number of miles? How many miles should the car have? Thanks, Rosalind

Dear Rosalind:
Yes!  More women in this industry is what we need!  Don't get me started about how women are much better with details!  As for licenses and permits, this has got to be one of my most asked questions.  I DON'T KNOW!  Every state and town has their own rules and regulations, so you have to do your homework!  Start with your town or city hall, and a good place to work with is an insurance agent that works with limos, they know a lot about what is needed. 
Second question:  one of my favorites!  I always tell everyone to start with the newest car they can afford.  However, since we are four years into a new body styling of Lincoln, you can get good used 1998 and 1999 limos out there for fairly decent prices. Check with leasing companies, they frequently have repos that are good deals.  As for miles, I am a firm believer in low mileage with a warranty.  Most limos companies take the additional warranties when they buy new.  Lincoln does a 6 year 100,000 or a 3 year 150,000.  Caddy does extended warranty also.  I advise everyone starting out to buy the lowest mileage they can and get a warranty.  It will save your butt with repairs while you are starting out. And believe me, you will have repairs, no matter how well you treat that car.  We put a lot of HARD miles on these cars idling, and all sorts of things go, including front end parts (all the time)! Big ticket item for a new company to come up with $3,000 to redo the front end!  Penny wise and pound foolish when you can buy a car for say, $25,000.00 with 100k on it or $28,000 with 50K on it.  For the average new company, it'll take two years to put that 50K on the second car, and all you have to pay for is regular oil change type maintenance.  One major repair (and you will have it) will make up what you spent buying the more expense car, and since you will probably finance it, the difference in payment will be very small.  Get my drift????  As for the number of miles, the lowest you can get!  But, by all means, under 75K. That will give you at least a year of worry free driving, while you build your business.  Have a great new year!  

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Dear Liz: I'm currently considering getting into the limo service industry and have read one of your articles on buying or leasing a vehicle and was surprised to find that there are some repo limo out there. I want to start out with at least a 120" 10 pax and have been seeing the prices on 98's and up around 41k and up. I'm looking to buy somewhere around 41k to 47k. but if i can find a car cheaper would be great. I plan on doing my own driving and getting the business off the ground myself. i'm willing to put the hours in to get this thing rolling. I would like to get started around April (proms, graduations etc.) starting around this time. If i could find car at really nice price I would like to be up and operational in March. Please send any info about repo limo that you have and thanks a lot.

Dear Barry:
Hey, Barry, I'm not an English teacher, and I have some grammar problems too, but you really have to work on your letter writing!  This was difficult to read, and It took me some time to figure out what you wanted.  (Webmaster's note - letter corrected for publication) In this business, presentation is KEY!!!!!! Now that I've yelled at you, I wish I could get $90.00 an hour where I am.  However, if that's what the market bears, then good for them!  If you opened a company, than you should charge $90.00 also!  Don't be an idiot, why charge $60.00 and cover your expenses, when you can get the $30 profit????? But then again, I'm not in your area, maybe the permit, insurance, whatever fees are higher there than in my area.  What's the gas prices like?  All these things factor into what you need to make a profit.  As to what is fair to pay a driver and to pay for insurance.  Like any bill THE LESS YOU CAN GET AWAY WITH, THE BETTER!  A lot of drivers around here make minimum wage or just a little more.  Why? TIPS! Actually, since it is a tipping job, I think you can pay that real crappy waitress pay, but then again, who would want the type of person who would work for that crappy money driving their $75K cars??? 

The inch measurement you see in advertising of cars is the number of inches that the car has been stretched.  Lets say you see a 120.  That means, that they took the car, sliced it in half (literally) and added 120 inches of metal, fiberglass and other good junk in between the front and rear doors.  If you take a tape measure, you can actually measure it!  Those used to mean they were a 10 passenger, now they are only a legal 8 passenger.  Legal number of passengers the car is goes by the number of seat belts in the car, not the number someone tells you! 

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Dear Liz: What would be the right amount to pay a driver when they bring a in new clients? 

Liz:
Well, this is a tough one.  How about as little as you can get away with?????  Ok, so much for jokes, I don't  think that would keep your driver as one of your salespeople, and we really do need the people out in the field to sell for us while on a job.  I suppose it depends on several factors, such as how big your company is, how much is made on the job ( a $65.00 airport referral versus a $1200.00 wedding), and the area you are in.  I actually worked out a per job fee of cash, and then credits toward that employee being able to have a "free" night out.  I do, however, make the employee pay for the driver's pay and tip, and any expenses, such as tolls. 

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Dear Liz: My name is Florin, and for a while I've been reading your interesting stories and I decided that now it's my turn to ask you something too. I've been searching in this limo-transportation bussiness for a while now, and I'm getting to the point where I would like to make a move, but before that maybe you can give me a hand with some of my questions. I'm looking at this '95 Lincoln Town Car Cartier only 45.000 miles for a price of $15,000, is this a good choice for starters like me? I'd like to start small, and also to do more local transportation. Also where is the best source of getting customers these days? Where can I find rates information per trip or per hour. By the way, I live in New Jersey. You think this bussiness could work for someone like me looking for a part time extra money after or before my regular 8 hour job? I'm looking to expand also after a while if this really works, in the future. 
Sorry for all these questions, but any help from you will help. Hope to hear from you soon. 
Florin 

Dear Florin:
Florin, I take it you're going to start with a Town Car, and run car service, not limo.  I really don't know the value of those cars, I would check the NADA or Blue Book value of the car.  Also, If this is a current livery car, remember, if you think the limos get hard miles, the Town Cars get worse!  Running into airports, and pushing the pedal can take it's toll. If you're going to go the Town Car route, and work it around your regular job, this might run into a problem.  Town Car clients are usually business people, and they want what they want when they want it.  If you work 9 to 5 and you have a contract with XYZ company, and they need to get Mr. T to the plane for 8, how you going to do that??????  By the by, the best way to get customers if from other customers!  Word of mouth.  But short of that, hit up your friends!!!!  Really, go to people and businesses you know and market it them, then go the
phone book, publication route.  Best way to get rates for your area is to call the competition!  Ask the rate from your area to JFK, Laguadia, Newark, Atlantic city, etc., if they ask you you can play dumb, and say you haven't made your plans yet, and they won't suspect a thing!  Yes, customers do it all the time!  I had a guy call last fall saying he wanted rates for NEXT fall, he was planning a trip and wanted to know how much to get to the airport.  After I got done laughing, I just said, I don't know, but I will tell you the CURRENT rates! 

Now Florin, you contacted me because you wanted an honest answer, no punches pulled,so I will do just that. Do I think that this business could work for you, working part time after or before your regular 8 hour job?  Frankly, no.  When are you going to answer the phone to get the jobs?  Liz is a stickler for ANSWER THE PHONE LIVE, NOT ANSWERING MACHINE!   How are you going to offer 24 hour service, which you have to do to corporate clients?  They usually fly out in the mornings (you need to get to work) and fly back around 4 to 8 PM. (you're still in work) and Florin, WHEN ARE YOU GOING TO SLEEP!  I won't even get into the tired factor of this job, and long hours on the road, and white line fever, and the MANY operators who have fallen asleep at the wheel.  So the bottom line is, maybe you need a partner?  Someone who works a different shift?  OR, AND HERE'S AN OPTION, FLORIN, get a LIMO instead of a town car, and only offer nights out and weekend work, weddings, etc.  You're also looking at a less tiring type of work, since town cars are run, run, get me to the plane, and limos are sit around outside the restaurant work.  See - that's when we sleep!!!!!!!!! Rethink, my man. 

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Dear Liz: I have been trying to locate a coach builder that stretches sports cars. I have searched every search engine and used every link to try to locate a stretched Viper limo, or at least a builder that creates such vehicles. Can you help me with this? Thank you, Wayne Blanchard

Dear Wayne:
I've seen ads for guys that stretch anything in Limo Digest, and also car magazines, like Rod and Custom.  I think you will have to talk to shops in your area that deal in exotic or antique cars.  Many of those guys will do custom work. 

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Dear Liz: We have three white Lincoln limos for sale. Would like to know the value of each. They are 1995, 6, 8 and 10 passenger.They are in running condition. Is there a web site that gives prices?  Thank you, Lauren

Dear Lauren:
Contact the manufacturer, and get them to give you a trade and retail value.  Get the NADA book, and check the value.  Lastly, go to any site that's selling limos (webmaster's note: check right here - Limos-On-Line) and see what they are asking.  Put all  three together, and I will bet they are all high and you'll get less on a sale than any of those three stated!!!  

Please email your questions to Webmaster


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