Do you like riding your bike around your hometown or major tourist destinations? Does bringing a buddy along to view the sights actually brighten your day? Running a bike tour business might be exactly up your alley. This may be a fulfilling company whether you are just renting bicycles and maps for customers to use on their own or giving week-long tailored guided tours that include meals and accommodation.
Follow these ten steps to start a bike tour company:
Make a plan for your Bike Tour Company.
Make your Bike Tour Company a Legal Entity.
Tax Registration for your Bike Tour Company
Create a Business Bank Account and a Credit Card
Create an accounting system for your bike tour company.
Obtain the Required Permits and Licenses for Your Bike Tour Company
Purchase Bike Tour Company Insurance
Create a brand for your bike tour company.
Make a website for your Bike Tour Company.
Configure your Business Phone System
Starting a company entails more than just registering it with the state. We’ve put together this easy-to-follow guide on launching your own bike tour business. These stages will guarantee that your new company is well-planned, correctly registered, and legally compliant.
STEP 1: Make a business plan.
A well-thought-out strategy is vital for entrepreneur success. It will assist you in mapping out the intricacies of your organisation and uncovering some unknowns. Consider the following crucial topics:
What are the initial and continuing expenses?
Who is your intended audience?
How much money may you charge your customers?
Fortunately, we have done a lot of the legwork for you.
What are the expenses of starting a bike tour company?
You’ll need a storefront/bike shop to store and repair your bikes; rent or mortgage will cost about $30,000 per year. Because this may not be where your tours begin, you need have transportation capable of transporting enough bikes for a group tour—an estimated $20,000 for a van. You’ll need to buy strong bicycles that can withstand frequent usage; anticipate to pay roughly $1,000 apiece. There are also the regular expenses of corporate equipment such as laptops, mobile phones, and dependable navigation services to consider. Setting up $100,000 for your first year’s operating expenditures should get you started. You should be able to reduce your investment in half if you start a party-bike trip.
What are the continuing costs of running a bike tour company?
You may believe that since you would be living outdoors, you will not incur much operating expenditures. This is not correct. You’ll need to maintain and repair your fleet’s bicycles, as well as have an office support personnel and keep your van running.
Who is the intended audience?
You will be able to target two key age groups. Young millenials and empty nesters have the freedom to travel at their own leisure. If you’re near the beach, you’ll be targeting families looking for a cheap bike rental for a couple of hours. Millenials and baby boomers have additional money to spend and would prefer to engage in a whole experience that includes a tour guide, picnics, and an informative discussion of sights. Overnight adventures or more physically demanding treks may pique their interest.
How does a bike tour business generate revenue?
Even if you are only renting a bicycle for a day-tourist to utilise on their own, your services are for hire. They may pay you by the hour, the day, or for a pre-arranged guided trip package that includes meals and accommodation. You must earn enough rentals to cover the expenses of the bicycles, their upkeep, and your wages.
How much money may you charge your customers?
Simple bike rentals without a tour cost around $10 per hour. For an afternoon excursion, guided tours in groups of 15-20 people may charge $40-$60 per person. Overnight guided trips with accommodation and food cost between $300 and $500 per person per day. Camping trips will cost $100-$200 less each day.
What kind of profit can a bike tour business make?
Above and above the price of the bike, food, and hotel, your profit comes from charging an hourly charge for your tour guide’s expertise. When your reservation calendar is filled, your successful bike tour firm should be able to make up to $200,000 in net profit each year.
How can you increase the profitability of your company?
Bundling activities for your consumers and integrating all expenses in a single, appealing bundle will provide the most revenues. Professionals looking for a brief vacation are drawn to all-inclusive adventures, and they are ready to pay a premium for the experience.
STEP 2: Establish a legal entity
Sole proprietorship, partnership, limited liability company (LLC), and corporation are the most frequent business structure forms.
Creating a formal business organisation, such as an LLC or corporation, shields you from personal liability if your bike tour firm is sued.
STEP 3: File your taxes
Before you can begin for business, you must register for a number of state and federal taxes.
To register for taxes, you will need to get an EIN. It’s really simple and completely free!
Taxes on Small Businesses
Depending on the business form you choose, you may have multiple choices for how your company is taxed. Some LLCs, for example, may benefit from being taxed as a S company (S corp).
These guides will teach you more about small company taxes:
Taxes on LLCs
LLC vs. sole proprietorship
Corporation vs. LLC
S Corp vs. LLC
How to Form a S Corporation
S Corporation vs. C Corporation
There may be state taxes that apply to your company. In our state sales tax guides, you may learn more about state sales taxes and franchise taxes.
STEP 4: Establish a company bank account and credit card
Personal asset protection requires the use of distinct business banking and credit accounts.
When you combine your personal and business accounts, your personal assets (your house, vehicle, and other possessions) are at danger if your company is sued. This is known as penetrating your company veil in business law.
Furthermore, understanding how to develop corporate credit may help you get credit cards and other financing in your company’s name (rather than your own), lower interest rates, larger lines of credit, and other benefits.
Establish a business bank account.
Opening a business bank account is not only required when asking for business financing, but it also:
Separates your personal assets from the assets of your firm, which is required for personal asset protection.
It simplifies bookkeeping and tax reporting.
Create a net 30 account.
Net 30 accounts are used to develop and grow company credit while also increasing cash flow. Businesses use a net 30 account to purchase items and refund the whole debt within a 30-day period.
Many net 30 credit suppliers submit information to the main business credit agencies (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how firms establish business credit in order to get approved for credit cards and other lines of credit.
Apply for a business credit card.
Obtaining a business credit card benefits you in the following ways:
Put all of your company’s costs in one location to separate personal and business spending.
Build your company’s credit history, which will be important for raising funds in the future.
STEP 5: Establish business accounting
Recording your numerous costs and sources of revenue is crucial to assessing your company’s financial status. Keeping precise and thorough accounting also makes yearly tax filing much easier.
STEP 6: Obtain all required permissions and licences
Failure to get appropriate permissions and licences may result in significant penalties or possibly the closure of your firm.
Requirements for State and Local Business Licensing
Certain state permissions and licences may be required to run a bike tour company. Visit the SBA’s reference to state licences and permits to learn more about licencing requirements in your state.
For information on local licences and permissions, visit:
Check with the clerk’s office in your town, city, or county.
Contact one of the local organisations mentioned in the US Small Business Associations database of local business resources for help.
Occupancy Certificate
A Certificate of Occupancy is often required for businesses that operate from a physical site (CO). A certificate of occupancy certifies that all building rules, zoning laws, and government requirements have been satisfied.
If you intend to rent a space:
In most cases, it is the landlord’s obligation to get a CO.
Before leasing, ensure that your landlord has or can get a valid CO for a bike tour company.
A new CO is often required after a big remodelling. If your location will be refurbished before opening, incorporate wording in your leasing agreement saying that lease payments would not begin until a valid CO is given.
If you intend to buy or create a location:
It is your responsibility to secure a valid CO from a local government entity.
Examine all building regulations and zoning standards for your business’s location to guarantee that your bike tour company is in compliance and may receive a CO.
Waivers of Liability
Bike tour companies should have their customers sign disclaimers to prevent liabilities and possible litigation.
STEP 7: Obtain commercial insurance.
Insurance, like licences and permits, is required for your company to operate safely and legally. In the case of a covered loss, business insurance protects your company’s financial well-being.
There are several sorts of insurance plans designed for various types of companies with varying risks. If you are unaware about the hazards that your company may encounter, start with General Liability Insurance. This is the most popular coverage required by small companies, so it’s a good place to start for yours.
Workers’ Compensation Insurance is another important insurance product that many companies need. If your company will have workers, your state may require you to purchase Workers’ Compensation insurance.
STEP 8: Establish your brand
Your company’s brand is what it stands for, as well as how the public perceives it. A strong brand will help your company stand out from the crowd.
How to Market and Promote a Bike Tour Company
Conventions are an expanding market for service-oriented companies like yours. Set up a stand at travel seminars, distribute brochures as a honeymoon alternative, and place print advertising on outdoor equipment dealers’ websites and catalogues. Encourage early registration to increase consumer follow-through on their intentions.
How to Keep Customers Returning
Customers will prefer your bike trip to a bus tour if they get to see sections of the location that big box excursions avoid. You must concentrate on every aspect of the bike route that is distinct from any other tourist site in order to increase its perceived worth. When your consumers have an enjoyable and uplifting experience as a result of your great customer service, unique expertise, and excitement for sharing their holiday, they will return. Don’t forget to change up your bike pathways to provide returning consumers a new experience.
STEP 9: Create your company’s website.
After you’ve defined your brand and designed your logo, the next step is to build a website for your company.
While developing a website is an important step, some may be concerned that it is out of their grasp due to a lack of website-building skills. While this was a fair concern in 2015, online technology has made significant advances in recent years, making the lives of small company owners considerably easier.
The following are the primary reasons why you should not put off developing your website:
Every genuine company has a website, period. When it comes to bringing your company online, it doesn’t matter what size or sector it is.
Social media accounts, such as Facebook pages or LinkedIn company profiles, are not a substitute for your own business website.
STEP 10: Install your company phone system.
Getting a phone for your company is one of the finest methods to keep your personal and professional lives distinct and private. That isn’t the only advantage; it also helps you automate your company, provides it legitimacy, and makes it simpler for prospective clients to identify and contact you.