Why Are Party Bus Rates So Different
Party Bus and Limousine Rental can be scary but it doesn’t have to be. Understanding the cost of ANYTHING first requires that you understand the value of what it is or what…The same rule applies to Party Bus Rates.
This is like asking someone how much is a steak? If you are at a diner vs. A prime steakhouse This can mean the price could range from $10-100+ depending on the cut, weight, etc. So it’s important to have an understanding of the product you are looking to purchase and the preferences you require. This will determine your budget and therefore allow you to decide the servicing company.
Things that drive down the cost of a party bus include daily expenses. Companies have bills to pay. So to counter those expenses they must prove their services appropriately In order to stay in business. Here are some things to think about.
1. Insurance
Most companies depending on the vehicle size can have Insurance rates upwards of $400-$1400 a month per vehicle. These are 1 million to 5 million dollar coverages.
2. Place of business
Most companies that have been around for a while usually have a place of business. However, with the help of the internet more newer companies are managing to work remotely keeping all vehicles in a separate location or in some cases in their own driveways! As we all know rent can be expensive. Cutting that expense down can allow you to provide a better rate.
3. Cost of vehicles
Let’s be realistic here…All vehicles are not Made the same! You can NOT just go by the accommodation. A Honda civic coupe and a Lamborghini both seat 2 comfortably!
Amenities, year of the vehicle, coachmaker and vehicle type all play key factors.
Coachmakers such as Tiffany Coachworks and Grench Motors provide some of the most popular and modern builds on the market. And these vehicles brand new cam run upwards of 100k to 175k. However, a startup company may opt to get a used bus at around 40k and spend another 20k or less to convert it into a beautiful party bus. Now with saving more than half on acquiring a fleet vehicle, it takes them less time to become profitable allowing them to market more competitive rates.
4. Cost of Service
Gas, Employees taxes permits are everything consumers don’t understand when booking a vehicle for hire. With gas rates constantly changing that has a direct reflect on a fuel-dependent industry. A typical Party bus gets about 8 miles per gallon intercity. This can in some cases equate to about $15-20 an hour just for Fuel!
Good drivers are not cheap either. Many companies Owners will drive themselves allowing them to sometimes price 10% -15% less than their competitors. A bad driver will not only cost you a salary but could also cost you return business if they are not properly trained (which accrues more expenses) Drivers who get paid 15%-20% of the cost of the service which in many cases is well deserved when you consider they carry the most responsibility when making your night a success.
5. Fleet size
This is important to think about because it can have a lot to do with the service you will receive AND at what cost it will come. A large Fleet can mean more expenses such as salaries and gas including lower insurance cost per vehicle, However, it can convert to a lot of business allowing you to compound your revenue more quickly.
A small fleet has its advantages as well, allowing a company to maximize and manage their productivity split tasks with independent contractors allowing an owner to do a lot of the day to day tasks themselves, therefore, cutting costs. However, this would mean that the owner would also need to be very organized to ensure everything goes smoothly.
In the case that there was something unfortunate to happen such as a mechanical failure sometimes these companies do not have the resources to provide replacement vehicles and can only provide refunds. A larger company may have the option to dispatch one of its additional vehicles to finish the job. All companies have the ability to call an affiliate provider to assist in finishing the run but IF the price of that affiliate is higher than the rate offered to the consumer many times the company will not go the extra mile to do so simply because it would cost them more time and resources in the process.
In Summary.
With all this being mentioned it is usually the combination of the under or uninsured, non-brick and mortar, custom built, owner driven, small fleets that can usually offer the best price.
But please don’t take this out of context. There are many small business owners that have built beautiful vehicles that enjoy servicing their own clients and are fully insured. It doesn’t mean they are not legit!
In the end, it is up to you. Do your research, Ask Questions and find the best company that fits your budget keeping all risks in mind.
