Unfortunately there is no way you can guarantee a regular income throughout the year. Once well established, your income will become a great deal more predictable but, to start with, driving lessons will occur erratically throughout the week. You should also realise that there are seasonal changes. During the period from the school Easter holiday through to around October, there is usually an enormous number of people wanting driving lessons. To cover the leaner winter months, you should aim to obtain new clients from September and October onwards. Many people do not like the idea of learning to drive in poor weather conditions or when it is dark. You may therefore need to consider revising your weekly working schedule to accommodate clients’ wishes. Approaching and throughout the Christmas period, those on a low income may vary their driving lesson appointments, the length of lessons or cancel lessons altogether.
Those with birthdays and those receiving cash for Christmas presents (or driving lesson vouchers) may well want to start lessons from 26 December. Otherwise, inquiries may be in short supply until around March. Your clients may want to use bank holidays for driving lessons but, if you live in a busy holiday/tourist area, you might consider watching the sport on television instead. Inform your clients that they may be paying good money just to sit in a traffic jam. You will also have the very real problem of trying to get to driving lesson appointments through the heavy traffic. Mondays are therefore a very good day to have as your rest day. If you are looking to have an annual holiday during the summer time, this is one of your busier periods, so having a holiday at this time is not ideal. It is worth considering a winter holiday in a warmer climate. With all the above in mind, you should now realise that you are not going to have a regular income throughout the year. Consider budgeting for this by having more driving lessons per week than you think you need, especially in the summer months.
Finally, you may consider finding a source where you can purchase, at a discounted price, books and CD-ROMs related to the theory and practical driving tests. These you could sell on to clients at the usual retail price, making a small profit. You could also hire these out for a set time. (Remember, however, that the theory test question bank is altered every year, round about autumn, so do not get stuck with out-of-date stock.) You could also insist that, as part of their course, your clients buy a logbook in order to keep a record of their progress. These can be bought from Driving School Pro and sold at a profit.
When constructing your business plan, you will have to take all your costs into account. Because of price fluctuation and other variables, it is impossible to give figures in this article, but you should be able to obtain some idea of costs by checking prices on the Internet and asking questions on the ADI forums. When considering your expenditure you should take account of the following: What type of car – manual or automatic (or are you going to run both?). Car servicing, depreciation, repairs, tyres, car cleaning and fuel. Roof and other signs.
Subscriptions to professional organisations. The ADI licence every four years (see the DSA’s website for current costs). Obtaining a good, cheap accountant. Talk to several before making a decision. Legal fees if you intend to draw up client–instructor contracts etc. County Court fees if you claim against clients for unpaid or cancelled driving lessons that are in breach of your terms and conditions. Stationery and computers and their repair/replacement. Telephone costs: landline and mobile. Bank charges (these sometimes start from the second year onwards). At the time of going to press, if you subscribe to the Federation of Small Businesses (FSB) and bank with the Co-operative Bank, you will not pay bank charges if your business account remains in credit. This is worth considering. Check first to confirm. Standing order’s/direct debit’s that transfer a set amount each month to your savings/retirement fund/pension account/health insurance account. Putting something away each week for your replacement car – this is cheaper than paying interest on a loan when the time comes to change it. Insurance to cover your accountant’s bills if the Inland Revenue decides to check your accounts. This can be a very costly event. At the time of writing, this item should be covered if you subscribe to the FSB. Check first. Health insurance. A private pension. Advertising. Income tax. National Insurance contributions.
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Note: This article was sent to us by: Catherine Britton at 01172010
1. Time to consider taking an ADI training course
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