E-hailing has become a popular go-to for many South Africans who want to generate an income. The general public often refers to this as ‘becoming an Uber Driver’, although many e-hailing platforms beyond this one brand exist. But is this job profitable enough to be a business? Let’s look at how to start with e-hailing.
What is E-hailing?
E-hailing is transportation facilitated through digital platforms that connect drivers and riders cost-effectively and conveniently.
South Africans have steadily been using e-hailing services more in recent years. In 2024, it was estimated that user penetration for e-hailing apps would reach 21,1% of citizens, representing over 10 million users.
The industry serves as a flexible opportunity for employment, seeing many drivers establishing their own hours, comparable to a freelance taxi driver, working as a side hustle, or even turning it into a business with multiple vehicles and salaried drivers. Yet, most earn less than minimum wage due to the high costs that serve as a barrier to entry. This translates into drivers that work dangerous hours that impact passenger safety.
However, the industry isn’t all gloom and doom. After, the vast amount of yellow Bajaj and Toyota Corolla on the road indicates some drivers cracked the code.
Factors to Consider at the Start of E-hailing
If you are considering to enter the e-hailing business, there are a few things you should consider.
Costs
The basic costs of owning and operating a vehicle include monthly payment, insurance, fuel and maintenance. For this reason, rent-to-own vehicles have become a popular choice for some drivers.
Fair pricing
One concern for drivers and passengers is the need for fair pricing. Drivers need to be fairly compensated for their service, factoring in general maintenance costs and other expenses, yet passengers don’t want to pay exorbitant fees.
Technology
Part of what makes e-hailing such a popular option to use for transportation is that the platform it uses makes booking, payments and real-time tracking a breeze.
Safety
Safety is a big concern, not just for passengers who are getting into a vehicle with a stranger, but the driver as well who drives around anyone from anywhere who makes a booking. Furthermore, South African road safety is questionable and becoming a driver has some risks involved with it. Whether it is accidents, highjackings, breakdowns, or robberies, drivers need to be safe too and consider how they will protect themselves.
Is E-hailing Profitable?
According to an article on IT Web, South Africa’s Uber drivers and delivery couriers earned R 2,3 billion in 2023. In this case, it was specifically due to the platforms’ flexible earning structure. However, being profitable depends on how the business is run.
As a new e-hailing business owner, you might not see profits immediately. What’s more, profits might be small too. It all depends on the cost of your expenses. Consider the above-mentioned factors such as insurance. You can find competitive pricing for vehicle insurance. Furthermore, investigate which platform with be able to give you the best value.
E-hailing is profitable, but if it is not managed well, it can also be unprofitable.
E-hailing Platforms to Join
South African entrepreneurs who what to start in e-hailing are spoilt for choice. There is a variety of international and local businesses that they can turn to. International options include Bolt, InDrive and Uber, with the latter having a range of offerings such as UberGo, UberBlack
UberX and many more.
Locally, businesses like BozaRide and Shesha, are entering the market with a uniquely South African approach.
Steps in Starting in E-hailing
1. Joining E-Hailing Platforms
Investigate which platform will suit you best. You should join the platform and carefully read all the requirements on becoming a driver. Although it is an excellent way to generate an income, it’s vital that you read the fine print. Depending on the service you use and the area where you are located, the requirements for your vehicle might differ.
Here are some basics you need to have:
First of all, different areas have different rules about which cars can be used for e-hailing services like Bolt. So, before you start, you’ll want to understand what’s needed.
- Driver Documents
- South African Professional Driving License (PrDP)
- Proof of identification showing you’re at least 21 years old
- Criminal record check (you can get this at any PostNet)
- Driving evaluation (only available in Cape Town, Johannesburg, and Durban)
- A profile image for the app
- Vehicle Documents
- Operating Card (Double Disk)
- Uber vehicle inspection certificate (in Johannesburg, Pretoria, Cape Town, and Durban. Only *DEKRA certificates are accepted.)
- Comprehensive vehicle insurance cover
- Operating License, Grant/Decision Letter, or an official Application Receipt (from the *Department of Transport in Johannesburg, Pretoria, or Cape Town)
- DEKRA is South Africa’s top provider of Roadworthy Tests, vehicle inspections, certifications, testing, and consulting across automotive, industrial, and construction sectors
2. Run Your Business
When you enter your e-hailing business, remember that the goal is to be profitable. You need to keep careful track of your income from rides as well as the expenses incurred from running costs. You can use a simple balance sheet to keep track of this.
Furthermore, some drivers go above and beyond to give their customers a good experience. When you are driving a UberBlack, for instance, that caters to a more expensive market, consider how you can increase customer satisfaction.
3. Your Business Future
If you are in the e-hailing game long-term, then you should consider what the future holds with regards to your e-haling opportunities. Business ideas that already exist can be to add another vehicle to your business and hire a driver who receives a fixed salary. From here, you can build your fleet of cars.
Other drivers expand into logistics. The key role players like InDrive and Uber have both presented their courier offering that allows drivers to pick up and deliver packages like a door-to-door courier service.
With so many options at your disposal, there is no reason not to start in e-hailing today.
