Did you know that Black Cabs on a corporate account are generally 30-40% more expensive than a luxury Mercedes chauffeur with a 'suited and booted' driver?
The reason for this is the structure of the Black Cab service - all the Black Cab drivers are self-employed and have fixed metre costs. Therefore the corporate account user will pay
(1) a 'run in' charge - i.e. the cost on the metre for the taxi to come from wherever it is when booked to the pick-up point, (2) an administration fee for the booking company (be it Dial-a-Cab, Radio Taxi, ComCab, or any other), this is generally between 5 and 15% of the total journey cost, (3) a booking fee, usually a further 5% of total journey cost or a flat fee, (4) the actual cost of the journey - this will be on the metre and will be unpredictable, (5) any waiting or parking charges - waiting time will always be charged on in full as it appears on the metre and needs to go to the driver, and (6) VAT.
Executive taxis on the other hand are able to offer single rate journeys and, as mentioned above, these work out at, on average 30-40% less than the Black Cabs overall charge for the same journey.
Why then do people continue to spend millions and millions of pounds per year on corporate Black Cab accounts? That's a very good question. Apart from the obvious answers of laziness and ignorance there are some very good reasons for having a Black Taxi account notwithstanding the potentially huge waste of costs. These are as follows:
(1) Immediate availability; and (2) Uniformity of service.
In relation to (1) clearly the Black Taxis boast fleets of several thousand cars compared with the generally low hundreds of the executive car services. However this bald fact can be misused by the Black Taxi service salesmen.
The fleet numbers often cover the fleets for the whole of Greater London and also only about 50-60% of them are on the road at any one time and of these only a small fraction in any one place at any one time (e.g. the City of London). Therefore if a company signs up 2 executive car companies with a combined fleet of several hundred and where these suppliers' clients a centred in the same geographical area as the client in question e.g. the City of London, comparable, if not better asap pick-up times can genuinely be achieved. The trick is (a) finding the right executive car companies - ICC helps with this, and (b) getting the right KPI's in place so that performance can be measured and monitored properly - again we advise on this. Once this is done most companies can save hundreds of thousands of pounds for a better service.
In relation to point (2) 'uniformity of service' this can be a real issue. Companies like their clients to see them in Black Taxis and employees often feel that the type of taxi they get is commensurate with their status. However such uniformity is easily achievable within the executive car arena. For example a client could ask that all staff except senior managers and directors get standard executive cars (i.e. late registration BMW's, Audis, Rovers, etc) and the S-Class Mercedes service is reserved only for important clients and very senior staff.
'One stop shop' solutions are increasingly being sought by astute corporate purchasers who recognise the potential savings and are alive to the service issues.
These services seek to harness Black Taxi and executive car suppliers onto one booking platform. The market in these unified platforms has grown enormously in recent years and now includes: Tri-Star's Aptus, Radio Taxi's 'One Call', 'Journey Man (developed at Lehman Brothers before its demise), Dial-a-Cab's Concierge, Professional IT's Freedom Platform, and many others. These platforms vary enormously in terms of independence (i.e. independence from any particular supplier), cost, performance, scalability, flexibility, user-feel, and interoperability with other booking tools e.g. Click Book, Get There, and Expedia Corporate.
About the Author
Ian works as an SEO and Web Developer for eSoftware Solutions. He has been in the industry for 4 years and works with both US and UK clients.
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