The days before Thanksgiving, I got the chance to add one more state to my portfolio of U.S. states I have visited. State #27: Maine. The city where I was deployed to—Lewiston—was a city much smaller than my hometown Bojonegoro in Indonesia, and it was cold.
As small as it is, it has multiple taxi services, unlike my hometown. It also has a very small airport, mainly for chartered and private flights. Lewiston used to have a textile mill, but the mill has now been converted into office spaces. My client occupies one of the building.
From Chicago, I had to fly to Portland, ME, which is about 45-minute drive from Lewiston. On Thanksgiving Eve, I had to fly to client’s HQ in Toronto and continue my work there for the week. My client told me that the traffic to the airport might be a bit crowded due to Thanksgiving, but perhaps I should be worried more of the old cars the taxis use that might break down in transit. I thought, great, pretty much what I needed when catching a flight.
My client helped me call one of the taxi services. It was clean; the driver was nice (he bought me Dunkin coffee) and chatty. So, we had 45 minutes to chat: politics, economy, and taxi business. Let’s focus on the taxi business. I thought that this was a good time for me to get nosy and try to understand this taxi business, because I couldn’t understand how people make money doing taxi business in such a very small city. I know we don’t have taxi service in Bojonegoro.
My driver started his taxi business last year with his dad with only one or two cars. After a year, it has now grown to five cars. His service is by calling-in since this is a very small town. He actually received some calls requesting pick-up while we were driving. In Lewiston, the taxis do not have meter; they go by zones, similar to what D.C. has (or used to have?). I asked him where people usually go when they use the taxis. Most of them use taxi service to run errand, like going to Wal*Mart, etc. Typical costs are less than $10.
His drivers lease the taxi from him for $6/hour. Any money his drivers make is theirs, except for that $6 lease. He also mentioned to me that he pays a contractor to clean his cars (I can’t remember now if he said nightly or weekly, I do remember the price: $40).
Anyway, I did a quick math. I couldn’t figure out how he makes money if he only collects $6/hour out of each car. So I asked him how he makes profit, how he can recover the cost of the cars themselves. He asked me how much I thought he paid for the car I was in. I think we were riding in a Mercury LaSable, or a Lincoln Towncar. So I answered him, “Fifteen?” He asked me, “Fifteen-hundred?” I said, “No, fifteen thousand.” He was laughing his ass off. Guess how much he paid for it. TWO HUNDRED BUCKS!
I was thinking….”oh boy..no wonder my client warned me about taxis breaking down on the street.” Thankfully, I was already in the airport vicinity when we discussed about this pricing, otherwise, being a paranoid that is me, I wouldn’t have enjoyed the rest of the ride.
He told me he couldn’t believe the price either when he was told by the seller. Truth is, he did pay $200 for the car, but he also had to put another $1,500 to do some repairs. But it was still a pretty good deal. He can probably make that money back in four months.
So, if you are thinking about starting a taxi business, you gotta find a car that sells for $200. With my newfound knowledge of taxi service, I can probably offer you some pro-bono consulting services.
Disclaimer: The taxi driver did tell me that $200 is not the typical price he pays.
