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Practical Guide for Transport Start-Ups_0910


									                            1.2 Practical Guide for Transport Start-ups
The information in this guide has been compiled to help you through the steps of starting up your transport business. Contact
details are provided, should you wish to do further research, planning and enquiring.

 Points of note:
 “80% of new businesses fail within the first two years”. This is largely due to:
    1. Lack of adequate planning and preparation especially in predicting market demand.
    2. Indadequate management skills.
    3. Insufficiant capital to launch the business and carry it through the development phase.

     • Talk to all the local authorities under whose jurisdiction your business will operate many regulations need to be
        complied with. Ignorance of the law is no defence and heavy penalties may apply.
     • Contact one or more of the trade associations. Their criteria for membership is usually a summary of all legal
        requirements. In addition it will list other necessary criteria for the establishment of a successful business as
        experienced by their members over many years.
     • Set up a proper legal trading entity such as a Limited Liability Company ([Pty] Ltd) or a Close Corporation (CC). This
        will protct you and your partners in your private capacities.
     • Set up meetings with an accountant, a lawyer, a road transport specialist, bank manager, the Receiver of Revenue
     • Funds to start up you business have to be secured through commercial lending channels such as banks and financing
        companies. Remember that any tourism related business might take up to three years before it develops a market
        share and becomes financially viable.
     • Do much preliminary work and research presentation of your concept. This will allow advisors and financiers time to
        read and absorb it before giving you misguided advice due to bad communication.
     • To achieve the best results you will need to commit time and money to the planning stage. The amount of effort you
        invest initially will significantly enhance you chances of success. If you don’t have the time, confidence, or the skills to
        do the work then it is best to employ a qualified cosultant or professional. - SATSA

It will be to your advantage when starting a tourism transport business to be aware of the following:

1.      Types of transport
2.      Business Planning
        Market research
3.      Statutory obligations
4.      Minimum requirements for transport operators
5.      Useful information services
6.      Contacts details for Cape Town Tourism membership team
 STEP 1:             What type of Transport Business do you want to start up?
1. Types of Transport - Two types of tour operators

The Broker compiles itineraries for prospective tourist and makes arrangements for clients in terms of accommodation, transport
and excursions. Brokers do not operate vehicles or accompany tourists. (Getting started in tourism pg23 – Western Cape
Tourism Board)

The Wheel operator owns or leases transport vehicles, for example large coaches, minibuses or motor cars. They transport
tourists to their destinations and to view tourist attractions. They also make the necessary arrangements with regard to
accommodation and other matters. (Getting started in tourism pg23 – Western Cape Tourism Board)

1.1 Tour Operator: A Tour operator is a “legal entity or company responsible for the conveyance of visitors to venues, attractions
and destinations. The operator should be registered and licensed in order to protect all parties involved, including the tourist, the
host community, the driver, the tourist guide, and the responsible road authority.” (Getting started in tourism pg23 – Western Cape
Tourism Board)
Local tour operator - The company that puts together the components of a tour for sale to the public and operates the tour.
Inbound Tour operator: A tour operator that specializes in inbound tourism. Tourists coming into a country.
Outbound Tour operator: A tour operator that specializes in tours to destinations outside South Africa.

1.2 Airline / Air Charter : An airline is an organization providing aviation services to passengers and/or cargo. It owns or leases
airliners with which to supply these services and may form partnerships or alliances with other airlines for reasons of mutual

1.3 Rail Transport: Rail transport refers to the land transport of passengers and goods along railways or railroads

1.4 Taxi: Taxi: “A car driven by a person whose job is to take passengers where they want to go in exchange for money”

1.5 Water Transport / Charter: Water transport is the process of moving people, goods, etc. by barge, boat, ship or sailboat over
a sea, ocean, lake, canal or river.

1.6 Coaches: Coach refers to a large motor vehicle for conveying passengers. It is similar to a bus but usually more comfortable
and designed for longer-distance travel or touring. Coaches have upholstered seats, carry a toilet and are air-conditioned.

1.7 Minibuses: A minibus is a motor vehicle that is designed to carry fewer people than a full-size bus. An example of a minibus
is the VW Transporter although there are many manufacturers producing models specifically for such use. The minibus is used
for public transport as a maxicab in South Africa..

1.8 Shuttle Service: A Shuttle Service is a “legal entity or company responsible for the conveyance of visitors to venues,
attractions and destinations. (Getting started in tourism pg27 – Western Cape Tourism Board)
     STEP 2:             The Business Plan
2.      Business Planning
Although this is just a practical guide, it is important to know that before you even start to go through the legalities of registering a
Transport business, you must know where your business is heading. Hence the importance of a Business Plan.

What is a Business Plan?
       A business plan shows the series of steps you need to take to achieve your business goals
A Business Plan helps you to:
   • think of good ways to run your business and develop a business strategy that will work
   • take a fair, critical and unemotional look at the business as a whole
   • think about whether your business idea will work
   • plan on paper what will really happen with your business
   • think through the important issues in your business in a clear, logical way
   • deal with problems in your business and work towards achieving success
   • set up proper ways to make decisions
   • communicate your ideas to all the people who will be involved in your business
For an outline of what you business plan should contain and addition Business Planning tips please contact the Cape Town
Tourism, Business Support Coordinator or the Business Support Champion in your area.

Market Research
The following information may be useful.

Identify your competitors and determine if your product can compete with theirs. In particular try to identify the unique selling point
or product difference that will provide you with a competitive edge.

For more information and help on business plans and marketing assistance, don’t hesitate to contact:
Cape Town Tourism Head Office
Adrian Solomons
Business Support Coordinator
Tel: (021) 487 6800
Fax: (021) 487 6899
The Pinnacle Building
Cnr Burg & Castle Streets
Cape Town
      STEP 3:                 Legal Requirements
3.        Statutory Requirements and local Government obligations
3.1       Vehicle and Transport Licenses
          Two Kinds:     Vehicle requirements & Driver requirements

Vehicle requirements
3.1.1 Vehicle registration and license
    1. You must get registration papers for the vehicle from the licensing department when you buy the vehicle.
    2. At the same time you must get the vehicle license and put the license disc on the windscreen of the vehicle. The license
       must be renewed every year.
3.1.2 Roadworthiness
       1. Each vehicle needs to have a Certificate of Roadworthiness.
       2. You need to take the vehicle to a public or private testing station. Here they will look closely at the vehicle and give it
            a Roadworthy Certificate.
       3. Then you need to take the Roadworthy Certificate to the licensing department.
3.1.3 Road Transportation Permit (also known as a Public Operating License)
    Every road vehicle that is to carry paying passengers must have its own Road
    Transportation Permit from the Local Transportation Board.
    An operating license can take anything from 4 to 12 months.
    You need documentation to prove that the service is necessary in the area you intend operating. You have to submit all
    documentation to the Transport Board.
    If the application is accepted it will be registered for specific routes.
    You can prepare your application yourself.
    You need to complete the form with:
         • Your personal or company details
         • The type of public transport service
         • The route details
         • Your vehicle details
         • You will need to provide a minimum of three supporting letters with the company letterhead from relevant business
             stating that they will support your business.

      You also need to sign an affidavit saying that you have not committed a violent or serious crime or a crime involving illegal
      weapons. There is a R25 administration fee for the Road Transportation Permit. Once you have a road transportation permit
      you need to show this license whenever you are asked to do so by a traffic officer and you must put a distinguishing mark on
      your vehicle.

      Road Transportation Permit:             Tel: (021) 597 1000
                                              Local Transportation Board
                                              c/o Voortrekker & Goulburn Rds
                                              Cape Town
Driver requirements

3.1.4 Driver Licenses
     The driver of any vehicle must have the correct license. This includes the correct license for the type and size of vehicle.

3.1.5 Professional Drivers Permit (PDP)
     This is requested for drivers taking paying passengers, requires at least two years of driving experience. Apply at the Local
     Traffic Department.
     You must send the following when applying for a PDP:
         • The necessary fee ( this is set is law)
         • Acceptable identification
         • Two photographs of the applicant
         • An original driving license
         • A medical certificate form an approved doctor (valid for 2 months)
         • Any other PDP already held by the applicant
     Application takes about 6 weeks and the cost is R210 in total. That is R170 for the PDP and R140 for temporary licence while
     you wait.

      Note: A PDP will not be given to anyone who has been convicted of or who has paid an admission of guilt fine for:

          •   Driving under the influence of alcohol or drugs
          •   Reckless driving
          •   Any crime where violence was involved

3.3      The Business
         3.3.1 Registration
         1. Business Registration can be done at Swift Reg. It can be done in one day registration. One buys a shell company
             and then you trade as. Tel: 021 595 3355

         2. Registration of the business’ trading name is done with CIPRO. It is done so that there is not more than one business
            with the same name & the name of your business is protected and cannot be used by anyone else.
            Only a Close Corporation or A Company needs to register a business.
            CIPRO – DTI Office, NBS Waldorf Building, ST Georges Mall, Burg Street, Cape Town Tel: 021 480 8060

Postal Address:                     Physical Address:                             Customer Contact Centre:
PO Box 429                          The Dti campus (Block F - Entfutfukweni)      Tel No: 0861 843 384
Pretoria                            77 Meintjies Street                           Fax No: 0861 843 888
0001                                Sunnyside                                     International Tel: +27 (12) 394 9500
                                    Pretoria                                      International Fax: +27 (12) 394 9501
                                                                                  Email Address:

Registration of a business or further advise can be done at any RED Door office, please ask your Business Support Champion for
a list of RED Door offices.
3.3.2 Zoning
    Application for rezoning (may take up to 3 months).
    Rezoning of premises, from residential to business maybe required. Town planning permission to establish a business
    requires compliance with Town and Regional Planning Commission. Requirements e.g. off-road parking space to be provided
    Each area has specific requirements. Please contact Town Planning on the following numbers for the specifics of your area.

    •   Bellville:                        021 918 2329
    •   Blaauwberg:                       021 550 1094
    •   Cape Town:                        021 400 3229
    •   Durbanville:                      (see Kraaifontein number)
    •   Goodwood:                         021 938 8459
    •   Helderberg:                       021 850 4346
    •   Khayelitsha:                      021 360 1150
    •   Kraaifontein:                     021 980 6190
                                          021 980 6183
    •   Kuils River:                      021 900 1773
    •   Muizenberg / Wynberg:             021 710 8000

3.1.6 Business Licences
Once zoning is approved the next step will be business license
Businesses (if required) need a Trading license from their municipality.
Compliance with local authority regulations includes: a fire safety certificate. This is obtained when business registration is
completed through your local municipality.
    • Blaauberg:                         021 550 7549 – Marian
    • Bellville                          021 918 2011 - Environmental Health Practitioner
    • Brackenfell:                       021 980 1202 - Junita
    • Cape Town:                         021 400 3004 - Prisila
    • Durbanville:                       021 970 3003 - Wilma
    • Goodwood:                          021 590 1483 - Sumaye
    • Helderberg:                        021 850 4300 - Rose Beukes
    • Kraaifontein:                      021 980 6201 - Devina
    • Kuils River:                       021 900 1780 - Juanita
    • Lakeside:                          021 788 9350 - Environmental Health Practitioner
    • Parow:                             021 938 8111 - Tina Snow
    • Bellville:                         021 918 2022 - Aldrien
    • Wynberg / Muizenberg:              021 762 2704– Fariet
    • Mfuleni                            021 909 3811 – Environmental Health Practitioner
    • Noordhoek                          021 789 1366 - Environmental Health Practitioner
    • Khayelitsha:                       021 360 1100 – Environmental Health Practitioner

3.1.7 Insurance
Public and Passenger Liability Insurance is suggested for all businesses. Contact Cape Town Tourism to access a list of brokers
and insurance specialists. The minimum amount is R5 million and the preferred amount is R25 million. .
                        Join Cape Town Tourism for an Innovative Membership
     STEP                 Programme and additional Business Support.
         Minimum Requirements
In order to join your local tourism organization you will need to pass a set of minimum requirements.
See Appendix X.
These deals with legislations issues such as:
Adhere to driver guide legislations.
   • Visitors must be well informed and protected against false advertising – On all collateral and brochures.
   • Tourist guides must be registered.
   • Operator must be covered in the areas in which tours are conducted under the territorial clause of the policy.

4.1     The following documentation is required for the various types of operators.
4.1.1   Airline/ Air Charter Copy of Operator’s Certificate (renewable each year) reflecting whether company is fully licensed to operate. The name of the carrier should appear on the licence together with all Aircraft registration numbers Passenger Liability Insurance - an actual copy, reflecting the policy number and sum insured, underwriter’s name and
        effective dates of cover required Copy of tickets which show licences and conditions of carriage

4.2.2 Rail Transport General Public Liability and Products / Passenger Liability cover An actual copy of the Insurance Policy is required, reflecting the policy number and sum insured, underwriter’s name and
        effective dates of cover. Passenger Liability & Emergency Medical Assistance available
4.2.3 Taxi General Public Liability Insurance - An actual copy, reflecting the policy number and sum insured, underwriter’s name and
        effective dates of cover. Details of any specific cover included in your policy must be copied. Any company providing food must be covered under “Products Liability”. Tour Operators must be covered appropriately in the areas in which tours are conducted under the “Territorial” clause in
        the policy. Defective workmanship is applicable if the company is undertaking their own repairs to vehicles, including changing
        brakes. Passenger Liability Insurance, An actual copy of the policy document is required reflecting the policy number,
        underwriter’s name, effective dates of cover, vehicle registration numbers, make of vehicle and amount of cover. Copies of all Motor Vehicle Licence Roadworthy Certificates for each vehicle utilised. Legible copies of relevant Road Transportation Carrier Permits for each vehicle, including annexure showing permissible
        routes. Permits are required for fare paying passengers Copies of PDP (Professional Driving Permit) for all driver/s

4.2.4 Water Transport/ Charter A copy of the Marine Insurance policy - reflecting policy number, underwriter’s name, effective dates of cover, boat
        description, and amount of cover and Passenger Liability A copy of Licence for vessel – specifying amount of passengers & crew, name of vessel and port of registration/
        operation, length of vessel and radius in which boat may travel A copy of Safety Certificate General Public Liability Insurance – An actual copy, reflecting the policy number and sum insured underwriter’s name and
        effective dates of cover. Details of any specific cover included in your policy must be copied. Any company providing food must be covered under “Products Liability”. A copy of the “territorial clause” – where cover is applicable.

If operator provides/markets tours for special needs travelers, certain minimum safety requirements must be complied with.

        No:                                                      CATEGORY
      1                                                           GENERAL
      1.1      Comply with all necessary regulatory condition at all levels of government specifically:
      1.1.1    Business registration
      1.1.2    Zoning conditions
      1.1.3    Other (state)
      1.1.4    Other (state)
      1.2      Public liability insurance. (state amount)
               Evidence that the operator is covered in all areas in which tours are conducted under the territorial clause in
               the policy.
      1.4      Passenger liability insurance. (state amount)
      1.5      Evidence that operator only operates with the required permits and registration.
               Staff training must be adequate in relation to services provided as per company description and marketing
               Evidence that all tourist guides used are THETA accredited and registered with the Provincial/National
               Registrar of Tourist Guides.
      1.8      Evidence that site guides are registered with the Registrar of Tourist Guides
      1.9      Information on reservation, payment and cancellation policies must be clear – check copies
      1.10     Visitors are well informed and protected against false advertising - check all collateral and brochures.
      1.11     Capacity to deal with disabled visitors must be clearly displayed on all marketing materials.
      1.12     Lost property system in place.
      2                                                    SAFETY AND SECURITY
               Proof that a safety and risk reduction plan (including at least fire, medical emergencies & equipment) and
               relevant procedures are place.
      2.2      Evidence that safety procedures are clearly displayed and communicated to staff and visitors.
      2.3      Relevant safety certificate is available for adventure and boat operators.
      2.4      Evidence that staff are trained to assist in emergency situations – proof of first aid certificates
      2.5      Relevant skipper’s license and certificate of seaworthiness are available for boat operators.
      2.6      List of required safety equipment is available.
      2.7      Evidence that the required safety equipment is available.
      2.8      Evidence that a maintenance process and procedure are in place for equipment.
      2.9      Emergency exits are clearly marked.
      2.10     All seatbelts are in working order.
      2.11    Clear display of maximum carrying capacity of vehicles.
              Evidence that operators providing tours for special needs travelers comply with the relevant minimum safety
      3                                                            VEHICLES
      3.1     Each vehicle has an operating license for the relevant area of operations.
      3.2     Evidence that all drivers taking visitors have Professional Driving Permits (PDP).
      3.3     Evidence that each vehicle has and carries a roadworthiness certificate.
              Evidence that vehicles used for transporting persons with disabilities in wheelchairs must have the correct
              anchoring equipment, ramps and hoists.
      4                                  TOURIST ATTRACTION & ADVENTURE OPERATORS
      4.1                        Property and equipment maintenance plan and checks must be in place.
      4.2                    Defective workmanship cover applies if the operator repairs his own equipment.
      4.3                                      Proof of standard operating procedures. (SOP)
      4.4                     Evidence of special needs traveler’s evacuation procedures where applicable.
      5                                     ENVIRONMENTAL FACTORS (require 3 out of 6)
      5.1                              Evidence of an environmental statement or policy. (required)
      5.2                   Evidence of a staff awareness or training programme on the statement or policy.
               Evidence that visitors are informed of environmental policy and initiatives so that they can participate (e.g.
                                        don’t litter, use the recycling bins, buy SASSI seafood, etc.)
      5.4                               Evidence of recycling of at least 50% of recyclable material.
      5.5                                        Evidence of waste disposal bags in vehicles.
      5.6               Evidence that staff is using collective and/or non-motorized transport, wherever possible.
      6                                                  COMMUNITY ENGAGEMENT
      6.1                                   Evidence of a local procurement statement or policy
      6.2                                Evidence of a community engagement statement or policy
      6.3       Evidence that visitors are briefed appropriately and consistently regarding community interaction norms

5.     Useful contact details
Cape Town Tourism–
Cape Town Routes Unlimited –
South African Tourism Services Association –
South African Tourism –
Tour Operators Association of Cape Town - Alvin Kushner - Tel: 021 551 5465
Image library on South Africa Tourism –

        For more information on training, funding etc please contact:
        Cape Town Tourism Head Office
        Adrian Solomons
        Business Support Coordinator
        Tel: (021) 487 6800
        Fax: (021) 487 6899
        The Pinnacle Building
        Cnr Burg & Castle Streets
        Cape Town

6.      Contact details for Cape Town Tourism membership

       Cape Town Central                                                Cape Town South
       Zayed Yaghya                                                     Fuad Peters
       Membership Administrator                                         Membership Administrator
       Tel: (021) 487 6800                                              Tel: (021) 787 9140
       Fax: (021) 487 6859                                              Fax: (021) 787 9150
       Email:                                     Email:
       Cnr Burg & Castle Streets                                        The Pavilion,
       Cape Town                                                         Beach Road

        Cape Town North East                                            Cape Town Central Coast – Blaauwberg Coast
        Gadijah Darries                                                 Chelene Wiggett
        Membership Administrator                                        Membership Administrator
        Tel: (021) 840 1400                                             Tel: (021) 521 1080
        Fax: (021) 840 1410                                             Fax: (021) 521 1099
        Email:                                  Email:
        Southey’s Vines                                                 1 Marine Drive,
        186 Main Road                                                   Table View
        Somerset West


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