Every mile counts! Learn How Easy It Can Be To Plan, Monitor and Verify Your Uber Revenue
How do you achieve a big goal without setting, working on, and measuring it? Yeah, we don’t know either. What we do know, is that the first step to making money and achieving your goals is to actually set them. The methods we will describe here can actually apply to all areas of your life, but as an owner of an Uber business, today we’re solely focused on your Uber Revenue.
We mean that in order to succeed you should pull out a piece of paper and a pen; a notepad or an app right now and take a stand for your own success. You need to get your thoughts out of your head and listed in some place that you will visually reference, often.
Your Uber Revenue goals are the measure of your success as an Uber business owner – and they are one of the most important Key Performance Indices (KPI) as you start or expand your Uber business. In our Uber owner business kit, we offer specific examples based on our experience and feedback from drivers around the world.
The formula which applies to every car you own is a proven equation, which we will summarize for you now. Also, it should be noted that there are slight market changes every day in the transportation industry, and knowing when to modify your line items is essential to producing accurate information.
The primary (not exhaustive) cost factors are:
- Your daily operational costs like fuel
- Periodic costs like oil changes, maintenance, and purchases
- Monthly costs like insurance and loan payments
- Annual costs like vehicle registration and any local licensing fees
- Overhead costs like Uber’s fees and driver pay
Your Uber Revenue is the last factor of the equation. Your revenue varies based primarily on the following-
- Rates charged to the riders ,be that regular or surge pricing
- Demand for your drivers and their ability to log miles during most of their shifts,
- Royalty paid to Uber business owners, after Uber takes their commission.
Although you can predict surge pricing, some of these factors are not entirely under your control. The data should be recorded, monitored closely, and after some time can be used to analyze your market.
Your revenue data also needs to be reliable so that your per mile equation is accurate! As discussed in our blog post on “How to verify your Uber revenue”, several software and apps exist in the market to support your efforts at accurately tracking every financial aspect of your business. Once your data has been verified as accurate, you then divide those totals over the expected distance you intend for each car to drive to determine your per mile revenue goal. See our sample formulas below-
Expected Revenue per mile = ERPM
- Expected Total Revenue from Uber = ETR
- Miles Expected to Drive = EM
- ERPM = ETR/EM
Revenue per mile = RPM
- Total Revenue from Uber = TR
- Miles Driven = M
- RPM = TR/M
- RPM is greater than or equal to ERPM
Note- Set a value for your ERPM, so you have a business target/goal, and actively monitor your RPM. Over the course of your business continue to compare your RPM to ERPM. Remember your goal is for the RPM to be at or greater than the ERPM.
Doing the aforementioned will help increase the odds of having a viable business. (Note, in this blog post we have not discussed monitoring costs, which is an essential element in ensuring profitability)
Depending on your KPI goals, you may find that taking advantage of revenue surges in your market either based on time or location will greatly impact your goal achievement. The small investment of your time, and additionally the use of our kit to detail the equation for you, will be a great tool for your business and a firm method for adhering to your plan and achieving your goals.
For other popular posts you might be interested in, check the links below:
- How Much Do Uber Drivers Make?
- How to Verify Your Uber Revenue
- How to Find the Highest UberX Fares
- Uber Customer Service (297 Cities)
- How to Become an Uber Driver
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