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Setting up a Driving Instructor Business

All you need to know about starting and running your business

Business guides » Setting up a Driving Instructor Business

What is a Driving Instructor Business?

There are more than 38,000 driving instructors in the UK, with more than 1.6 million people taking their practical driving test every year.

A driving instructor is an individual who is hired by a learner driver to help them improve their driving skills and prepare for their driving test. A driving instructor will teach learner drivers the theories and techniques that they will need to know in order to safely operate a vehicle.

A driving instructor business could teach learners how to drive a number of vehicles, including cars, motorcycles, buses and heavy goods vehicles (HGVs). Driving instructors usually specialise in one particular type of vehicle. Driving instructors can choose to teach learners how to drive a manual or automatic vehicle.

Some responsibilities and tasks a driving instructor is likely to undertake are:

      • Assess the student’s current driving knowledge, skills and ability.
      • Plan driving lessons that cover all necessary driving skills.
      • Teach students about traffic rules, driving laws, road safety and the Highway Code.
      • Teach students about emergency situations that might occur and what they should do in the event of an emergency.
      • Teach students the practical skills they will need to drive a car, such as how to use the pedals, gears, mirrors, the indicator and the handbrake correctly.
      • Instruct students on the correct use of vehicle controls.
      • Teach students how to ensure the correct road position at all times.
      • Teach practical skills, such as steering, turning, reversing, braking and parking.
      • Teach students how to make basic vehicle checks, such as checking the oil level and the tyre pressure.
      • Instruct students on safely driving at junctions and roundabouts.
      • Instruct students on how to correctly brake and perform emergency stops.
      • Instruct students on hazard awareness and how to perceive hazards.
      • Teach important manoeuvres, such as parallel parking, bay parking, and turning in the road.
      • Inform students about the driving test syllabus.
      • Make driving lesson appointments and keep records of appointments.
      • Organise payments and keep appropriate records.

 

With so many people learning to drive every year, there is always a demand for new driving instructor businesses. A driving instructor business owner will be self-employed. However, you can choose how self-reliant or connected your business will be.

Driving instructors can choose to set up their own independent driving business and find their own students. Alternatively, they can sign up to an already established driving school or franchise and utilise their existing register of students. However, being part of a franchise will usually mean they will be charged a monthly fee or the franchise will take a percentage of their earnings.

To become a driving instructor and set up a driving instructor business, there are certain characteristics, skills and knowledge you will need to possess.

Some characteristics you will need to have are patience (particularly in stressful situations), good communication skills, and the confidence to teach others. You must also have the ability to monitor your students’ performance and improvements, good teaching skills and the skills to successfully manage your business, appointments and finances.

Some other requirements a potential driving instructor will need to adhere to are:

      • A full UK or European Union (EU) driving licence that has been held for a minimum of four years.
      • The ability to read a number plate from a minimum distance of 20 metres.
      • Be a fit and an appropriate person that is able to pass the ADI (Approved Driving Instructor) Register suitability assessment.

Types of Customers

The types of customers that a driving instructor business will attract are people of all ages who want to pass their driving test.

Around 11% of people who start learning to drive are aged 17. A third of first-time drivers in the UK today are between the ages of 17 and 20. The average age that people become qualified drivers is 26. However, the oldest person to pass their driving test in the UK was 105 years old.

Although many learner drivers are below the age of 30, a driving instructor is likely to teach students of all ages.

The majority of driving instructor businesses won’t have a target age group. However, there may be other demographics you choose to target:

  • Geographical location – To reduce the time you spend travelling and the amount of money you spend on petrol, you will likely focus on a particular geographical location. If you live in a big city, it is recommended that you focus on a specific area or part of the city.
  • A specific demographic – Some driving instructors choose to focus on a particular demographic. For example, some female instructors target female customers.
  • Manual or automatic learners – Manual and automatic learners must learn to drive in the correct car. If you have an automatic car, you will need to target customers who only intend to learn how to drive an automatic car.
Car Cartoon
Driver Learning Sticker
Learner Driving

Equipment You Will Need

When starting up a driving instructor business, there is some equipment you will need to invest in. A driving instructor business will have fewer equipment requirements than many other businesses.

Some of your equipment requirements will include:

A vehicle

This will be your biggest expenditure. You will need a vehicle that is safe, good quality and has affordable repairs. The vehicle will need to be dual control, meaning the pedals will be on both the driver and passenger sides of the car. This allows the instructor to brake or accelerate the car if necessary. You can buy a used dual control car for as little as £5,000, whereas a new car can be between £20,000 and £100,000 depending on the make and model. Alternatively, you can choose to lease the vehicle, which will allow you to replace the car when necessary.

A roof sign

Your roof sign should be distinctive as it will act as an advertisement for your business. The roof sign should be personalised with your business name and telephone number and the learner sign. Roof signs typically range from £80 to £150 + VAT.

Adhesive door and body panels

This can help your business gain exposure. These panels can be kept on at all times to provide constant exposure to your business. They can then be removed from your car if you ever decide to sell your car or cease operating as a driving instructor. Remember, your vehicle is your most effective marketing tool. Panels can cost as little as £15 per panel.

Learner plates

You will need the red ‘L’ learner plates on your vehicle any time it is being driven by a student. Although you can buy cheaper L-plates, these can become faded or fall off your vehicle. Look for L-plates that fully comply with regulations and are made from quality materials. L-plates usually start from £2 per plate.

Business cards

Business cards are an important marketing tool and can be given to new or existing customers. They should include your business name and contact information. Business cards can also be used as appointment cards, allowing you to write the details of your students’ next appointment. Business cards are a fairly affordable marketing tool and can cost between £15 and £200 for 500 cards. The price can vary depending on the material used, the quality of the finish, and the design.

An appointment system

There are several ways you can choose to make and record your appointments. Some driving instructors choose to use a traditional appointment book to make their appointments. However, others will use a mobile app or computer software, enabling customers to book appointments electronically and ensuring they are safely recorded.

Driving Instructor Business

Typical Pricing

To allow you to properly plan your business, it is important that you plan your business’s finances. Being aware of how much your initial investment is likely to be and what your monthly expenses will be can help you to predict your monthly and annual profits and help your business to be more successful.

Some typical costs you can expect to pay when setting up and running your driving instructor business are:

Equipment costs

Although a driving instructor business has few equipment requirements, you will still need to consider these costs. Equipment costs can vary significantly, depending on the cost of the vehicle. Your equipment costs can vary from £10,000 to £100,000.

Trainee driving instructor licence

All driving instructors must have a specific licence before they begin operating. The trainee driving instructor licence has a cost of £140. You can apply for the licence on the gov.uk website and it takes approximately 30 minutes to apply.

Approved Driving Instructor (ADI) test

You must successfully pass all three parts of the test before you can operate as a driving instructor. The cost to take all three parts is approximately £300.

An enhanced Disclosure Barring Service (DBS) check

The cost of an enhanced DBS check is £40. Your DBS check will need to be updated every three years so factor this cost into your budget.

Advertising and marketing costs

Advertising is a great way to grow your driving instructor business and is particularly important when you are first setting up your business. The recommendation is that you spend no more than 10% of your annual revenue on advertising costs. For example, if your annual revenue is £50,000, your maximum advertising costs should be £5,000. As your business grows, you may receive many of your students from word of mouth recommendations and you may be able to reduce your advertising costs.

Typical running costs

Your typical running costs are the everyday costs associated with running your driving instructor business. This could be costs associated with your vehicle, such as tax, MOT, services, petrol and repairs.

Insurance

The cost of insurance can vary significantly depending on the types of insurance you purchase and the level of coverage you opt for. Prices can vary from as little as £7 per month to as much as £70 per month.

Branding

Your branding costs could include creating a logo, making and distributing business cards, and creating a business name.

Safely Running a Driving Instructor Business

Safely running your driving instructor business is imperative to ensuring the health and safety of you, your students and other road users.

Some ways you can safely run your driving instructor business are:

Manage safety on the road

You are responsible for the safety of yourself, the learner and other road users. There are several ways you can do this, including:

  • Make sure your instructions are clear.
  • Anticipate any hazards and be prepared on how to deal with them.
  • Ensure the learner knows you can intervene by using the dual control system.
  • Plan the route in advance.
  • Don’t let the learner drive if you have any concerns about their competence.

Ensure your vehicle is well maintained and safe to drive

An unsafe vehicle can be a danger on the road. You should perform regular checks on your vehicle, including checking the tyre pressure, oil level and brakes. You should also ensure your car undergoes regular services and MOTs. If you have any concerns about your vehicle, you shouldn’t allow your students into the vehicle.

Safely Running A Driving Instructor Business
Running A Safe Driving Instructor Business

Conduct risk assessments

Many learners may not realise that a driving instructor business should conduct risk assessments. A risk assessment can help to ensure the health and safety of everyone in the car and other road users. Although risk assessments are not a legal requirement for businesses with fewer than five employees, they are recommended to ensure that driving instructor businesses operate safely.

Risk assessments could cover:

      • Identifying potential hazards.
      • Determining who could be at risk.
      • Evaluating the potential risks.
      • Implementing any safety measures.
      • Recording the results of the risk assessment.
      • Reviewing the risk assessment regularly.

Implement cleaning procedures

Driving instructor businesses have multiple different students using the car in one day. It is therefore important that driving instructors implement cleaning procedures, such as cleaning the steering wheel, gears and indicator after every student. You should also do a deep clean of your car once a week. To ensure the cleanliness of your vehicle, you can learn about the six stages of cleaning on our knowledge base.

Implement emergency procedures

Having emergency procedures is important to ensure the safety of everyone involved. Being aware of what to do in the event of an accident or an emergency is a great way to protect your students and other road users.

Legal Requirements

There are certain legal requirements you will need to ensure you adhere to when starting up a driving instructor business. Failure to comply with legal requirements could result in you being unable to work as a driving instructor. You could also receive a fine, points on your driving licence or a criminal conviction.

Some of the legal requirements your will need to comply with are:

Approved Driving Instructor (ADI) three-part test

This is a three-part test that you must take before working as a driving instructor. Part 1 is a theory test that involves multiple-choice questions and a hazard perception test, Part 2 is a test of your driving ability, and Part 3 tests your ability to teach pupils. You cannot operate as a driving instructor until you have passed all three parts of the ADI test.

Register with the ADI

Once you pass the ADI test, your name can be added to the ADI Register. The ADI Registrar is in charge of the register and is employed by the Driving and Vehicle Standards Agency (DVSA). The registrar can refuse your registration or remove you from the register. If you are not on the ADI register, you cannot operate as a driving instructor. You will need to renew your ADI registration every three years.

Obtain a trainee driving instructor licence

You can apply for this licence once you have passed the ADI Part 2 test and have undertaken a minimum of 40 hours of training with a qualified Approved Driving Instructor.

The learner plates

The red ‘L’ learner plates are a legal requirement on cars that have a learner driver. They must be kept on at all times. The L-plate must comply with the specifications set out by the Highway Code. The Code states that the plates should be 178mm square in length and height and the ‘L’ must be 102mm tall and 89mm in width. 38mm must cover the height of the ascender. The plates must be fully visible to other road users who are 50 metres in front or behind the vehicle. If you do not comply with these regulations, you (the instructor) could receive six points on your licence and a fine of £100.

Insurance

You will have several insurance requirements as a driving instructor. Some types of insurance will be legally required whereas others are recommendations. Types of insurance coverage typically required by driving instructor businesses are Any Driver Insurance, Negligent Tuition Cover, Replacement Dual Control Vehicle Cover, Banned/Convicted Drivers Retaking Tests Cover, Public Liability Insurance, and Professional Indemnity Insurance.

Undergo an enhanced Disclosure and Barring Service (DBS) check

You will need to pass the enhanced level criminal record check before working as a driving instructor. As you will be alone with your students and may teach students who are under the age of 18 or are considered as vulnerable, having a clear DBS check is essential.

Ensure you have no motoring offences

If you have been disqualified from driving in the past four years, you cannot apply to be on the driving instructor register. You may also be rejected from the register if you have been convicted of dangerous driving, driving under the influence of drink or drugs, driving without due care and attention, driving without insurance, excessive speeding, or failing to stop after an accident. You are also likely to be rejected if you are found guilty of certain non-driving offences.

Apply for permission to use DVSA logos

Using Driving and Vehicle Standards Agency (DVSA) logos as part of your business shows that you are an approved driving instructor. You can apply to use the DVSA logo using the online application form.

Register your business

You must register your driving instructor business with HMRC before you begin operating. You can register as a sole trader or as a limited company. You will need to register your business name and any other relevant information before you begin operating.

Register for self-assessment tax

This allows you to calculate and pay your taxes each year. You will need to track your finances every month and submit any expenses as part of your tax assessment.

Driving Instructor Teaching

Positives of Owning a Driving Instructor Business

There are some huge positives of owning a driving instructor business:

Be your own boss

Being your own boss gives you the opportunity to control the growth of your business, manage your own time, and gain more self-confidence and job satisfaction. Owning your own driving instructor business also means that all your profits will belong to you.

Flexibility to control your workload

You can set your schedule and decide how little or often you want to work. You can teach part time or full time and take holidays off whenever you want. Some driving instructors choose to teach in the evening and at weekends, whereas others choose to follow more traditional working hours during the week.

Great income potential

The average cost of a driving lesson in the UK is £27 per hour, rising to £30 in big cities such as London. If you are teaching several lessons per day and growing your client base, you could earn a great income and make an impressive profit.

Predictable income stream

You will have the majority of your lessons booked in advance and will know how much income you are predicted to make each week or month. Teaching learners how to drive is also a year-round business, with most instructors earning the same amount throughout the year. This makes it much easier to predict your profits.

Job satisfaction

Being a driving instructor can provide you with great job satisfaction. Teaching people new skills and seeing them succeed can be extremely rewarding. You will also have the opportunity to meet new people from different walks of life. Seeing your business become a success can also be extremely satisfying.

Choose your own clients

You have the opportunity to take on as many or as few clients as you want. If you meet with a potential client and struggle to connect with them or are not sure you can help them, you can choose not to work with them. You are also not entered into a contract with any of your clients, meaning you can let them go at any time.

Work with the local community

If your driving instructor business operates in your local community, you will have the opportunity to meet people local to you and become a bigger part of the community.

You’ll never get bored

Being a driving instructor provides you with lots of face-to-face interaction and the opportunity to talk to lots of people. You will be teaching different skills in every lesson, teaching people of different levels and abilities, and driving to different areas. This makes your job more enjoyable and means you are less likely to get bored.

Client recommendations

Many driving instructors get a lot of their business from word of mouth and client recommendations. This allows you to maximise your time and grow your business, while also reducing the need for expensive advertisements and marketing.

Driving Instructor Ready For Lessons

Negatives of Owning a Driving Instructor Business

However, there are some cons to owning a driving instructor business that you should be aware of:

It can be stressful

You will be responsible for business accounting, managing legal and administrative duties, taxes, organising lessons and tests, teaching students and managing your students’ safety. This can be stressful to some people, especially if they are managing their owning driving instructor business, rather than operating as part of a franchise.

Training can be difficult 

Becoming a driving instructor is not as easy as you might think. Training usually takes between 12 and 18 months, and you will have to complete multiple training courses. This can also be expensive.

It can be expensive

As well as needing to fund training costs, there are multiple other costs associated with setting up and running your driving instructor business. This includes insurance, petrol, servicing, MOTs, and the cost of purchasing a vehicle. You will also need to pay advertising and marketing fees and franchise fees (if applicable). The associated costs can be expensive, making it more difficult to turn a profit.

High time commitment

To accommodate all of your students and to attract new students, you will likely need to be available for lessons in the evenings and at weekends, as the majority of people will work during the week. Working anti-social hours can be difficult and may affect your home and social life.

Time lost through travel

The time it will take you to travel to different lessons around your city is money lost. If you have a lesson that ends at 12 pm, you may then have half an hour or more where you cannot earn any money as you need to travel to your next client. You will also not be paid for your lunch hour and holidays.

High liability

You will be responsible for the safety of your students, other drivers and pedestrians. You will need to purchase a high level of insurance, which can be expensive. Inexperienced drivers are much more likely to be involved in an accident, which could result in damage to your car or an injury to you, your student or another person.

Planning Your Driving Instructor Business

An effective well-designed business plan is essential to ensure the success of your driving instructor business.

When planning your business, there are several important considerations you will need to make:

Will you run your own driving instructor business, or will you operate as part of a franchise?

You will need to decide whether to be an independent driving instructor or operate as part of an already established driving school as this will impact other factors, including your marketing strategy, your equipment requirements, your monthly expenses, and your customer base.

What are your business objectives?

Deciding your business objectives can help you create a one-year, three-year and five-year plan and can be pivotal to the success and growth of your business. Business objectives can help you with your marketing procedure and help you to implement actions that will help you to grow your client base. Business objectives are particularly important if you plan to set up an independent driving instructor business.

Your business objectives should be SMART:

      • S = Specific
      • M = Measurable
      • A = Achievable
      • R = Realistic
      • T = Time-bound

      What is your local competition like?

      It is important to ensure that the local market is not already saturated before you set up your driving instructor business. By looking at the local market, you can also consider ways you can make your driving instructor business stand out. It is recommended that you also look at what practices other driving instructors use successfully and what does not work as well.

      What will your working hours be?

      Are you going to operate part time or full time? Are you willing to offer lessons in the evening and at weekends? The hours you operate will have a significant impact on the types of customers you are likely to attract. For example, a working professional is unlikely to use a driving instructor who only teaches during the day on Monday–Friday, whereas this may not be an issue for shift workers or students.

      What is your cost forecast?

      Calculating your start-up costs (including the cost of equipment), your estimated costs monthly and annually, and any overhead costs can help you to calculate how much profit you are likely to make. It can also help you to determine how much you are going to charge your students and to calculate the minimum number of students you need to teach to make a profit.

      Can you finance the business yourself or will you need to source an outside investment?

      Once you have completed your cost forecast, you can then determine whether you can finance your driving instructor business yourself or whether you need to acquire investments from an outside source.

      Have you complied with all legal requirements?

      It is essential that you file all your paperwork and comply with all legal requirements before starting up a driving instructor business. Failure to comply with the legal requirements could result in delays in setting up the business, forced closure, or the incurrence of a fine.

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