SME Diaries: Covid-19 was tough for our car rental business. We made it a priority to protect our hirers and staff

Small- and medium-sized enterprises (SMEs), which form 99 per cent of businesses in Singapore, have felt the impact of Covid-19 keenly. TODAY’s Voices section is publishing first-hand accounts from SME owners and managers on the highs and lows of running a business in the pandemic.

In this instalment, Mr Jimmy Ong, 42, whose firm leases cars to private-hire drivers, describes how costs rapidly escalated when Covid-19 ground commuting to a halt. Despite that, the firm chose not to take the “easy” way out by retrenching staff or demanding payment from drivers. Instead, it relied on its reserves, as well as various support schemes, to ride out the storm. 

Reliable Rides started as a small car rental company in 2016. Our principal activity is the renting and leasing of cars to private-hire drivers. 

We did well for the first two years, growing from 20 vehicles to a fleet size of 400.

We started to feel the impact of Covid-19 two months before the pandemic hit us hard in Singapore. 

In February 2020, there was a significant drop in passengers as many of us were already reducing outdoor activities. 

Then, many businesses were already working remotely. Our rental income began to drop as drivers started returning their vehicles to us. 

With the drastic fall in passengers, our drivers’ incomes were also badly affected. Many of them saw their daily earnings drop by between 50 and 70 per cent. 

As a car rental company, our source of income is rental revenues. If our drivers’ income is affected, the effect will ripple. 

The problem was exacerbated during the circuit breaker from April to June 2020. 

Our drivers recorded a further income drop by as much as 90 per cent. Many of them even had zero income. With no income, they were not able to pay their rental.

We wanted to help our hirers get through this tough period together, especially those who had been with us since we started. 

We extended a 50 to 70 per cent rental discount and allowed them to defer their payments. 

The company was caught in a situation where rental income decreased greatly and yet we still needed to pay for monthly costs such as salaries, car loans, insurance and maintenance. 

Our losses quickly escalated to about S$500,000 a month.

It would have been easy to enforce payment from customers and retrench staff but our mantra then was to “leave no man behind”. 

We refused to let the years of hard work go to waste, and tried various ways to keep the business going so that our customers, and most importantly our 10 staff members, were taken care of.

We did this by tapping our company’s reserves and our personal savings. 

The Government’s Jobs Support Scheme for SMEs was crucial in helping us retain all our workers. 

Meanwhile, the Covid-19 Driver Relief Fund and Point-to-Point Support Package helped keep our hirers on the road. 

More than two years after the pandemic struck, we have learnt the importance of diversifying the business in good times. 

For example, during the down period, we encouraged our staff to learn new skills such as digital marketing. 

In late 2021, when we were appointed the authorised reseller of DFSK electric vehicles in Singapore, that training came in useful. 

Our staff were able to set up digital marketing campaigns to gather sales leads, a job which would have been outsourced previously. 

Looking back, the company was greatly influenced by the resilience and grit of our earlier generations. 

It is the “never give up” attitude which gets us through tough times and will chart our course into the future. 

ABOUT THE WRITER:

Jimmy Ong, 42, is the operations director and one of the co-founders of Reliable Rides. He started the car rental company in 2016 and is inspired by the resilience and grit of Singapore’s Pioneer and Merdeka generations.

If you are an SME owner or manager with an experience to share or know someone who wishes to contribute to this series, write to voices [at] mediacorp.com.sg with your full name, address and phone number.