A key component of taxi reservation apps is a sophisticated fare computation algorithm. Customers can use it to examine the average fare and travel time. The taxi booking app bases its fare computation on four factors: the base charge, cost per minute, cost per kilometer, and booking fees.
Ride fares are primarily calculated based on distance and time. A smart fare management system is a system in which automated fare calculation includes all parameters such as distance, time, fare, taxes, tolls, etc. However, Taxis have tiered pricing depending on the time of day. Thus, don't be surprised if you see a different fare on the same trip in the morning versus late evening hours.
On the other side, the Admin can also keep track of the demand for taxi services and the drivers' availability at a certain location at a specific time; based on that, the Admin might raise the fare charges during peak hours. Based on this information, they can set fair prices for a given location for a set amount of time. This will attract drivers and make sure there are enough of them to meet changing demands.
Here's an analytical Taxi fare breakdown:
- Base Fare: $1.00
- Fare Per KM: $1.60
- Fare Per Minute: $0.40 This charge only applies for the duration that the Driver stopped the taxi (e.g., traffic lights, STOP signs, etc.).
Base Fare: Base Fare is a fare that fare will add to the final fare and other parameters.
Fare Calculation = Base Fare + (Distance travelled X Fare Per KM) + (Total duration X Fare Per Minute) - Promo Discount + Tax