Micromobility and other new mobility types are on the rise. Many fleet sharing startups have sprung up all across the globe in the past few years. Unfortunately for entrepreneurs looking to get into the business, that means that the competition between companies can be quite fierce.
But don’t despair — we’ve compiled a list of risks associated with starting a fleet company and ways to overcome them. If you inform yourself ahead of time, there’s no reason why you won’t be able to see any big hurdles coming before it’s too late.
Vehicle Theft & Damages
It’s no secret that vehicle theft and damages are commonplace for fleet sharing companies. It should be obvious that when customers don’t have to purchase a vehicle themselves, they’re less likely to want to treat that vehicle with respect. In fact, taking photos of kick scooters that got ruined in unfortunate ways — like being submerged in rivers or thrown onto roofs — has become something of a fad recently. Kick scooters aren’t the only vehicles getting damaged, of course: cars often have their windows broken into, and bikes are easy to steal because they’re so lightweight.
DON’T CUT CORNERS.
So how do you keep a handle on vehicle theft and damages? One of the most obvious answers is by upgrading your locks and alarm systems. Retrofit locks, for example, significantly reduce theft in kick scooters, which is very high. In fact, in some cities, it’s already a requirement for kick scooters to come with locks so that riders can lock them up when they’re parked.
Make sure to research the alarms and/or locks that make the most sense for your business type, and don’t cut corners when buying them — cheap locks and security systems are a waste of money and won’t protect your fleet. Also, it’s always a good idea to have software that includes theft and damage reports as part of their analytics. It’s easier for you to manage your fleet if you have an overview, and being able to predict damages that accrue due to regular wear and tear will save you time and money.
Saturation of the Market
Fleet sharing businesses are a big deal right now, which means that the competition between companies is very fierce. Bike, car, scooter and kick scooter-sharing companies now dominate the mobility landscapes of many cities — if you live in an urban centre in Europe, you probably walk or drive past multiple mobility providers on your way to work every day. There’s a “hype” surrounding vehicle sharing companies, particularly kick scooters and electric vehicle types in general, which means that many entrepreneurs feel like it’s now or never — start your business now or miss out on all that demand. We agree with those entrepreneurs. Don’t let the competition scare you into thinking you don’t have just as good of a chance of getting your concept off the ground as everybody else!
ALWAYS PUT CUSTOMER SATISFACTION ABOVE SAVING COSTS.
To stand out from the supposedly oversaturated shared mobility market, you’re going to need to follow two rules. The first is to make sure you have a “customer-first” approach. Many companies make the mistake of asking their customers to set up an extra payment account instead of offering a prepaid e-wallet system. Others only let customers pay via credit card or require them to take an image of where they parked the vehicle, which is a problem if the rider’s smartphone camera is broken — as just one tiny example. Think about everything from your customer’s perspective, and you’re already well ahead of the game.
The second rule is to buy high-quality vehicles. Not only does it reduce damage costs in the long run, but it also helps increase customer satisfaction dramatically. In a city full of shared vehicles, the vehicles that run perfectly and have a longer-lasting battery life will slowly start to dominate the mobility scene. Because who wants to ride a kick scooter with broken brakes, or e-bikes with spokes that are bent out of shape? Nobody. Everyone will avoid a company with low-quality vehicles like the plague after one bad experience.
Choosing the Wrong Software Provider
Since high-quality vehicles are an absolutely crucial component of any vehicle sharing company, your software needs to be high quality, too. Offering an app that frustrates and confuses users is a very bad policy. Similarly, having faulty or unusable hardware destabilizes the entire foundation upon which your company is built.
A GOOD SOFTWARE PROVIDER WILL ALWAYS INCLUDE REPORTING.
Also worth mentioning: having software and hardware but having to pay extra for analytics and reporting is an absolute waste of money. A good software provider will always include reporting as part of the deal. (If you’re curious about other things to look for in your software provider, check out our article on the topic.)
The good news is that all of the risks we mentioned are manageable. If you’re unsure of the best way to go about launching your company or want to learn more about what to expect when starting a vehicle sharing business, we at Wunder Mobility can guide you.