Building a Scooter Sharing App and Operations, insights to make Profitable Business the right way in 2021

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By Carlos Agudelo

Jan 25, 2021

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A big explosion of sharing vehicles, scooters, e-bikes, and mopeds started in 2018, the Free-Floating model was just at the beginning with many companies like Bird, Lime as the first ones to launch the big revolution followed by others, but you might wonder if there are opportunities to start this in your city yet. The short answer is YES, as long as you implement some of the insights we provide here.

Start a Scooter Sharing App by following these 7 steps:

  1. Step 1: Understanding the Business
  2. Step 2: Create an Operating Plan
  3. Step 3: Build a Strategy for Handling local Government
  4. Step 4: Plan for the right Vehicle for your environment
  5. Step 5: Find the right Factory Partner and create a Supply plan
  6. Step 6: Build or Buy an App Plan
  7. Step 7: Earn When People Ride!

With the crazy year we just had in 2020, across many countries got in lock down and also some others just had very difficult situations to get people moving safely and Micro Mobility started to have a gained popularity overnight as users immediately realized it’s benefits as a utility and not just for recreation.

The first insight found is that people actually started to move less and less due to all the factors that were created among the pandemic, especially for their workplaces like in this case for Los Angeles where the total drop on average of people moving to their workplaces was about -22% (Check Los Angeles Mobility Report January 2021). People are now thinking more in terms of convenience to be connected in their neighborhood, and environments of mobility below 15 minutes are going up, this is the perfect opportunity for you to start an app to support mobility for people in your community. By checking some stats for the industry and specifically for the Moped Market the growth was about +58% in 2020, similar to bike purchases in US that were about +75% in April 2020, and now even the industry have a forecast of total grow up to US$34,6 Billion by the year 2027 which is a tremendous growth rate for all cases, opening door to new opportunities.

We arrived to a market where people are using less cars and moreover looking for alternatives such as bikes started to be part also of the main usage and purchase option for people but in some markets like in the UK you might not be able to find a scooter with a big delay just because the inventory of shops wasn’t ready (Check this article from BBC)

Now this could be the opportunity to start thinking of a business that can help your economy while helping people move around.

As mentioned before, you might have some challenges but that’s why we are here to tell you the whole picture of the business and how to operate it correctly.

First, just checking in case you don’t know who we are (In case you know this you can skip this paragraph), we started this for the sake of being a scooter operator some years ago in Latin America. For several months, people asked similar questions and then we decided to land as a Global Provider for Micro Mobility. We work with many factories globally and provide services to multiple countries, where we support thousands of vehicles and hundreds of thousands of users across the globe. Our experience has led us to launch ourselves in many cities and we have condensed all the learnings within our software. We have so much to share with you, so no more introductions (no at all trying to sell you, but it's important to know).

Micro mobility in Cities, Market Stats

NO MORE DELAYS!…Here are the steps.

Step 1: Understanding the Business

The first thing we did wrong in this process, and really one of the steps we said we could do along the process was just understanding what is for real Micro Mobility. There are many resources available online, but the quick insight about this is that this has to do with the purpose of the vehicles; it is most likely the purpose of the vehicles is personal transportation, especially first and last mile, simply put. Knowing this, you will have to understand that the experience is quite different from that of ride hailing or sharing a car, as these are more focused on specific goals.

Throughout the first months of operations we discover quickly that this can be a model of transportation for more than just the purposes that was created. So people had patterns of movement beyond the limits of the map and the limits of the vehicle. In some cases, we saw people moving for the entire city which was incredible. Fortunately, our systems started to show us not only that data but also it helped us to build systems that as you will see are important to have a better app and operation.

For this quick understanding of business, I gave a really short explanation. You might find a deep follow-up if you check one of our videos within our Mobility academy that is completely free and will help to understand what this business is about Check Micro Mobility 101 in the Mobility Academy.

Step 2: Create an Operative Plan

Part of the success of the company in Mobility is based in three factors:

The area to operate

a.     Define the location of your operation this will lead to determine the potential demand that you will have for your vehicles and the people who will have benefits

b.     Define the impact of the vehicles compared to other means of transportation such as taxi cabs, MTS (Mass Transit System), ride hailing and similar.

Map coverage

Create the coverage area, this will be important in the future steps you might need to present to the government your plan and in most cases the important part of this is just a matter of having clarity of the areas, specially if they have authorized and non authorized areas such as historic places where none vehicles are allowed.

Vehicle Needs

Understand the area where you are about to operate, so you can check if vehicles have or need springs or any other similar specific feature.

Do I need storage to run this?

Usually yes, but let me tell you that this is not mandatory and is one of the key factors we’ve approached with our framework of operations which is called the N.O.W. Framework, a full operating manual on how warehouses are not mandatory to run this business and yet can help to save more money beyond not having a warehouse.

You have also here 7 tips for profitable vehicle sharing

Step 3: Build a Strategy for the local Government

In this case we strongly recommend reaching the local government officers. In our own experience, running different environments from the most sophisticated to the more little city across the globe, we identify that for most governments it is important to create more convenience and alternatives for the citizens to move around so don’t be afraid to reach the government. In most cases they will request structured plans but at that capacity we also got you covered (Again just a spoiler, not necessarily an ad).

In some cases, failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down. You don’t want all of this great idea to be taken over by the government.

On the other side of you are countries like the United States you might have to check at state level some Business and Licensing Requirements.

Certain state permits and licenses may be needed to operate a scooter rental business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

Certificate of Occupancy (Specially for United States)

A scooter rental business is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO).  A CO confirms that all building codes, zoning laws, and government regulations have been met.

If you plan to lease a location: Always check with your landlord if the CO is available for location because usually it is his/her responsibility to have it. If you have other planned activities, you might check if you need to renew it. You might need to process the same way if you plan to run a new construction.

For other countries the core rule is to talk upfront about your plans and get the right buy in from the government that you got the right partners on your side.

Step 4: Plan the right Vehicle for your environment

Ok, you did so far a lot of work and yet didn’t arrive at the final result… don’t panic I will clarify.

Planning a vehicle means that you did the work to understand the conditions of the environment.

A city environment

  • Big City

Planning for a big city is definitely a challenge but is important to check the roads and how vehicles can respond in situations where they need to move beyond the first and last mile. Sometimes, you might need to provide a more special type of service like a long term rental even with scooters. In cases as such, we add an extra charger for the long term renter. We enabled that feature and saw customers not only intrigued by the cheaper rental price and longer time, they also saw the difference between by the minute price but of course this is a matter of understanding the usage.

  • Little City

You might have the chance to explore vehicles like Mopeds, where you can have the opportunity to even have people carrying more stuff or weight in the vehicle. Scooters in these cases are also part of the image and can be really helpful if people move the standard first and last mile.

A campus environment

  • Station based fleets are common, in some cases scooters can be useful but in others cases just the standard bikes are ok. Either way, we recommend having the support of the institution where they can also support students or employees so they can get cheaper prices while moving comfortably and safely.

Recreational and Vacation environment.

  • This is one of our preferred environments especially since some of our customers implemented in areas like this the business and people satisfied with the accessible alternative for cities where this could have never been possible earlier. Furthermore, bikes can be perfect but also scooters are highly convenient because people can ride them easily.

A rental Service environment.

  • Whether a car or moto rental, you can have an upsell for customers, and create a real good environment for the customers to utilize new services. For this case it is up to you from your understanding of your customers to decide what can work in the places you operate.

You can also review some of the vehicles and products available where you can see all the factors to decide about a vehicle check our listing of Products.

Step 5: Find the right Factory and create a shipping plan

China is by wide difference the biggest provider of scooters and electronic spare parts for most if not almost 99% of the scooters across the globe. Choosing the right one is a challenge we faced and even failed many times. This is because we bought vehicles based only on target prices (trying to get the cheaper option.) While this might sound familiar, I’ll tell you that we chose the cheap option and it didn’t go well. So after this we learned some important things:

Having the right factory

After the assessment in the last point, now you have a strong understanding of the areas, and you could check factories for the three types of vehicles and plan how the vehicles would be shipped with the right cost and billing, so customs don’t become a cost effective issue in the future.

Creating a QA environment for vehicle

You don’t have eyes in the factory, in most cases sending a person to the place is expensive (we did that multiple times and it was extremely expensive.) Therefore, you need a tool or something that tells you that the scooters work and that they will arrive in good condition. Fortunately, we have a tool for this embedded within our core system.

And connecting the vehicles

If you want to connect the vehicles, remember that you will always need to consider the IoT and connectivity. This has two variables, the SIM card and also the cloud management.

The first case is relatively easy to solve, but be careful since not having the right admin environment for SIM cards in some cases can be not only expensive but also difficult to administer.

For example, what would you do if the scooter gets disconnected. This happens very often and it’s similar to a cell phone. How can you locate a scooter or make sure you are having the right info? Consider those situations.

(In cosmic we provide that through our factory partnership program)

The second one is related to how you will be managing the vehicles and the asset, the most important thing. Not only a matter of visualization it is a matter of getting the right insights about localization, connectivity and also by having a task based environment it will help to improve how people can respond to infield events.

At the end I strongly recommend you checking some of this within our dashboard.

Step 6: Build an App Plan

Delivering software is a matter of multiple factors the key ones to consider in this industry are:

  • Onboarding: Customers need to understand the service they will have to dive in on how to use the vehicles and where to ride

  • Maps: People need to know where to get the vehicles scooters, bikes or mopeds, for them the easiest way is always to use geo based localization.

  • QR Code: The industry was born on the premise of ease of use, that’s why the QR code became the standard to use here.

  • Payments: Having a infrastructure for payments is a core vital for the service Globally we currently have availability for more than 70 global payment providers.

  • People and Asset Management: The economics of this industry are one of the core things to take care. Having people doing the right activities within the areas of operation alongside, having the right insights about team location, etc. can be challenging tasks while also delivering the right experience for everyone to understand what, when and how to run this operation In the field.

  • Rentals: By the minute, or by days, this is related to bookings and just people having the chance to take them on the streets. For both cases it is very important to create environments with best in class experience UX and simplicity in the usage is really important for customers.

  • Customer Support: The core success within this business is having the ability to provide to the people the right information and services in real time, which is why customer support is one of the key factors. At Cosmic, this is one of the most key differentiating ways we provide all support for you and you don’t really need to take care of anything here; we will make sure customers get all in real time. But as insight shows, customers prefer services that respond fairly quickly to what they request.

Step 7: Execute on Operations and Product Including Insurance

Now is the day of live operations arrived and customers are waiting for your service. You need to make this a reality what are you going to do!!!

One of the most core things to know is this:

“Mobility Businesses that think in Operations as part of Customer Success are the ones that make the quintessence of for benefit for profit business ”

Getting it is not easy but here the quick steps:

  1. Plan the people movement
  2. Location of scooters, e bikes or mopeds
  3. Follow Up on experience (vehicles in the right position, with enough battery to provide a good service)
  4. Assign time frames for delivery in rentals and for maintenance overhead.
  5. Check a spare part plan
  6. Execute and be discipled stick to the plan!

For Insurance two are highly recommended to acquire

Third Party Liability Insurance

Cover yourself in situations where people don’t know how to use the service or even run the vehicles Despite the number of people trailed or the type of vehicles used, accidents happen. This is why insurance is mandatory for most, if not all governments.

Vehicle Insurance

We operated in hectic environments of Latin America, so most of the systems were optimized to the point that we got a low rate of vehicle loss below 5% in markets with very high crime rates. But even with a strong system, it is important to have the vehicle covered.

Following all previously stated steps will lead to a good delivery for customers but is really important to make sure that you get all the components of the business in place. Some might be really hard and others pretty easy, but regardless, you might need more training and information to have the right execution which is core for the success of a mobility business.

So I’ll invite you to check the Mobility Academy where you will have insights with experts in the field to get all the information and relevant insights about the business. (Start here for free today)

To Start a More customized business you can also chat with us, feel free to reach our Sales team, they will share with you not only different use cases but also will provide all support to make you successful in the entire journey. (Chat With Us)

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