If you are a gearhead, you possibly cannot shake the desire to have a garage full of vehicles. There’s something very luxurious in choosing which car to drive on which day – but that luxury comes at a heavy price. Even setting aside the initial investment in ownership, vehicle owners spend several thousand dollars every year on insurance, fuel, registration, and maintenance. Because you do not Jay Leno or Kylie Jenner, there’s little hope that you can afford such a collection. Except…
One way to own a fleet of vehicles and survive costs is to monetize your garage by turning it into a car sharing company. Many experts believe that car sharing is the future of transportation, so by jumping on current market trends, you can grow your business before it booms. Plus, you can justify buying vehicles of all makes and models for your business. If you want to learn more about how to get your car sharing business up and running in 2019 and beyond, read on.
Research Your Local Market
Unless you live in a really rural community, there’s possibly at least one car sharing service operating in your area. Large, established carshares, such as Zipcar and Enterprise CarShare, have covered most of the world, and if they are not in your suburb, they definitely serve a close by city. Since you aren’t ahead of the curve in developing a carshare service, you’ll need to do some market research to understand what carshares operate, what models they use, what their prices are and who their customers are.
Next, you should do additional research on your potential clients. Questions that should guide your research include:
- How old are the carshare clients in your area?
- What do carshare clients use this service for?
- Where do carshare clients live, and where do they go?
- What is the typical income of a carshare client?
- How tech savvy are carshare clients?
Finally, you should bring the two parts of your research together to understand which parts of the local market are currently underserved. This will get you started on car sharing in your niche and get more traction from the start. Some examples of niches include providing a carshare for folks, for families or for those who want luxury brands and models. Once you have an idea for the foundation of your business, you can begin building it in earnest.
Understand Your Needs
You know you need a car — although the make and model you choose may depend upon your audience and car sharing model. However, there are other important components that must be acquired before you can ensure that your business has what it takes to succeed. This includes:
Precise technology. Carshares depend on every kind of technology, from GPS on vehicles in fleets to payment services for users to keyless entry and ignition systems. you can take advantage of car sharing software from RideCell to help you with some of these needs.
Proper insurance. Cars are expensive, and dangerous. Undoubtedly, more than one of your car sharing clients will be involved in a crash, and you need a way to protect your assets from any lawsuits. You cannot depend on regular car insurance; your business needs special car sharing insurance to stay safe.
proper fee structure. How (and how much) you charge your clients will depend upon who they’re and why they need a vehicle. And that brings us to the final step…
Develop Your Model
There are three established model for car-sharing businesses. This includes:
B2C Car Sharing
The most well-known form of carsharing, business-to-consumer carshare provides vehicle access for ordinary people who need transportation. There are several ways to structure B2C, from the station-based model (where all available vehicles are picked up and dropped off at a particular spot) the AB model (where members can pick up and drop off vehicles at different parking lots) to the free-floating model (which allows users to pick up and leave the vehicle wherever they need to within an area). Typically, users pay a monthly subscription fee in addition to a per mile or hourly fee. Since this is a popular car sharing model, likelihood is that customers in your area are familiar with the concept and able to set up the service with minimal fuss.
P2P Car Sharing
Since most privately owned vehicles are idle for 90 percent of the day, it is a passive way for car owners to make money — much like Airbnb is for cars. You will develop the infrastructure, but the car owner will provide the vehicles and listings for users to view and order. You will need to devote a portion of your income to payments to car owners, and there are some risks for the car owner and for you, the business owner, but given the recent growth in the P2P industry, this isn’t a model to disregard. right away – unless you are just looking to share cars to buy your own fleet.
B2B Car Sharing
Businesses often need vehicles to help workers move from office to office, meet with clients, transport products and more. If you have an interest in buying not consumer cars but commercial vehicles such as trucks, trailers and tractors, you may consider establishing a B2B car share in your area. Business clients tend to be harder to attract but more profitable in the long run.
In fact, the desire to own multiple cars is not a good motivator for building a car sharing business. However, if you have an entrepreneurial mindset and enjoy buying and managing fleets, you’ll probably find success in this industry.
