Want a flawless e-scooter sharing platform? Avoid these 10 Pitfalls

So, you want to launch an e-scooter-sharing platform with flawless performance? Great choice, especially when the e-scooter rental business model is adaptable and growing at the tremendous rate of 16% CAGR in the next decade. However, most e-scooter businesses are failing to do so because they fall for the common pitfalls and ultimately shut down. So, if you don’t want to be one of those, avoid the below mentioned 10 common mistakes when you are setting up your e-scooter sharing platform. 

10 mistakes to avoid when building your e-scooter sharing platform

Learning from others’ mistakes is how you ensure success for your business. Following are the 10 most common mistakes the scooter-sharing businesses make leading to major losses. 

Not estimating your market demand 

Whether you are a startup or a new business, you must consider the product-market fit first before launching. For example, do you expect a plant that needs lots of water to grow to bloom in the middle of a desert country? The chances are low, almost zero. Similarly, you can operate in a market where there is demand for the rental business and not the other way around. Ideally, if the city has less than 1 Lakh of population, there might be less demand. 

So, if you plan on entering a new market or starting your e-scooter rental software from scratch, you need to understand if there are enough people in need of rental scooters for short distances like 4-5. The research will help you know if you should launch the business or even if you launch your business, how many fleets you should be investing in. 

Ignoring the regulations of the country for e-scooters

With the rise of e-scooters as a mobility alternative comes an increase in public hazards by rough drivers, accidents, and unceremonial parking. One of the major concerns for the states is to facilitate the e-scooter business while maintaining the well-being of the citizens. Therefore, each state has its unique set of regulations that an e-scooter rental business must obey; thus if you want to operate in a market, research the local laws and ensure that your business model aligns with those rules. 

For example, in Barcelona, the government has created specific parking zones for e-scooters and parking anywhere apart from these zones is prohibited. Los Angeles has strict insurance laws for the e-scooter business. Once you meet the insurance regulations of LA, you can easily get permits from other countries because they have slightly easier insurance policies. 

Lack of efficient e-scooter software and user app 

Doesn’t matter if you have the top e-scooters in your fleet or you have the best team to manage your operations; if you don’t have an efficient user app and software, your business is bound to fail. A user scooter-sharing app is the only way they can connect to your company and use the service. The e-scooter software is the life of your e-scooter sharing platform. It helps you track, manage, and rebalance the fleet to boost the ROI, resolve customer queries, manage revenue, and let you collect and analyse your data. However, if your user app is lagging or lacks UX, you’ll lose users, and the brand image will decline.

Squillion Tech is a scooter-sharing software development company dedicated to helping the scooter rental businesses succeed with e-scooter app development. Eazy Ride, our subscription-based scooter-sharing solution, includes access to customizable user applications and admin software. You can use these to kickstart your business with minimal fund requirements effortlessly. Furthermore, our expert team of developers installs the system using IoT and other tech stacks and helps to train your team to use the software. But what if you need control of the source code? We can help you with that! You can get access and control of the source code of the software and user app. Contact us to know how! 

Not estimating the operational cost and charges right 

Now, estimating the cost is one of the most crucial decisions you need to make as an e-scooter rental business founder. Considering the zillions of tasks on your to-do list, it can be hectic to micro-analyze the costs and decide the charges for renting your scooter. You must understand the breakdown of the cost and how much profit margin you need to keep. 

As per the BCG report, an optimum e-scooter rental charge must cover the cost of purchasing the scooter, securing insurance and permits, maintenance and repair costs, e-scooter charging costs, and the profit margin. Some of these are fixed costs like the purchasing cost and insurance, while the others are variable costs that can be used to fluctuate the price as per the demand. Therefore, do your research regarding the costs and competition to set the cost per unit and the profit margin that will help you attract and retain customers. 

Furthermore, you must understand that each rental e-scooter has a shorter lifespan (3-5 months) compared to the privately owned one due to reasons like frequent and rough use, vandalization, and more. Additionally, you if you are building a software and app from scratch, that cost will add up. Therefore, set the rent such that you could atleast break even with the cost of purchasing the scooter. 

Compromising scooter quality for cost reduction 

Now, from the point mentioned above, think of ways to reduce the cost, especially in a competitive market. One of the most common ways most people think of reducing cost is to opt for cheaper scooters, especially because they have shorter lifespans. However, it might be the recipe for failure. The core pillar of your scooter rental business is the scooters that you rent out to the users to use and commute. That’s why any compromise on the quality of the scooter impacts users’ experience, leading to losses and a bad brand image. Furthermore, if you have to buy a new e-scooter every three months, your expenditure will be off the roof, reducing your profits. 

But the problem of cost remains the same: how can you reduce the price? One of the ways to reduce the cost is to maintain the scooters regularly for the longevity of the scooter. Additionally, you can reduce the cost by opting for subscription scooter-sharing software and user apps like Eazy Ride by Squillion Tech instead of developing it from scratch. The subscription based software charges much less ($5-$10 per vehicle) than the thousands of dollars for development. 

Inefficient maintenance of the e-scooter 

Maintenance is that chore that keeps your business afloat. It can be a tedious job to schedule the maintenance of the fleet, especially if you have thousands of scooters lying around different parts of the country. However, you have to maintain your scooters for the longevity of the scooter, excellent customer experience to retain them, and get the best ROI. 

You can do it yourself or do yourself a favour and work with a maintenance company to automate the process and avoid any mishaps. It helps you maintain the performance of the fleet and focus on other tasks better. 

Not utilising your fleet capacity efficiently 

How often do your scooters stay in their parking spot? It’s completely normal for the fleet to remain ideal, especially when it isn’t a rush hour. However, this ideal time should be small to get the best ROI. Most companies, especially the newly established ones often do not consider relocating the scooters in rush hours, aka rebalancing the scooters. By rebalancing the scooters in the rush hours to a high demand area, you can utilize the scooters and move them back when the demand goes to normal. 

Lack of managerial staff for your rental business 

Your staff can make your business fly high. We know that most of the tasks of the scooter rental businesses are automated: booking the ride, finding the ride, and parking the ride. However, the customers might need the support in real-time. That’s where your staff plays a vital role. They can help the customers resolve their queries through the app, call or in person assistance. Furthermore, maintenance and marketing are crucial tasks to run your operations which need support from your staff members. 

Overlooking data security 

E-scooter-sharing platforms handle sensitive user data, including user license details, payment details, vehicle insurance, revenue, and location history. A breach can damage customers’ trust, company damage, and lead to legal consequences. Implementing strong cybersecurity measures, including encrypted payment gateways and secure cloud storage, is a must for scooter rental businesses. With Squillion Tech, you can rest assured that your data is secured and only accessible to those who you want with role-based access.

Having a rigid business model 

The market changes at a tremendous speed, especially if you are operating in multiple countries. That’s why a rigid business model for an e-scooter sharing platform will lead to the failure of your scooter rental business. Therefore, focus on creating a scalable and flexible business model that adapts to the structure of the market and the regulations of the diverse states and countries. The flexibility could be in terms of the prices for profit maximization, operations for regulatory compliance, and marketing strategies based on the market trends. 

Conclusion 

Making your e-scooter sharing platform successful depends on things you have done and avoided. While you might know a lot of things that you must do, we discussed 10 things that you shouldn’t do. Ignoring the market demand, customer needs and government regulations are bound to make your business fail. Furthermore, choosing cheaper scooters to reduce cost, neglecting maintenance, and not recruiting supporting staff directly impact your customer experience and, thus, your brand image. Sticking to a rigid business model, keeping your scooters in the same spot, and under or over-estimating your cost can impact your profits. Spending too less on e-scooter sharing software and apps can lead to a decline in customer satisfaction and mishaps in operations. So, invest in the right tools, comply with the local regulations and create a scalable business model for success! 

Squillion Tech can help you with their Eazy Ride, a subscription-based E-Scooter Sharing solution including software and a customisable app. With skilled developers, we help you integrate the software into your existing system effortlessly and also train your team! If you want to own the source code, we can help you with that as well! Checkout our scooter-sharing solution page for more information!