Bike Sharing - You get what you pay for!

Bike Sharing - You get what you pay for!

The old adage “You get what you pay for” has never been more true than when looking at bike sharing. It’s no secret that the historical model of bike kiosk stations in large cities is becoming a way of the past. But is dockless truly the solution moving forward? Kiosk models were very expensive and could not get great coverage around a city. This presented a problem and dockless has likely come to a town near you, claiming they have solved this issue!

Dockless programs are boasting “free” solutions for the city when it comes to bike sharing, but is it really “free”? That’s what we’ve been trying to understand. Though these are certainly more affordable models for bike sharing, they have presented a few problems of their own.
 

Financial Sustainability. These dockless solutions are heavily backed by VC funding and they have created programs that have proven to be financially unsustainable. So what happens when your cities’ bike share goes bankrupt like Bluegogo? First, you’re left with thousands of bikes scattered throughout your city, blocking streets, sidewalks, storefronts and more. Not only is this unsightly, but it is not “sustainable”. If the goal is to provide a sustainable, or “green” mode of transportation for your community, then abandoning thousands of bikes does not seem to fit what cities are looking for. This has been coined as the “Bike Graveyard” and is something to be weary of when looking at a “free bike share”.

Forfeiting User Deposits.  In 2017, more than six different Chinese bike shares went bankrupt which resulted in over $150 million in user deposits being forfeited. This was community members, nearby residence, and tourists hard earned dollars that were forfeited from these bankruptcies. Again, the “free bike share” doesn’t appear to be free for the residence of the community.

With tens of millions of users, how did this happen? Several of these bike share companies had millions of users to keep the cash flowing in, but this was not enough. When the VC funding dried up, the income through these “free” bike shares could not sustain any longer. The “Buck a Bike” programs are very similar and are proving unsustainable.

In the end, using a “free” bike share program can leave much to be desired. You may find your city littered with unmaintained bikes blocking city streets, or worse. Your fellow residence may experience a forfeit of deposited funds. These are all things to consider when choosing a bike share provider. Are the cities best interests at the forefront of the Bike Share's business model? Think through the true cost of a share program before moving forward and make sure you understand the sustainability of the program. Bike shares can be a phenomenal amenity for the community if done right!