Discuss about the New Bike Sharing System Gets Rolling.
The report contains the information of bicycle rental industry in Singapore with the help of giant players dealing in the same industry. Basically, it can be broadly classified as an important industry that rent bicycle for short span on time for a charge or fee. Some of the players of the same industry in Singapore may include Ofo, oBike, Mobike and many more. The report is divided into three sections in which the first section includes the overview of the industry. The second section involves its analysis with the help of some macro factors which is followed by the attractiveness of this industry in Singapore.
It is estimated that the bicycle industry is becoming more competitive and attaining a large share of revenues and is predicted to grow in the upcoming years. Cycling is considered to be the most recreational activities in many countries and there has been rapid increase in the number of cyclists over the last couple of decades (Ibsen and Bump, 2015).
In context to bicycle rental industry in Singapore, it has been revealed that bicycle was not used for the mode for mode of transport in 90’s as very less number of people used it to roam around the region. But, there has been an increase in the use of bicycle between the year 2000 and 2005. Singapore is not a very big player of bicycle manufacturing site but now, the rental bicycle industry has gained a huge popularity (Vasagar, 2017).
It has been revealed in a recent survey that Singapore is gradually moving towards a more bicycle friendly city and is likely to build more than 700 km of cycling paths and park connection in the upcoming years. Though, the current situation of the country reveals that cycling is not allowed on footpaths and riders have to travel on the road in the absence of bicycle lanes. But the recent development of bicycle rental industry might resolve this issue by the development of bicycle lanes to ensure secured rides (Russo, 2015).
Ofo: Ofo is basically a significant provider of a bike sharing platform which is highly defined to give an efficient ride to its customers in the fast paced city. It has its 1000 bikes in Singapore and they are bright yellow in color. To use the service, one must have the mobile application to unlock the bicycle which is available in both iOS and Google play store (Soo, 2017). The customers are only required to enter a verification number sent to their mobile through SMS in order to use the service. Ofo are single speed bicycles as there are no gear shifters to meddle about with. These bicycles have front as well as rear brakes with all the important safe accessories built in it. It costs $ 0.50 per trip and one must need to end the trip on the app to have a glance of trip details with its charges (GDS, 2017).
oBike: The bicycles of oBike are white in color with an attractive basket in front and one can unlock the bicycle by scanning QR code which is found on the bike itself. Before using the service, one must need to enter the credit card details and put down a small deposit through its mobile application (Second Wind, 2015). The charge of oBike usage is $ 1 per half hour. One of the biggest features of the bikes of oBike is that an individual can easily use the app to look at the map with the main aim to locate the closest oBike bike. Initially, the company launched its services in the western and northern parts of Singapore but now, it has extended its services in other parts as well. Ofo and oBike both are Chinese companies and the eventual fleet size of both players is projected to reveal that of the LTA’s, which is directed to come up with about 2,330 bicycles in Jurong Lake District, Marina Bay, Tampines and Pasir Ris (Ting, 2017).
Mobike: The Chinese firm Mobile announced the official launch of its bike share service in Singapore in the year 2016. The company is working happily with many educational institutes in Singapore and did partnering with National University of Singapore, Singapore Management University, and Republic Polytechnic. Basically, Mobile uses a dock less bike sharing system in which riders make use of mobile application in order to unlock its bicycles. The firm has not revealed the number of bikes it has in Singapore (Lim, 2016).
It is important to understand the macro factors to analyze the bicycle rental industry as a whole. These factors may include environmental regulations and protection, significant legislations, government policies, economic growth, lifestyle trends, maturity of technology and many more. It has been analyzed that bicycle rental is attaining a huge popularity in most of the countries across the world and the evolution of mobile applications have make it more popular among the users (Technavio, 2016).
This is because they can easily track a bike as per their suitable and current location. The government of different countries is investing in such products to make a pollution free region and the changing lifestyle of people have made it easier to adapt to this approach (Persistence Market Research, 2016).
In order to examine the analysis of macro factors on this industry, the pestle analysis has been given below:
Political factors: The growth of bicycle rental industry is foreseen in Singapore and the government of country is also making sure to construct more cycling paths to link neighborhood, schools and market since the year 2010. This has allowed major cyclists to commute safely and choose a better rental service among the various players in the same arena (Cheong, 2017).
Economical factors: The public transport fares have risen due to which this has become an economical option and many bicycle rental companies introduce various economic benefits to attract customers. For instance, Ofo started a free bicycle ride for those who are using the service for the first time to gain a huge traffic with an ease. Also, it is evident that the price of bicycles and their fares are not at all impacted by inflation from rising fuel prices in Australia (Sutton, 2016).
Social factors: It has been observed that the government of Singapore promotes healthier lifestyles due to which citizens are becoming more health conscious. As a result, they are making sure to incorporate exercise in their daily chores and cycling is one such exercise that helps to feel better and healthier. This mode of transport helps people to burn calories with an ease by choosing rental bicycle services with an ease (Transport for London, 2010).
Technological factors: Technology plays a vital role when it comes to bicycle rental industry in Singapore as mobile applications have made it easier for users to use the service and track the location without any kind of difficulty (Oortwijn, 2016). One can easily pay through these mobile applications instead of paying by any other mode and the major benefit is that the maps in their mobile apps help them to look at the map to check the nearby bicycle available (Abdullah, 2017).
Environmental Factors: It is apparently true that bicycle do not pollute environment at all like other automobile vehicles do as it does not use any kind of fuel in it. This aspect makes sure that this industry is extremely safe for the environment (Abdullah, 2017).
Legal Factors: Cycling has undoubtedly gained a huge popularity in Singapore but footpath cycling was still illegal in the country due to safety concerns. Many individual stated that footpath cycling is safer and the result has launched as the trial of legalizing footpath cycling to test the same (Citrino, 2016).
Henceforth, it can be stated that Singapore is gaining popularity in terms of bicycle rental industry due to its various fruitful benefits due to several technological advancements. A customer needs to register EZ- link card to recognize the contact information and the main objective of this industry is to provide people excellent control over their everyday travelling. Also, the macro factors reveal that this medium has become economic due to hike in public transport fares (Zagster, 2015). In nutshell, it is a great approach to get healthier and add rigorous exercise in their daily routine with an ease.
Bicycle rental industry is attractive up to a greater extent as it has become one of the most environmental friendly businesses that attract tourists, local people and everyday travelers to ride without any difficulty. The main objective of this industry is to protect the environment and enhance the well being of customers at economical prices. The rides are available at much affordable prices with no waiting time and one can have easy control over speed which reduces the fear of fatal accidents. Also, the attractiveness increases as this industry is not at all affected by jams which save the time as individuals do not get stuck in traffic (Citrino, 2016).
The report properly covers the present scenario and growth prospects of bicycle rental industry as large number of bike sharing programs are offered by Singapore. Currently, there are more than 500 bike sharing schemes across the world with a market volume of more than 1.3 billion Euros. The global market for the offers of bike sharing is expected to grow up to 5.3 billion Euros by the end of the year 2020. It is foreseen that Singapore is included in the growth of bicycle rental industry due to altered customer behavior as they are changing their traditional paradigm of travelling in which people travel around their local area (Ting, 2017).
It is apparent that more and more individuals are opting for bike sharing offers as it gives them a fast and economical way to reach from door to door. Basically, there are 6 key factors that determine the attractiveness of this industry and they are high density network, multimodal integration, simple handling, attractive pricing, high quality bicycles and support of local authorities. In this regard, high density network says that there should be high concentration of pick up and return points of bicycle availability that are easily accessible (Second Wind, 2015).
This is a positive aspect in Singapore as people can search the nearby bicycle easily through maps on mobile applications. Multimodal integration is still to come in Singapore while simple handling is present in the rented bicycles of the region. In fact, many firms provide basket in front for easy carriage and handling where as attractive pricing is like a feather in the bicycle rental industry of Singapore. This is because some firms are not taking charge of first ride while some has low registration cost which makes this industry highly economical for people (Ting, 2017).
High quality bicycle is another key aspect to ensure the attractiveness of this industry as modern bikes ensure a comfortable ride and keep maintenance costs down. This can be found in the bicycle rental industry of Singapore as the bikes are super comfortable in all the aspects. The last aspect is the support of local authorities and the construction of cycling lanes in Singapore states that the government supports this industry (Technavio, 2016). Therefore, bicycle rental industry is highly attractive in Singapore as well as in various other parts of the world too.
In order to understand the attractiveness of bicycle rental industry, the porter five force analysis has been given below:
Rivalry among Existing Firms: The rivalry among the competitors is medium but it has now been increasing due to the arrival of new rental bicycle firms in Singapore. Some of the giant players of this industry may include Ofo, Mobile, oBike and many more that are competing among each other to get the maximum market share without any kind of major difficulty (Vasagar, 2017).
Bargaining Power of Customers: The bargaining power of customers is quite high due to the availability of numerous numbers of substitutes like buses, taxis and other public transports. It is assumed by large number of individuals that other modes of transport are faster than a bicycle and it is good to prefer them to avoid any kind of delay. Also, other modes of transport are easily available and make individual reach faster as compared to bicycle as described in this section (Thampuran, 2016).
Bargaining Power of Suppliers: The bargaining power of suppliers of bicycle rental industry is low as large number of substitute and bicycle rail suppliers are available in the market. If suppliers would start negotiating then, they are aware of the fact that the firm might switch to another supplier due to its ample availability (Cheong, 2017).
Threat of New Entrants: There is low threat of new entrants due to the presence of many restraints and also, it requires large amount of capital. Apart from this, there are already various giants in the same industry and it would be really difficult for a new venture to compete with them (Good Year, 2015).
Threat of Substitute Products: The threat of substitute products is high due to presence of various players in the market as customer is likely to switch if they get better services at much affordable prices (Low, 2017).
From the above analysis, it is clear that bicycle rental industry has a huge scope in Singapore but companies are required to be more competitive to provide the fruitful services to its clients. This is because there are high chances that customer may switch if they get better services from any other firm.
Conclusion
From the above discussion, it can be concluded that bicycle rental industry is gaining huge popularity since last couple of decades. This is because people have started using this to make their everyday travelling easier as well as economical. Basically, these firms provide access to their vehicles for a short period of time by renting their bikes at a nominal cost. The proper discussion of the industry of Singapore is done in this report to analyze the macro factors that are ensuring as well as impacting its growth. In nutshell, it is clear that bicycle rental industry has become really attractive due to several kinds of benefits that it serves as described in the above mentioned section.
References
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