Commute As a service - Subscription

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How much would you pay for it?

  • CAD 700

    Votes: 0 0.0%
  • CAD 750

    Votes: 0 0.0%
  • CAD 800

    Votes: 0 0.0%

  • Total voters
    2
Joined
Nov 2, 2019
Messages
7
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Ottawa
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Country
#1
Hello Forum,

********after covid is gone*************

I am planning to start a new business in Ottawa - Gatineau area. This would be a commute solution. - (subscription based service) The aim is to simplify the commute for users while reducing the number of cars on the road and air pollution.

How it works: for a monthly fee, a driver will pick you up from your house and drop you at the office door. In the evening, the same driver will take you home. You will always have the same driver picking you up.

There would be up to 3 passengers per car. You don't need to worry about driving, parking, car maintenance, clearing up the driveway (on a winter morning) etc.

I don't think I need to mention which make of cars, it would be. ;) Comments and suggestions are welcome.

Thanks.
 
Last edited:

garsh

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#3
I assume this will only work for people who can keep a strict schedule?

$700/mo. $8400/yr.
That would be $42,000 for 5 years.
And that only covers a commute.
You would still need a vehicle (or pay for Ubers, etc) for any other travel.

The cost is getting up there with the price of a new vehicle.
Let alone looking at used vehicles.

If you can start small and see if it works, give it a shot.


1605809499723-png.36119
 

Ed Woodrick

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#4
In New York City it's called a car or limo service.
Don't forget that you'll probably need a cab/limo service license.

The second that you put more than one person in a vehicle, you tend to turn it into a basic commuter service. The problem is that you have to wait for others to get picked up and then dropped off. Unlike a car service which is generally one person to a vehicle.

Your best bet for the service may not be individuals, but businesses.

For me, I wouldn't pay for it. I loose the flexibility to make stops along the way. And heck, with the Tesla, it may seem be the same thing with FSD.
 

FRC

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#5
I think that you were wise to put this idea out for input from others. It appears that the responses thus far have been mostly negative and I'm gonna jump on that bandwagon too. This sounds to me like a business school bus. You would have to pay me to ride to work every day with complete strangers. I applaud your entrepreneurial spirit but this isn't the winner that you're looking for.
 
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#6
Thanks everyone for the response.

I should add some qualifiers here.

1) the service is aimed at people who live in a suburb 40 -50 KMs away from the city, they drive to work (pre/post covid) and it takes them an hour or more each way.

2) a suburban household generally has 2 cars (husband and wife's/partner's). 1 of those cars is used primarily for commute, this service can **replace** the 2nd car.

3) if they drive to work:

) drive for an hour or more

) find a parking spot

) pay for the parking / pay monthly parking (if they pay monthly then #2 doesn't apply)

) they can be a bit fatigued by the time they are in the office

) drive back to home in heavy traffic


The service solves all of the above

4) UberX wont pick you up in a suburban area 50 KMs away from the city.

5) You are sharing the car with neighbours (not strangers) because people living close to you, are most likely to be in the same car as you. you care about the driver and other passengers being the same, there is a trust that develops over time. this is very important for the service to succeed.
 

GDN

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#7
I see both sides of it. Sounds like a lot more than I'd ever pay, since it likely as much as a car payment. However when noted the Car / Limosine services in NYC, it's likely right on par. There are many of them and they seem to do quite well. They do seem to likely contract with companies rather than individuals, but maybe this is the new thing for those that can afford it, it would definitely leave me out however.
 

Ed Woodrick

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#8
Thanks everyone for the response.

I should add some qualifiers here.


5) You are sharing the car with neighbours (not strangers) because people living close to you, are most likely to be in the same car as you. you care about the driver and other passengers being the same, there is a trust that develops over time. this is very important for the service to succeed.
This is extremely easy to say, but extremely hard to implement.
Carpools are often unsuccessful because they take longer to get to work. don't see why this is any different.
Neighbors that you know are probably limited to less than 100 people, well, maybe >50 who commute and probably none that work near each other.

In Atlanta (yours may be different) effectively no one else works near where I work. That's one of the reasons why mass transit isn't desired, it doesn't get me to where I need to be.
Talk to your neighbors, find out where they work. I suspect that it would be rare to find folks that have to commute > 50km AND work within 10 km of each other.

It's basically a carpool where one person doesn't have to drive. That basically just makes it a really expensive carpool to have to pay someone to drive for you.
 

Bigriver

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#9
I always have to do some Canadian to US conversions. The lower end in your poll of $700 CN is about $515 US. And 40-50 km is 25-31 miles.

I worked for a company that moved its headquarters about 35 miles away, creating a long commute for most of its large work force. For a period of time, they provided commuting buses to us for free, then converted to charging for it, then eventually disbanded the busing. Among the people who used the busses, some broke off and formed van pools of maybe 5 to 10 people. I’ve racked my memory trying to remember the cost, and don’t have a clear number. I think for someone who went to the office every day, it worked out a little cheaper than gas and tolls, which maybe ran $10/day - and this was almost a decade ago, so inflation would maybe double that value for today. So $20/day times 20 work days/month is $400. Lower than your lower end of $515 US in the poll, but closer than I expected when I started this mental exercise.

I never was interested in the van pool service. My flexibility and freedom is worth more to me than any potential cost savings, and not to mention that I like driving. For those who did like it, I remember hearing some who didn’t like driving, some who wanted a reason to have to leave at a given time 😏, and some were interested in the cost savings and no wear and tear on a car. I’m not aware of anyone who tried to get by with 1 less car in their household because of it. If someone is a parent with multiple kids, it would be very challenging to reduce down to 1 car. Or even without kids, for the spouses to coordinate all their activities around the other’s use of the car. I know of few who would make that sacrifice unless an absolute financial necessity.

I think your price has to be no more than their out of pocket costs for gas, tolls and parking. I don’t think you can put a price on the convenience, because at least to me, it seems to lose more convenience than it gains. I think your biggest challenge would be to find your customers. To find people who live near each other (so you are not having to spend an extra half an hour picking up people), with similar schedules, and with similar (enough) desires for chatter versus a quiet ride (not to mention radio preferences)..... doesn’t sound easy to me.
 

garsh

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#10
My company paid for a van rental for those of us who live about 30 miles north of the office.

One of these: https://www.commutewithenterprise.com/

It's completely free for employees to use. One of the employees just needs to volunteer to drive it each day. There were about 3-6 people who took advantage of it regularly (before the pandemic). I could have, but I find the fixed schedule to be too limiting. I doubt any of us would have taken that option if it was $700 CAD/mo.
 
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#11
Great business spirit. If you can fill a need and turn a profit you are good to go. Most businesses don't make it. Many obstacles...professional liability being a big one.
Start small. Try to stay in the profit zone. Adapt and evolve and you may find a niche.
 
Joined
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#12
Great business spirit. If you can fill a need and turn a profit you are good to go. Most businesses don't make it. Many obstacles...professional liability being a big one.
Start small. Try to stay in the profit zone. Adapt and evolve and you may find a niche.
Thanks :) thats the plan, start small and expand as people realize the value it provides.
 
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#13
I always have to do some Canadian to US conversions. The lower end in your poll of $700 CN is about $515 US. And 40-50 km is 25-31 miles.

I worked for a company that moved its headquarters about 35 miles away, creating a long commute for most of its large work force. For a period of time, they provided commuting buses to us for free, then converted to charging for it, then eventually disbanded the busing. Among the people who used the busses, some broke off and formed van pools of maybe 5 to 10 people. I’ve racked my memory trying to remember the cost, and don’t have a clear number. I think for someone who went to the office every day, it worked out a little cheaper than gas and tolls, which maybe ran $10/day - and this was almost a decade ago, so inflation would maybe double that value for today. So $20/day times 20 work days/month is $400. Lower than your lower end of $515 US in the poll, but closer than I expected when I started this mental exercise.

I never was interested in the van pool service. My flexibility and freedom is worth more to me than any potential cost savings, and not to mention that I like driving. For those who did like it, I remember hearing some who didn’t like driving, some who wanted a reason to have to leave at a given time 😏, and some were interested in the cost savings and no wear and tear on a car. I’m not aware of anyone who tried to get by with 1 less car in their household because of it. If someone is a parent with multiple kids, it would be very challenging to reduce down to 1 car. Or even without kids, for the spouses to coordinate all their activities around the other’s use of the car. I know of few who would make that sacrifice unless an absolute financial necessity.

I think your price has to be no more than their out of pocket costs for gas, tolls and parking. I don’t think you can put a price on the convenience, because at least to me, it seems to lose more convenience than it gains. I think your biggest challenge would be to find your customers. To find people who live near each other (so you are not having to spend an extra half an hour picking up people), with similar schedules, and with similar (enough) desires for chatter versus a quiet ride (not to mention radio preferences)..... doesn’t sound easy to me.

thanks for a detailed post. as you said, you cant put a price on convenience. this doesnt have to be the cheapest option, it just needs to be comparable.

cost of driving to work ~ 40 KM in Ottawa (Downtown):

$20 for parking each day OR $250 per month (but its hard to get a monthly parking spot)
cost of gas: I had a german car earlier (sedan - MB C350), I had to fill it up with $80 gas every 3rd day when I was driving. This is not to say that the gas cost is the same for everyone but it is a substantial amount in any case
fatigue of driving in traffic for 2 hours each day (can you put a price on it?)
car maintenance
having to visit the gas station when you would rather just go home
sitting in a noisy car for 2 hours (I plan to provide Noise Cancelling headphones)
 

JasonF

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#14
I’m not so good with numbers, but I’ll throw in this general concept:

The first thing to do is to make sure you don’t have competition that can do it cheaper, better, or more convenient. Check on Uber/Lyft/Taxi rates and make sure your concept is not just slightly cheaper. Though maybe you can make it work if it is, since you add the convenience of always being on time, and always having the same driver and passengers.

Even though it might be fun to run a driver service (basically a limo), make sure it’s very profitable. You might not want to keep driving people forever, and you might want to hire drivers. Make sure there is room for that. Also, look ahead to whether it’s profitable and easy enough to operate that you can license franchises in other areas. That’s where the real money would be.

And finally, the most important, have a lawyer check and make sure you won’t be running afoul of any ride sharing, taxi, or limo laws in the city. Take into account potential licensing and inspection fees. Don’t do like, ironically Uber did, and hope using gig labor will protect you until cars start getting impounded.

Other than that, I disagree with the assertion above that it would be too expensive. Depending on how large the city is, how scarce parking is, and how far those people live from their jobs...even if they already have a car, they might not enjoy the stress of parking 6 blocks away and paying for it (and risking theft), and then having to walk in the cold and snow to work. That alone might be worth it for them.
 
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#15
Hi Jason, you have some good advice there. Thanks. I appreciate it.

I am planning to hire a driver, that's partly the reason I need to charge 700 a month.

You hit the nail on the head, with this statement:

...even if they already have a car, they might not enjoy the stress of parking 6 blocks away and paying for it (and risking theft), and then having to walk in the cold and snow to work.