Wanting to Start a Segway Tour Business--Looking for advice
 

Howdy all. After an incredibly enjoyable Segway tour while on vacation in San Francisco, I'm wanting to explore the possibility of opening up my own tour business in my area. I live in a beautiful central Texas city with a major historic university that thousands of students, parents, and visitors trapse across on foot every single day. Without going into a bunch of flowing linguistics, it really is an IDEAL place for Segway tours.

So with that having been said, what are some of y'all's ideas and suggestions about someone who is brand new to the game looking to start a touring company? I realize that the overhead to buy a fleet of new machines will be considerable, and I'm assuming that liability insurance will also be considerable (though I don't know just HOW considerable). Perphaps that would be a good starting point for discussions...

The starting point should be...
 

Why do you think that your area is a great place for a successful Segway Tour? Your thoughts and reasoning are paramount...

So much is involved in starting a Segway Tour business, please do yourself a favor and don't rush to hang the shingle. It could be a very costly mistake. Good luck...

Oh, I'm in no hurry to get things started. My wife and I currently have very rewarding jobs but we would love to cultivate a family business where we are our own bosses.

In short, as I'm currently envisioning it, I would offer tours of Texas A&M University which is the 7th largest American university with an enrollment of 48,000 students. The school's 130 year old main campus here covers 5,200 acres, to give you an idea of its size. So needless to say, there is a lot of history, a LOT to see, and a LOT of ground to cover. Parents and prospective students come to the campus all throughout the year to get a feel for things and see if the school is right for them (or their child). Also, with the George H.W. Bush Presidential Library & Museum and numerous other events related to the university, there are always a lot of visitors in town.

Currently, the only campus tour option is a free walking tour offered by the university. Honestly, the tour sucks and it certainly doesn't help that it requires lots of walking in the 100+ degree (F) Texas heat. About the only thing the tour has going for it is that it's free. Another thing that happens is that students who are going to be incoming college freshmen arrive all throughout the summer for New Student Conferences, which is essentially orientation. They come with their families and attend numerous meetings with advisors in addition to getting a feel for the layout of the campus. I speak from personal experience when I say that oftentimes the parents tend to skip out on the "getting to know your way around campus" portion due to physical factors (namely, mobility and endurance problems). When my parents came with me for orientation back in 2000, they had significant trouble getting around (dad's got bad knees, mom's hip gets to hurting her) and had to leave most of the exploring to me and my sister (who was also an incoming freshman). So looking back, if a Segway tour had been an option, we would have been all over it for a way to get a good look at the entire campus without wearing the parents out in no time.

Although our campus isn't a "walking campus" (meaning that no vehicular traffic is allowed inside the campus), there ARE a lot of buildings that you really just can't get to from a vehicle. And of course, the parking situation is a nightmare. So you're really only left with the option of walking or riding bikes. At least...currently. ;)

Me, my grandfather, my father, my brother, my sister, and my wife all went to A&M. For that reason, I've got [what I consider to be] a great appreciation for and knowledge of the campus and its history. Although this will only help in starting a tour company, I think it's definitely a good first step.

So maybe that'll help a bit to explain some of the reasons why I want to offer tours here and why I think they would be a big hit with visitors and residents alike. Shoot, maybe college students will want to take their dates on tours. Or student groups that are looking for a fun outing and a way to learn more about their campus. :cool:

One thing that I'm really clueless about though is how much insurance usually runs for a Segway tour company. I would imagine that aside from the cost of equipment, insurance is probably going to be the largest expense. Florida, can you offer some insight into the insurance situation for Segway tour companies? :)

Can you get permission from the University to conduct for-profit activities (and Segway use by a tour company) on campus?

Seems like I'd get that answer (in writing if possible) before I spent a dime on getting hardware.

When you can get permission for both those items, then do your research on business licenses, taxes, etc., as well as try and get quotes for insurance (at the limits rerquired by state and local laws (as well as the University). get an idea of suitable locations to run the business out of (and find out average rental cost, as well as phone, electricity, water, and so on).

Get information on what your employee costs will be (wages), including having an accountant check your books (you don't want to screw up paying taxes, missing utility payments or forgetting tax withholding). You may have to cover the employees health care and so on as well (depends on where you are and how much they work - most good employees would rather get benefits). *you can do market research by asking similar sized businesses those questions, but be sure and explain that you are thinking of developing a business plan - don't tell them it is for a school project or something like that, they'll remember if you were less than forthright.

Find out what the cost of the Segways will be, plus helmets, locks, advertising, signage, credit card machines, licensing from Segway, cash register, money pouches, paper, pens, etc. (million more little things here)

You want to be able to realistically be able to figure out your costs, then figure out how many rentals you will need to make that much money. If the number is really big (i.e. lots of rentals daily/weekly/monthly) to break even, you'll be taking on more risk. Segway rentals are also very seasonable (dead of winter will see less rentals, if any, and in summer there will be less students but maybe more tourists).

I would try and get as much data as you can about establishing a business in your town (do you need a license? do you need to join a chamber of commerce or downtown business association?) Do you need approvals to establish the business at all? Do you need to hire a lawyer?

Segways are almost the least important part of the equation (I know - blasphemy on this forum, but I'm talking business) as far as your success or failure.

I'm not even scratching the surface here, look online or locally on how to write a business plan and that will give you more information.

Don't get discouraged, and good luck.

Chris

Talk with some successful tour operators
 

We have several very good ones on here. Bvelke has a great tour in Gettysburg PA and has had to deal with a number of issuses that you will also be dealing with.

Talk to both Segway Authorized Tour operators as well as independant operators to get input.

Like any business, this is no just walk in and then go to the bank with all the cash operation. There is a lot of hard work involved, and if you are not a people person, this may not be the best business. You have to like people, as you will get all kinds who come to you and expect you to make the next two hours of their lives the most wonderful ever.

Think big but take little steps until you get your self-balancing wheels under you.

Best of Luck!

Thanks for all the encouragement guys. What is the deal with "Segway Authorized Tours" vs. Non-authorized tours? Also, what does it take to become an authorized Segway dealer?

Segway Authorized Tours
 

Are only Segway Dealers can offer Segway Authorized Tours. They have to follow specific guidelines set by Segway.

Does it really make a difference? In my oppinion not really, other than they get a fancy sticker for their door and that they can use the term.

Contact Segway to find out more about being a dealer. It reguires a number of things to be a dealer, a specific purchase quota, specific business protocol, and other things. But you do have access to things in the world of Segway that you do not as a non-dealer, but there is also alot of responsiblity and additional costs associated with being a dealer.

My advice would be to set up your business plan for your Segway Tour, and start there. If you like it, then think about being a dealer. You may want to talk to some of your local dealerships and see if you could be a sub dealer for them, before you venture out on your own.

I've actually been thinking about this a lot. Luckily, as a police officer, I think I have a fairly good idea just what the university could and could not do about Segway tours being offered on campus. Essentially, our traffic laws in Texas (which also apply on campus since it is a public institution) allow EPAMDs (Segways) to be operated on sidewalks, in bike lanes (which we have a lot of here), and sometimes even in the main roadway (main lane of traffic). With those laws on my side, I really can't think of much that the university could do short of something like a general Segway ban on campus. And I'm not sure they could even do that since Segways are classified as EPAMDs. Of course, I would want to conduct myself and my tours in a way that wouldn't come close to pressing my luck. I would want to speak with officials at the school first and tout my proposal as an attempt to be an ambassador for the university (all the while admittedly making a profit for myself). I'm going to try and talk to a couple friends that work for the University Police Department here in the coming days about any problems they might foresee or experiences they've had with Segway operation on the campus. I'll let y'all know what I learn.

I'm still curious about insurance costs though...

I wouldn't even consider doing a Segway Tour at any university without both their blessing/endorsement (which you will need to have any real long-term chance of business success) and a partnership set up with the university to have direct access to 'every' prospective/active student and their families. I would make sure that every person 'checking out' the campus sees it on my segway Tour. I would happily hand over a piece of my business income for that customer access.

Otherwise, I understand your personal attachment to the school, but just a Segway tour of a university (even Harvard) would not be a great location as a 'tourist attraction'.

So far, I have spoken with the University Police Department and an official at the University Business Office. Both were very encouraging and said that they couldn't think of any problems that the university would have with someone offering Segway tours of the campus. The man at the business office is going to speak with another office that handles contracts just to double check but said that he didn't see anything wrong with it at this time and thanked me for seeking the university's approval before going forward.


I agree about needing to get the university's blessing, and I am working on that, but it's somewhat difficult with a university of this size simply because there are numerous offices that could potentially have a say in the matter. And getting the blessing from one office might not necessarily communicate to other offices that you have received said blessing. Like I said, I'm working on that though. ;)

I really like the idea of setting up a partnership/contract in order to increase the customer base. However, I'm not sure that would be something I could get into right at the start. Again, with a university of this size, I get the impression that they are extremely picky about who they partner with and what company names they will put on anything that also bears the A&M logo. I would just assume that they would only agree to partner with a company that was established, had a history of success, and was not a brand new upstart company. Again, only an assumption (that I am in the process of confirming or disconfirming), but from the whispers I've heard around town, this is most likely the case with A&M.


If I may, why do you think that the university campus alone would not support a Segway tour business? Like I said, A&M is the 7th largest school in the nation, covers 5,200+ acres, and brings in TONS of visitors, sports fans, students, and prospective students on a continual basis.

Thanks again folks for all your advice and input!

Being a police officer should give you access to at least pitch the proposal that you may have to work harder if you were not in a known profession... As a cop, you are likely to be able to pass any historical or criminal checks... That will give the University some ease of mind...

As far as partnering with the university, money is always an odd factor... I might suggest, that until you are established, you offer a different compensation. It is up to you, but any organization that size will have a constant flow of new employees, new staff, and their families... You may wish to offer coupons for free tours (or a coupon for a free tour with two purchased ones or something like that) so that the university can itself use your service for their incomming staff and families... They may see this as a service to their own, without getting money involved... (and of course, it takes less out of your pocket as well).

As far as Tom's suggestion that a University Campus is not a stand alone or sufficient site for a tour, I do not agree... OF course, he is better at segway tours than I am, and even though I do live in the Boston Area, I am more familiar with Yale since I grew up in the New Haven, CT area...

There are different tours by bus and trolly now, of that Yale campus, and I would suspect of the Harvard or MIT campuses as well... These colleges have a rich history, and a tremendous asset in historic buildings, as well as are often the center of many social and political happenings... Many have botanical, scientific and other displays as well...

So, while I do not have segway tour experience, I do know of tours by other means that do go on in some of these locations... Perhaps Tom is right in that they may not have enough tourists to form a pool alone, that I do not know, but as a site, I believe they have a great deal to offer...

As far as the tour on the T A&M campus, good luck. Work hard, offer a fun time, with some education thrown in, mix it all up with the segways, and you're in like Flinn!

Keep smiling, and share that segway smile!

I would suggest you may need to rethink the point that Chris made. Remember, you aren't just gliding on campus, you are operating a profit-making (you hope) business on campus. Ask the manager of the cafeteria or one of the machine vendors what they're paying to do business on campus. I'm betting it won't be a small figure.

You may not have to pay a fee for the privilege, but if you don't get permission in advance, I see the potential for some unpleasant discussions with lawyers in your future. :( :( :(

Well if you'll read my last post, you'll see that I spoke with someone in the university's business office who said that [although he will check with one other office in the next few days,] his office doesn't have a problem with me doing the tours on campus and he appreciates me consulting the university first. ;)

great place to start, keep working until you have something in writing (doesn't have to be a formal contract yet - you will want something like that later on down the road), start putting a business plan together (there are self help books, local business organizations, business students, etc. that can help you with that part). I was involved in two start up businesses while I was in college and the first opened my eyes to the large amount of stuff that I did not know, the second showed me how much more work I ended up doing when I was the boss and not an employee.

In your favor - A&M has a large population that would make use of your tour business, it has lots of experienced tour guides (usually college students), it is large in area nad a Segway is almost a requirement for a tour that does not involve getting on and off buses.

The insurance question you have depends on what the university/town/county/state require for liability insurance (at a minimum) for a business (that also is putting people with minimal but minimally adequate training on Segways). you may try calling a few tour operators and asking what insurance carrier they use, then call the company and ask them about your specific area (if they need numbers tell them no more than a 10 to 1 ratio of tourists to guides, a mix of older and newer Segways - $2500-$6000 per unit, 30 minutes of instruction including watching the safety video and using a lesson plan, etc.).

Good luck . . . have fun . . . stay positive

Thanks again everybody! Keep the suggestions coming!

One thing that I have been wondering about though... Is it forbidden to use the name "Segway" in the name of your business if it is not a "Segway-authorized tour"? In other words, could I call it something like "Aggie Segway Tours", eventhough I might not be a Segway-authorized company? Thanks!

Take onboard everything you are being advised, and don't for one second consider this venture unless all the powers that be at the University are 100% behind you. Tom at Florida Ever Glides pretty much invented the tour concept, and was a great help to myself (and I am sure many others) over a couple of years ago when I was in your situation. I run a tour at a "private" location here in the UK, which is Leeds Castle in Kent. The Castle is promoting our tours very heavily, indeed, today they sent a 28,000 email promotion for us to their customers. Make sure there is something in it for the University, even if you settle on a % of your takings. Remember it's a two way street, what can you do for them?
Good luck.

Thanks Nick.

Probably the most important single item to consider when contemplating a new Segway tour business is demographics. Can the area support a tour price high enough to ever turn a profit? Especially in a recession, when people are generally cutting back on all expenses, including discretionary spending. If you price it too low, you will work your *** off (if your lucky) and still never turn a profit unless you have little to no expenses. And. you'll work hard and not smart. On the otherhand, if you price it too high for the area and it's economics, you wont get nearly enough customers to make the venture even viable.

It is highly recommended to pick an area that can easily support $65.00 per person + to be able to have a good return on your segway Tour investment. And don't just think it might. The more affluent the area the better the chance of success.

And, don't lose sight that for the money spent by your guests, you must always exceed their expectation of the tour. This is where most tours go wrong. Many segway tours are nothing more than a guided ride that emphasizes the Segway and not the tour.

What will make or break the business is your return or referral guests. Over time it should grow to about 30% of your business. And, this additional revenue is what makes your business able to grow and thrive during economic fluctuations...

Are any of y'all that are Segway dealers willing to answer a few questions over the phone?

Just to give you guys an update, I have located two possible locations for the business. I can't believe how expensive it is to rent retail space here! And I spoke to one Segway dealer who essentially said that you need at least $130,000 to become a Segway dealer. Which...is going to be impossible for me to do. I hate that because I think I could introduce a lot of potential buyers here to Segway (police departments, EMS services, college students, etc.). So anyway, I guess I'll have to resort to running a non-authorized tour company. Any thoughts?

get more numbers (rental costs, payroll, insurance) so that you can create a business plan, you may be able to get investors

Don't take the advice wrong, but if $100k is too much to start a business you may be getting in over your head. To do it wright it will cost a substantial amount of money. To do it wrong is just a waste of money. Slow down, get all of the ducks lined up, and get a clear picture of 'the good, the bad, and the ugly'. It will be time well spent...

$100K isn't too much. That's actually about what I'm looking at needing to get started. But $130K for the dealership aspect alone is a lot IMO. Add to that all the other expenses you'll have to cover (plus all the expenses for the tour aspect) and you're probably looking at well over $200K. And THAT probably IS too much for me. So, for that reason, I guess I've almost written off the idea of there being a dealership aspect to my future business.

Don't get me wrong, being an Authorised Segway Tour is great, and it has many benefits (we have taken 3 bookings from overseas because of our "authorised" status). In addition to that, I am very proud that we are one of only 3 authorised tours in the UK.
However, you do not need to hold the dealer status to run a tour (many top tours are not dealers, Tom for example). Whilst I appreciate that many tour's are dealer add on's, in many ways they are seperate business's. One is a high turnover low revenue (relatively) operation, the other is a high value lower unit turnover operation. Concentrate on one (the tour operation) 1st as it is a lower cost set up and it is actually what you want to do. Contact your nearest dealer(s) and maybe set up a recipricol deal, they advertise you, you sent customers to them. After all, what better way to find out if you want to buy a Segway than take an extended test drive!
Recipricol links work well. For example CovRob and I both operate tours, but at opposite ends of the country. We promote each other on our websites, and indeed, it is not unknown for either of us to get sales enquiries from the others area, which we happily pass on and don't poach on each others area. We also talk about once a fortnight and exchange idea's, as well as having a good old moan at times, as it can be a lonely business, especially here in the UK with only about 7 dealers in total.

Hey Phil,

My name is Drew and I am the loudest and proudest member of the Fightin' Texas Aggie Class of 2018! I am currently working for a Segway Tour Company in Houston and realized I want to start a Segway tour company in College Station. I wanted to know the reason why you never opened up a tour company or what information you have collected! I am going to send you a personal message and I hope we can meet and talk about the business, Segways and hear some Old Army stories!

Ninebot PTR Elite + 16-20 mile range $1795
 

The best advice you can get is do what you want to, thousands of people will talk you out of doing something because they can't see your vision. Everyone on a tour signs a waiver. "Factory Direct 4 Ninebot" is selling new PTR Elites for $1795 a piece to blow out 500 units, these are the low cost Segways half the weight, Ninebot bought Segway in 2015, get a few and see what happens with less than $10,000 you can grow as you need to. PayPal has financing available as well. Best of luck :thumbsup:

As you state correctly......The part your missing, is with the cheaper Ninebots there is no redundancy....My biggest fear would be what the insurance would be monthly, and what would it be after the first uncontrolled shutdown?

Remember roller skating rinks?....Slides and diving boards in hotels?

Just food for thought.