A Different Rental Model?

[mark1qhorsey]

Folks,
Many of us have experienced the standard "Segway PT Tour" of Locations XYZ with several - sometimes many, participants gliding dutifully along in long lines. It is very limiting in my opinion...

Is this the only successful rental business model so far? I can imagine that in some areas with sufficient population that "rent your i2 for the day, week, or forever" might apply. Credit or debit card billable days would be automatic, with little customer financial pain. To give customers day, week, monthly rentals, its theirs to keep going (with charging at home), a free helmet and a GPS locater installed might be very profitable? For a single training and customer safety session, one might obtain many days of income rental. Sales of used units in good working condition would be useful for stock turnover.

Several different types of EVs are available, so, renting several kinds simultaneously would test type-form acceptance - PTs vs bikes, vs three and four wheelers. What flaw is there in this rationale? Insurance liability? There are many more details like price points and costs of course, including factoring rates of unit damage, loss, repair, recovery and replacement on the fly, etc. But this model could penetrate a market with many EVs of several types, from one storefront... It's an interesting approach, that others who may have tried it please comment. What do you all think? Thanks!

[LibertySegway]

Segway of Oakland rents Segs in various ways. Hourly, Daily, weekly, monthly plus traditional type tours and even team building Segway Polo! Check out the ads on their website or EBAY. "Segway Steve" rocks!

[Bob.Kerns]

Originally Posted by LibertySegway

Segway of Oakland rents Segs in various ways. Hourly, Daily, weekly, monthly plus traditional type tours and even team building Segway Polo! Check out the ads on their website or EBAY. "Segway Steve" rocks!

Indeed, I rented a unit from them before buying, to make sure it was gong to meet my needs. It made it much, much easier to decide to buy.

I think rentals converting to sales, and repeat rentals, are an important part of the model.

Also, I think rentals to people flying in from out-of-town, either owners who can't bring their units, or people who'd just like some mobility around town, and who maybe have taken a tour in the past, is another market. It's probably small now, but I think it can be grown. I know that I'm certainly interested. I'm interested in renting a Gen1 for dealing with airports, but I'd sure rather have a nice familiar i2 on the other end.

Or even better, if I could have a rental set of *batteries* at the arrival counter when I arrive with my i2, it would be great, and solve half the lithium problem.

[bentbiker]

There have been discussions on this subject before. The biggest problems are related to the inexperienced renter who does not own a unit. With no vested interest in the image he leaves behind, the renter often venture into areas where they shouldn't be and operate them in a manner that doesn't engender good feelings by residents. At least one city banned the use of Segways, primarily because of rentals.

Without the experience, there is a very real risk of injury to both the rider and others. I believe I have read that insurers treat rentals differently from guided tours. It is difficult to require a helmet once a renter leaves sight of the shop. I remember one tour operator stating that rentals were a horrible idea; he was not talking about renting to people who already own.

Damage would appear to be much higher than normal based on the rental units I have seen. A renter will try things he would never do if he had $5K invested in the unit. How do you prove that the wheel wobble is worse than when the rental started? Or that the couplers have been shredded by hours of rough usage?

Finally, if the owner of the units is a licensed dealer who can offer to apply most of the rental fee toward the purchase of a unit, I could see it being a way to convince a skeptical buyer. However, I don't see many people being willing to shell out $100 per day, per unit, for an extended period without such an interest in purchasing.

I'm under the opinion that most dealers DON'T rent except for special circumstances, and it isn't because they haven't thought of it.

[Bob.Kerns]

Originally Posted by bentbiker

There have been discussions on this subject before. The biggest problems are related to the inexperienced renter who does not own a unit. With no vested interest in the image he leaves behind, the renter often venture into areas where they shouldn't be and operate them in a manner that doesn't engender good feelings by residents. At least one city banned the use of Segways, primarily because of rentals.

Without the experience, there is a very real risk of injury to both the rider and others. I believe I have read that insurers treat rentals differently from guided tours. It is difficult to require a helmet once a renter leaves sight of the shop. I remember one tour operator stating that rentals were a horrible idea; he was not talking about renting to people who already own.

Damage would appear to be much higher than normal based on the rental units I have seen. A renter will try things he would never do if he had $5K invested in the unit. How do you prove that the wheel wobble is worse than when the rental started? Or that the couplers have been shredded by hours of rough usage?

Finally, if the owner of the units is a licensed dealer who can offer to apply most of the rental fee toward the purchase of a unit, I could see it being a way to convince a skeptical buyer. However, I don't see many people being willing to shell out $100 per day, per unit, for an extended period without such an interest in purchasing.

I'm under the opinion that most dealers DON'T rent except for special circumstances, and it isn't because they haven't thought of it.

I agree with all that, but as Segways become less of a rarity, I think equation shifts a bit. There are more people with experience, there are more people who are potential purchasers, etc.

I think the inexperience factor has to be addressed. It requires an investment of time equivalent to a short tour, at a minimum. That's what I got, and I was very glad to get it. I'm sure it was a significant factor in my success.

What I didn't get, but wished I had, is any training in how to use it in a socially-acceptable way. For me, I would have just found it useful suggestions for what I was already figuring out. For others, it would be useful information they wouldn't have thought about.

And yet others would ignore it. One advantage of spending more time with a first-time renter is that you can try to spot those people, and then decline to rent.

Another thing is that all these negatives have to be factored into the price. Renting won't be cheap.

But I find that a very significant percentage of the people I talk to now, HAVE TAKEN A TOUR! I think we really have a significant market penetration, which changes the reactions of others to Segways they encounter, and increases the pool of people who will be interested in renting.

[Lily Kerns]

But I find that a very significant percentage of the people I talk to now, HAVE TAKEN A TOUR! I think we really have a significant market penetration, which changes the reactions of others to Segways they encounter, and increases the pool of people who will be interested in renting.

And don't forget those, who, for whatever reason, already have one and haven't been able to fly with it or whatever... If it could be available as you would rent a car, for example.

[mark1qhorsey]

Originally Posted by bentbiker

...With no vested interest in the image he leaves behind, the renter often venture into areas where they shouldn't be and operate them in a manner that doesn't engender good feelings by residents. At least one city banned the use of Segways, primarily because of rentals.

...It is difficult to require a helmet once a renter leaves sight of the shop. I remember one tour operator stating that rentals were a horrible idea; he was not talking about renting to people who already own.

Damage would appear to be much higher than normal based on the rental units I have seen. A renter will try things he would never do if he had $5K invested in the unit...

...However, I don't see many people being willing to shell out $100 per day, per unit, for an extended period without such an interest in purchasing.

I'm under the opinion that most dealers DON'T rent except for special circumstances, and it isn't because they haven't thought of it.

I suppose I should have mentioned that many Tour / rental Operators have surely thought of the 'idea' about 'freelance' rentals and rejected it for some or all of the reasons above. The biggest plusses (to me) are an enticement to own PTs and other EVs. Some of the caveats are inherent safety / social issues with PTs, that are not the same for all types of EVs, including inline scooters or three wheeled knockoffs of PTs. The Out-of-Control Glider problem has to be managed as you say, by training and straight talk, and if necessary declining to rent to obvious potential hot-doggers.

I am interested in the question of liability insurance. Any more thoughts on that touchy issue? A 'freelance' rental business would not eliminate the idea of tours, but tours are highly location sensitive, and labor intensive, for average hometowns. Community willingness to accept the business has to be prepared well to avoid a severe police or public backlash. The preparation is in careful consideration of municipal codes, transportation boards, and on. But I cannot think of a better way to penetrate the consciousness of the community if 'responsible' EV renter/owners are seen frequently, and everywhere reasonable. Thanks for sharing more thoughts!

[Bob.Kerns]

Originally Posted by mark1qhorsey

I suppose I should have mentioned that many Tour / rental Operators have surely thought of the 'idea' about 'freelance' rentals and rejected it for some or all of the reasons above. The biggest plusses (to me) are an enticement to own PTs and other EVs. Some of the caveats are inherent safety / social issues with PTs, that are not the same for all types of EVs, including inline scooters or three wheeled knockoffs of PTs. The Out-of-Control Glider problem has to be managed as you say, by training and straight talk, and if necessary declining to rent to obvious potential hot-doggers.

I am interested in the question of liability insurance. Any more thoughts on that touchy issue? A 'freelance' rental business would not eliminate the idea of tours, but tours are highly location sensitive, and labor intensive, for average hometowns. Community willingness to accept the business has to be prepared well to avoid a severe police or public backlash. The preparation is in careful consideration of municipal codes, transportation boards, and on. But I cannot think of a better way to penetrate the consciousness of the community if 'responsible' EV renter/owners are seen frequently, and everywhere reasonable. Thanks for sharing more thoughts!

I don't disagree with anything you've been saying. I'm just pointing out that the landscape isn't static, and it might be worth revisiting that decision in that light.

About liability insurance -- well, actually, about liability. The liability picture is different when you rent someone a device, than when you lead a tour. On a tour, you are responsible for offering a safe tour environment and for monitoring the operation.

That both gives you more opportunity to avoid incidents, and more responsibility to avoid those incidents. I expect both factors play into the pricing of any insurance (how accurately, I cannot guess).

But consider ski rentals. People die while skiing on a regular basis. (It's a large population). Some of the people killed, maimed, or injured surely rented those skis; and they certainly were carried up the slopes on lifts, and those slopes were maintained or not, well-monitored by safety patrols or not, with rescue and emergency medical services well-provided, or not.

Lots and lots of liability exposure there, and a much greater per-transaction risk, IMHO. And yet they are able to obtain coverage, and operate. So we have one potential model to learn from.

There are lots of differences, of course -- not least of which, is scale. One incident to a small tour operator is a much bigger business risk, than perhaps 100 equivalent incidents on the slopes. The slopes have the law of large numbers on their side, while any small deviation from "average" on the small operator's watch can spell financial hardship or ruin.

But scale is exactly what is shifting here. I see that we have tour operators banding together to offer SegwaySightseeing.com, which is an entirely wholesome development. We see many cities with multiple operators, both as dealers and tour operators, sometimes within close walking distance of each other.

We also see tour companies with multiple operations -- either in multiple cities, or in multiple locations within a region. Again, scale gives a more robust business, better able to adsorb the risk of singular events, and lower overhead, and a more stable income stream. And, with consistent training and execution, probably better insurance rates as well.

Individual operators who haven't evaluated this question recently, may want to re-evalaute it now or in the future.

[Halffro777]

Originally Posted by Bob.Kerns

I agree with all that, but as Segways become less of a rarity, I think equation shifts a bit. There are more people with experience, there are more people who are potential purchasers, etc.

I think the inexperience factor has to be addressed. It requires an investment of time equivalent to a short tour, at a minimum. That's what I got, and I was very glad to get it. I'm sure it was a significant factor in my success.

What I didn't get, but wished I had, is any training in how to use it in a socially-acceptable way. For me, I would have just found it useful suggestions for what I was already figuring out. For others, it would be useful information they wouldn't have thought about.

And yet others would ignore it. One advantage of spending more time with a first-time renter is that you can try to spot those people, and then decline to rent.

Another thing is that all these negatives have to be factored into the price. Renting won't be cheap.

But I find that a very significant percentage of the people I talk to now, HAVE TAKEN A TOUR! I think we really have a significant market penetration, which changes the reactions of others to Segways they encounter, and increases the pool of people who will be interested in renting.

I don't understand what the advantages of renting out a Segway would be. As with any business you have to analyze the risk verses reward and I can tell you that giving someone a Segway that they are not personally vested in exposes the owner of the unit to a TREMENDOUS amount of risk. So, unless you were going to charge an amount that coincides with the risk, there just isn't enough to be gained. I get phone calls from people looking to rent a segway at least twice daily and I have never found a situation that fits all of the criteria you listed above. In most cases it is just somebody who wants to fly around and show them off to people or they want to take them to inappropriate places. I just don't see how this could be good for the community in any way.

[mark1qhorsey]

Originally Posted by Halffro777

...As with any business you have to analyze the risk verses reward and I can tell you that giving someone a Segway that they are not personally vested in exposes the owner of the unit to a TREMENDOUS amount of risk...

It doesn't make sense to rent brand new PTs, freelance. Some i2s are already available online for about $ 3000, and would perhaps be not insured. So, as I understand it, it's the possibility of liability [and social backlash] risks for a rental. Thanks, for your insight.