Have you ever thought about starting an ebike rental business? Did you know that within one Summer or less every ebike could have fully repaid the initial investment?
When it comes to popularity, Ebikes have really taken the world by storm. It seems like overnight these electric bikes have become one of the most highly sought after mode of transportation. These bikes can be found in almost all the major cities of the world. They are a great way to get around and they provide many different benefits. But there is another benefit that these eBikes can offer that you might not have thought about.
Starting An Ebike Rental Company
Some very smart business minded people are taking full advantage of the popularity of Ebikes by starting their own rental companies, and so can you! While some people living in the city will have their own Ebikes, others that are visiting will not. This will create an opportunity for you to earn some serious money renting out electric bikes. One of the best ways to tour a city is on the back of an Ebike. Many tourists will jump at the chance of renting one from someone like you. But before you can jump into the Ebike rental market, there are some things you will need to consider. Below we have taken the time to build a comprehensive list of things that you will need to know.
The Main Upfront Costs
First and foremost, you will need to consider your upfront startup costs. These will be the main items you will need to get the ball rolling. The first thing you will need to buy is, of course, Ebikes. The price of an average high-quality Ebike is around $1,500 to $3,000 depending on the models you choose. As you can see, Ebikes are highly affordable and since they will be your major investment, the cost of starting up your own company will be minimal. Compared to opening other types of rental businesses such as a car rental company, an Ebike rental business can be started on a small budget. So if you choose to start off with 10 Ebikes, you would only need to potentially raise $15,000 compared to hundreds of thousands for other types of businesses. However, you can always start out with just a few bikes and scale your company as the demand for your services grows.
Other Upfront Costs
Now we should think about other upfront costs that you may possibly run into. Now that we have learned about the main costs, let's focus on some of the other costs that you will face.
- A business license: One of the first things you will need to begin operating a rental company is a license to conduct business. Depending on where you live, you will probably be able to purchase a license at your local city hall or county courthouse. Some cities will even allow you to file for a business license online. The cost of getting licensed will be determined by your local government and will likely only cost you a few hundred dollars.
- Liability Insurance: The next cost you will need to take care of before starting up your company is liability insurance. This type of insurance will help not only protect your company in case something happens but also your customers. The price of liability insurance will be based on the type of policy you choose. Keep in mind that the higher your premium, the more you will be covered for.
- Getting Incorporated: To further protect your own assets like your own personal savings account and any property you may own, you will need to incorporate your company. For a small fee, you can have the paper work processed by a professional filling service like LegalZoom.com. To incorporate your company, it will cost between $150 to $350 dollars for filing fees and you will also have to pay the state a small fee.
- A Website: No company these days is complete without having a website. A website will help draw in new customers and help get the word out about the services you provide. Having an online presence is very important to your company's future and it will give you a place to call home. Many people choose to build their own company websites. But if you are not comfortable doing so, you can have one built for only a few dollars per month.
- Advertising: Next, you will need to spend some money advertising your rental company. This can be done in a wide-range of different ways. Some choose to purchase online ads on social media platforms, blogs and other websites to help promote their business. The cost of advertising online can be a few dollars or a few hundred, depending on the size of your marketing campaign. You can also market your rental service online without spending a dollar simply by building a few social media pages and inviting people to come take a look. Online marketing is going to be your best tool but you can also advertise in other ways. You could advertise in travel magazines and brochures which many tourists will be looking at. Billboards, TV and Radio ads can also work well but are more pricey.
- A Lawyer: Getting a legal contract drawn up by a lawyer is a great way to protect yourself. You can have all your customers sign this legal contract before rendering them services. A local lawyer should be able to provide you with legal advice for a few hundred dollars or less. Remember to choose a lawyer that has experience with legal contracts.
Here comes the good part! The potential profits you will make off each electric bike will be determined by the amount per hour in rental fees. Rental fees will vary from city to city but the average price of renting an Ebike is around $10 in the United States. In some European cities, the rental fees may be higher or lower depending on the location. But for this example, we are going with the base fee of $10 per hour. Below we will break down the rental fee and compare it with the initial cost of purchasing one Ebike.
- The Cost of one Ebike is around $1,500.
- Each rental hour you will gross $10 in profit minus the other costs of doing business.
- After only 150 hours of rental fees your investment will be returned leaving nothing but pure profit.
- In a little over 30 days you could see your rental company starting to turn a profit.
As you can see, it won't take you long to get the money back you invested and to start making a profit. While this all depends on the amount of people renting your Ebikes and the number of hours they ride, it isn't hard to see the potential here.
Choosing The Right Ebikes For Your Business
Doing Your Homework
Before you start a Ebike rental company or any business for that matter, you will need to do your homework. Doing deep research will give you the knowledge you need to build your company the right way. There are quite a few things you will need to research before making any large investments in your new company.
- Your Target Audience: First, you will need to do some research and find out who your potential customers will be. You need to start by thinking about who would benefit the most for your services. In the case of an Ebike rental company, your target audience will likely be tourists who come into your city while on vacation. The age group that would likely be renting your Ebikes are between the ages of 16 and 75. If you target the right people with your marketing efforts, the money you spend on advertising will go a long way.
- Finding Out If There Is A Need: Next, you will have to find out if there is a need for your services. Some smaller towns that have only a few streets which make it easy to walk from place to place might not be the best place to start an Ebike rental company. On the other hand, if you live in a mid-sized to large city, many people would love a chance to ride around on an Ebike instead of walking.
- Get To Know Your Competition: If you live in a larger city, chances are there may be a company already renting Ebikes. This means you will have competition. Don't let this discourage you! Competition is healthy and most people welcome it. But always remember to keep an eye on your competition in order to see what rates they are charging or what specials they may be offering. This will allow you to be able to stay competitive and keep the flow of customers coming in. Additionally, you will need to take note of how your competition presents themselves. This will give you an advantage over them and allow you to represent your rental company in the best way possible.
Marketing Your Ebike Rental Company
While we have talked a little about marketing your rental company already, it's time to take a deeper look at this important subject. Marketing is a vital part of any business and without it you won't have very many customers. Below we are going to go over some ways that you can successfully promote your Ebike rental company.
- You Will Need A Website: One of the most important ways to promote your business is with your own website. This will be the place your rental company calls home on the internet. The website should give clear and accurate information about your company and the services you are going to offer. You will be driving people to this website in hopes of making a sale, in your case, you will be renting Ebikes. On the website, you should showcase the bikes you have to offer and the rates which you charge either by the hour or by the day. Also, you will need to have a payment portal so that your customers can pay online. Also, your website will need to be mobile friendly because most people will be using their smart devices while viewing your site.
- Online Directories: People will need to be able to find you online and a great way to do so free of charge is by placing your information online. Google, Yelp and other information websites will help guide people to your location and give them important contact information. So make sure that you are filling these directories out and providing all your info.
- Social Media: Social media is a very powerful tool that you can use to market your company. People of all ages and walks of life use social media to find new companies. So make sure that you learn about the many social media platforms that are out there. Facebook, Twitter, and Instagram are just a few you should be active on. You may even want to hire someone to handle all your social media accounts so you can focus on other aspects of your business.
- Online Marketing: You will also need to market your company in other places on the internet. You may wish to build banner ads and have them placed on travel blogs and other related websites. This will help drive traffic to your website where people visiting your area can find more information about your rental rates.
- Local Marketing: Local marketing is also a powerful tool that will help get the word out about your services. Something as simple as a flier in a local store window or an advertisement on a billboard can do a lot of good. Putting an ad in your local newspaper may also attract new customers and it won't cost a whole lot to do so. The sky really is the limit when it comes to local marketing and you can spend as little or as much money as you want on advertising. But remember to balance local marketing with online marketing. This will give you the best of both worlds and it will help your company to thrive.
- Get Involved In The Community: Another way that you can increase you bottom line is by getting involved in the community. A great way to do so is by attending local business leadership conventions where you can hand out your company card. You may also want to join your local Chamber of Commerce who will work with you to get your business noticed. Mingling with the people in your community will provide you with word of mouth advertising which is one of the best forms of marketing.
Take Action Today
Now that you know more about how to start an Ebike rental service, it is time for some action. After you have done your homework and put in the time to learn your target audience, it's time to make a move!
It is time to commit to your new company and make a few major purchases. A great place to start and getting your feet wet is by buying a few Ebikes to get your company started and eBike Generation can offer huge savings on ebike purchases to reduce that risk even further by offering a bulk discount.
Additional resources to help you choose the right eBike for the job can be found in this blog post, Top 7 Fat Tire eBikes for 2019.
So what are you waiting for? Get out there and invest in your future today!