Can AutoWale be the Meru of Rickshaws? [Review]
The rickshaw booking space has seen its fair share of players but none have survived. Some did not sustain as the unit economics did not workout at small scale, while other had pure operational challenges in terms availability, communication etc.
Autowale, the on-call rickshaw booking service, recently launched in Bangalore. The service was available in Pune for about 2 years and announced an angel round of Rs.2Cr back in May this year.
The rickshaw booking space has seen its fair share of players but none have survived. Some did not sustain as the unit economics did not workout at small scale, while others had pure operational challenges in terms availability, communication etc.
Here’s a short list of those who made some buzz while they existed.
- Rickshawale: Mumbai – Oct 2011 – Shutshop
- AyAuto : Pune – July 2011 – Shutshop
- RadioTukTuk: Gurgaon – Nov. 2010 – Shutshop
- EasyAuto : Bangalore – 2007 – Shutshop (Update: EasyAuto continues to operate in Patna, Bihar)
Autowale also did not reach this stage without hiccups. They changed the business model midway to stop bleeding. The earlier model earned them a fixed convenience fee per booking that they generated but the new model is based on owning a pre-paid time + distance based inventory. This inventory is then managed according to the bookings they generate. For the user it is still same i.e. standard govt. controlled rates and additional convenience fee of Rs.20.
The auto-rickshaw business is as unorganised as one can think of from the outside. Multiple locations, non-English speaking operators etc. is a challenge, but on a second thought you will realise that the industry is well managed already. With RTO controlling the rates, availability of data on all drivers at a single place, and a strong and effective union that they are part of – all this helps you get into the market without worrying about talking to each rick owner at individual level. Though, training the drivers and on-field communication still needs significant efforts.
Given the govt. regulations in this space one cannot start their own fleet of rickshaws from scratch, you can only be a booking service that works with the existing rickshaw drivers.
Here’s a firsthand experience with the service and some numbers based on conversation with one of their drivers.
I heard of Autowale through a friend on Facebook and tried for a short distance. I had too many luggage so didn’t dare flagging a rick on street, fearing some absurd quote for extra charge.
- Total booking time on phone was a little over 5mins. The lady who answered the call did not understand English. But she did not understand the locality names as well and handed the phone to someone else.
- The system they were using was definitely slow as they took atleast 60 seconds to locate standard names on a distance calculator.
- I was told Rs.20 extra at the end of the call. Site says minimum 6KM (about Rs.66 in Bangalore) but the driver said it is Rs.100 minimum.
- They currently have 300 autos in Bangalore. Drivers are paid a fixed fee of Rs.18K/month for a fixed number of KMs (Rs.600/day for a 10 hour shift). The onus of fuel and maintenance is that of the driver. An avg. rickshaw driver expects to make Rs.30K per month. This fixed monthly income gives them a good breather.
- Drivers are expected to return to their respective hub after each journey. A hub generally covers about 4-5KMs radius of distance. Fare collected on return, if any, is theirs. Drivers generally take up 5KM or less journeys if they get directly and keep 100% of that.
- Minimum booking period is 1hr in advance but even lesser is fine. I got an Auto in about 20 mins.
- The total time to explain a residential address to driver was 30 seconds. He was right at my doorstep. All this without a GPS. If you’ve booked a Meru you know how painful this is, they would take atleast 2-3 calls of total over 2 mins even with GPS.
- The rick I took came from about 5KMs away. Rs.20 extra isn’t much for long distance, given that expectation is set right and no haggling is required. The service is best for station travel where any rick on street would ask almost 50% extra. Effectively, for 10 KMs you pay Rs.13/KM.
If you’ve lived in Bangalore, you would immediately appreciate the hassle free service. Hopefully, the booking time would reduce as the staffs get trained over time.
Given that you hardly require air-conditioners here, I believe a lot of cab booking junta might try Autowale for a change and save some change for themselves.
[Guest article contributed by Naman Sarawagi, cofounder of Findyogi.com]