Op-Ed. As DecoBike Miami Beach celebrates 2 years of success it should be noted that the local bike shops are paying a hefty price. The Deco bike share program offers multiple pricing plans; one plan is designed for locals and the other for visitors–and they generate much of their revenue from visitors. Many of the Deco stations have been strategically located by hotels, attractions, beachfronts, and all the hot spots that tourists flock to. But now it appears that Deco might be targeting local bike rental shops as well.
Recently, a Deco kiosk was placed across the street from a bike rental shop in Miami Beach that has been there for many years pre-dating the Deco program. This Deco kiosk was placed next to the existing bike rental shop despite already having 4 locations within 1 to 2 blocks in every direction. Similar to the leaching effect that food trucks have when they operate in close proximity of a restaurant, bike share kiosks can take money away from bike rental shops. While cities have taken measures to regulate food trucks, the same cannot be said about bike share kiosks.
Since the Deco program was introduced, bike shop rental revenue is down 40 to 50 percent in Miami Beach. The remaining rental revenue mostly comes from families who need bikes for their children, cyclists looking for bikes suited better for longer rides, and people who are looking for a better deal or don’t have a credit card.
There are only 5 bike shops in Miami Beach and many of them depend on bike rental income to remain in business. And now that Deco has started to site Deco kiosks by their bike shops, the local shops have banded together to fight back. By creating a marketing campaign to support local bike shops, the shops aim to explain the difference between automated bike rental machines and bike rental shops. In addition to the campaign, the shops plan to lobby the city to create a “bike share free zone” perimeter surrounding the bike shops–similar to how cities like Philadelphia and New Orleans have addressed food truck locations.
In other cities, many bike shop owners are actually pro bike share. They know that bike share is overall good for the bike industry; it attracts more butts to bikes, and cities with bike share programs are investing in cycling infrastructure likely resulting in more bike sales.
This all prompts the following question: can bike share companies coexist with bike rental companies? The answer is unclear and depends on what tone is set by the city through its contract with a bike share operator.
Cities can do the following to assist local bike rental shops:
- Before approving a bike share location that is near a bike shop, ask the bike shop if they want it there. If the answer is no, place it somewhere else at a reasonable distance from the shop.
- Urge the bike share operator to create pricing strategies that discourage rentals of over one hour.
- Consider contracting directly with local bike shops for maintenance and re-distribution of bike share bikes.
- Consider contracting with local bike rental shops at parks and waterfronts, and keep bike share out of these areas.
- Enforce a minimum age limit for bike share customers, which is often set at either 16 or 18.
- Install bike corrals in-front of bike shop to increase shop visibility.
- Invest in resources that promote local bike shops.
- Provide tax deductions and other subsidies for local bike shops.
- Influence the bike share operator to list all bike shops on the bike share website, and provide enhanced listings for pure bike rental shops.
- Influence the bike share operator to display an ad on the bike share website promoting local bike rental shops for long term rentals and bike equipment for children.
- Influence the bike share operator to post a list of nearby bike rental shops on the bike share kiosks.
- Influence the bike share operator to list local bike shops on maps and mobile apps.
- Influence the bike share operator to email bike share members discounts for guided bike tours offered by local bike rental shops.
- Influence the bike share operator to email frequent share members discounts to purchase a bike from a local bike shops.
- Influence the bike share operator to refer all group bike rental and tour business to local bike rental shops.
- Allow rental shops to sell advertising on their own bikes and/or include rental bikes that meet quality criteria in bike share advertising sales.
Why should the city do all of this? The answer is, unlike public transit that is owned and operated by the municipality, most bike share programs are not fully owned and operated by the city and, thus, a private entity profiting from a public service and public space should not come at the expense of local bike rental shops.
Conclusion: Cities and bike share operators can do much more to assist local bike rental shops, but even if they don’t, the free market and entrepreneurial spirit will end up winning. New bike rental technology will hit the market and before you know it, the table will turn.
So, back to DecoBike: please respect existing business. Move your kiosks out of “bike shop zones” and, as you are about to setup in San Diego, show some consideration and respect to local bike rental shops. Learn to share–after all, you are in the sharing business!
The City of Miami Beach response: “… our goal is to be sensitive to existing businesses providing similar or comparable services. We are happy to meet [with the bike shops] to discuss possible solutions.”
Note of disclosure: The opinions expressed in this article do not necessarily reflect the views of the BikeShare.com editorial staff. Josh Squire has been in the bike industry for twenty years on both sides of the aisle, operating traditional bike rental shops and bike share programs in multiple cities. He has also been a competitor of DecoBike on multiple bike share RFPs, and he is a financial supporter of BikeShare.com.