RIDEGURU
Hey All,
Looking for some honest feedback from rideshare drivers. We make in-car vending machines - our vending machines are completely self-service so you don't have to hand products to passengers. Passengers scan a QR code, select the items they want in our app, the sections with the items open up and the customer is charged for products the select. We were wondering which business model will appeal to rideshare drivers and will appreciate your feedback. We also understand that not all Uber/Lyft drivers like to sell products in their car and that is totally fine - we are seeking feedback from those that are interested in making extra income while driving. You load the vending machine with products and continue with driving.
Questions:
1. Would you prefer to buy (or finance) the vending machine and sell whatever product you like? In this case, we only take 6% commission for providing you a bunch of tools (payment tools, anti-theft tools, analytics tools, age verification tools, mobile apps/web interfaces for your products and more). You can sell anything as long as you have the appropriate licenses. For example, you can sell CDB products in Colorado, California etc.
2. Would you prefer to get the vending machine for free and only sell the products we send you? In this case, we take 80% commission and you get 20% commission.
3. Would you prefer to pay a monthly fee for the vending machine ($35) and sell your own items? In this case, we only take 6% commission.
Basically, if you get the vending machine for free, you can only sell the products we send you and you get 20% of the revenue. If you buy, finance or pay a monthly fee, we only take 6% commission and you can sell anything you like.
Learn more here: http://travtail.com/ and https://travtail.squarespace.com/stores/p/travdash
Comments
There used to be a company called Cargo that did something similar. They'd be responsible for stocking your cars with candy bars, and we get paid a small fee for everything we sold. For my buddies who tried it, I heard it was kind of a crapshoot. They got paid, but it was so loosely managed that no one kept track of inventory and everyone did whatever they wanted to. Basically, the company send them boxes of candies and some money were transacted. I know drivers who were consistently getting free food and eating it all. (insert joke here about drug dealers not touching their own products.)
I have no idea if they exist anymore.
Long gone. I tried signing up, and they don't even respond anymore. I think they were purchased by some other advertising company. I am fairly sure Uber dropped them because I even inquired Uber and they had no idea what I was talking about.
I think they are defunct. I mean, they got bigger things to worry about with the Covid and everything than selling PlayStations in their cars.
They do. Sort of. I think they either got bought or at least signed some partnership with Uber, and they started selling all kinds of stuff like phone chargers and Nintendo Switch. It's like one of those vending machines at the airports that sell PlayStations and Bose headsets.
https://techcrunch.com/2019/07/17/uber-riders-now-earn-rewards-for-shopping-during-their-trip-with-new-cargo-app/
I think that was Uber's attempt to break into retail. They wanted to make every car a moving storefront.
I know it was only available in some markets. No idea what they are doing now.
First of all, thank you very much for your feedback.
Cargo actually doesn't exist anymore. We think there were several reasons for their failure:
1. Drivers had to hand products to customers themselves. A lot of legal issues with this. If the driver gives the product to the customer at the end of the trip, it is pointless to have a vending machine in the car. We believe a good in-car vending machine needs to be self-service - it needs to be smart enough to know who the customer is, what products they select, and charge the customer appropriately etc.
2. We think drivers were wrongly incentivized. Since all I have to do to make most of my money is give free products away, I will basically be focused on giving those free products to friends and family.
3. Sending products to thousands of drivers every time they run out of inventory is very expensive for low value items like snacks or drinks.
That being said, we see the biggest risk for our business as drivers not willing to pay or financ…
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First of all, thank you very much for your feedback.
Cargo actually doesn't exist anymore. We think there were several reasons for their failure:
1. Drivers had to hand products to customers themselves. A lot of legal issues with this. If the driver gives the product to the customer at the end of the trip, it is pointless to have a vending machine in the car. We believe a good in-car vending machine needs to be self-service - it needs to be smart enough to know who the customer is, what products they select, and charge the customer appropriately etc.
2. We think drivers were wrongly incentivized. Since all I have to do to make most of my money is give free products away, I will basically be focused on giving those free products to friends and family.
3. Sending products to thousands of drivers every time they run out of inventory is very expensive for low value items like snacks or drinks.
That being said, we see the biggest risk for our business as drivers not willing to pay or finance the vending machine even though it's a lot different from DriveCargo's. We provide a bunch of tools (accepting any form of digital payment from passengers, tax remittance in certain states, anti-theft features, inventory tracking and analytics etc.).
We think drivers could use the vending machine to sell high margin products (chargers, advil, CBD products in markets that allow recreational CDB etc.) instead of low value products like snacks.
Since you think drivers may not be willing to pay for the machine, do you think they will be more willing to get the vending machine for free and sell the products we send them? For example, we may get CBD retail licenses in markets like Colorado and send them to drivers for product distribution. Also, how has COVID-19 impacted the number of passengers?
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One thing I can say, and this applies to most drivers, is that none of us want to pay anything up front. Ridesharing driving has a slim margin and we do not like to invest in paying monthly fees or buying a vending machine.
In #1, you mention us providing our own products. Many drivers do this already. We are the store, stock person, and a clerk. We offer stuff and riders buy. I am not sure how kosher this is (in terms of law, licenses, tax, etc.), but I know many drivers do this and are very creative with it.
That brings me to the point. Why do we need a vending machine there if we are already selling items from hand-to-hand? The benefit of a vending machine is I can just leave it and it makes money. We already have a store clerk, so I think it's a hard sell for a driver to "invest" or "pay commissions" to have a vending machine.
I do see the benefit of it being "self-service" and more considerate for covid.
I think we all know we can just hand over good. the vending machine provides so much benefits here.
For one not all drivers want to be "selling" stuff. Have you tried offering something, the passenger says, yes, and you say that it isn't free? It's super uncomfortable. The thought crossed my mind to sell items in my car (like water and gum), but it was just hard and awkward. Maybe it's just me, but I prefer a vending machine to be honest. No need to describe anything, no weird criticisms,... having a legitimate machine gives you the credibility.
I like the automatic payment through QR code and such. I don't want to be dealing with money.
The covid thing plays into this too, sure. People are already super weird and nervous about taking Ubers. I think the vending machine is exactly what would make this valuable.
I have no idea of the finances. I think I like #1 the best. Send us the box for free and we pay commissions. You mention about our buying the box... I don't know. I guess it depends on how much it is.
Thank you very much for your feedback. The machine currently goes for $299 but we can bring the price all the way down to $220.
We think the best use of the vending machine is to sell high margin products (chargers, advil, CBD products in markets that allow recreational CDB etc.) instead of low value products like snacks.
If we got CBD retail licenses in markets like Colorado and send CBD products to drivers, do you think there will be a reasonable number of drivers interested in getting our vending machine for free and selling products like this in those markets? Or do you think they want to buy/finance the vending machine and sell their own CBD products? Alcohol and condoms will be a good product category for the Las Vegas market - it's relatively easy to get a license to sell alcohol in Vegas. Plenty of limo drivers sell alcohol in Vegas.
Thanks again for taking time to provide us feedback.
I like no upfront investments, and I like #2. We drivers like no risks and only reward. Simple.
No monthly fee. $35. We already have so many of those. but i guess it's all economics.
Does the vending machine get installed on the car? Bolted on? I prefer to not have anything prominent installed on my car.
Not so much for me, but for those who use the car for both Uber and personal matters, it needs to be removable. Prefer that they not be bolted on.
The vending machine will be strapped on using a belt - you can remove it anytime you want.
Sounds like one of those business-minded high school students. Every school has one.
What kind of products would you send us?
Some drivers already sell and stock the cars with water, tylenols, condoms, hand sanitizers, bags of chips, etc. that we can buy at Costco.
The way you mention age verification makes it sound like you are talking about selling booze. That'd be a riot.
The product we send will depend on the market. In general, we will send fast moving and high margin items like chargers, Advil etc. In certain markets, we can get licenses to sell age restricted products in the vehicle (CBD in Colorado, Alcohol in Vegas etc.).
The main question is whether drivers will pay for the vending machine ($220-$299) and use it to sell their own products or will prefer to get it for free and sell the products we send them.
The main value of the vending machine includes: it allows you not to solicit, no need to deal with cash (a major concern in a COVID world) or waste time giving the customer a square reader, it gives your car a much better look (instead of placing the items in random places), it helps prevent theft (apart from the fact that the product is secured in the box, a customer can’t steal the box or items for several reasons - it is tied down to your console, customers must have a valid credit card to open the box and will be charged for any…
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The product we send will depend on the market. In general, we will send fast moving and high margin items like chargers, Advil etc. In certain markets, we can get licenses to sell age restricted products in the vehicle (CBD in Colorado, Alcohol in Vegas etc.).
The main question is whether drivers will pay for the vending machine ($220-$299) and use it to sell their own products or will prefer to get it for free and sell the products we send them.
The main value of the vending machine includes: it allows you not to solicit, no need to deal with cash (a major concern in a COVID world) or waste time giving the customer a square reader, it gives your car a much better look (instead of placing the items in random places), it helps prevent theft (apart from the fact that the product is secured in the box, a customer can’t steal the box or items for several reasons - it is tied down to your console, customers must have a valid credit card to open the box and will be charged for any item they take, the store vibrates if a customer tries to open the door aggressively without first scanning a QR code and you will be notified instantly etc.).
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You say there is a QR code that opens up the doors. This means that I assume the unit needs a cellular connection and a electric source.
I don't think plugging it into the cigarette plug is a problem. A USB would do. Most drivers have USB splitters in their cars.
For cellular, your company would have to pay I assume. so there must be some minimal sales requirement so you can recoup the investment. You'd have to vet out those drivers who drive x hours a month.
Yes, you are correct. The vending machine will come with a cellular connection. IoT plans are cheap these days and that will not be a problem.
We are currently trying to gauge interest from rideshare drivers and determine the business model that will work best.