General Cycling Discussion - Starting a Bike rental business

OK, I'm going to leave my decade old corporate job real soon and open a bike rental business. I live in a good location, have a good part of the business plan worked out: start with a good but small location, 30 to 50 new bikes from trail to cruise, hybrids, some kid trailers and maybe a couple of tandems, have worked out the financials, including investments, utilities, charges, liability insurance, marketing etc. I even have experience in this field, (ok that's about twenty years ago..) Has anyone in this forum done this ? Would be interested in hearing success / failure stories or just good stories. Also feedback from anyone on what they expect from bike rental shops, they like and cannot find etc.
Sorry if I bored you with this topic. Thanks.;)

I wouldnt leave your corporate job for that. Start small and open on weekends or hire someone to rent out furing the day while you work. Thats a big risk for a business that will probably not make any big profits. It does sound like a story from the show the "Good Life" on HGTV or something.

Originally posted by djbowen1
I wouldnt leave your corporate job for that. Start small and open on weekends or hire someone to rent out furing the day while you work. Thats a big risk for a business that will probably not make any big profits. It does sound like a story from the show the "Good Life" on HGTV or something.

Thanks for your concern but I have aleady thought of that as business will only be seasonal and my financial plan does show a significant drop from my current salary to potential net profit.. Subsisting is not a problem. Oh, I forgot to mention, I'm quiting the job anyway..

I don't have any experience in renting out bikes or working in a bike shop, but wanted to wish you best of luck. Sounds like you know what you are getting into, and you realize you will not make the same money. But money is not everything, how many times have you heard I've never been more broke or more happy in my life.

You don't have your'e location filled in, where are you located? Where is the shop going to be? Maybe if I ever get out you're way I'll need to rent a bike.

Where is the business to be located? Seems like you could get some good word of mouth going through this forum and others like it.

You don't mention your location but you do say it is seasonal which implys you have snowy winters. It's also implied that there is a large tourist population to avail themselves of your service. Is there skiing in the area? Do your slope operators maintain bike trails in winter? Getting studded tires to take advantage of this might be something to think about. You don't mention about contacting local hotels, motels, inns etc. about space to advertise. Just opening a storefront without adequate advertising in the form of posters or newspaperads is asking for slow word-of-mouth acknowledgement.
Have you considered clothing or pack accessories? I think you will find that once people see a "Bike" store they will come in looking for things normally found at a full line LBS.
How about maintenence? Will you do it yourself? Hire a mechanic? Take the equipment to a regular shop for repair. You'll find that rental bikes are not used kindly. Bent wheels, bent derailleurs, poor shifting and brakes that don't stop will be common complaints.
But you are embarking upon a wonderful adventure and I wish for you the greatest amount of success possible. Good Luck!

Good luck!

"Take this job and shove it..." huh. Well good for you it sounds like you have things worked out.

Like everyone says post your location so we can come see you. Will also be a shop? I mean you'll need to sell used rentals from time to time and get new ones so you may as well plan to sell new bikes, maybe some of the trade-ins could be rentals.

Joe

:beer: :beer:

Good luck on your new business venture. Seems like you've done your homework and you know exactly what you're doing. And yes, it is seasonal, unless you're located in SoCal! Will you be located on or near a major bike path?

Good for you! Big difference in living a rich life and living life rich. I'm stuck somewhere in between.

I run a bike rental busniess, oddly for a big hospitality corparation. You seem to have all the bases covered. Rental customers tend to be non-cyclists. Some don't even understand the concept of riding on the right. They have the general additude that bikes are toys. I deal with a large enough minorioty of casual cyclists, that didn't want to mess up their bikes in the sand, that keeps me sane. A serious cyclists will usually bring his/her bike with them, but I try to market a small quick repair service to these folks.

Make sure you have a good rental agreement that MUST be signed. Take credit cards and driver's liscense numbers.

If you want to get into delivary, you're on your own. I don't do delivaries, but my busniess is resricted to the resort I'm empoyed at.

Originally posted by L J Horton
You don't mention your location but you do say it is seasonal which implys you have snowy winters.

YES

It's also implied that there is a large tourist population to avail themselves of your service.

YES

Is there skiing in the area?

NOT NEARBY, AT LEAST ONE HOUR AWAY

You don't mention about contacting local hotels, motels, inns etc. about space to advertise.

YES, DEFINETLY IN MARKETING PLAN. GOOD LEAFLETS AT ALL GOOD PLACES TO STAY.

Just opening a storefront without adequate advertising in the form of posters or newspaperads is asking for slow word-of-mouth acknowledgement. AGREED, BUT LOCATION IS PRIME TOO.

Have you considered clothing or pack accessories? I think you will find that once people see a "Bike" store they will come in looking for things normally found at a full line LBS.

THOUGHT OF SOME MERCHANDISING BUT DEFINETLY NOT TURNING INTO AN LBS, FAST MOVING GOODS ONLY

How about maintenence? Will you do it yourself? Hire a mechanic? MYSELF FOR A START, THEN HIRE MECHANIC WHEN BUSINESS TAKES OFF.

Take the equipment to a regular shop for repair. TOO EXPENSIVE.

You'll find that rental bikes are not used kindly. Bent wheels, bent derailleurs, poor shifting and brakes that don't stop will be common complaints. GOOD POINT, PLANNING ON PURCHASING GOOD QUALITY NEW BIKES WILL HELP REDUCE THIS PROBLEM.
IF BUSINESS IS GOOD, TURN FLEET AROUND QUICKLY

But you are embarking upon a wonderful adventure and I wish for you the greatest amount of success possible. Good Luck!

THANK YOU FOR THE ENCOURAGEMENT ! :beer:

Originally posted by DieselDan
I run a bike rental busniess, oddly for a big hospitality corparation. You seem to have all the bases covered. Rental customers tend to be non-cyclists. Some don't even understand the concept of riding on the right. They have the general additude that bikes are toys. I deal with a large enough minorioty of casual cyclists, that didn't want to mess up their bikes in the sand, that keeps me sane. A serious cyclists will usually bring his/her bike with them, but I try to market a small quick repair service to these folks.

Make sure you have a good rental agreement that MUST be signed. Take credit cards and driver's liscense numbers.

If you want to get into delivary, you're on your own. I don't do delivaries, but my busniess is resricted to the resort I'm empoyed at.

Thanks DieselDan. I was actually looking for good sources of rental agreements. Any advice ?

Your best bet would be to find a lawyer to help you draw an agreement up. Our's basiclly reads:

The customer is responsable for the bike.
The customer is responsable for his/her/their own saftey.
Clauses about damage, replacment cost, return policy, and other legal stuff.
A clause regarding local issues.

You may want to include something regarding helmet use, use by children, and storage. Remember, bicycles are regulated as vehicles, you can't enter into a rental agreement with a minor.

Again, find a lawyer. I work for a large hospitality company with lawyers on the payroll. Don't go it alone. I don't think this would cost very much.

I don't have any specifics as I am just a cyclist. A few ideas:

- If you are far away and have access to special accomodations available only to cyclists, you might even get "real" cyclists to rent bikes.

- If you have special or different bikes, you might get more cyclists interested. I don't think I would rent a bicycle unless I have a _really good_ reason to rent one; but if my wife was cycling, I would be interested to "try out" a tandem. I would even have rented a real tandem to try with my daughter if I could find one compatible to my 36" legs and her 7 year old frame.

- Once you are more well known, you might look into renting other types of bicycles. I think there would be a market for "light touring" bikes (i.e. relatively good performance, but still good tires for street bumps, not too fragile, drop bars...). Maybe quick cable connectors that would allow you to configure the bike with straight or road bars, perhaps?
One of the reasons I don't rent a bike is the lack of such bikes on the rental market. Straight bars are not comfortable for my wrists.

- There is a shop in Québec city that rents all her bikes with a rear rack (basic one) and good lock. I think that's a wonderful idea. People who rent for more than 1 hour like to park their bike to go to the toilet, eat... and including a lock in the deal is a good way to protect your investment. I think she also supplies the helmet.

- All rental shops in Montréal seem to rent fenderless hybrids. I think fenders would increase the number of days bikes are rented, would increase mileage and would protect the drivetrain from road grime. What person, on a holiday, would like to rent a bike when the ground is wet or sloppy, if that person knows they will have to visit a laundromat soon afterwards.

Regards,

When i was in Las Vegas, I rented a bike from a shop that promoted adventure tours. I had a blast touring Red Rock Canyon. Even cyclists go on vacatations, and many don't take their bikes with them.

To touch on some of the issues mgagnonlv brought up:

Tandems: Bad idea. Liabilty and maintence headaches you really don't want to deal with. 98% of rental customers aren't cyclists, they wouldn't know wether cadence starts with a "c" or a "k".

Light touring bikes: Be careful. In a coastal area, cables seize faster then usual. Any bike with shifting should be limited to an internal gear hub.

Locks: I assumed Cycliste had common sense enough to REQUIRE locks with rental. It's best not to charge for locks unless it is lost. Use combination locks of some kind, key locks are more trouble then a Florida election.

Helmets: Don't force customers to wear helmets outside of what the law requires. Keeps a supply on hand. Again, don't charge for them unless they get lost. Follow the same health department regulations regarding bowling shoes and roller skates. You may want to consider a check box in your rental agreement wether the customer borrowed a helmet, did not borrow a helmet, or supplied his/her own.

Fenders: not a good idea, especially in a coastal area. Corrision will eat away at the hardware, possibly causing an accident. Dents can cause the bike to be unsightly, therefore undesirable to rent. Common sense should tell people you get dirty riding a bike. The clean up time would increase, taking the bike off the road longer, and decrease revnue possiblities. Fenders do not protect drive components.

Again, rental customers tend to be non-cyclists and regard bikes as toys. Serious cyclists usually bring thier own equipment. Casual cyclists like to ride for the sake of ridng. Tourists want everything for free.

Wife and I spent some time this summer at the Root River trail system in Mn. (Had a great time by the way) There were bike rental places all over. Every one of them rented hardtail mt. bikes and Recumbents. Yup, Recumbants (cheap ones). I've never seen so many recumbents in my life. I'll bet you 1/3 of the bikes on the trails (paved) were recumbents.

I am hoping to hear a little bit more about your business model. Of course, I assume you want to keep your details a secret, but what sets your bike rental idea apart from a standard rental shop?

Location? Trails? Regular biking vacation destination? Tours? Tourism?
Weather? Roads? Are you attached to a resort?

I don't have any specifics as I am just a cyclist. A few ideas:

- If you are far away and have access to special accomodations available only to cyclists, you might even get "real" cyclists to rent bikes.

- If you have special or different bikes, you might get more cyclists interested. I don't think I would rent a bicycle unless I have a _really good_ reason to rent one; but if my wife was cycling, I would be interested to "try out" a tandem. I would even have rented a real tandem to try with my daughter if I could find one compatible to my 36" legs and her 7 year old frame.

- Once you are more well known, you might look into renting other types of bicycles. I think there would be a market for "light touring" bikes (i.e. relatively good performance, but still good tires for street bumps, not too fragile, drop bars...). Maybe quick cable connectors that would allow you to configure the bike with straight or road bars, perhaps?
One of the reasons I don't rent a bike is the lack of such bikes on the rental market. Straight bars are not comfortable for my wrists.

- There is a shop in Québec city that rents all her bikes with a rear rack (basic one) and good lock. I think that's a wonderful idea. People who rent for more than 1 hour like to park their bike to go to the toilet, eat... and including a lock in the deal is a good way to protect your investment. I think she also supplies the helmet.

- All rental shops in Montréal seem to rent fenderless hybrids. I think fenders would increase the number of days bikes are rented, would increase mileage and would protect the drivetrain from road grime. What person, on a holiday, would like to rent a bike when the ground is wet or sloppy, if that person knows they will have to visit a laundromat soon afterwards.

Regards,

Though I am not sure if I want to target "real cyclists" only, those may tend to either travel with their own bikes or want to experience high ends models, this would be a niche market. I am more thinking of family / leisure.
Tours are an interesting business but require extensive logistics and some personnel I am not willing to engage in at least for a start.
Only rental providers here are some LBS, not always have available as they use them also as loaners, no specific display, few suitable locations, so not real competition + they are closing down one after the other :-(
Tandems are definetly a must have. For kids there are attachements, confusingly called "tandems", that consist of a half bike attaching to the rear of a real bike, I have never tried one but they seem to work well as rentals. Good trailers for smaller ones work well too, safety must be kept highest though as higher liability engaged.
Locks and helmets are a must have, (mandatory for kids over here). Locks should be provided free with all bikes, as well as helmets with kids bikes and some rental packages.
Very good point about fenders ! Thank you for your list of suggestions ! ;) :beer:

To touch on some of the issues mgagnonlv brought up:

Tandems: Bad idea. Liabilty and maintence headaches you really don't want to deal with. 98% of rental customers aren't cyclists, they wouldn't know wether cadence starts with a "c" or a "k".

Light touring bikes: Be careful. In a coastal area, cables seize faster then usual. Any bike with shifting should be limited to an internal gear hub.

Locks: I assumed Cycliste had common sense enough to REQUIRE locks with rental. It's best not to charge for locks unless it is lost. Use combination locks of some kind, key locks are more trouble then a Florida election.

Helmets: Don't force customers to wear helmets outside of what the law requires. Keeps a supply on hand. Again, don't charge for them unless they get lost. Follow the same health department regulations regarding bowling shoes and roller skates. You may want to consider a check box in your rental agreement wether the customer borrowed a helmet, did not borrow a helmet, or supplied his/her own.

Fenders: not a good idea, especially in a coastal area. Corrision will eat away at the hardware, possibly causing an accident. Dents can cause the bike to be unsightly, therefore undesirable to rent. Common sense should tell people you get dirty riding a bike. The clean up time would increase, taking the bike off the road longer, and decrease revnue possiblities. Fenders do not protect drive components.

Again, rental customers tend to be non-cyclists and regard bikes as toys. Serious cyclists usually bring thier own equipment. Casual cyclists like to ride for the sake of ridng. Tourists want everything for free.

Tandems: agree, but they are real attraction and people tend to rent them for short period just for the experience, so short time / high price. Am still looking around for the best value on the market.

Gear hub and cables: good point. I think cables should be replaced by good teflon ones with internal sleeve after first service. Have you ever tried this ?

Locks: Good point about combination. I would even insert the use of lock in a contractual liability clause.

Helmets: thanks for the check box idea, this is excellent !

Casual cyclists: agreed 100%, and bikes must be robust, simple but attractive at the same time.

Thanks DieselDan !

Wife and I spent some time this summer at the Root River trail system in Mn. (Had a great time by the way) There were bike rental places all over. Every one of them rented hardtail mt. bikes and Recumbents. Yup, Recumbants (cheap ones). I've never seen so many recumbents in my life. I'll bet you 1/3 of the bikes on the trails (paved) were recumbents.

Recumbents were on my list at a start, but I think I will limit them to one more as an attraction than a real rental. But they are fun to ride ! ;)

When i was in Las Vegas, I rented a bike from a shop that promoted adventure tours. I had a blast touring Red Rock Canyon. Even cyclists go on vacatations, and many don't take their bikes with them.

There is a company here that organize adventure tours, I am not excluding this kind of venture in the future but cannot afford the logistics and personnel required for the moment + am not sure on ROI, would need to research more.
Thanks Poppaspoke.

I am hoping to hear a little bit more about your business model. Of course, I assume you want to keep your details a secret, but what sets your bike rental idea apart from a standard rental shop?

Location? Trails? Regular biking vacation destination? Tours? Tourism?
Weather? Roads? Are you attached to a resort?

No real standard rental shops here, only some LBS do some rentals. They are far apart from each other, most not in the best locations, need to call them before you get there, and on and all do not promote rental as a core + they are usually closed on Sundays. Tourists usually are not aware of their rental services.
Not attached to a resort, plenty of trails and scenic quite roads, sea and river front, tourism, plenty for a small operation. Problem I guess is once opened, that's when competition will appear, ah well... :rolleyes:

Thanks Paramedic :beer:

Oh, and I forgot, I am not in Iowa :D

Gear hub and cables: good point. I think cables should be replaced by good teflon ones with internal sleeve after first service. Have you ever tried this ?

I haven't tried any cable operated components because it's a lived and learned experance by prior managment. Even with teflon, the sand and salt gets in there and gums things up. The beach sand here is very fine quartz with crushed coral.

I think location is probably going to be your biggest factor as to whether it's a success or not. A bike hire shop in the New Forest that I used the other Summer largely ran fully rigid MTB's (Dawes) which seemed pretty reliable and were still overkill in terms of what you needed for the flat gravel chipped trails. Kid's and teenagers are probably more likely to hire an MTB than a hybrid. They had a handful of full-suspension bikes as well - complete overkill for the area but kids seemed willing to pay the not inconsiderable extra they charged for them so they might be worth the extra maintenance costs... What was a good idea was having a couple of adult trikes and both kid and dog trailers. It might be worth having a look on the web for hire companies in other countries - thety might be happy to share advice with someone who won't be a direct competitor.

:) Come to Iowa and I will show you RAGBRAI....

Good luck to you. Since many businesses fail in the first couple of years, it is almost needed that you have enough mola to exist for 3 years without depending on the business for income.

Speeking of failed businesses, you might try to find a LBS that is going out of business and buy their old bikes. Rent them all year, then sell them for what you piad and start over again.

Ideas others have not mentioned:

1. include in base price helmet for riders
2. give option for trunk rack on rental car
3. have cheap and good gloves available for purchase
4. have local bike maps available for service

Good luck. I don't think there are many locations that are good enough to generate a profit from rentals only. You might consider subleting space inside another business to keep your overhead down.

Hey I am looking for a bike rental business plan can you help me

Hey I am looking for a bike rental business plan can you help me
Sure. Buy low, sell high.
also don't forget:
Location. location, location.

Glad to be of service.

Work for 6m at a local shop that rents bikes.

http://www.businesstown.com/businessopps/newbiz-a15000.asp

score.org

Okay, so you have some encouragement...now I will come in as the naysayer..;)

Do you have any business experience or training? I have my MBA, and frankly didn't know how much I didn't know until I took my classes. Running a successful business is a lot harder than most people think.

Good intentions and knowing a lot about bikes is not enough. You may very well succeed, but most people who don't succeed do so because they didn't look at it objectively and had little to no finance knowledge. They were too emotional and sentimental.

Running your own business often means 16 hour days 7 days a week for a year or two. So many people look at owning a business as freedom, but eventually find it is more of a prison.

I suggest taking some business classes if you don't already have finance experience. You can also check out the motley fool website or investopedia. Things like profitability index, internal rate of return, and net present value calculations are a good start to figure out just how good an idea this business is. It may help you figure out mistakes now and if you need to boost your sales in some way before you get into trouble.

Another very basic but important concept is upselling. AKA "do you want fries with that?" It is hard to get the customer into the store to make a purchase, but once they do, it is easy to get them to spend just a little bit more. Provide options that can add onto the main sale such as equipment upgrades, food, maps, whatever you can think of.... And whatever you do, it is important for the customer to feel like they got a deal and to be happy and content with what they spent. People don't mind spending money as long as they feel good about the purchase.

I've seen some bike rentals in Galveston. Most of the customers have VERY poor riding skills. And, many of the bikes are very heavy, and of very poor quality. The combination of an unskilled rider and a unsafe bike makes for some heavy insurance problems.

The "flat foot" designs from Electra seem ideal for a rental. A three speed beach cruiser with a "flat foot" design is easy for an unskilled rider to handle. Get into trouble...just put your feet down. With an extra long seatpost, a "medium" cruiser would fit 90% of the male population, and a "medium" women's cruiser would fit 90% of the female population.

The customers in Galveston are perfectly happy to pay $10 an hour (and more) for a rental. So, with a $400 bike, just forty customers pays for the bike...as long as all forty customers come back with both the rider and the bike in one piece.

Oh boy. A three year old thread. Nice.

Okay, so you have some encouragement...now I will come in as the naysayer..;)


Anyone contemplating this route in life, read very careful what she has to say. I've been there, done that with bike rentals and tours. A competitor ran another business to subsidise the bike hire, and he employed $8/hour students to run it. The bikes were badly maintained and he put the business back on the market after four summers.

I did the business course and all, but was severely undercapitalised. I ended up as a microbusiness and I lived at a subsistence level for two years, but I tolerated it because of the "lifestyle". I escaped without owing anyone anything and with my sanity intact, but only just because I took on other employment.

You need at least two years living expenses as part of your capital, and remember those living expenses have to be at the level of comfort to which you have become accustomed.

And don't ever, ever underestimate the money you will have to spend on marketing and promotion, especially on tourism magazines and websites, as well as commissions to businesses and even kickbacks to their staff. It's expensive to get to the relatively isolated audience you wish to reach and you may well spend more on marketing and promotion in the first three years than you draw as wages.

I also would suggest a sideline, such as other hire items, or retail or something that will tide you over the seasonal shoulders and dips.

Oh yeah, also remember there are a whole heap of people out there who know how to spend your money better than you do. :)

Oh boy. A three year old thread. Nice.
Whatsa matter? Don't want any competition?

Whatsa matter? Don't want any competition?
History shows threads like this are locked, then the person who dug it up warned. I don't worry about compitition, you should worry about me.

History shows threads like this are locked, then the person who dug it up warned. I don't worry about compitition, you should worry about me.
Warned? Warned by whom? And for what? The new poster asked a question. So what if 3 years ago there was a similar question? The thread was long forgotten. Shoot, almost none of the threads are all that original. What's your beef? If not interested, ignore it.

Cycliste

I started a rental business a few years ago and was wondering how yours is going. Thought maybe we could exchange any information that we have gleaned. I hope yours is now a huge success story.

EliteBikeRentals