The idea of a sharing economy has led to the growth of businesses especially e-commerce platforms because they are relatively favourable to start up and become a worthy player in the market. A good example of such an e-commerce platform is the peer to peer car rental platform. It is an e-service that operates on the premise that a company provides roadside assistance, insurance and platform for users to list the cars they wish to rent while providing an environment that is transaction safe and friendly for both car owners and renters with industry players including companies like Drivy UK. Click here to rent a car today. However, it is important to note that peer to peer car rental is not the same as car sharing. The concept of car sharing UK works on the premise that a third party which owns a fleet of cars that members can use but in the exchange of a set fee. The company is tasked with the maintenance of the cars and in most cases it is responsible for paying for the fuel.
How the service works
A person who wishes to list a car on an e-commerce platform has to get access to an app belonging to a company by providing owner details plus pricing, photos and vital information of the car’s fuel economy. This information will be visible to users who wish to rent a car from the platform. A user will browse through the listings available and specifies the duration they wish to rent the car then goes ahead to book the car. Once the car owner approves the request, the attached credit card is charged and the vehicle will be available for pick up by the renter at a time that is agreed upon by both parties. Once they are done with their trip, it is their responsibility to return the car. In case of any damages, the car owner will access the damages and contacts the rental company to find out how the damages will be catered for. It is important to note that this is generally how the service works but there may be some few variations depending on the company you choose to use.
The Business Model
The business model for peer to peer private car rental companies is quite simple. Car owners and car renters are connected via a private car rental in the UK e-commerce platform provided they are in a particular area. Users can rent cars for a day, a week or just some few hours. On average, some surveys suggests that a car will only sit idle for approximately 22 hours a day but choosing to rent it out can be one way of earning yourself a few more coins. Some companies claim that car owners can make up to £9,000 a year. Many e-commerce platforms attract new customers to their companies by offering their customers additional benefits like 24/7 roadside assistance or insurance coverage.
How Private Car Hire Companies make Money
The primary way through which a majority of the private car hire business players make money from the business is by charging a nominal commission every time a renter books a trip. The charges of course differ from one platform to another. Apart from charging the nominal commission, they can earn some extra revenue from on-site car promotions and banner ads.