Alexander Pershikov, the transportation evangelist, founder of GetTransfer.com, serial entrepreneur and a metaverse visionary.
A few decades ago, if you wanted to go anywhere by taxi, you had to call a transportation company, order a cab and wait to be picked up. If the trip was urgent, you went out to a busy street and caught a cab. In both cases, the ride cost was often high, and the waiting time was often unpredictable.
The game began to change in the 2010s when Uber, Lyft and other aggregators entered the global market. These companies completely turned the idea of cabs upside down. The customer no longer had to call and wait; the order for a ride could be placed directly on a smartphone app, and you immediately saw the cost of the trip and the waiting time. Drivers no longer had to be specially trained taxi drivers and have a yellow cab. You could go to work at any time by registering on the app. The world saw people transform into taxi drivers in minutes. It was an industry disruption, and it was big.
However, there have also been challenges along the way. I started my own ride-hailing company in 2016 with the goal of supporting not only clients but also drivers after observing some of the pain points drivers have faced.
Commissions And Costs
The ease of ordering and paying for a cab is modern and convenient for customers, but let’s keep in mind that the people who make ride-hailing companies flourish in the first place are the drivers. But, from my perspective, if a company’s focus is primarily on the customer, this could mean sacrificing the driver’s experience.
Some taxi park owners might remember the times when they were the elite of business managing taxis. I believe these times are gone, as the demand for ride-hailing apps has increased. However, with ride-hailing, “A lot of drivers don’t feel that they are paid enough, that the commission is too high, that the companies don’t care about them,” Harry Campbell, a driver and founder of a rideshare blog, told Bloomberg.
Furthermore, as Buzzfeed News reported, rideshare drivers’ net wages don’t account for additional costs of being a driver, such as car insurance, gas, car payments, maintenance, etc. One driver told Slate, “In any given week, [he] expects to lose a bit more than $350 to gas, car cleanings, insurance, maintenance, and parking costs.” I believe challenges such as these can contribute to burnout and stress among drivers.
Changing The Rules Of The Game
Drivers have held strikes against the existing game rules in big cities. From my perspective, companies can work to change the game rules by creating new services that take care of all the participants in the process. This is something my company is doing, as are others.
For startups looking to enter the space, focus on offering low commissions for drivers and convenient applications. Aggregators can also work to change the situation and make it more beneficial for everyone. I think the magic formula of happy drivers requires modest commissions and no hidden payments.
In order to bring highly skilled professionals into the ride-hailing industry, I believe companies should also give back earnings to drivers. I think this could cause some drivers to not consider ride-hailing work as temporary, and clients can immediately get the benefits of the service.
For the industry, I see the long-term solution as building a marketplace that brings long-lasting peace so everyone will enjoy the process: the driver, the client and the companies. All that is needed is to shift our gaze away from the benefits of “now” and pay attention to people. That’s guaranteed to bring benefits later.