MIKE GALVIN: THE STATE OF THE INDUSTRY Continued from page 59
To look at the macro – where is the leadership of this industry? Yes there are lots of organisations to help you out with the local council, to get a rank, to stop a rank being taken away and to get a driver’s badge back. They will huff and puff about bigger decisions, the Deregulation Act for example, and try with futility to get well documented and legally formulated decisions reversed BUT where is the horizon scanning? What are we doing to influence the three/five year strategy, who is feeding into the labour manifesto for the next election? Who will stop Uber or anyone else if they decide to get local licens- ing washed away and enable direct to driver despatch – where in our industry is that body? It’s no secret that it is nowhere. Likewise it will stay nowhere because no one wants to pay for it. By pay I am talking a thousand pounds a month or some- thing meaningful, not the odd tenner a month and a heroic £100 if there is a special box rattling exercise to launch a judi- cial review.
You will pay your employer’s liability insurance, you will pay your licence, you might even insure your building but when it comes to your business……..possibly your most valuable asset (worth more than your house if nurtured properly) you don’t want to pay. Do you know your local MP? Do you speak to the press? Do you involve yourself in the local community? Often the answer is no. That may be lack of time, lack of confi- dence/competence or a myriad of other reasons BUT big business will. Not only will they, but they are and they are doing it now!
If you look at the successful industries they all face existential threats from time to time. Some fall by the wayside, some come together and buy the representation and other things that they need to thrive. The Road Haulage Association is a prime example. There are many others.
‘further turmoil to an industry that is ill placed to deal with it’
Our industry’s key systemic threats are; leadership, technology and distribution. Companies such as Riide are in a prime posi- tion to take up this mantle but have they got the aspiration, infrastructure, available competences and resources to do so? Has the NPHTA or LPHCA? Has anyone in this industry? I am not here to judge others, just to make the point that unless the industry starts to get itself organised and into a position where it has a clear strategy, where big and small can not only survive but thrive and it develops the infrastructure to project, protect and deliver then every week, month and year will bring further turmoil to an industry that is ill placed to deal with it. Maybe when we talk about consolidation we should talk about institutions merging instead of fighting each other for members and be properly answerable to their members who in turn are prepared to pay proper fees for a proper ser- vice.
BACK TO THE FUTURE If you call this success, what does failure look like?
So to return the original question – is this development good or bad for the industry? Without sitting on the fence……it depends. If you are happy with your lot, if you have no vision
60
Dr Michael S Galvin
https://mobilityserviceslimited.com
SEPTEMBER 2020
to grow exponentially, no exit plan, no hope of longevity and want a third parent I don’t see it will do you any harm, and in the short and medium term it may be very good for you. You might get a free/cheap system, more work with no effort and enjoy the rest of your career administrating drivers and pla- cating local licensing authorities.
It could be good for businesses which are on their knees if they need a short term tactical influx of business to get them through the next eighteen months – it could mean short term gain and long term pain but hey - survival is good. If they can wean them- selves off of the easy money after the crisis, maybe it’s fine.
But what of those who want to grow, to retire to a beach, to buy bigger houses, smarter cars or pass a thriving business onto their kids? It may still have a place if ten per cent of your business comes through Uber or even 20 per cent then you can still call the shots, unless your competitor takes your drivers because he is taking everything that is thrown at him by Uber. Remember, your competitor may not even be in your town – Uber et al don’t have to worry any more about making provision, they will be outside of the regulatory regime.
The true answer is a simple one – what is it you want your business to do? Where do you want to be in five years? Will this help you or not?
SPARE A THOUGHT FOR OUR NEW SILICON VALLEY FRIENDS
Whilst we are talking about victims let’s spare a thought for Uber. This is a brave decision, yet another twist and turn in what appears to be a catalogue of strategic confusion. What do they do if everyone leaves? Do they buy someone else? Do they give up? How many more directions are there to spend billions on?
Trying to operate at scale in licensing areas with hundreds or very low thousands of drivers is very different to New York, London etc. The secondary cities in the UK are relatively small; people like cash, they already have cheap prices, they are brand loyal, cabs already arrive quickly and drivers know that if they leave an operator they probably won’t be welcomed back.
I honestly believe that there is little to show for the money (a fortune by anyone’s standards) that has been spent – cus- tomers are fickle, another promo code from someone else and they are off. Setting fares to a level where you can take pas- sengers off the bus and tube in London was never sustainable. What about ride sharing – even before Covid that was going nowhere and now……..
The UK industry has despite the weaknesses mentioned above remained resolute and survived and still has 90+ per cent of its customers still using it. I despair every time I sit on a panel and am asked ‘why has Uber been so successful?’
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