Analysis of the tricycle rental market in India
The relevance of research
A tricycle is a three-wheeled motorcycle with two front wheels and one rear wheel, designed for use on public roads and subject to registration with the traffic police. The tricycle rental market in this study is understood as a set of enterprises that provide services for hiring tricycles to the consumer for temporary use, forming the market supply, the number of users of the above services and forming market demand
Purpose of the study
Analysis of the state of the tricycle rental market, assessment of the market size, analysis of competitors, as well as identification of factors affecting the tricycle rental market
Content
Chapter 1. Overview of the tricycle rental market in India
1.1. Product description
1.2. Potential market capacity
1.3. Current trends and development prospects of the studied market
1.4. Assessment of factors affecting the market
1.4.1. Social factors
1.4.2. Technological factors
1.4.3. Economic forces
1.4.4. Political factors
1.4.5. Conclusions about the influence of factors on the market
1.5. Product Market Life Cycle Stage
1.6. Competition from substitute products
Chapter 2. Analysis of the industry in a crisis
Chapter 3. Assessing investment attractiveness factors of the tricycle rental market in India
Chapter 4. Forecasts and conclusions
4.1. Barriers in the tricycle rental market
4.2. Tricycle Rental Market Growth Drivers
4.3. Market Entry Recommendations
4.4. Key findings from the study
Research excerpt
Part 1. Overview of the tricycle rental market in India
1.1. Product description
Consider the characteristics and features of the Indian tricycle rental market.
The tricycle rental market in this study is understood as a set of enterprises that provide services for the provision of rental tricycles to the consumer for temporary use, form the market supply, the number of users of the above services and form market demand, as well as the relationship that arises between sellers and consumers of tricycle rental services in India. .
A tricycle is a three-wheeled motorcycle with two front wheels and one rear wheel, designed for use on public roads and subject to registration with the traffic police.
The main foreign manufacturers of tricycles present in the Indian market are: BRP (Bombardier Recreational Products, the number of official dealers in India according to the official website of the company is 81, Spyder, Ryker models), Polaris (the number of official dealers in India according to the official website companies - 2, Slingshot model), Yamaha (the number of official dealers in India according to the company's official website - 120, Yamaha Niken model), etc.
At the same time, BRP produced a tricycle for the first time in 2007.
The idea of providing rental services specifically for tricycles is new, while the vehicle rental market itself, including car and motorcycle rentals, has been developing in India for at least the last decade. In addition, interest in active and dynamic types of recreation in India is growing every year. People actively combine trips out of town with riding motorcycles, quad bikes, snowmobiles. Tourist trips and motorized transport are in demand. Tricycles, in this case, will also not be an exception, because most of the tricycle range is designed specifically for this. The peculiarity of tricycles is to provide high technical characteristics and capabilities, safety that motorcycles do not have, and experience a special kind of emotions and impressions.
From the point of view of competition, this niche is free, in India there are no companies providing tricycle rental services yet. Competition will be felt on the part of substitute products - motorcycle rentals. At the same time, the cost of services of the latter is much lower.
The target audience is quite wide: men and women of the age category 25-45 years old who have a driving license of category ""A"" and driving experience in this category for at least 2 years.
Thus, this niche is promising and unsaturated, the project has potential.
The Indian tricycle rental market is characterized by the following features:
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1.2. Potential market capacity
Taking into account that potential consumers of tricycle rental services will be owners of motorcycles, ATVs, persons with category A driving licenses and not having their own motorcycle, motorists with category A driving licenses, we will determine the potential capacity of the tricycle rental market in India.
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1.3. Current trends and development prospects of the studied market
Key trends in the Indian trike rental market include:
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Among the prospects of the analyzed market are:
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1.4. Assessment of factors affecting the market
Let's consider the main factors influencing the tricycle rental market and, accordingly, the demand and income of market operators.
1.4.1. Social factors
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Diagram 1. Population dynamics in India, as of 01 Jan. 2012-2020, million people
During 2014-2018 The dynamics of real money incomes of the population of India was characterized by …
Diagram 5. Dynamics of real money income of the population of India, 2012-2019, % to the previous year
During 2015-2019 The dynamics of real money incomes of the population of the Krasnodar Territory had …
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According to the data of the analytical agency ""AUTOSTAT"", the Indian motorcycle fleet as of January 1, 2020 amounted to … thousand units. About half of the entire park falls on …
The picture of the distribution of the motorcycle fleet by region is as follows. The top ten were:...
1.4.2. Technological factors
The tricycle rental market follows the digitalization trends that have increased in all sectors of the economy. In particular, for the convenience of users, an online booking system has been developed that includes a step-by-step algorithm for choosing rental dates (pickup dates and return dates), rental / return point location, tricycle model selection, additional options and services, payment method, reflection of the discount system depending on rental days. In addition, the option of registering a personal account is provided. Using the online booking system is convenient for customers who see the availability of booked tricycles in real-time mode, and for company owners who receive the maximum possible number of rental applications. At the same time, due to the instant updating of information, it is possible to avoid double bookings of the same tricycles for the same dates and rental periods.
At the same time, the introduction of online services for managing online booking requires additional investment and does not always bring the expected financial effect for the owner of the company providing tricycle rental services.
1.4.3. Economic forces
Dynamics of India's GDP
The dynamics of India's GDP is an indicator of the country's economic development. GDP has an impact on the development of all sectors and markets of the economy, as well as the level of effective demand of the population.
In 2012-2015 there was a gradual decline in economic growth rates until reaching negative values in 2015 (the fall was 2,0% compared to 2014). This trend was accompanied by a corresponding decline in business activity in the private sector of the economy.
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Dollar rate
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Changes in business sentiment
According to the quarterly monitoring of entrepreneurial confidence in the service sector, conducted by Rosstat, and determined through surveys of changes in the attitude of entrepreneurs to various aspects of their activities (output, demand, stocks, number of employees, level of capacity utilization), one can note a slow increase in optimism over the period 2015-2019 gg. and weakening the intensity of the negative trend.
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Diagram 13. Dynamics of the index of entrepreneurial confidence in the services sector, quarterly, 2015-2019, Q1 2020, %
The volume of services provided to the population by rental companies
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The share of rental services in the structure of paid household services to the population of India
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Indian market for new motorcycles
In accordance with the data of the analytical agency ""AUTOSTAT"", the sales volume of new motorcycles in India in the 1st quarter of 2020 is …
Diagram 16. Sales of new motorcycles by union territories of India, 1 quarter. 2020, pieces
1.4.4. Political factors
Regulatory and legal framework in the field of rent / rental. The industry has a developed legal framework. Defining documents include:
Indian Civil Code (as amended on April 28, 2020). Part two, articles 626-631.
Consumer Protection Law of India (as amended by Federal Law No. 9-FZ of January 1996, 2) (as amended on April 24, 2020).
Consumer Services Regulations in India approved by Government of India Ordinance No. 15 dated August 1997, 1025 (as amended on October 4, 2012).
GOST R 57616-2017 Household services. Rental services. General requirements. Introduction date 01 January 2018
Licensing. In accordance with Article 12 of the Federal Law of May 04.05.2011, 99 N 18.02.2020-FZ (as amended on February 28, 2020) “On Licensing Certain Types of Activities” (as amended) dated March , , a list of types of activities for which a license is required . The provision of tricycle rental / rental services is not included in this list, therefore, a license is not required to engage in the relevant activity.
Renting tricycles to persons holding a category A driver's license. In accordance with Indian law, a vehicle can only be rented to persons who have a license of the appropriate category. For violation of the law threatens administrative liability:
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1.4.5. Conclusions about the influence of factors on the market
We will conduct a STEP analysis of factors that will influence the tricycle rental market in India.
Table 1. STEP analysis of factors influencing the tricycle rental market
As a result of the STEP analysis, we can draw the following conclusions about the impact of macro factors on the tricycle rental market.
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1.5. Product Market Life Cycle Stage
The tricycle rental market is a completely new line of business. This niche is undeveloped and undersaturated, there is no competition from market operators providing similar services. A related area of this type of activity is the rental of motorcycles, which will compete as a substitute product.
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1.6. Competition from substitute products
Competition from substitute goods will be motorcycle rental, the cost of which is significantly lower than the cost of renting tricycles. The motorcycle rental market is currently in the development stage, which is accompanied by an increase in the number of market operators, an increase in the model range of the motorcycle fleet, the expansion of the geography of motorcycle rental companies, etc.
Let us give examples of market operators providing motorcycle rental services in the cities that have already appeared and are expected to have tricycle rental points.
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Part 2. Analysis of the industry in a crisis
Conducting an analysis of the industry in a crisis is complicated by the fact that the tricycle rental market is completely new, this service is just appearing on the market. In this regard, there is no data on the established volume of the market in this industry, the level of consumer demand, consumer preferences, consumer satisfaction with this service, the practice of consuming this service from customers, its behavioral function in a crisis. It is logical in this case to conduct an analysis of the industry under study, taking into account the influence of constraints and growth factors that will affect the tricycle rental market in the current economic situation.
At the same time, the following constraining factors are significant for the analysis:
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The following growth factors are significant for the analysis:
The uniqueness of the rental product, the feeling of unforgettable emotions, an exceptional way to spend leisure time and travel, combined with the safety and high technical characteristics that a tricycle has - on the one hand. On the other hand, the high cost of this type of vehicle and the impossibility of acquiring it in the ownership of each user.
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In addition, people who are tired of self-isolation are starting to take short weekend trips, while preferring personal or rented transport to the plane. Renting a tricycle is one of the best alternatives in this regard. At the same time, the main emphasis is needed on the development of individual tours at the request of the client, more active promotion of ready-made tours and tours among tricycle owners.
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Part 3. Evaluation of factors of investment attractiveness of the tricycle rental market in India
The positive factors of the investment climate in the tricycle rental market dominate over the negative ones. However, the strength of the influence of negative factors and their importance in the current economic situation is estimated more highly.
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The most significant negative factors.
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The most significant positive factors.
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Part 4. Forecasts and conclusions
4.1. Barriers in the tricycle rental market
The barriers that exist in the tricycle rental market include:
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4.2. Tricycle Rental Market Growth Drivers
Among the growth drivers of the tricycle rental market are:
Business activity of the regions central to the country's economy and their significance on the map of tourist flows.
Annual growth in the number of motorcycle owners and persons who have received a category “A” driver's license.
An increase in the number of customers using tricycle rental services, which, on the one hand, is due to the desire to spend leisure time, travel and adventure, experience special emotions, on the other hand, the inability to purchase their own tricycle due to the high cost of this type of transport.
Expansion of the geography of the presence of rental points, access to regions with a high concentration of tourist flows and a motorcycle fleet.
The organization of motorcycle tours on tricycles in India and the world both among owners and renters of tricycles contributes to the popularization of this vehicle and its rental services, which, in turn, leads to an increase in the number of consumers of tricycle rental services.
Formation of a tricycle fleet in terms of meeting the needs of users both in terms of technical characteristics and cost of services.
4.3. Market Entry Recommendations
The following proposals can serve as recommendations for entering the market:
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4.4. Key findings from the study
The idea of providing rental services specifically for tricycles is new, while the vehicle rental market itself, including car and motorcycle rentals, has been developing in India for at least the last decade. In addition, interest in active and dynamic types of recreation in India is growing every year. People actively combine trips out of town with riding motorcycles, quad bikes, snowmobiles. Tourist trips and motorized transport are in demand. Tricycles, in this case, will also not be an exception, because most of the tricycle range is designed specifically for this. The peculiarity of tricycles is to provide high technical characteristics and capabilities, safety that motorcycles do not have, and experience a special kind of emotions and impressions.
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At the same time, the strength of the influence of constraining factors is estimated by GidMarket analysts quite highly, however, the potential for market development in the current conditions lies in the plane of following the emerging tourism trends - individual trips and trips by small companies, and choosing a tricycle rental service will not only be a way to get special emotions from traveling, but also as a way to safely isolate from the mass congestion of people.
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Diagrams
Diagram 1. Population dynamics in India, as of 01 Jan. 2012-2020, million people
Diagram 2. Dynamics of the population, as of 01 Jan. 2012-2020, thousand people
Diagram 3. Dynamics of the population, as of 01 Jan. 2014-2020, thousand people
Diagram 4. Dynamics of the population, as of 01 Jan. 2017-2020, thousand people
Diagram 5. Dynamics of real money income of the population of India, 2012-2019, % to the previous year
Diagram 6. Dynamics of real money incomes of the population, 2013-2019, % to the previous year
Diagram 7. Dynamics of real money incomes of the population, 2016-2019, % to the previous year
Diagram 8. Dynamics of real money income of the population, 2015-2019, % to the previous year
Diagram 9. Dynamics of tourist flows, 2014-2019, million people
Diagram 10. The structure of the Indian motorcycle fleet by union territories, as of 01 Jan. 2020, %
Diagram 11. Dynamics of India's GDP, 2012-2019, % to the previous year
Chart 12. Monthly dynamics of the US dollar against the rupee, 2015-2019, Jan-Apr. 2020, Rs. for 1 US dollar.
Diagram 13. Dynamics of the index of entrepreneurial confidence in the services sector, quarterly, 2015-2019, Q1 2020, %
Diagram 14. Dynamics of the volume of services provided to the population by rental companies, 2015-2019, million Rs.
Diagram 15. Dynamics of the share of rental services in the structure of paid household services to the population of India, 2015-2019, %
Diagram 16. Sales of new motorcycles by union territories of India, 1 quarter. 2020, pieces
Chart 17. Life cycle stage of the tricycle rental market
Chart 18. Forecast dynamics of India's GDP, 2020-2023, % to the previous year
Diagram 19. Forecast dynamics of real money incomes of the population of India, 2020-2023, % to the previous year
Tables
Table 1. STEP analysis of factors influencing the tricycle rental market
Table 2. Operators of the motorcycle rental marke
Table 3. Assessment of factors of investment attractiveness of the tricycle rental market
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