NINER

BIKES

Prepared For: UNC Charlotte Parking & Transportation Services

Prepared By: Chris Parette & Bryan Macdonald

Description:

UNC Charlotte is in need of a new efficient way to travel around campus.

With Niner Bikes, students and faculty will utilize the use of bikes by renting
them for a certain time increment, which encourages health, improves travel
to classes, and makes the campus money.

Table of Contents
Executive Summary3
a. Objective
b. Goals
c. Solution
Pricing for Rentals5
Bike Station..5
Employees.7
a. Number of employees & Wages
b. Bike Station Hours
Theft Prevention8
Market Segment8
Financial Plan..9
Break Even Analysis.9-10
Projected Sales and Expenses.10-11
Liabilities.11
Advertising.12
Conclusion.12
Sources.12

Executive Summary
Objective
UNC Charlotte is a very student friendly campus, but with the size of campus
growing by the day, the campus could use a new method of transportation to
help students get around campus more efficiently. Niner Bikes is a student
and faculty exclusive bicycle rental service that will help students get around
campus while encouraging activeness.

Goals
The Goals of Niner Bikes are:

Provide exceptional service to all customers

Provide our service at a reasonable price
Grow in popularity and use each year
Help students and faculty get around campus easier
Keep students and faculty safe.

Solution
We are proposing the purchase of 50 bicycles and the building of a 12x 6
Bike Station where the bikes will be kept, the rentals will be given, and the
broken bicycles will be repaired if needed. We will also have smaller needs
like a computer, telephone, and repair tools. Niner Bikes will quickly become
a profit for UNCC once it is established as a well-run business that helps
students and faculty travel around campus easier.
We will discuss the pricing for renting, cost to run the business, legal
liabilities, theft prevention, employment, and our bike station. We will also
talk about marketing and our financial plan

Pricing for Rental

We are proposing four different types of rental prices. For both students and
faculty prices are as follows:

$10 a day
$30 a week
$65 a month
$120 a semester

These prices include the rental of a helmet for safety purposes and a U-lock
for theft prevention purposes. The prices are very reasonable to what we are
trying to accomplish. They are not so expensive that people will decide not
to rent them, but they are also not so cheap that a profit will not be made. It
is a happy medium. These prices are also not necessarily set in stone, and
can be subject to change over the course of time if demand increases or
decreases. We also are very open to other types of rentals, whether they be
for a weekend, for a year, or for any other amount of time.
Daily rentals will need to be returned by closing the next day, and weekly
rentals will need to be returned the same day of the week that your began
your rental. Monthly rentals will also need to be returned the same day of the
next month. So if you rented the bike on March 19th, it needs to be returned
no later than April 19th.
Stanford University has a bike rental program that we have done some
research on. Figure one shows the rental and pricing options that they offer:

24
hours
(Mon- Weekend*
Fri)

Rental
Rates

Same
business
day

Basic bike

$20

$30

Mid-level
Mountain
bike or
Commute
r bike

$25

$35

High-end
Road bike

Weekly

Monthly

3
months

Yearly

$40

$80

$150

$210

$285

$50

$90

$175

$260

$365

4
$35

$45

$75

$100

$200

$300

n/a

Figure 1

As you can see, Stanford University also offers higher-end bikes for higher
rates. This is not something that we are proposing to start immediately, but
after the Niner Bikes here at UNC Charlotte gets off the ground, it may be an
option that would be worth looking into.
Stanford also offers a number of add on accessories for an extra cost. Figure
2 some of the things that they offer:

What comes with my rental?

Helmet (Bell and other brands that meet the safety standard)

U-lock and, if requested, cable

Free flat-tire repair at our shop

What accessories can I rent?

Front basket, installed - $10

Rear rack with basket, installed - $20

Front light (with batteries), installed - $10

Shimano SPD clipless pedals, installed - $10

Road pedals, installed at pickup - $10

Flat repair kit - $20

Saddle bag containing CO2 cartridges or mini-pump, tube, multitool, patch kit

Fender set, installed - $20

Child carrier, installed - $30
Figure 2

This is also something that can be added down the road, and would be an
easy way to add more profit to the bike rental program.

Bike Station
In order to successfully operate our Niner Bikes program, a main building or
station is needed to keep the bicycles, rent them out, and repair them if
needed.
This is why we are proposing a 12x 6 bike station that can be the main hub
for our bike rental program. This station will house the employee on the
clock, it will state the pricing options for renting out a bike, and outside of
the station the bikes will be locked up and stored. It can also be the place
where our employees do minor repairs, such as fix a flat tire, repair a loose
chain, or whatever is needed. We dont need a massive building for our
operation, just a small headquarters to do the tasks necessary to keep
rentals running smoothly.
The University of Colorado at Boulder has a bike rental service and repair
program in a small building that we would like to model our station after.
Figure 3 is what their repair and rental station looks like:

Figure 3

This station is almost exactly what we are looking for. It is simple,

inexpensive, and accomplishes what we need to be able to successfully help
our customers and make their bike rental experience worth their time and
money.
We are open to wherever UNCC would like to put the bike station. One
suggestion we have is potentially around the Student Union, which is
somewhat the main hub of campus and where a lot of students travel
through on a daily basis. Cramer Street is also a popular road that is driven
on so it will get a lot of eyes on it. If you are facing the Student Union from
Cramer Street, there is room over on the right side by the brick sidewalk and
grassy area that would be an ideal area for our station and main Niner Bikes
headquarters to be located at. It is out in the open, not in the way of
anything major, and has enough traffic that travels through it in order to
attract new potential customers. We plan to have UNCC make the building,
since they may have certain specifications or guidelines that they go by for
buildings.

Employees
Another positive about having Niner Bikes on campus, is the employment
opportunities it offers to students. We are going to pay our Niner Bikes
employees $9 an hour to run our bike station and do repairs on broken bikes.
At the time of hiring, we will go through a one day training program with new
hires to go over rental policies, customer service training, along with how to
do simple repairs to bikes. We will only have one employee working at a
time, but we will have three employees on the staff at any given time. When
it comes to hours of operation, we plan to have the following hours available
to rent bikes:
Business
Hours

Mon

Tues

Wed

Thu

Fri

Sat

Sun

Open

9 to 5

9 to 5

9 to 5

9 to 5

9 to 5

9 to 3

Closed

Figure 4

We believe that these are the hours that will be the most efficient use of
employee time and the most traffic for students and faculty wanting to rent
bikes. This is a total of 45 hours a week that Niner Bikes is open, so that
would give each employee about 15 hours a week. Sunday is a very slow day
on campus, so we dont feel that there is a need to have Niner Bikes open on
that day. We will also be closed during holidays, and days where the campus
is closed. All employees hired will need basic repair skills.
We also plan to not be open if the forecast for the day is expected to be
below 40 degrees. The traffic for bike rentals on a cold day would be very
little and it would be a waste of money to be open if nobody is going to rent
a bike.
Inside the shop, we will need to have some form of computer, whether it is a
PC or a Laptop, in order to access our bike database along with accessing the
database for current students. We will also need a telephone so potential
rentals can call if they have any questions about prices or hours.

Repairs

For repair purposes, we will need an adjustable bike rack, some basic tools to
be used for repairs, along with other bike repair tools like a pump, gloves,
WD-40, and some of the other basic repair needs.
Outside of the shop, we will have multiple bike racks that will be used to
store the bikes not rented at the time, along with locks to prevent theft. In
the case of rain in the forecast, we will need around a half dozen tarps to put
over the bikes to prevent them from getting wet or damaged in the rain.

Theft Prevention
In order to prevent theft, when renting a bike from Niner Bikes. You will be
asked for your student ID along with another form of ID. That will then be
entered into our database, along with the serial number on the bike you are
renting. This way, we know who rented a bike, and what bike they rented.
The reason for asking for two different forms of identification is in case of
student ID theft, so that specific student loses their ID, they cant be charged
for renting a bike they never rented. We will also have a database that only
allows current students to rent the bikes, so no former students who have an
ID from their previous time at UNC Charlotte cant rent a bike.
We also do not accept cash payments. Only Credit and Debit Cards will be
allowed, so if the bike isnt received by its return date, you will be charged
the late fees that go along with not returning your bike on time. Our late fees
are as follows:

Per day late, $5, up to one week.

Per day late after one week, $10.
After one month of no return, the bike is to be assumed as stolen, and
the student/faculty member will be charged $100.

This is the reason cash is not accepted. If paid in cash, we do not have a
credible form of payment to charge the renter if the bike is returned late or
not returned at all.

Market Segment
University students are our main target market.

Mostly commuters, great for daily rental usage and returning

customers.
24% of students live at campus housing.
The undergraduate class size is increasing in size every year.
9

Convenience of location and low prices.

University faculty and surrounding population

Are willing to commute to work by bicycle.

Can be used for tours or events. Ex: football, baseball events
Population

University Area Charlotte

Students
Faculty

160,000
27,238
3,000

Figure 5

Population

University Area - Charlotte

Students

Faculty

Figure 6

Financial Plan
This financial plan was developed based upon previous years data from
existing store records, and population records. Existing store records are
needed to make assumptions pertaining to sales and cost of operations.
The topics presented will follow specific predictions.

10

Break-even Analysis
The break-even analysis determines the point of profit for the company in
one year. The data provided in figure 7 is based upon expenses for the first
year of opening. The table gives a rough estimate of how much we need to
sell to cover our expenses for a year.

Break-Even Analysis
40,000

20,000

-20,000

Sales

Expenses
-40,000

-60,000

-80,000

Sales
Figure 7

Projected Sales and Expenses

Starting-up in year 1 will have greater expenses because of initial costs of
products. A few of the initial expenses we will have are bicycles, helmets,
building, and a website. The profit shown in figure 8 comes from rental of
bicycles, accessories, and our repair station. The graphs shown give a
good representation of our yearly expenses and sales.
11

Column1
Sales
Expenses
Profit

Year 1
Year 2
Year 3
Year 4
$97,680. $122,100 $134,250.
$146,520.
00
.00
00
00
$89,264.
$44,219. $42,559.0
$45,939.0
00
00
0
0
$8,416.0
$77,881. $91,691.0
$100,581.
0
00
0
00

Figure 8

Revenue Forecast
Sales
Bicycle Rental
Accessories and
Parts
Repair
Total Sales
Expenses
New Bicycles
Insurance
Website
Marketing
Computer
Helmet
Safety Locks
Misc.
Payroll
Building
Total Expenses
Total Revenue

Year 1
$88,000

Year 2
$110,000

Year 3
$121,000

Year 4
$132,000

$4,400
$5,280

$5,500
$6,600

$6,050
$7,200

$6,600
$7,920

$97,680

$122,100

$134,250

$146,520

Year 1
$10,000
$774
$6,500
$4,000
$350
$2,000
$440
$200
$35,000
$30,000

Year 2
$3,000
$969
$4,000
$600
$350
$300
$35,000
-

Year 3
$1,600
$1,089
$4,000
$320
$300
$250
$35,000
-

Year 4
$4,000
$1,389
$4,000
$800
$450
$300
$35,000
-

$89,264

$44,219

$42,559

$45,939

$8,416

$77,881

$91,691

$100,581

Figure 9

Liabilities
With a large number of bikes on campus and the large number of students,
this plan also comes with the risk of liability. You do not want lawsuits if a
student somehow gets hurt. We will need to install a plan where we are not
liable if there is an accident involving the bike, whether it be a spill, or even a
12

potential accident involving a motor vehicle. We will make sure when bikes
are returned and before they are rented out that they pass a safety
inspection, so we cannot be accused of renting out faulty bikes.
We will also have a waiver that will be signed by each renter that claims if
they are to get into an accident, we are not liable. That being said, even with
the inspection and safety precautions that will be put into looking at the bike,
there is still a risk of something breaking. If something is to physically break,
at that point there may be something that we can do, since it may not
necessarily be the renters fault.

Advertising
Niner Bikes is something that will need to be advertised to really get the
word out on campus. We plan to just do advertising on campus, which should
relatively inexpensive. We would like to be advertised on the UNCC Parking &
Transportation website, so people are able to access our rates and phone
number at any time. Along with that, putting flyers around buildings on
campus, and even putting signs on the side of buses and bus stops. We have
the costs of marketing and advertising in Figure 9.
Advertising at sporting events is a strong time to really get eyes on the
product too. Football games where the parking is all over the place is a great
opportunity to get people to rent for the day. We also anticipate a lot of our
marketing and advertising to be through word of mouth between students.

Conclusion
Niner Bikes has the potential to be a very popular service that is offered by
UNCC. Through offering exceptional service at a reasonable price, it is easy
to see the popularity growing year by year. Biking around a campus the size
of UNCC, with over 27,000 students, the potential for growth and profit for
Niner Bikes is quite astounding. The growth over the last 25 years at UNC
Charlotte has been exponential, and so should the varieties of
transportation, With your help, we can make this service into a roaring
success.

Sources
"Campus Bike Shop." Stanford University. Web. 4 June 2015.
"Bike Rental Program." Montclair State University. Web. 4 June 2015.

13

"Travel by Bike." Parking and Transportation Services. University of Colorado

Boulder. Web. 4 June 2015.

Five Tips for Marketing to College Students. Entrepreneur. 23 Sept. 2010.

Web. 03 June 2015.
B-safe, B-fit, B-cycle. Charlotte Bikes. Web. 05 June 2015.

14