In this executive summary, we outline how we used the Entrepreneurial Mindset along with other principles learned in BUS 101 to address the identified problem through a business inspired solution. In specific, we focus on the inefficiencies involved with renting cars from airports.We feel this is a problem confronted by many travelers and that our service will increase efficiency for travelers.

Bolt: Valet Car Rental

 

Driehaus School of Business

Bus 101: Business Fundamentals

Professor Slapansky

Group 5

November 14th, 2022

 

Introduction:

In this executive summary, we outline how we used the Entrepreneurial Mindset along with other principles learned in BUS 101 to address the identified problem through a business inspired solution. In specific, we focus on the inefficiencies involved with renting cars from airports.We feel this is a problem confronted by many travelers and that our service will increase efficiency for travelers.

 

Motivation:

We have found that customer experience within the rental car industry specifically in airports can be frustrating. Companies that offer this service can be inefficient and have bad customer service. We want to make this service an easy and fast process to help our customers cut down their wait time to spend their time more efficiently.

 

Proving Our Motivational Hypothesis Via Empathizing With Frequent Travelers:

To test our hypothesis, we used both primary and secondary research. From this research, we discovered both sides of the pain and gain points, about renting a car from airports. This

research offered us material to work on our conceptualizing and convey an end arrangement

that obliged the issues ordinarily met by typical passengers.

 

Primary Research:

 

To conduct a primary research, we:

1. Developed an airport survey where we could physically go to the O’Hare International Airport and ask passengers to answer a few questions. Discover customer sentiment and willingness to recommend our business with a single question.
2. Set up an online survey for the local audience to fill in with 5 quick questions. This survey led us to find out what customers think about this service – what they like, what they don’t, and our main concern was to focus on the problems passengers face while renting cars at the airport. (refer Appendix A)
3. Send survey to a certain age groups like parents who could potentially send out our survey to their coworkers (helpful if their work area focuses more on traveling a lot)
4. We focused on one particular question, “have you spent more than an hour waiting for a rental car?”. We created a survey for this question on a social media platform, Snapchat, to get a large number of responses at a lesser time.
5. Analyzed the results.

 

The conclusions from our surveys were as follows:

• 35 users out of 38 users indicated that they often prefer to rent cars.
• 11 users out of 38 users found it convenient to rent cars.
• 14 users out of 38 users found it efficient to rent cars.
• 5 users out of 38 users find it very efficient to rent cars at the airport.
• 3 users out of 38 users find it difficult to rent cars from the airport.
• 8 users out of 38 users identify wait time to be less than 15 minutes.
• 21 users out of 38 users feel they have to wait up to 40 minutes.
• 5 users out of 38 users discerned their wait time within 1 hour.
• 3 users out of 38 users noticed the wait time to be more than 1.5 hours.
• 3% of users are willing to spend extra money for extra services.
• 7% of users are not willing to spend extra money for services.

 

From leading one-on-one surveys, we further found that the rental cars at the airport will be a great startup since most of the consumers are willing to spend money into this service. Therefore our company, Bolt, would like to provide this service with given reasonable prices and also allow us to conquer their problems. All users we’ve  conducted on the survey expressed the need for a better solution kept with  high quality. Overall our primary research validated our initial hypothesis.

 

Secondary Research:

We had the option to check our essential discoveries by utilizing secondary research data and

insights. We used different sources from the Internet platform, we viewed as the accompanying:

 

• (Avis Pickup model): Follow the signs to the Lower Level (Baggage Claim) to the free consolidated Rental Car Shuttle Bus which is located by the third curb at the airport. The digital display on the bus will read: “Rental Cars / Parking Lot F”. Each terminal has designated areas for drop-off and pick-up.
• The average wait at O’hare for a rental car is 25 minutes and 26,327,962 passengers used Chicago O’Hare Airport in 2021.
• The US car rental market size measured by revenue is $56.3 billion in 2022.
• In 2019, the last pre-pandemic year, the average rental car in the U.S. cost about $51 per day. Those figures come from a recent Bloomberg analysis.
• Halfway through 2022, and some rental firms still don’t have enough cars because of a shortage of automotive chips.
• According to Matt Clarke, Kayak’s vice president of North America marketing, waiting that late will risk leaving travelers with few or no options. Clarke also suggested expanding the search beyond the biggest rental agencies like Hertz, Avis Budget and Enterprise to include companies like Turo, a car-sharing service that allows individuals to rent out vehicles ranging from sedans to luxury sports cars, and Kyte, which delivers rental cars directly to a customer’s door.

 

Defining the Problem: 

Considering our primary and secondary research, we discovered that the key points

 

We utilize the 4 W’s system to pinpoint the issue we are settling for and afterward draft an issue explanation.

 

The 4w’s:

Who is affected ?

• Passengers traveling within a limited time.
• Passengers who can not afford taxis could rent cars which are cheaper. When you plan ahead, it seems that public transport is much cheaper.
• Passengers traveling to a place without any car service pickup.

What is the problem?

• The reality is most people miss the bus/train or get lost and end up with a taxi — that costs much more.
• Don’t carry your luggage around. Trunk will do that for you. You will save on cloak room expenses.
• Availability of taxis; there are no taxis around in the US, it is almost impossible to find a taxi in most cities at a certain time.

Where does it happen?

• Airports, rental car garaging that are on the other side of the parking lots from where passengers leave their terminals.
• Cars could be delivered at a provided location from the passengers. Delivery option is available in specific downtown locations if you rent a car for a long term.

Why does it matter?

• Save time; getting around with a car is faster than public transport. The less time spent for transportation is equal to more time for discovering.
• Considering the comfort, luxury and cost-savings that car rentals provide.
• Allows passengers to expect a stress-free onward journey. In that case, renting a car right from the airport can make the entire experience most convenient. It can save you from frustrating public transportation and costly taxi trips. At the same time, you can pick up the car and drive it off immediately after you land at the airport.
• Safety issues; public transportation. For many travelers, the most significant disadvantage of public transportation is the possibility of being attacked or robbed. In situations where travelers are unfamiliar with the customs or language of a particular place, they may be particularly vulnerable to being targeted by criminals. Tourists may wish to use rental services and enjoy complete freedom.

 

Our Problem Statement:

Travelers have a problem when renting cars from airports. Our solution should deliver a faster, hassle-free, and more efficient experience for travelers. After completing your reservation, you can request your ride to be delivered to your address. Just contact us if the rental location has the delivery option and we will handle the rest.

 

Ideating to a solution:

Initially, the group decided to focus on an area that needed improvements and caused frustrations to most people which led us to the airport. The issue was not coming up with different ideas, but finding ideas that hadn’t already been put into testing. The summer of 2022 was the resurgence of global air travel due to the intensity and severity of the COVID-19 pandemic. There were record numbers of passengers inside airports across the world resulting in increased wait times for both TSA, bag checks, rental cars, baggage claim, and general airport services. We thought of trying to find a way to help make the TSA process easier but, other companies such as CLEAR and TSA Precheck have already become well established in the area. Most other issues inside the airport stem from problems inside the airlines and attempting to either alleviate those or create a new airline was not in the interest of the group.

This led us to the idea of rental cars, an industry that has not had huge changes as the world has moved into its modern travel era. This led us to thinking about some of our negative rental car experiences and also a general decrease in the satisfaction rate of all rental car services globally. Having to trek across the entire airport parking lot to reach the rental car garage and likely stand in line, even if you’ve previously paid and filled out everything, likely there’s still waiting. This led us to the idea of changing this experience where the rental car company works for you, not the other way around.

 

Test:

To test our prototype solution, we will use the segmenting principle of marketing to identify specific groups of people who have shared needs, characteristics and experiences. More specifically we will break down the potential market for our product into the different users who could benefit from renting cars at the airport.

 

Step One: Small Batch

The car rental business has a very expensive barrier to entry. We have to have hundreds of cars on end, a large valet staff, and a very easy to use app. After purchasing all these things, we will likely need to revise them. The type of cars people like the most will affect which ones we purchase. We can get an idea of the demand on certain cars, but it is not wise to go all in. Our plan to minimize costs up front would be to create the app first. This will allow us to only spend around twenty-thousand up front. We would then partner with a smaller rental car company to test our idea. Using their cars and our app, we will be able to test the demand and price elasticity.

 

Step Two: Sample Markets

Our first sample market would be O’hare. This is because it is one of the largest airports in the country and from there we can collect a substantial amount of data. Because in our test phase we are partnering with a smaller rental company, when people go to rent a car from them our service will be mentioned. Initially it would be slow, but the users would start to compound giving us data. Our second sample market could potentially be Midway. This would give us data from a smaller airport giving us an advantage if we ever wanted to expand beyond O’hare in the future.

 

Step Three: Analyze Data Received

In order to gather data other than just users and revenue, we will include a brief optional survey when people return their cars. This could be done in multiple ways. For the app, we can include a short 1-5 satisfaction survey and an optional writing section. This would cover the data for the app which we could further analyze and improve. When people return the car they will have to press drop off on the app and will be prompted to complete a short satisfaction survey. Using these two app surveys we get an idea of how the order process is received, as well as the full experience after.

 

Step Four: Iterate 

Our main goal is to create an experience like no other rental car company can provide. Part of this will be revising our process and app according to our feedback. Positive feedback is great, but negative feedback is what will make our company great. Feedback from the customer will be addressed and then implemented accordingly.

 

How Will The Solution Make Money:

Our Solution, Bolt, will make direct profits from users. Like most companies in the rental car industry,  Bolt will charge a flat fee per day. The price of the car will depend on the size of the vehicle. Additionally, there will be a valet fee that will be included in the total cost for the consumer.

 

Small Car: $30.00 per day

Mid-sized Car: $40.00 per day

Large Car: $50.00 per day

Luxury Car: $60.00

*Each car rental will also include a $15.00 valet fee*

 

Since we are providing lower than average prices and our goal of efficiency, we envision our users to continue to use our service as well as refer others to use it as well. Our employees/drivers will be trained using the ServQual model to ensure that our consumers have a greater customer experience with us rather than our competitors. Reliability, Responsiveness, Assurance, Empathy, and Tangibles will be a key source in enhancing our opportunity for long term success.

Marketing:

Product: Bolt, the airport valet car rental company

Price: Mentioned in the “How the Solution Make Money” section

Placement: We will place our product on youtube ads, billboards on busy highways, and in office buildings. Youtube ads are common among the top rental car companies, so implementing it would be good to get baseline ratios and conversion rates. Our main target audience is people who travel for work. We will find the most trafficked routes to big business offices and place billboards accordingly.

Promotion: Our promotion would be a mix of event, testimonial, and pull marketing. Using a mix of these will maximize growth in the early stages all the way through the late ones. Event marketing would include events like business conferences. Testimonials would come from big company leaders in the later stages of the company. Pull marketing would be the overall strategy. All the promotions would include some type of deal/selling points.

Prototyping Our Solution:

For prototyping our solution we would develop our app and website where the cars would be rented through. Some features that this app would include would be to enter your flight information to find cars that are available for you to rent. View our entire inventory to find the right car for you and know that your specific car is in our inventory. Set a specific date and time for you to be picked up. Input what gate you will need to be picked up from as well as which gate you will be returning the car at. View all fees and know exactly what you are being charged for before you complete your purchase.

 

 

 

 

Prototyping:

We created a wireframe of what our app and website would look like. Our goal is to make renting a car from start to finish as easy as possible. The best way to start is by making an intuitive process to order the car. Our process for this design was to have the least steps possible, while still making sure every customer’s questions were answered.

 

 

 

 

 

 

1. Sign in/login page

• Users are brought to the sign up or login page where they are met with our logo and slogan.
• Down below is the business model and how it works. The customer first books the car before the flight, flies, and then picks up the car right outside the terminal from a worker.

2. Flight Information

• Users are directed to a flight information page.
• They will select their choice of airline along with their flight number or code so we can track when the customer will be arriving.
• Bag number will be asked to get the timing down to perfection of when the customer will get out of the airport.

 

 

 

3. Car selection

• The user will first select the time frame they want to rent the car for.
• A list of cars available show up and how many of each are left (filters will also be added ie: brand of car, how many people can it fit/trunk space, price).
• Once a car is selected you are prompted to move on by the “book” button that appears down below.

 

4. Order Details

• The order details include information like the price, car,  timeframe, and any other fees.
• Customer puts in a credit card or various payment methods that can be saved for a quicker transaction the next time around.
• Customer is prompted to put in their phone number which alerts them exactly when the car is there.
• The customer is then told to pick up the car at the terminal.

Initial Funding:

To Fund our test on our market we will be crowdfunding through different channels such as Indiegogo and SeedInvest Technology. We will use this initial round of funding to create and polish the applications both online and on mobile devices. After initial critical review of the company we will be able to approach venture capital investment firms with our future plan and reviews. After bigger investment we will start developing a fleet of cars of our own for our initial launch.

 

Long-Term Business Plan:

After our start with crowdfunding, once we are able to prove that the demand is there for our services we can move into funding through venture capital. Once we have enough capital we would start off at O’Hare airport in Chicago. We would attempt to grow our business and car inventory at O’Hare as our customer base grows stronger. Once we have established ourselves as a player in the market at O’Hare and start making profits we would look into expanding into Midway. As we become a household name in Chicago we can then focus on moving our business into other major airports around the country. If we are able to dominate the market in the U.S. then we would then look to expand into Central American countries and Canada. With continued growth we would look to potentially expand into European and Asian markets. Our goals are to revolutionize the car rental industry and take control of this market. The companies that are currently dominating this industry are still using outdated strategies and are not being challenged by new companies in this market.

 

Conclusion:

Implementing the information we learned in BUS 101, we developed a solution to correct inefficiencies in airport car rentals. We believe our solution is economical and feasible and will immediately make this process more efficient for travelers. Additionally, we believe that because of the time and hassle consumers will save with our proposed service it will gain great traction and will have great opportunity to expand nation and eventually world wide.

 

The Lean Canvas Model

PROBLEM The process of renting a car takes too long.	SOLUTION Bolt Rental Car Service: Valet experience with cars at the airport.	UNIQUE VALUE PROPOSITION  Eliminates the commute from terminal to rental car site. Competent employees will create a better customer experience		UNFAIR ADVANTAGE  People value their time over most other things. If we speed up the rental process, people will have an incentive to rent through us.	CUSTOMER SEGMENTS  Target customers are all airport travelers, specifically business travelers.
Existing Alternatives Enterprise offers a service to pick up customers exclusively from non-airport locations.	KEY METRICS (KPIs) –  # of users – time between order and dropoff	High Level Concept   -limo service meets hurts -valet service meets rental cars		CHANNELS Reach business travelers through ads on social media and billboards on the highway and in office buildings.	Early Adopters Business travelers who are in a time crunch or simply don’t feel like waiting in line at a rental location.
COST STRUCTURE   Fixed costs:  Programmers Cars Parking Lots Office Space Insurance Gas   Variable costs:  Car Repairs Marketing			REVENUE STREAM(S)   ·     Individual users  Cost of Rental Valet Fee Tips

 

Appendix A

Survey as given on Google Forms

 

 

 

 

References

Milenkovic, D. (2022, April 14). 25+ Car Rental Industry Statistics That Will Surprise You. Carsurance. https://carsurance.net/insights/car-rental-industry-statistics/