Ratti Report celebrates its 6,000th post with: An umbrella-sharing startup
Steve’s breakdown: Yeah that’s right, an umbrella-sharing startup that lost nearly 300,000 umbrellas in a matter of weeks. Like they thought people were going to leave umbrellas at an umbrella station while it’s still raining. (gasp!)
So where’s the new business lead here? Everywhere! There are people out there with a stupid amount of money with really stupid ideas and you need to find them, become their friends and take their money. In the name of capitalism, take their money.
(Oh and yeah, we have posted 6000 leads since incorporating. Not bad for one writer 😛 )
JUST SAYIN’, WORLDWIDE: With bike-sharing companies like Mobike becoming incredibly successful in Chinese cities, a few startups have decided to mimic the concept with shareable umbrellas. The only problem: most of the umbrellas have gone missing.
Only a few weeks after starting up operations in 11 cities across China, Sharing E Umbrella announced that it had lost almost all of its 300,000 umbrellas.
The Shenzhen-based company was launched earlier this year with a 10 million yuan investment. The concept was similar to those that bike-sharing startups have used to (mostly) great success. Customers use an app on their smartphone to pay a 19 yuan deposit fee for an umbrella, which costs just 50 jiao for every half hour of use.
According to the South China Morning Post, company CEO Zhao Shuping said that the idea came to him after watching bike-sharing schemes take off across China, making him realize that “everything on the street can now be shared.”
A host of different companies have been able to take advantage of China’s sharing economy craze. Foreign enterprises like Uber and Airbnb both managed to make inroads in the Middle Kingdom, but their Chinese rivals (Didi Chuxing and Tujia, respectively) have fared even better.
With the help of mobile wallets and barcode scanners, Chinese residents can now rent anything from bikes to basketballs to cell phone chargers. Naturally, this has attracted many tech startups to experiment in Chinese urban centers; however, some ideas have turned out better than others.
While Sharing E Umbrella gave out their umbrellas at train and bus stops, they soon realized that getting users to return the umbrellas would be a problem. “Umbrellas are different from bicycles,” Zhao said. “Bikes can be parked anywhere, but with an umbrella you need railings or a fence to hang it on.”
The SCMP reports that Zhao concluded that the safest place for an umbrella would be at the customer’s home, where it would be safe and undamaged. But, apparently, customers have skipped the final step of then returning the umbrellas, simply keeping them for themselves.
Each lost umbrella costs the company 60 yuan to replace, but Zhao has not yet given up hope. He reportedly plans to release another 30 million umbrellas by the end of the year. If at first you don’t succeed…
Sixth Tone points out that Sharing E Umbrella, along with its 14 other competitors in the umbrella-sharing industry, might face even more problems as the weeks turn into months.
For a business that depends on rain, finding a steady profit might prove challenging. China receives the most rain in the summertime, leaving little interest in the business during drier months. What’s worse, in regions with frequent rain, people are more likely to just buy their own umbrellas.
Umbrella renting schemes aren’t the only sharing businesses suffering from problems with theft in China. Last month, shared-bike startup Wukong Bicycles went out of business in Chongqing after nearly all of its bikes were stolen following just six months of operation. Shortly afterward, Beijing-based 3Vbike followed suit after their stock of bikes was reduced to just a few dozen.
So even though it would be nice to grab an umbrella when walking home in a downpour, one thing seems clear: if sharing economy companies don’t change the way that they keep track of their products, they won’t stick around long — whether it rains or not.