Friday, March 21, 2014

What this company needs...

Probably not a good, stiff minimum wage hike (aka, the Sawant Solution), but a different business plan;
Leaders of Citi Bike are moving quickly to raise tens of millions of dollars to rescue the popular bike-share program as it loses money, according to people familiar with the matter.
Citi Bike's bright blue bicycles have become a seemingly indispensable part of some city neighborhoods, but its managers don't believe it can survive if it doesn't become more appealing to tourists and expand to new neighborhoods, the people familiar with the matter said.
The program's leaders have approached officials in Mayor Bill de Blasio's administration about raising Citi Bike's rates, the people said.
We, of course, are all in favor of businesses being able to set their own prices--and see if, having built it, the customers will come--but it seems unlikely that higher prices in the face of already weak demand will increase revenues.

One issue is that Citi Bike has proved more popular than expected with annual users who generate comparatively little revenue. Some 99,000 people pay $95 a year plus tax to be able to use the bikes for 45 minutes at a time.
The potential for far greater revenue, however, is with short-term users. Many of those were expected to be tourists, and they haven't used the bikes nearly as much as officials had anticipated, people familiar with the matter said.
Tourists are there to have reasonable prices....

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