My coworker and I planned to go on a bike ride at Stanley Park (In Vancouver) after work today. We were both excited about the change of pace from our usual routine, but we weren’t sure how it would turn out because neither of our friends here had ever rented bikes before. I suggested YesCycle as I already had a good experience with them.
The store looked like any typical bike rental shop with rows and rows of bicycles – except all their bikes were lined up neatly in little groups! That part made sense, but we walked around looking for Fabio, the store manager. People who seemed to know what they were doing were helping customers, but Fabio was nowhere to be found.
Then someone came up behind me and said: “Hi! Welcome to Yes Cycle Adventures, where rentals are done digitally! Just have your ID ready so you can complete the rental process in under 30 seconds!”. This was Fabio.
Easy as pie
I was very confused because I had come to rent a bike for the day, not do anything “digital.” But then my coworker piped up and said that she needed to sign something agreeing to terms before we could leave with the bikes, so I decided it would be a good idea to understand what was happening. As I got closer, she showed me her phone, and there it was: On YesCycle’s online order form, there was this rental agreement consisting of two short sentences, with a picture of the bicycle she was renting attached to it!
I thought for sure this would take at least 10 minutes to do – but Fabio walked up from behind me and said, “is your friend ready?” I asked her if there was anything she had to do on her end, but apparently, everything was done with the app. She just needed to show it to Fabio, who scanned the QR code on his phone. It took all of two minutes!
But how they improve their service
I still couldn’t wrap my head around how this was possible. So, I asked Fabio if we could chat briefly after our bike ride. “Of course, your satisfaction is our priority! We just wanted to streamline everything so you can get in and out of here as quickly as possible”. I took his word for it, and we headed out to the bikes.
When we were back, I asked Fabio about their success story and how they could improve their customer service.
Since using Rentrax, our in-store customers’ wait time decreased by 40%, and our revenue increased by 18%
Fabio – YesCycle Owner
With the objective to reduce in-store customers’ wait time and eliminate pen and paper, Yes-Cycle decided to start using Rentrax. Yes-Cycle’s Denman location underwent a complete digital transformation overhauling the shop operation to support online and kiosk reservations. In addition to improving customers’ experience, by reducing the average wait time to less than 3 minutes, the shop saw an 18% increase in profit, mostly due to savings on employee costs. It did not take long for Fabio, Yes Cycle’s founder, to implement Rentrax in their second location.
To get digitalized or fade away
This transformation was not an easy decision for them. Nobody in the shop had any experience working with computers before. But the world was changing so fast. You could see more people using cell phones. More were asking to see if the store has an app. Other stores already started to move to the digital era. “I felt this is the time,” Fabio said. “We need to move to the digital environment, and we need to be more exposed and ensure we keep up with these changes.”
So they decided to try it. “It was a little bit intimidating at first,” he said, but after they gave it a chance, everyone loved it. They saw improvements immediately; customers were happy, and sales were up.
“I think this is the future of the bike rental business, and we should move forward and be more modern and advanced with that,” Fabio said. “We just need to take a chance.”
Objectives:
A) Reduce customers’ wait time
The main goal was to reduce the average waiting time for our customers from 8 minutes to less than three minutes. To accomplish this, we first had to understand the nature of the lineups and how we could change our customer’s experience. We analyzed it as a system consisting of four parts: (1) customers who arrive to rent; (2) employees handling those customers; (3) queues where they wait; and (4) allocating staff dynamically to meet demand.
We then looked at the many opportunities to reduce wait time by looking outside our four walls. We analyzed what was happening with other customers who had already begun their experience. We identified three distinct behaviour patterns for them: 1) hanging around, 2) Talking to others, or 3) leaving. If we could change the expected time for those in this pattern to be less than 3 minutes, we could reduce the minimum wait time for all.
To resolve the issue of customers arriving during periods of high demand, we took a closer look at how our staff assign the bikes to customers. We discovered that in the peak time, there were bikes that were already assigned to online customers but rented again to walk-ins.
Once we started to observe the processes, we explored how other rental shops schedule their rentals. It was clear that the best solution would be to implement a more modern system.
B) Decrease employees’ cost
Our average ticket/transaction size is $18, and our average employee cost per transaction is $8.50. We aim to reduce the average cost per employee per transaction from $8.50 to $6.
By monitoring the tasks done by each of our employees over a period of 3 weeks, we determined that one person typically does nine transactions in an hour during peak time.
However, if we add another person into the equation, that number jumps to 16 transactions per hour. So, adding more people will not solve our problem.
Strategy:
Utilizing Rentrax for a complete digital transformation and overhauling the shop operation to support online reservations by:
1) Using a mobile app, customers can fill out the forms and place the order before entering the Shop or seeing an employee.
2) Using self-service kiosks to complete the payment process instead of being limited to one cashier or manager. Customers can place orders and pay using a credit card. There is no need for a cashier or a manager to carry out those tasks now. It saves customers from waiting in the lineup to make payments as they complete their rent order comfortably even before they see an employee.
3) Using the mobile application to scan the barcodes of the bikes to complete the order process. The mobile app makes it easy to attach the bike to their order by scanning its barcode. Using this new process, YesCycle has reduced their average processing time of one order to less than 7 minutes.
4) Using an interactive touchscreen display kiosk for a better user experience with fun and efficient content.
5) Eliminate manual imprint of credit card slips: Rentrax eliminated the need for cyclists to wait in line for manual credit card imprints when renting bikes. Riders can now hop on a bike more quickly. But before technology was introduced, each customer had to queue in line for a lengthy process involving filling out a paper credit card form.
6) Eliminate the overbooking problem when renting bikes
Sometimes, you have customers who rent the bike over the phone, but when they arrive, there is no bike available. This happens when you rent out the bike to walk-in customers without regard for the number of available bikes. By using software, they can now have better control over inventory. By looking at the screen, they know what is available and what is not.
7) New method of selecting bikes to rent: Utilizing the mobile application, customers can access information about the bike’s features and checkout in advance. Cycling enthusiasts can select specific brands, styles, sizes, and colours after searching for their favourite bike model through the online order form. Now, while customers are considering their bikes, staff can use the mobile application to scan and reserve their bikes. Customers can complete their payment process by scanning the barcodes of the bicycles they want to rent and then attaching them to their order using the mobile app.
8) Reservation Confirmation: Customers will receive a text message with their reservation details once they select bikes and check out.
9) YesCycle has also implemented a new operation for the Shop: With the increasing number of visitors to YesCycle, we implemented a simple technique to improve customer service by training employees on how to greet and welcome customers more proactively and effectively. We also encourage all employees to communicate with customers and suggest using our Kiosk and the online order form when we see them hesitating about reserving a bike in advance through our website.
11) Tracking data: We can also track our customers’ behaviour and compare them across different times of the year to better understand their preferences.
Results:
A) Reduced customers’ wait time by 40%
Our new technology reduced our average processing time of one order from more than 8 minutes to less than 3 minutes. We further reduced wait times by creating shorter lines for customers who reserved their bicycles beforehand. We also created a shorter line for customers renting bikes through our mobile application.
B) Increased profit by 18% in the first month alone.
We have created our own Rentrax Kiosk to reduce staff workload. With these changes, we can now increase productivity by 30%, which has resulted in an increased profit of 18% for the first month since launch.
Since we integrated our new technology, YesCycle has increased its annual revenue by 15% and is growing yearly. However, it has been worth it as we have improved customer service with a better user experience.
C) Eliminated pen & paper, including credit card slips
We also eliminated the need for manual credit card imprints, which freed up time and resources for customer service. We are also proud to be playing our part in reducing our carbon footprint.
D) Reduced overbooking
With improved inventory management, It has become easier to track our inventory levels thanks to Rentrax features that made it easier for us to keep track of our bikes’ status. This has helped us reduce overbooking and optimize our inventory to save money.
E) Enjoy doing business with YesCycle
With our new technology, we have fewer frustrated customers. We can now offer a better experience for all of our visitors ranging from the local residents who commute only a few days a week to those who are visiting the town. Our new process also enables us to provide better customer service by freeing us from manual work and allowing us to focus our efforts on training our employees on how they can best help customers use our systems.
F) More satisfied customers who want to return for more bicycle rentals.
Our new process generates a better customer experience through the Kiosk and our mobile application. This has resulted in more satisfied customers. We have also received emails saying they would like to rent again at YesCycle, which is also positive news for us!
G) Decrease in employee cost by 20%
When Rentrax was first implemented at the Denman location, there were 15 employees on a peak day (our business is seasonal). Still, now we handle more customers with only 12 employees on a similar day. This saves us up to $50,000 annually because we do not need as many people to work in our bike shop. We have also seen an improvement in the employees’ experience since they no longer need to be at the front desk.
H) Incentive Program:
Since we have more vision over each employee’s activity (Using Rentrax), we plan to implement a system that rewards them for good customer service and early completion of tasks. Thanks to Rentrax, we can track each employee’s transaction. We want to have a better experience for our staff, so we introduced some small changes that will truly matter to them. We hope this will influence them to work better and improve our business.
Conclusion:
We have successfully adopted this method, resulting in a more efficient reservation process, including a shorter wait time for customers and fewer overbooked bikes. We have also created a better customer experience by eliminating paper, manual credit card imprints, and other unnecessary processes. In addition to these benefits, we have reduced our inventory costs and increased revenue with improved automation systems. As a result of this initiative, YesCycle has experienced an increase in profit by 18% and is growing at a rate of 50-60%.
The process of improving the bike rental service lowered costs, increased sales, and gave an overall better experience for customers and employees. The entire process took a few days to complete, but it was well worth it in the end. Now that Fabio has modernized his bike rental service, he hopes his new idea will inspire other bike shops to do the same.
The process of improving the bike rental service lowered costs, increased sales, and gave an overall better experience for customers and employees. The entire process took a few days to complete, but it was well worth it in the end. Now that Fabio has modernized his bike rental service, he hopes that his new idea will inspire other bike shops to do the same.