Pareto Efficient

In search of pareto improvements

Branded Boda Idea

with 3 comments

Problem:  Imperfect information about boda drivers (motorcycle taxis) leads to unsafe free-for-all

  • Many bodas drive unsafely and without helmets
  • Many do not know their way around town
  • > 90% actually rent their motorcycle from a local owner and see their earnings impacted accordingly
  • The influx of many new bodas threatens to squeeze margins for the drivers
  • There are no branded fleets of boda drivers — its a wild west…

Solution: Leverage branding, scale and economic incentives to improve driver safety/earnings

Driver Safety:

  • Provide clearly branded well maintained bodas to drivers
  • Provide road/accident safety training to all drivers
  • Provide helmets and day-glow vests for driver/passenger
  • Require drivers to know the major districts, connecting roads, and typical tourist stops
  • Require drivers to speak basic English

Driver Earnings:

  • Revenues: Hopes that branding will cause drivers to stand out in the crowd, and get more fares.
  • Costs: Over time, the drivers will pay less to rent the bodas

Back of the Envelope:

  • There are over 200,000 boda drivers in Uganda
  • 1,000 drivers paying the market rent would be $1.7MM USD/year in revenues (2.8bn Ush)
  • As the bikes are paid off, the cost structure of the business will decrease, which we can pass on to the drivers in the form of lower rental costs.
  • Increased driver earnings will increase the quality of their lives.
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Written by thetyson

October 9, 2008 at 3:02 pm

3 Responses

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  1. […] I thought of a way to promote safer boda driving and enhance the earnings of bodas.  You can read about it here if you’re […]

  2. Curious what angles can be had to tie a service model into it (aka cabbies). Allows for regular lease payments for a set amount of time with a minimal buyout clause at the end of a given term. Build a service model into the lease so that bodas are in general good condition, safer, etc. Part of the monthly payment is a quarterly oil change (2 or 4 stroke?) with general condition checklist etc. The idea of packaging these into a standardized experience sounds like it would be helpful to both the drivers and their passengers…

    procopes

    October 22, 2008 at 8:59 pm

  3. Procopes –

    Smart. Agreed. The standardization of make/model would make these streamlined service packages more feasible.

    thetyson

    December 9, 2008 at 9:49 pm


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