Step 7: Financial risk and scenario planning

When building your business case, it is useful to think ahead about potential risks and scenarios which may have a potential cost attached. Here are some examples:

Accounting for seasonality – you may experience less bike use during colder months in Scotland so working through the impact of this on your scheme is advisable, especially if you are making income from hire costs. There may also be less to do, which if you have paid staff running the scheme, should also be considered. A solution to this may be having higher prices during summer months – or diversifying the activities you do to keep people engaged across the winter months.
Battery swopping – you will need spare batteries depending on your choice of e-bike. Talk to your bike provider/manufacturer about specific costs and what is required.
Wear and tear – anticipate replacing parts of your bikes and get costs from suppliers or social enterprise bike projects who provide equipment at low cost.
Mitigate damage or theft – have plans in place so you don’t need to buy replacement bikes or accessories. Your insurance policy should cover this provided they are convinced you have the proper processes in place such as secure storage facilities.
Unexpected tasks – e.g., what to do if a rider experiences a puncture far away from your bike hub and needs collecting?
Volunteer or staff issues – have back up plans in case your volunteers or staff are unexpectedly unavailable and therefore cannot lend out the bikes or fulfil critical functions.
Risk mitigation – there are risks to consider when adopting more technical ways of running a scheme. For example, what will happen if an app you use for unlocking bikes, booking and billing, has a technical fault? Make sure you think these through when choosing tech solutions.
Customer satisfaction – making sure customers are satisfied and have a good experience of using your bikes will ensure reliable ridership, positive feedback, and valuable word of mouth about your scheme.
Competition – engage with your local bike shop to ensure they are behind the project as opposed to seeing you as competition (especially if you have competitive hire and loan prices).