Saturday, November 01, 2014

The Vicious Cycle of Ridesharing

Give Rides. Keep giving rides. Then, finally drivers receive a direct deposit minus commission in the following week to compensate them for trips taken between Monday-Sunday of the previous week. Welcome to the world of ridesharing!

Trip earnings are barely enough to hold drivers over another week, as waiting to get paid keeps them off the road. Ridesharing is no ordinary job, there must be money available at the beginning of every week. During slow times, drivers may fall into downtime traps where they'll spend more on gas searching for rides than what is earned completing trips.

It is not sustainable to drive unless drivers are given guaranteed earnings to maximize shifts. Too many short rides and too many cancellations disrupt the ridesharing balance. The vicious cycle of ridesharing is reinvesting earnings into maintenance, repairs and fuel. In the end, drivers lose money and lose time providing ridesharing services.

How in the world can ridesharing drivers survive on the road? Figuratively speaking, ridesharing drivers are destined to fail and fall hard. It's inevitable! Unexpected repairs and increase in gas prices will sink them fast. The most severe problem in ridesharing is when Clients/passengers/riders cancel rides and/or influence ridesharing drivers to go off course and waste time.

During the busy Halloween night, a driver reported that several clients, in a row, requested rides and canceled these trips. Many irresponsible clients waste their drivers' valuable time. Additionally, two more clients requested rides and watched this driver make two 10-minute trips to retrieve them. Unfortunately, both of these clients canceled those trips right at the moment their driver reached their pickup address.

The same result, the same problem. Both canceled back-to-back rides cost this driver valuable time during surge pricing. What happens here is that a client hooks a driver, and then waits until they approach a pickup address to cancel this ride. With a flawed cancellation policy in place, clients get a free pass on first-time cancellations. Therefore, these drivers are locked into these ride requests and lose out on those cancellations.

One major ridesharing app experienced technical difficulty. This network issue prevented their driver from ending a particular trip. As the driver waited to end this trip, his client and he discussed ridesharing services and their impact on the transportation industry.

Somehow, this client was still connected with a female UberX driver who traveled 20 miles to pick him up. She said it wasn't nice of him to leave without notifying her of this decision. However, technical difficulty caused this error and this female driver lost out on many surged trips.

Technical issues, pay delays, overhead costs, client cancellations, GPS problems, one-dimensional navigation and other setbacks influence driver income. The largest impact on ridesharing is delaying trip earnings for 8-10 days on rides given Monday-Wednesday. As a result of this, drivers lack available resources to afford gas and toll charges on the weekend(best possible days to drive).

Don't fall into this vicious cycle. Ridesharing drivers are capable of making $1200-$2000 (after commission taken out) driving 50-80 hours per week. However, these drivers can experience financial hardship from any of the problems described above, and this could reduce their earnings to $300-$600 a week before gas expenses are calculated into the equation.

There are ways to avoid this vicious cycle. Drivers must first strike a financial balance, which may prevent outside distractions from disrupting shifts. Nonetheless, drivers need gas money available early in the week. Drivers may want to apply for a new credit card to charge gas. Furthermore, drivers must work high demand hours to reduce downtime. Lastly, choose popular areas and bust times where ride requests are at a constant.

Learn to balance ridesharing. Avoid falling into a financial hole. It is easy to lose money ridesharing, which performing these ride services can lead to credit issues and serious car problems. Good luck ridesharing!