Bolt and InDrive are changing he landscape of Ride hailing in Zimbabwe

A few years ago I got to lead the work that would introduce ride-hailing at a large scale into Zimbabwe. While other companies like Hwindi and GTaxi were already providing ride-hailing services, it was at a generally small scale. In 2017, I took charge of a project that would become VAYA Africa and at some point, the largest ride-hailing platform in Zimbabwe. Now 7 years later, ride-hailing culture has flourished a bit more and we have seen interesting developments. Several multinational players have entered Zimbabwe. In this article, I want to talk about the impact I have seen from the entrance of Bolt and InDrive on the market.

In most cases, people believe that on-demand services have low barriers to entry. They believe it’s as simple as having an app and jumping into the market. Unfortunately, that’s not always the case; let me speak to ride-hailing in the least. A lot goes into the operational preparation: recruiting drivers and making sure that the driver spread is such that these drivers are pretty much anywhere that they may be needed. After recruiting drivers there’s the work of making sure they are adequately trained on the use of the app, on your business culture, and customer service expectations; all very important things. Another important thing to note is that these expenses can be incurred by just a company if there are multiple competitors; the rest can just poach trained drivers. For the Zimbabwe market, this company was VAYA.

When VAYA Africa was launched to the public in October 2018 it had a clear objective. The plan was to make VAYA Africa a platform that was used throughout Zimbabwe. This meant a lot of work had to go into educating the market as to what VAYA was, how to use it, the benefits, and the savings. The education work was on both sides: customers and drivers. Except for those who used the existing platforms and/or had traveled to countries where the ride-hailing culture was more mature, very few people knew what the product was supposed to do. Luckily, VAYA Africa’s parent company is no stranger to culture-changing products and services as well as the work needed to achieve national customer proliferation.

I often argued with friends that Bolt and Uber would never come to Zimbabwe despite being available just south of us in South Africa. My argument was that our market was simply too small for them to undergo the work required to register in another country and then deal with all the regulatory issues before starting a business. I’ll have to confirm these figures but I believe Harare (the metropolitan capital) has a population of about 1.6 million…that’s roughly the size of Soweto alone (1.8 million people). I also argued that ride-hailing was growing slower because of a lower inherent need: in South Africa, I use it because I’m scared for my life. In Harare its more about convenience as there are so many registered and unregistered Taxis available and I hardly ever feel like my life is in danger. It’s safe to say that I was wrong. Bolt came to Zimbabwe! They were not the only ones.

A few years ago Taxi F and inDrive started making waves on the Zimbabwean market, mostly with online ads. It was exciting to see the market grow. This surely meant pricing would get better for the average Zimbabwean rider. While it would take another year or so for the InDrive model to sink to the public, both businesses benefitted largely from a market that had a lot of trained drivers who were unhappy where they were. Not that this mattered: it is standard on-demand marketplace behaviour to find one person offering the same service on multiple platforms. When Bolt came, I was excited. I had been a fan of the service from its Taxify days and often preferred it over Uber on my visits to South Africa.

What it Means to Have These Services in Zimbabwe

The introduction, increasing activities, and visibility of Bolt and InDrive have offered a huge breath of fresh air on the market. For one, my experience has been that if I’m in hard-to-service areas, one of them will definitely have a car in the area. This means less worry about the actual spread of available drivers for taxi services.

AFFORDABILITY. The cost of taxis and ride-hailing has generally been on the decline as the three most active platforms compete for the Harare market. InDrive has proven particularly useful with its ‘negotiation’ feature that allows riders to negotiate a price down before the ride is taken. This means the potential for even more savings for customers and maybe more customers for the drivers.

ZERO COMMISIONS. I’ve always generally had an interest in ride-hailing so I tend to ask them what makes them happy with an app. The biggest thing among drivers right now has been the fact that both Bolt and InDrive are currently not taking commissions. What?! That’s insane, right? It’s also a great way to penetrate a market because you can offer your value with less pressure. I’ve always believed ride-hailing to be about more than just cheaper rides. I guess this is the time that they are showing this to the Zimbabwean market. I also know the first app to start taking commissions will lose its drivers to the competing app. A lovely game of Chicken has started now. No one knows for sure how long it will be like this but drivers will try to make the best of it and take as many rides as possible while they make all of the money.

TRUSTED BRANDS. While VAYA Africa came from a trusted local brand, the current competition offers more than that. Bolt is a name that arguably features in the global top 5 of ride-hailing platforms against services like Uber, Lyft, Grab, and Didi. InDrive is in over 45 countries and entered a few countries around Zimbabwe before coming in. Multinational apps are great for traveling tourists as they get access to names and services that they experience in their home countries.

What Risks Are These Platforms Taking?

Entering a new market always comes with risks. Through conversations I have tried to see what level of investment these companies have made to maybe try and ascertain how long we will have them.

REGISTRATION. For both apps, registration is purely online which means it’s very quick. It likely means they don’t know the state of the cars we are riding. Despite that, they are able to add drivers a lot faster which is likely to ensure improved driver spread.

LOCAL OFFICES. To my knowledge, none of these services have offices here. That means their administrative costs (for Zimbabwe specifically) are very low and as a result, the savings can be translated into discounts for Zimbabwe’s riders. That’s a great show of how the global community is growing and barriers to entry on a multinational level are falling. I don’t know what it means for customer disputes in worst-case scenarios though: would we be able to get full attention and assistance if something went wrong?

REGULATIONS. Regulation in Zimbabwe when it comes to ride-hailing is still pretty ambiguous. Unfortunately, the ambiguity lies more on the side of potentially making it very costly for those involved (drivers and the companies). As there is no regulation for ride-hailing itself, it means the drivers would fall into passenger transportation class vehicles (aka registered taxis) and those licenses are expensive, the parking regulations are archaic and the legal interaction between an organization and independent contractors is difficult as withholding tax currently sits on 30%. I’m sure that by being based outside Zimbabwe, these organizations will be able to operate untroubled for a while.

Conclusion

Ultimately, the Zimbabwean ride-hailing space is currently in a good place for both riders and drivers. No one side is benefiting more from Bolt and Indrive being in the market. I’m curious to know if there are any qualitative reasons why riders prefer one over the other locally or if it’s all homogenous. Homogenous would not be good for the companies as that would mean customers will always just see-saw between the services based on who is cheaper. If the apps are building communities and growing the value they offer to create loyal customers then maybe we will see something interesting. Next is UBER!