Should I move forward with this idea....
Discussion
Looking for some feedback from the collective brain power / experience of the pistonhead community. Long story short am being synergised (made redundant) at the end of the month. Not unexpected or a problem and will enable a good few months of not having to work due to the terms of the exit. Have a real desire to do something different and with cars and am lucky that I don't need to get back on the corporate grind stone quickly.
So the idea:
Car club in the mould of P1 but for mortals, with cars that are fun to drive / interesting but you wouldn't need a race track / autobahn to experience most of their abilities. Aware of the Classic Car Club in London, but I would be based in essex (close to Chelmsford and Colchester) and focus on more modern stuff
Membership:
- looking at getting to 60 or so members, with 10 cars available to them
- would look to avoid hugely complicated points systems requiring a degree in astro physics to work out that your points get you one drive on a summer weekend and thats about it (or a few drives in the middle of winter in the 'worst' car)
- thinking along the lines of membership getting you 6 weekends (friday pm pick up, monday first thing drop off) and 6 'weekday' (pick up monday pm, drop off thursday last thing). With a portion having to be used outside of the 'high season'. Would also have a few lucky dips, where you call up and see whats available the next day, for that day and take whats available (say 6 of this single day uses)
- would open the booking for the month on the first day or the month, on a first come, first served basis (via a web portal / app)
- thinking of having one, max two 'levels' of cars again to keep things simple / easy to understand
Cars
Top Level - Atom, Caterham 420, Porsche Spyder / Cayman R / 997 Gen 2, Noble, SL55 AMG, Lotus Exige / Evora, Jag F Type, BMW M6, Audit R8 / TT RS, Bentley Continental, Aston V8, Afla 4C; maybe something like a XJR for when members need something with a little space
'Second' Level - Boxster, Elise, Caterham (lower spec than 420), Abarth spider, S2000, Cayman, M3, GT86, TVR, Chevy SSR (very random i know!) etc. Again a suitable 4 door that still has some poke
Cost
Have done very rough calcs at this stage and have a couple of options:
Option 1) - if the club has 10 'top' level cars, am thinking the ball park annual membership would be £5-6k. Would have a small joining fee to cover admin / set up etc, and thinking that the first 100 miles per day would be included and thereafter a small per pence charge.
Option 2) - if the club has 10 'second' level cars, the annual membership comes in £3-4k (not exactly half due to some of the fixed cost of premises etc), again some thought around mileage
Option 3) - have 2 levels in the club (5 cars from each), membership costs somewhere in the middle of the above two options
Other Thoughts
- would want to run the club as a club, in other words create a bit of community with a 'club house' where members can drop in etc and events organised for members (incremental fees to cover incremental costs)
- thought about adding one or two 'other' vehicles to the club that members might find useful to have access to - e.g. a campervan
- thinking about offering other services to members (leave your car with us and we can sort out MOT, service, Valet, etc) Would hope to include some of these for 'free' others at a reasonable cost
So all (constructive) feedback very much welcomed....
So the idea:
Car club in the mould of P1 but for mortals, with cars that are fun to drive / interesting but you wouldn't need a race track / autobahn to experience most of their abilities. Aware of the Classic Car Club in London, but I would be based in essex (close to Chelmsford and Colchester) and focus on more modern stuff
Membership:
- looking at getting to 60 or so members, with 10 cars available to them
- would look to avoid hugely complicated points systems requiring a degree in astro physics to work out that your points get you one drive on a summer weekend and thats about it (or a few drives in the middle of winter in the 'worst' car)
- thinking along the lines of membership getting you 6 weekends (friday pm pick up, monday first thing drop off) and 6 'weekday' (pick up monday pm, drop off thursday last thing). With a portion having to be used outside of the 'high season'. Would also have a few lucky dips, where you call up and see whats available the next day, for that day and take whats available (say 6 of this single day uses)
- would open the booking for the month on the first day or the month, on a first come, first served basis (via a web portal / app)
- thinking of having one, max two 'levels' of cars again to keep things simple / easy to understand
Cars
Top Level - Atom, Caterham 420, Porsche Spyder / Cayman R / 997 Gen 2, Noble, SL55 AMG, Lotus Exige / Evora, Jag F Type, BMW M6, Audit R8 / TT RS, Bentley Continental, Aston V8, Afla 4C; maybe something like a XJR for when members need something with a little space
'Second' Level - Boxster, Elise, Caterham (lower spec than 420), Abarth spider, S2000, Cayman, M3, GT86, TVR, Chevy SSR (very random i know!) etc. Again a suitable 4 door that still has some poke
Cost
Have done very rough calcs at this stage and have a couple of options:
Option 1) - if the club has 10 'top' level cars, am thinking the ball park annual membership would be £5-6k. Would have a small joining fee to cover admin / set up etc, and thinking that the first 100 miles per day would be included and thereafter a small per pence charge.
Option 2) - if the club has 10 'second' level cars, the annual membership comes in £3-4k (not exactly half due to some of the fixed cost of premises etc), again some thought around mileage
Option 3) - have 2 levels in the club (5 cars from each), membership costs somewhere in the middle of the above two options
Other Thoughts
- would want to run the club as a club, in other words create a bit of community with a 'club house' where members can drop in etc and events organised for members (incremental fees to cover incremental costs)
- thought about adding one or two 'other' vehicles to the club that members might find useful to have access to - e.g. a campervan
- thinking about offering other services to members (leave your car with us and we can sort out MOT, service, Valet, etc) Would hope to include some of these for 'free' others at a reasonable cost
So all (constructive) feedback very much welcomed....
(posting here as well as the Business forum as i would love 'local' feedback)
Looking for some feedback from the collective brain power / experience of the pistonhead community. Long story short am being synergised (made redundant) at the end of the month. Not unexpected or a problem and will enable a good few months of not having to work due to the terms of the exit. Have a real desire to do something different and with cars and am lucky that I don't need to get back on the corporate grind stone quickly.
So the idea:
Car club in the mould of P1 but for mortals, with cars that are fun to drive / interesting but you wouldn't need a race track / autobahn to experience most of their abilities. Aware of the Classic Car Club in London, but I would be based in essex (close to Chelmsford and Colchester) and focus on more modern stuff
Membership:
- looking at getting to 60 or so members, with 10 cars available to them
- would look to avoid hugely complicated points systems requiring a degree in astro physics to work out that your points get you one drive on a summer weekend and thats about it (or a few drives in the middle of winter in the 'worst' car)
- thinking along the lines of membership getting you 6 weekends (friday pm pick up, monday first thing drop off) and 6 'weekday' (pick up monday pm, drop off thursday last thing). With a portion having to be used outside of the 'high season'. Would also have a few lucky dips, where you call up and see whats available the next day, for that day and take whats available (say 6 of this single day uses)
- would open the booking for the month on the first day or the month, on a first come, first served basis (via a web portal / app)
- thinking of having one, max two 'levels' of cars again to keep things simple / easy to understand
Cars
Top Level - Atom, Caterham 420, Porsche Spyder / Cayman R / 997 Gen 2, Noble, SL55 AMG, Lotus Exige / Evora, Jag F Type, BMW M6, Audit R8 / TT RS, Bentley Continental, Aston V8, Afla 4C; maybe something like a XJR for when members need something with a little space
'Second' Level - Boxster, Elise, Caterham (lower spec than 420), Abarth spider, S2000, Cayman, M3, GT86, TVR, Chevy SSR (very random i know!) etc. Again a suitable 4 door that still has some poke
Cost
Have done very rough calcs at this stage and have a couple of options:
Option 1) - if the club has 10 'top' level cars, am thinking the ball park annual membership would be £5-6k. Would have a small joining fee to cover admin / set up etc, and thinking that the first 100 miles per day would be included and thereafter a small per pence charge.
Option 2) - if the club has 10 'second' level cars, the annual membership comes in £3-4k (not exactly half due to some of the fixed cost of premises etc), again some thought around mileage
Option 3) - have 2 levels in the club (5 cars from each), membership costs somewhere in the middle of the above two options
Other Thoughts
- would want to run the club as a club, in other words create a bit of community with a 'club house' where members can drop in etc and events organised for members (incremental fees to cover incremental costs)
- thought about adding one or two 'other' vehicles to the club that members might find useful to have access to - e.g. a campervan
- thinking about offering other services to members (leave your car with us and we can sort out MOT, service, Valet, etc) Would hope to include some of these for 'free' others at a reasonable cost
So all (constructive) feedback very much welcomed....
Looking for some feedback from the collective brain power / experience of the pistonhead community. Long story short am being synergised (made redundant) at the end of the month. Not unexpected or a problem and will enable a good few months of not having to work due to the terms of the exit. Have a real desire to do something different and with cars and am lucky that I don't need to get back on the corporate grind stone quickly.
So the idea:
Car club in the mould of P1 but for mortals, with cars that are fun to drive / interesting but you wouldn't need a race track / autobahn to experience most of their abilities. Aware of the Classic Car Club in London, but I would be based in essex (close to Chelmsford and Colchester) and focus on more modern stuff
Membership:
- looking at getting to 60 or so members, with 10 cars available to them
- would look to avoid hugely complicated points systems requiring a degree in astro physics to work out that your points get you one drive on a summer weekend and thats about it (or a few drives in the middle of winter in the 'worst' car)
- thinking along the lines of membership getting you 6 weekends (friday pm pick up, monday first thing drop off) and 6 'weekday' (pick up monday pm, drop off thursday last thing). With a portion having to be used outside of the 'high season'. Would also have a few lucky dips, where you call up and see whats available the next day, for that day and take whats available (say 6 of this single day uses)
- would open the booking for the month on the first day or the month, on a first come, first served basis (via a web portal / app)
- thinking of having one, max two 'levels' of cars again to keep things simple / easy to understand
Cars
Top Level - Atom, Caterham 420, Porsche Spyder / Cayman R / 997 Gen 2, Noble, SL55 AMG, Lotus Exige / Evora, Jag F Type, BMW M6, Audit R8 / TT RS, Bentley Continental, Aston V8, Afla 4C; maybe something like a XJR for when members need something with a little space
'Second' Level - Boxster, Elise, Caterham (lower spec than 420), Abarth spider, S2000, Cayman, M3, GT86, TVR, Chevy SSR (very random i know!) etc. Again a suitable 4 door that still has some poke
Cost
Have done very rough calcs at this stage and have a couple of options:
Option 1) - if the club has 10 'top' level cars, am thinking the ball park annual membership would be £5-6k. Would have a small joining fee to cover admin / set up etc, and thinking that the first 100 miles per day would be included and thereafter a small per pence charge.
Option 2) - if the club has 10 'second' level cars, the annual membership comes in £3-4k (not exactly half due to some of the fixed cost of premises etc), again some thought around mileage
Option 3) - have 2 levels in the club (5 cars from each), membership costs somewhere in the middle of the above two options
Other Thoughts
- would want to run the club as a club, in other words create a bit of community with a 'club house' where members can drop in etc and events organised for members (incremental fees to cover incremental costs)
- thought about adding one or two 'other' vehicles to the club that members might find useful to have access to - e.g. a campervan
- thinking about offering other services to members (leave your car with us and we can sort out MOT, service, Valet, etc) Would hope to include some of these for 'free' others at a reasonable cost
So all (constructive) feedback very much welcomed....
Its an interesting idea definitely, it all comes down to numbers though. Whether the club could survive on less than a full amount of members and what your costs would be for all of those cars, plus a clubhouse and other costs such as staffing etc. You'd probably have to look at what cars will give you the least amount of trouble, plus the cost and trouble of insuring those cars for those people which would probably mean that you'd have to set requirements for members ie. age related or clean license (possibly) etc.
You'd have to see whether there are enough high net individuals in that area that would be interested in spending that much on a membership they may not use all that much, offering monthly costs and levels of membership might help with that.
The idea of looking after the members cars is a nice touch and would certainly help maintain a business and possibly add to the community spirit, you could even offer storage for those cars as that is a growing sector in the market I believe.
Also for me personally I would love to see classic cars offered on something like that, which would of course present more problems possibly, but classic cars also offset their upkeep costs by appreciating in value (in theory!).
Interesting idea though, looking forward to seeing what people come up with!
You'd have to see whether there are enough high net individuals in that area that would be interested in spending that much on a membership they may not use all that much, offering monthly costs and levels of membership might help with that.
The idea of looking after the members cars is a nice touch and would certainly help maintain a business and possibly add to the community spirit, you could even offer storage for those cars as that is a growing sector in the market I believe.
Also for me personally I would love to see classic cars offered on something like that, which would of course present more problems possibly, but classic cars also offset their upkeep costs by appreciating in value (in theory!).
Interesting idea though, looking forward to seeing what people come up with!
Do the maths stack up? At 60 members it might I presume you would be buying them on finance you will also need storage and a mother of an insurance policy. How do the sums work at 20 or 40 members? Sounds interesting especially the servicing and MOT I like that bit leave your car for a day and take the atom to work instead.
tricky with costs - if piggybacking off a car storage facility it might work. If you start with that the labour and skills and equipment and storage all there plus a high net worth customer base in a 20-25 mile radius.
Stand alone it has high set up costs (plus wages, time and peak season stresses) and if all new cars getting high mileages the depreciation could be a killer as 60 x £6k is only £360k (10 cars in top range are far more)- and after 1 or 2 years most members would have driven most cars and you'd need to be replacing them to keep interest (build in a replacement cycle and start off with a few not so new cars to replace).
Are the cars in top range special enough to attract and keep members?, I know depreciation is much bigger on most cars mentioned (and alot of other cars from new) - but you don't pay for that in one hit or think about it much.
Stand alone it has high set up costs (plus wages, time and peak season stresses) and if all new cars getting high mileages the depreciation could be a killer as 60 x £6k is only £360k (10 cars in top range are far more)- and after 1 or 2 years most members would have driven most cars and you'd need to be replacing them to keep interest (build in a replacement cycle and start off with a few not so new cars to replace).
Are the cars in top range special enough to attract and keep members?, I know depreciation is much bigger on most cars mentioned (and alot of other cars from new) - but you don't pay for that in one hit or think about it much.
Thanks for the feedback all
Muncher, yep aware of AV, similar model but as you say they are 'higher end' (and London vs Essex) compared to my 'idea'
Rustyuk - was after more of a club / community feel than hire but like the idea of starting with a lower number of cars (maybe start with 5 and as members build let them vote on the next 5 cars...)
BoRED S2upid - the excel adds up (Im a qualified accountant ;-) ) but thats based on the assumptions being correct and people wanting to pay the fees...! At 20 members couldn't cover the 10 cars (and wife would be killing me), at 40 members getting close to b/even (no finance costs as not financing the cars)
48K - will do
jammy-git - the upfront cash requirement is pretty high (buying the cars with cash), but the exposure not too great (assuming i can sell the cars at 70/80% of purchase price if it doesn't work out)
Taaang - have factored in 175% of the usual annual maintenance cost for the cars (based on my experience having owned an atom, s2000, cayman, several 911s and an aston) - whether thats enough i guess depends on how well the members treat the cars...
Yipper - actually the EBITDA margin is pretty good (based on my assumptions so far) but the capital costs are a little scary!
Any thoughts on whether you would join ? Do the cars outlined / time you'd have with them attract you to pay the fees i've outline?
thanks again for peoples time, very much appreciated
Muncher, yep aware of AV, similar model but as you say they are 'higher end' (and London vs Essex) compared to my 'idea'
Rustyuk - was after more of a club / community feel than hire but like the idea of starting with a lower number of cars (maybe start with 5 and as members build let them vote on the next 5 cars...)
BoRED S2upid - the excel adds up (Im a qualified accountant ;-) ) but thats based on the assumptions being correct and people wanting to pay the fees...! At 20 members couldn't cover the 10 cars (and wife would be killing me), at 40 members getting close to b/even (no finance costs as not financing the cars)
48K - will do
jammy-git - the upfront cash requirement is pretty high (buying the cars with cash), but the exposure not too great (assuming i can sell the cars at 70/80% of purchase price if it doesn't work out)
Taaang - have factored in 175% of the usual annual maintenance cost for the cars (based on my experience having owned an atom, s2000, cayman, several 911s and an aston) - whether thats enough i guess depends on how well the members treat the cars...
Yipper - actually the EBITDA margin is pretty good (based on my assumptions so far) but the capital costs are a little scary!
Any thoughts on whether you would join ? Do the cars outlined / time you'd have with them attract you to pay the fees i've outline?
thanks again for peoples time, very much appreciated
Thanks for the feedback, appreciate you all taking the time
luke harding - yep all about the numbers! I'd steered away from classics as not massively mechanically minded and was looking at the 'gap' between models like the classic car club and P1 / Aventi. But if thats where the demand is, its something I will defo look at
RL17 - wasn't planning on new cars, have based my calcs on pre loved cars, all with less than 25k miles / FSH etc - hopefully the main depreciation hit has already occurred but have costed into my model having to renew the cars every 2 - 21/2 years. If i get 60 members at the rates I mentioned (and my other assumptions hold true) it all adds up - big IF though... Your point on the cars is exactly what I am nervous on. I would pay the money to access these cars but don't want to base a business on what I would want as my wife points out often, I am 'unique'. Would the cars i've outlined attract you to pay these fees?
UptheIron - yep the top tier cars are costed at £40-£45k in the model but assuming they will last two to three years and have some worth after that (not huge),the EBITDA margin is good and the free cash flow funds replacement cars in this time frame (and leaves some profit assuming i can get 60 members at the fee levels AND my other assumptions hold true..)
RL17 - yep, less depreciation on those high end cars but a) haven't got the cash to fund those type of vehicles, b) they don't interest me and c) hoping the 'gap' in the market has more people interested. Based on my experience of owning cars like the ones I have mentioned (have been lucky to own s2000, cayman, 911, aston and an atom), the cost of ownership including depreciation isn't a million miles away from the fees. Whether people will be attracted to that proposition (versus owning the car and paying the costs less directly via depreciation) is one of my key questions
Thanks again for the feedback, much appreciated. I guess my core question is - anyone in essex attracted to this proposition and could see themselves joining the club to access the cars I have mentioned at the fees i have outlined?!?
cheers
luke harding - yep all about the numbers! I'd steered away from classics as not massively mechanically minded and was looking at the 'gap' between models like the classic car club and P1 / Aventi. But if thats where the demand is, its something I will defo look at
RL17 - wasn't planning on new cars, have based my calcs on pre loved cars, all with less than 25k miles / FSH etc - hopefully the main depreciation hit has already occurred but have costed into my model having to renew the cars every 2 - 21/2 years. If i get 60 members at the rates I mentioned (and my other assumptions hold true) it all adds up - big IF though... Your point on the cars is exactly what I am nervous on. I would pay the money to access these cars but don't want to base a business on what I would want as my wife points out often, I am 'unique'. Would the cars i've outlined attract you to pay these fees?
UptheIron - yep the top tier cars are costed at £40-£45k in the model but assuming they will last two to three years and have some worth after that (not huge),the EBITDA margin is good and the free cash flow funds replacement cars in this time frame (and leaves some profit assuming i can get 60 members at the fee levels AND my other assumptions hold true..)
RL17 - yep, less depreciation on those high end cars but a) haven't got the cash to fund those type of vehicles, b) they don't interest me and c) hoping the 'gap' in the market has more people interested. Based on my experience of owning cars like the ones I have mentioned (have been lucky to own s2000, cayman, 911, aston and an atom), the cost of ownership including depreciation isn't a million miles away from the fees. Whether people will be attracted to that proposition (versus owning the car and paying the costs less directly via depreciation) is one of my key questions
Thanks again for the feedback, much appreciated. I guess my core question is - anyone in essex attracted to this proposition and could see themselves joining the club to access the cars I have mentioned at the fees i have outlined?!?
cheers
I'm wondering if the location might work against you? "Chelmsford-Colchester area" is not particularly revered for great driving roads and is not very central or immediately on a motorway network so anyone hiring for a nice weekend away in the New Forest/West Country/Cotswolds/Wales/Peak District etc is going to burn quite a bit of time and mileage allowance. Similarly with the "club atmosphere"/clubhouse idea - there needs to be a pretty compelling reason to make the schlep over to that part of the country. I'm not going to pop over from Milton Keynes after work for a lemonade and a natter for example. So if you don't have a large core of very local members then the idea of people just dropping in isn't really going to work. One idea you might consider is organised driving holidays - some time away somewhere with a bunch of people and bunch of cars, everyone gets a day in each car etc.
I think you should be looking at leases on newer cars -less capital at risk and probably more profitable.
Big market will be the Instagram generation who if they are paying 6/7k a year would want to be showing off in a 488 not a 40k 10 yr old r8.
Speak to a large franchise - hr owen, jardines, Stratstone etc and look at lease costs vs a purchase model and deals on multiple orders.
Also it’s not just sports cars people want to be seen in - g Wagen/ RR/new Defender would be popular too.
Good luck and I hope it’s a success.
Big market will be the Instagram generation who if they are paying 6/7k a year would want to be showing off in a 488 not a 40k 10 yr old r8.
Speak to a large franchise - hr owen, jardines, Stratstone etc and look at lease costs vs a purchase model and deals on multiple orders.
Also it’s not just sports cars people want to be seen in - g Wagen/ RR/new Defender would be popular too.
Good luck and I hope it’s a success.
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