How would you assess the overall validity of the Zipcar business idea (How you like or dislike

it?)? In the United we have discovered that more than 20 millions citizens uses the public transport to get to work. In many of this cases the usage of public transportation does not derives from the impossibility of purchasing a car, rather than the fact that for their way of living and transportation needs does not justify the investment on a car. In almost all of the situations, although the clients would not need to get a car to get to work, the true is that they need one for extra activities in their daily life; just like errands, going to appointments, visit friends or get out of the city. Much of the times this needs could be satisfied by the usage of taxis or renting a car. In the first case, some times the cab services possible could not fulfill their specific needs and the problem with the rental services is that the bothering process a lot of times dissuades people from using it. Here is where the idea takes form and the niche market is created. The client for Zipcar should be an adult older than 21, with a valid driving license, no major traffic violations and college-educated individuals. A city that met al these criteria was Boston, and moreover the expensive off-street parking and good transportation system created the perfect market to launch the product, where more than 15,000 of their habitants could be potential clients.

Why did the founders revise their financial plans (Exhibit 3 -> Exhibit 5)? After the first model was created in 1999, the company continued with their research process and the market investigations and inside deliberations, from this studies they have found a gap between the initial assumptions and the feedback received; which demonstrate that although it is possible to being asking the correct answers, many times the answers that we are giving can be driven by our personal suppositions rather that real situation. Another factor that could promote this reviewing is the fact that the initial model was based on structuring a business model created in Europe, and the review makes sense due to the adaptation of it to the North American population and Market. Also, the creation of the new product of daily rents, created the necessity of restructuring the business model and forecast since this incentive probably could attract more clients and therefore more revenue.

What can you learn from the real operation data (Exhibit 8b)? The September reflects the real financial development and the actual user usage patterns, which reflects that in many cases the reality is far the expectations. We also observe that although for the price and variable costs structure the model was reviewed, the fixed costs did not suffered any modification and this is reflected in the gap between the $10,491 corporate overhead costs forecasted for one month (125,895/12) and the real cost of $30,000 which the company incurred in September. We also observe this breach in the difference between the month forecasted $4,590 Boston office overhead and the real $14,000 costs incurred in the month.