Beijing Business Today, 8/20/17
Dockless bike-sharing service 3V Bike, which suspended operations on June 21, has announced on its official account on Tencent's (0700.HK) WeChat mobile messaging app that it is re-entering the market. The company had temporarily halted service after losing a large portion of its deployed bikes due to the use of mechanical locks. The company has decided to upgrade the quality of its bikes, install anti-theft GPS smart locks, strengthen its onsite maintenance, pivot to a local affiliate business model, and focus on tier-five and tier-six cities.
A reporter for Chinese media site Beijing Business Today learned that 3V Bike has yet to release an independent app. Instead, users must register and pay fees via the company's WeChat public account.
An affiliate of 3V Bike told Beijing Business Today that it contacted 3V Bike via its public WeChat account and then received a contract to become an affiliate.
The contract states that Beijing Huayaodi Technology, operator of 3V Bike, will provide the affiliate with software, smart lock, and bike technology, and provide guidance on bike deployment, maintenance and operations. The affiliate will purchase bicycles equipped with smart locks from 3V Bike, with an initial order of at least 500 bikes at RMB 660 per bike. 3V Bike will provide a three-year quality guarantee on the bike frame. 3V Bike will arrange shipping, and the affiliate will be responsible for receiving the bikes and final assembly, as well as deployment and daily operations and maintenance. The affiliate must locally register a shared bike rental company, take responsibility for shared bike operations, and receive approval from local government before bikes are deployed.
The contract also states that bike rental fees and deposits will be received and managed by 3V Bike, with affiliates being paid a monthly share. 20% of bike rental fees will go to 3V Bike, and the other 80% will go to the affiliate. 40% of any government subsidies will go to 3V Bike, with the remaining 60% going to the affiliate. 100% of advertising revenue from the bikes will go to the affiliate.
Editor's Note: For more information on this topic, please see "Bike-sharing App '3V Bike' Exits Market over Bike Thefts," MD 6/30/17 issue.