Examples of Pre-Filled Circular Canvas: The Case of Lime electric scooters
The circular economy tends to provide significant fiscal, financial, and social benefits. Companies, on the other hand, have a rough time defining the success margins when it comes to taking steps. The circular canvas helps to plan the business while taking into account impacts on the territories and habitats.
Neutron Holding Inc. (doing business under the name Lime) began as a service supplier of environmentally sustainable transportation services. They had been around for a while, but in 2018, they changed the game by introducing e-scooters for hire. The increase in sales and capacity to raise funds tells the whole tale of a next-generation e-mobility business. They are an excellent example of a private corporation attempting to address noise and traffic congestion.
The mission
The mission brought forward by Lime is revolutionizing and democratizing urban transport.
Key activities
There are three categories of core initiatives now that Lime has reached significant scale:
- organizational excellence through round-the-clock customer service and good maintenance;
- accelerated expansion to new countries and cities;
- improving current and looking for future value propositions in providing electric bikes and scooters that are safe, readily available, and easy to use.
Partners
Lime has multiple partners involved in operations and business development. As for the former, data storage companies, French auditing firm Planète oui and self-entrepreneurs are key partners in ensuring the smooth running of the business. As for the latter, Lime has secured plenty of partnerships with Uber, real-estate partners, or event organizers which all allow for the promotion of business and further adoption of Limes as means of transportation.
Resources
Natural resources: Production of electric scooters is costly in terms of natural resources: Aluminium and lithium are needed for the production of the frame of the scooters; rubber and plastics for the detailing of the frame; gold and copper are needed for the conductors of the electric scooters.
Technical resources: Moreover, electric scooter networks have multitude technical resources to manage starting from the development of the network software, GPS tracking system and application to scooter charging hubs. As the network increases, more people and factory workforce is needed.
Energy resources: Production of the scooters themselves is rather costly in terms of coal and other resources. Further, transportation of Limes around the cities and/or to charging hubs requires fuel. Lastly, electricity is needed to charge the scooters. Options for more sustainable operations would be to use electricity-powered vehicles for transportation, and charge the scooters with electricity from renewable sources.
Value proposition
Lime’s value proposition capitalises on the provision of sustainable, fun and easy to use transportation service enabling people to go from one place to another. This analysis helps to holistically see how they deliver said value proposition.
Users and context
Currently, young professionals are mostly using Lime due to their prominent activity on apps and high rates of mobility. Users must be above the age of 18 and hold a valid driver’s license. Before they take their first trip, they must check the license by scanning it into the app.
Next use
According to Lime, all available parts are recycled at the end of the useful lifespan to achieve 97% of landfill diversion. Moreover, broken scooters are repaired or in case that is deemed impossible, their parts are repurposed.
Distribution
Lime works through diversified distribution channels: although the transportation from factories in China and the United States is made by the company, self-entrepreneurs are transporting Limes to charging stations within the cities.
Impact (Positive/Negative)
Positive impacts: Lime provides another means of traveling which is rather sustainable and allows for easy navigation in busy cities. Moreover, with Lime already having a sustainability dimension in mind, comes a welcome push towards circular economy.
Negative impacts: Although Lime strives for sustainable practices, its manufacturing facilities are far from their customer base. With quite a large share of users in France, for example, Lime has to transport the scooters from China or California where it has manufacturing facilities.
Profitability Analysis
Costs: The highest costs stem from the manufacturing of the scooters and labor costs to ensure an adequate and readily available customer support system. Moreover, there are high initial investments into online platform development for smooth running. Lastly, maintenance of both scooters and the platform require additional variable costs.
Revenue: The revenue comes from a fixed-rate charge for the rental service, which takes $1 to unlock and $0.15 per minute ride. Currently Lime does not offer any bundle pricing models.
To go further:
- Get the company more robust by imagining cultural, societal, or economic disruptions and considering how they could impact operations. Foreseeing future scenarios will aid in better understanding the interdependence of the Circular Canvas components and the implementation of safety nets to mitigate the impact of such incidents. For example, suppose access to technological services is restricted due to global internet regulatory uncertainty; how will this impact the business, and what might be done within the company to mitigate those risks? This practice will increase the company’s resilience and adaptability in the face of challenges.
- Make changes to the elements of Circular Canvas to reduce the negative effect. If, for example, too much plastic waste is a detrimental impact of your activity, look for more sustainable materials within the supply chain or next-use alternatives.