How can a locally owned taxi app compete with the giant?

With Phnom Penh Post's earlier article, Exnet taxi started in June 2016 being the Kingdom's first to promote taxi hailing app service. Meanwhile, Uber, the hailing app giant is expanding in Cambodia being Uber's 78th country of operation.

I've tried Exnet couple of times and I was really satisfied with its relatively convenient and fast service while Uber on the other hand also give fast service however I noticed that it is unstable on waiting time as they allow the drivers to accept booking while they are still to drop off their passenger.

Fare from central market to Aeon mall.
UberX : 3-4$
Exnet app : 12,700khr

Wonder on how will the government/country support and encourage their local entrepreneur to startup while they embrace giant company like this.

I've never seen an UBER here.. I tried the App as well, no UBER.

If people got used to PassApp, EXNET, Itsumo, UGo711. a lot of them lol. then, Uber has quite a competition..

And Grab Car will join the fray by year end in PP.
Am currently in KL where I have always used Grab Car. Doesn't seem as good as last visit here. A few driver initiated cancellations. Dirty cars & not very professional drivers.

I used Uber exclusively yesterday & each driver was dressed better, car was cleaner. Drivers here are Soooo much more considerate than Cambo. Allowing to turn out, turn in, merge & use of horn nearly non existent.

And a city of 2.5 mil is immaculate. Virtually no trash to be seen.

Still even grab Car far excels the local taxi cos. & there aggressive demeanor + exorbitant pricing. Went to KL Bird Park from Bukit for 6MYR. When we were finished I asked standard taxi what would be the fare to return. 30 MYR.

A couple were exiting a late model Honda & I asked driver if he was Uber & he was. He returned us to hotel for 7MYR.

Good competition breeds a better business model. Success goes to the best.

Uber and Grab will most likely dominate the market. Problem with the local ride hailing apps is that most of them, if not all, are just ready made apps where they have sticked their own branding on it, and they don't have big enough marketing budget to compete with global giants. Only way I see local apps can survive is that they make their own software and they come up some local twist. One could be tight partnership or merge with local mobile payment service app. Imagine you could get a ride straight from your Pi Pay app or something like that. Otherwise they will have hard time a head of them.

How about encouraging creativity instead of copy-cating everything, or subsidising copycats? I see nothing wrong with the giants coming here, especially since smaller enterprises have traditionally competed on pricing. Local companies have tiny margins, so it's easy to compete or gain market share that way.

Sara wrote: ↑Fri Sep 29, 2017 10:22 am Wonder on how will the government/country support and encourage their local entrepreneur to startup while they embrace giant company like this.

The gov't is pretty mercenary so I expect it'll serve whoever has the biggest pocket book, which in this case is Uber.

Bitte_Kein_Lexus wrote: How about encouraging creativity instead of copy-cating everything, or subsidising copycats? I see nothing wrong with the giants coming here, especially since smaller enterprises have traditionally competed on pricing. Local companies have tiny margins, so it's easy to compete or gain market share that way.

Uber has $80 billion of venture capital so it can operate below cost until it's competitors go out of business, then it can jack up the price due to the lack of competition.

By your copy cat logic only Ford should be given subsidies and bailouts to manufacture cars and motorbikes since its founder invented the internal combustion engine and consumers should be deprived of superior German, Korean and Japanese brands because gov'ts shouldn't nurture infant industries or pursue import substitution. Another benefit of operating your own domestic firms is that foreign gov'ts can't threaten to remove them during an embargo.

Promotion code: UberPPLaunch

$4 off the next 10 trips (up to 15 October)

Should cover most journeys within the city centre

ali baba wrote: ↑Fri Sep 29, 2017 12:08 pm

Sara wrote: ↑Fri Sep 29, 2017 10:22 am Wonder on how will the government/country support and encourage their local entrepreneur to startup while they embrace giant company like this.

The gov't is pretty mercenary so I expect it'll serve whoever has the biggest pocket book, which in this case is Uber.

Bitte_Kein_Lexus wrote: How about encouraging creativity instead of copy-cating everything, or subsidising copycats? I see nothing wrong with the giants coming here, especially since smaller enterprises have traditionally competed on pricing. Local companies have tiny margins, so it's easy to compete or gain market share that way.

Uber has $80 billion of venture capital so it can operate below cost until it's competitors go out of business, then it can jack up the price due to the lack of competition.

By your copy cat logic only Ford should be given subsidies and bailouts to manufacture cars and motorbikes since its founder invented the internal combustion engine and consumers should be deprived of superior German, Korean and Japanese brands because gov'ts shouldn't nurture infant industries or pursue import substitution. Another benefit of operating your own domestic firms is that foreign gov'ts can't threaten to remove them during an embargo.

Egad man. That's total bullshit. Henry was on the front line of assembly line production but that is all.
The credit is usually given to Daimler but many a engine preceded there development.

ali baba wrote: ↑Fri Sep 29, 2017 12:08 pmUber has $80 billion of venture capital so it can operate below cost until it's competitors go out of business, then it can jack up the price due to the lack of competition.

By your copy cat logic only Ford should be given subsidies and bailouts to manufacture cars and motorbikes since its founder invented the internal combustion engine and consumers should be deprived of superior German, Korean and Japanese brands because gov'ts shouldn't nurture infant industries or pursue import substitution. Another benefit of operating your own domestic firms is that foreign gov'ts can't threaten to remove them during an embargo.

I don't think you understand what I'm saying. When did I say the big company should be given subsidies...? I don't support monpolies nor oligopolies, but the fact is they have that market cap because they created the market and thus had the first mover advantage. What changes or improvements have the local apps made?

I also don't understand the point you're trying to make with your references... Boeing is a favoured child, so what? It's protectionism at it's best. They're now attacking Bombrdier for building and selling planes to Delta in a class Boeing doesn't even produce, by falsely claiming that Bombardier are dumping... A complete farce and yet another perfect example of government favouritism and protectionism of Boeing. Again, I think you misunderstood me.

Anyways, Uber took forever to come over here, which should have given ample time for other competitors or entrepreneurs to either:
a) copy uber 100% and become the only local name in the business
b) create a niche market by differentiating themselves a bit from uber
c) set up a completely different/unique product that filled the local demand

Oh, and as mentioned, you should thank the guys from the land der dichter und denker for the automobile. Ford brought in the assembly line, nothing else. Still, it was an important achievement that made Ford products better in many ways than the competition... If the competition doesn't make itself better than Uber, why would or should anyone use them? History has shown time and time again that if the product is good enough, people will use it vs the established behemoth (or in this day and age, be bought out by the corporate giant for being a better product).

Cambodia is a small country so it cannot change the rules of the game, it can only play as best it can and tariffs, quotas, capital controls, subsidies and so on are all legit tools that were successfully used by every developed country during their industrial development.

If the competition doesn't make itself better than Uber, why would or should anyone use them?

You're taking the (short-term) perspective of a consumer who is concerned about price and service. I'm looking at it from the perspective of a gov't that wishes to create jobs and business oppourtunities. You also ignore barriers to entry and exit such as Uber's access to vast pools of data and vast cash reserves that can be used to grow the business without worrying about turning a profit. It also allows it to benefit from economies of scale and undercut the pricesof saller start ups leaving consumers with less choice and less competition. To use an analogy- Is it fair to expect a group of 11 year old girls to compete against the Harlem Globe Trotters on a level playing field? Must people would argue that the playing field should be tilted in the 11 y.o.'s favour until they are big and skilled enough to face the Globe Trotters as equals.

My misunderstanding of Ford's history makes it a poor example but I think you see what I'm getting at. When incompetent and criminal businesses practices are rewarded with no-strings subsidies and bailouts or punished by modest fines that are less onerous than the tax burdens of legit companies, those who refuse to use the same tools on principal have no hope of succeeding.