With more ride-hailing companies entering the domestic market, Exnet Taxi Cambodia, which is the country’s first operator, said its business is affected by the growing competition, and that a new business model is needed for it to survive in the industry.
Exnet Taxi Cambodia’s founder, Hor Daluch, told The Post on Wednesday that his firm plans to introduce a new system for drivers which will be free-of-charge, and lower rates to passengers using the company’s App.
The operator charges a commission from drivers which ranges between 20 per cent and 25 per cent of the total cost of passengers’ travelling.
Daluch said that he is finding a new source of revenue for the company besides depending on commissions from drivers, such as generating advertising revenue from companies that wish to advertise their products and services.
“The competitive landscape no longer makes it sustainable for ride-hailing operators to depend solely on commissions from drivers.
“Operators who are not flexible and unable to find a new business model may disappear from the marketplace.
“We are now in a very tough situation due to competition. To survive, we need to create new business model,” he said.
“With our new business model in place, we hope to get more disciplined drivers with because our business model will benefit drivers more and they can offer good services to the clients.”
According to Daluch, Exnet has about 2,000 registered drivers and majority of them are car drivers, while more than 20,000 users have downloaded the company’s application on their mobile phones.
He said the company’s potential partners for the new business model could be companies involved in payment gateway as they are targeting to expand their network by using technology as the main platform.
Other companies that are promoting branding for their products are Exnet’s target as well.
Daluch anticipates a lot of challenges to implement his business model such as difficulties to lobby drivers to join his company, as they might be threatened by main ride-hailing operators to disconnect the drivers from their network if they join Exnet.
“We foresee a lot of challenges to implement our new business model, but we will try to resolve these issues as we proceed,” he said.
At the same time, Daluch is also seeking for potential investment partners like equity firms to raise funds to strengthen the company’s operations in order to remain competitive in the market.
While there are about 10 ride-hailing App companies offering their services in Cambodia at present, Daluch predicts that in the future, only large foreign players will dominate the market as they have the financial capacity and technology expertise.
These companies are able to entice customers by introducing attractive new business ideas such as offering discounts.
He also said that to ensure the ride-hailing firms in the Kingdom remain profitable and continue to sustain their business, the government needs to introduce the necessary policy to support and protect local players in the market.