Global Strategic Immersion Project - Part A : Introduction

(Please read this first) -

GSIP - Phase 3 : Beam Your way into Tokyo and Kyoto – FINAL -MG –

Table of Contents

1. Executive Summary

2.Defining the business & Market/Industry

3.Challenges faced in the country chosen – Japan

4. Frameworks : SWOT, Pestle, Porter’s 5 Forces.

5. Key Market drivers.

6.Origin of Beam Micromobility

7. Strategic goal pursued by Beam

8.Recommended strategies :Short Term : Launch of Beam electric vehicles in Tokyo and Kyoto

9.Medium Term Strategy

? ?????10.Balance Scorecard A.Financial Goal? B : Consumer Strategy C Internal processes at Beam D . Learning ?

??????? Innovation & Technology adoption .

???? 11.Gap Analysis .

???? 12.Long Term Strategy

???? 13.Current scenario in India

???? 14. Miscellaneous information regarding EVs in India

??? 15. Will Beam WIN in APAC

?? ??16.CONCLUSION

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1.Executive Summary

The major use of bicycles in Tokyo and Kyoto is for travelling short distances. This is the neighborhood concept where everything is in the reach of 2 – 5 Km. This means that they travel to school , hospital , supermarkets etc. Figure 2 below shows statistics for the same.

The culture of the bicycle lanes encourages towards the Go-Green drives of the government of Tokyo but also helps in the electric and eco-friendly business models that are being adopted. The ancient bicycle “Mama-Chari” is the only popular bicycle in Japan.

Let’s connect with the various efforts the government is taking to increase the bicycles or the e-scooters is the great multilevel parking facility. The dedicated lanes, various parking techniques, all are depicted below:

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Some Japanese consumers even make use of conventional shared mobility, such as carsharing and ride hailing, which may well be an expensive ride more so because it is ?short distance. Thus, the increasing need among consumers for a not so expensive ?means of transport for short distances is propelling the demand for micromobility.

Represented in the picture below are? the characteristics of the various modes of travel a short distance.

The Japanese micromobility market revenue is expected to witness a 78.7% CAGR during 2021-2030, ?from $39.4 million in 2020, to reach $11,663.0 million by 2030.

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???????? The COVID-19 crisis has affected the Japanese micromobility market positively, especially after the lifting of the lockdown. The fear of infection has forced people to shun mass transit means, such as buses and metros, and opt for shared two-wheelers instead.

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???????? The government has implemented policies and market players have taken the initiative to enhance shared mobility during these uncertain times and are driving the demand for micromobility services in this island nation.

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???????? Japanese citizens love cycling , the shrinking workforce will still have to run errands , pay their utility bills go to the railway station which could be 1-3 kilometres away and hence we want to go ahead with our plan to launch Beam Saturn and Beam Apollo in Tokyo and Kyoto. Beam needs to co – partner with Soft Bank since it promotes Bike Sharing in Japan ?

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???????? With the weakening of the Japanese Yen due to stagflation in the Japanese economy. we are recommending that Japan should become a manufacturing hub for Beam Saturn and Beam Apollo? so that they can readily supply these electric bicycles to neighbouring countries in Asia Pacific – South Korea, Thailand, Malaysia? and? to Australia, New Zealand? where Beam is operating currently and hoping to move into the micromobility space in countries like Phillipines.

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???????? The dockless bifurcation system is said to lead to? faster growth in the Japanese micromobility market in the future, under segmentation by sharing system. Customers prefer this system since the latter does not require the two-wheeler to be picked up and dropped off at a particular point. Similarly, market players save money as they are not required to set up docking stations

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2.????? Defining the Micromobility business & Market/Industry

Micro-mobility is defined as – “A class of small, light vehicles, shared scooters and bikes (both human-powered and those with electric motors, docked and dockless) that are driven by individuals at speeds of less than 25 km/h. Bicycles, e-bikes, electric scooters, electric skateboards, shared bicycles, and electric pedal assisted bicycles all fall under the category of micro-mobility devices.”

?????????????? The general market for micro-mobility in Japan is forecasted to massively grow by the end of this ????

???????????????? decade and is expected to be a major contributor to the GDP of the country. This is the direct ????????????????

??????????????? result of increasing air pollution and transportation costs and hence the increasing demand for a ????

??????????????? more sustainable mode of transport.

·??????? ?As a Team when we evaluate the Japanese micromobility market based on type of vehicle we realized that consumers primarily used ebikes in the past. Ebikes are clean, cost efficient and very popularly used among the Youth.

• Beam will launch bicycles, scooters, then mopeds though the other types that have existed? are Skateboards, Hoverboard and Segway

???????? Softbank is the promoter of bike-sharing in Japan. ?Docomo bike-share was first launched?in February 2017 together with NTT Docomo, making around 150 electric-assisted bicycles available at 32 stores in Tokyo and currently operating in?more than 20 cities. They are equipped with a smart-lock, which can be activated with the help of? a? travel card or a pin code.

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3.????? Challenges faced in Japan

???????? ?In 2021, for the 11th consecutive year, the country has faced a steady decline in its population.?

???????? As of October 1,2021 the country's population stood at 125.5 million, down 644,000 from a year earlier. While there were 831,000 births in Japan in 2021, there were also 1.44 million deaths.

Japan is dealing with two problems: a shrinking workforce and an ageing population.

???????? While the rate of decline has slowed in recent years, thanks to an increase in foreign employees arriving under a more liberal visa system, coronavirus has had a detrimental impact, preventing firms facing labour shortages from hiring foreign workers.

???????? A community with a higher proportion of senior citizens can be less appealing to businesses. Business owners face a shortage of qualified workers, while the country's economy suffers without foreign businesses.

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???????? Keeping these consumer needs and insight in mind this is how the Plan among Team 6 evolved? to act as Business? Consultants to Beam Micromobility? and launch e- bicycles and scooters in Tokyo and Kyoto. Essentially, consumers? will want to? have easy access to electric vehicles that will help them cover the first and last mile.

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???????? 4.? Frameworks : We applied the following frameworks / concepts with respect to the current context in the Japanese Market . Given Below

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A.SWOT Analysis

???????? Strengths: The Company has a high valuation with a total amount of over $126.4m raised over six rounds of funding. Further their product is exactly in-line with the global demand of an alternative and a more sustainable transportation system in order to achieve an overall reduction in carbon footprint.

???????? Weaknesses: Since we are only at a Development- Introduction phase for this product – the statutory approvals from governing bodies for launching the same is a fairly long and convoluted process. Further, for the same reasons, the supply chain for raw materials are still not streamlined.

???????? Opportunities: As Global Warming is becoming more and more of a reality, we are seeing a rise of smart cities, globally. This has directly increased the demand of micro-mobility as an alternative mode of transportation (as it is more sustainable). Particularly for Japan – air pollution is at a record high – this again is pushing the government to adopt the micro-mobility model.

???????? Threats: Again, due to the stage of lifecycle micro-mobility as an industry is at right now, there is a lack of regulatory bodies governing the rules and regulations – this, at times makes getting permits difficult and complicated. Further, micro-mobility is yet to become a preferred mode of transportation. One major reason is that it is not suitable for long distance travels.

B.Pestle Analysis

???????? Politically, Japan has always maintained healthy relations with other nations. Their policies support new business making ventures easier to establish in the country.

???????? From an Economic lens, Japan’s GDP is currently over $5000B and is expected to witness a growth rate of 0.4% and 0.5% respectively for the next two financial years. Further, the market for micro-mobility is very encouraging in Japan – currently the market size is at about $40M and is expected to grow to over $11000M by 2030 (with is a mighty CAGR of 78.7 % for the observed period!)

???????? Socially, Japan’s primary concern is their vast ageing population and decline in birth rates – which is resulting in an overall deficit in population. At a more micro level, Japan is well-known for their immense traffic and crowd during rush hour as well – which has unfortunately also resulted in casualties.

???????? From a Technology standpoint - Like the rest of the world, the infrastructure required to support the functioning of micro-mobility is still at a very developing stage in Japan. However, as the market of Electronic Vehicles and Micro-mobility is increasing in Japan – the market for the ancillaries is also expected to grow at a rate of ~45% till 2027.

???????? From a Legal perspective, as mentioned previously, governing bodies and frameworks are still undefined, unstructured and lack clarity as far micro-mobility is concerned.

???????? Air pollution is of a major concern for Japan’s Environment – which is the result of industrialization and urbanization and also the growing number of vehicles on the road.

C. Industry Analysis using Porter’s 5 Forces :The threat of New Entrants is relatively HIGH for the micro-mobility industry due to the sheer growth that is predicted – as mentioned before, the market size is expected to be a staggering $11000M by 2030 from the current size of $40M.

????As there are some micro-mobility organization already existing in Japan, the option for a Substitute is MODERATE. Existing players in the market include Mobby Ride Inc., Hasegawa Kogyo Co. Ltd., Exx Co. Ltd. etc.

??Bargaining power for suppliers would be LOW as Beam is a sizeable organization – having presence in multiple countries. Further, as there is a good volume for mass production, there is always a possibility of lowering the bargaining power of suppliers- Standardization in production would also indirectly help this.

???????? There would be LOW to MODERATE Bargaining Power for the buyers as Beam’s targeted market would be spread across the regions of Japan.

???????? The overall Industry Competition is expected to be high even though micro-mobility is not a mainstream mode of transportation. This again is the result of the need for sustainability.

?? 5.Key Market Drivers: As a group we Brainstormed and arrived at the following argument after carrying out Impact analysis amongst ourselves and indicated in the diagram after this paragraph.

??? Clearly all stakeholders – the Government , Beam? Micromobility Management and importantly Consumers ?in? Japan are worried about????????????

1.Air pollution is a major cause of concern for Japan, this factor would come out to be a very key market driver for the increase of the micro-mobility industry.?Transportation costs on existing modes??of Transport examples being your own car , taxis is quite high . there is an increasing demand for a more cost effective solution for transportation??????????

2.Currently, the short-distance transportation system lacks efficiency in short distance commute

3.Need to reduce onslaught of traffic in Asian cities in general and Japan ( Tokyo & Kyoto) in ??particular?????

6.Origin of Beam Micromobility

??Yale classmates Alan Jiang and Deb Gangopadhyay cofounded the shared mobility by the name BEAM – Beam Mobilty Holdings registered in Singapore in 2018. They thought about the concept with the growing need of electric vehicles and in the dense Asian city the personal car ownership had to be replaced eventually. The expansion modes would be e-bikes and e-mopeds. This would be covered in the later sections. A quick review of the co-founders , Jiang led the Southeast Asian operation for Ofo and also was Uber Indonesia’s Country Manager. He grew Uber Indonesia to the fifth largest market globally.?????? ???????

This post is in two sections . This is Part A ???????

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