Supply of a good is the entire range of quantities that producers are able and willing to offer for sale at different prices, in a given period of time, ceteris paribus.
The law of supply states that there is a direct relationship between quantity supplied of a good and the price of a good. Thus, price changes will lead to a movement along the supply curve and a change in the determinants of supply will leave to a shift in the supply curve. Generally, China’s bike-sharing boom is driven by rapid advancement in technology. This boost is helping China make the leap from a manufacturing-based to a service-oriented economy.Technological advancement often means that fewer resources are needed for production of a good and this leads to lower costs of production, therefore, at every price, suppliers will be able and willing to sell more. For bike-sharing, all it requires is a smartphone. Users can find the nearest bike via GPS, scan the bike’s QR code and open its smart lock through a mobile-payment app. At the end, the bikes can be docked almost anywhere and users will be notified of the fee they need to pay.
On an average, it costs £2 in London, and typically lots of tapping at an unresponsive kiosk screen, just to unlock a city-run shared bike. OFO bike works pretty similar to this. After an initial deposit, is 50 pence every half an hour and a few seconds to get the bike going.
In China, rides cost between 0.50 and 1 yuan ($0.08-0.
15) for 30 minutes. This helps that the firms save on physical infrastructure such as docks. One of China’s biggest bike-sharing players, Mobike, uses airless tires, is dockless, and cashless. In addition, Mobike has invested much in research and development. Their bicycles now come with solar panels and smart locks.
Mobike ran trials with Qualcomm and China Mobile on implementing the latest IoT technologies such as Cat-M1 and NarrowBand IOT (NB-IoT). While, Ofo, has also started working with Huawei and China Telecom on employing wireless internet and NB-IoT technologies.Number of sellers is another reason why the supply of bikes had been increasing.
Mobike, Bluegogo and Ofo are competitors. Both companies originate from China. With other cities in China following with the idea of Shanghai, Mobike’s expanded astonishingly rapidly. Within 18 months, it had covered 180 Chinese cities. Bluegogo, another China bike-sharing company, had 600,000 bicycles in circulation, 20 million users and $58 million (Bt1.8 billion) in investment funds.
Ofo, one of the the 3 biggest bike-sharing companies claims to own around eight million shared bikes globally, and registered three billion rides by customers in more than 170 cities. As of April 2017, as many as 520,000 shared bikes were reportedly in service in Shenzhen alone and the figure reached 890,000 in August. Currently, the few well-known bikes sharing companies are, Mobike, Ofo, Bluegogo, MingBike and HelloBike.
Even with the frenzy China’s bike-sharing economy is facing, there are still many startup companies who is trying to set up a bike-sharing business. However, these companies are trying to place their focus on being more sustainable. With the increase of sellers in the market, there are more choices of different types of bikes and more bikes are being made available to consumers. Therefore, supply increases and supply curve shift to the right.