Why did the business model research of Ofo fail?

Ofo is one of the earliest bicycle sharing platforms in China, and its business model research found that the reasons for its failure are as follows:

1. High investment and high cost: As a bicycle sharing platform, ofo needs a lot of investment to buy, operate and maintain bicycles. However, ofo failed to effectively manage funds during its rapid expansion, resulting in huge losses. In addition, ofo is also facing higher and higher maintenance and operation costs, such as repairing damaged bicycles and providing transportation services.

2. Core issue: ofo's original business model is to let users unlock bicycles by scanning QR codes and charge them. This model does solve the problem of the last mile trip to a certain extent. However, many users maliciously damaged the vehicles and left them in disorder, resulting in a significant reduction in the number of bicycles. As a result, users can't find available vehicles, and the use experience and service quality decline.

3. Serious management problems: ofo faces serious management problems in its operation. On the one hand, ofo failed to adapt to changes in regulatory policies, which led some cities to rectify and restrict bicycle sharing, limiting the development of ofo. On the other hand, ofo also failed to effectively manage its own operation and service quality, resulting in user complaints and loss.

4. Fierce market competition: With the development of bicycle sharing market, ofo is facing pressure from other competitors. Other bicycle sharing brands have also risen rapidly and introduced better product and service innovations. This makes ofo's competitive position in the market gradually weaken.

To sum up, the study of ofo's business model found that high investment, high cost, core problems, management problems and fierce market competition were one of the main factors leading to its failure. These problems are intertwined, which eventually leads to the inability of ofo to continue to operate effectively.