Strategy; Variable and Fixed Costs Zipcar (www.zipcar.com) is a car-sharing club founded inCambridge, Massachusetts, in 1999. The club members pay an annual fee and then have the opportunity to rent a small car (usually a subcompact; the models include the Toyota Prius) for a fixedhourly rate. Zipcar is located largely in select metropolitan areas such as Boston, San Francisco, andWashington, D.C. Members, called “Zipsters,” make reservations for a car on the Zipcar website andthen use an access card to open the vehicle. The vehicle has a “home base” parking spot where thedriver picks up and returns the vehicle. The club—which, as of early 2017, operates in more than500 cities and towns, at more than 600 college campuses, and 50 airports—has grown to more than1 million members since its initial public offering in April 2011.Required1. What are the fixed and variable costs for Zipcar?2. What are some of the competitive advantages and challenges of the Zipcar concept?
Strategy; Variable and Fixed Costs Zipcar (www.zipcar.com) is a car-sharing club founded in
Cambridge, Massachusetts, in 1999. The club members pay an annual fee and then have the opportunity to rent a small car (usually a subcompact; the models include the Toyota Prius) for a fixed
hourly rate. Zipcar is located largely in select metropolitan areas such as Boston, San Francisco, and
Washington, D.C. Members, called “Zipsters,” make reservations for a car on the Zipcar website and
then use an access card to open the vehicle. The vehicle has a “home base” parking spot where the
driver picks up and returns the vehicle. The club—which, as of early 2017, operates in more than
500 cities and towns, at more than 600 college campuses, and 50 airports—has grown to more than
1 million members since its initial public offering in April 2011.
Required
1. What are the fixed and variable costs for Zipcar?
2. What are some of the competitive advantages and challenges of the Zipcar concept?
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