Values Go Before the Fall

A shudder may have run through the taxicab industry today at Yellow Cab of San Francisco in the SF Examiner announced plans to file for bankruptcy.

The news was especially scary since General Motors just invested heavily in Lyft while Ford is in talks with Google (a major shareholder of Uber).

The case of Yellow Cab, however, it different. It points to a rather large failing that I have seen in many of the taxi cab co-ops that have popped up in the last decade. These co-ops, while billed as “worker co-ops” act more like producer co-ops. The drivers remain independent contractors and the co-op is more of a shared-services model. In the case of Yellow Cab, I understand that joining is difficult and long heard rumblings that non-member drivers get treated much differently than member drivers. While those are the rumors or thoughts from the industry (take it for what its worth), it is clear to me that many of the cab co-ops miss their best opportunity to compete with Uber and Lyft by failing to promote their co-operative identity.

In the case of SF Yellow Cab, they identify as a co-operative. That is great, but they don’t explain what this means to the passenger. As the story notes, there seem to be, in addition to the competition, a serious problem with accidents at Yellow. Shouldn’t a worker coop be at the top of the safety chart? I would think so.

Shouldn’t a worker coop be at the top of the safety chart? I would think so.

I also think that there marketing should be helping consumers understand the value of doing business with a co-op. How workers in a worker-owned co-op enjoy better working conditions and can participate in the decision-making process. This should mean that the needs of the customer can be relayed back into the organization.

These ideas, of course, are part of the Co-operative Identity. Caring for Others, Social Responsibility and Concern for the Environment. Worker Co-ops need to help consumers see and feel the competitive advantage.

Another general value that all of the taxi coops seem to miss in their battle with Uber and Lyft is solidarity. It seems as though every taxi co-op has their own app and on-line ordering service now, but what they miss is that people don’t want to have 20 different taxi apps on their phone. There are enough taxi coops out there to have a national app that would cover the Bay Area, Philly, Denver, Portland, Nashville, DC-Metro, and Madison, yet as far as I can tell, none of these co-ops are talking to each other.

Although the greater threat to worker-owned taxi cab fleets may be driverless cars, to survive long enough to manage that transition, they need to start working together nationally and creating a concept of domestic fair trade that puts the cooperative identity front and center. For some of these co-ops, it might require that they embrace the co-opeative identity beyond putting the word “co-op” on the side of the cab.

About John McNamara

John spent 26 years with Union Cab of Madison Cooperative and currently helps develop co-ops in the Pacific Northwest. He holds a Ph.D. in Business Administration and Masters in Management: Co-operatives and Credit Unions from Saint Mary's University.
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