Improving BEST: Why none of the routes of Mumbai’s public transporter is profitable–Part5
The BrihanMumbai Electric Supply & Transport (BEST) operates in two specific roles. Firstly, it is required to provide last mile connectivity to people travelling on local trains - which is the feeder role of BEST. Secondly, BEST also must provide an alternative to the local trains in serving the long-distance routes - the trunk-transportation role. In this fifth article of my series, I will look at ways to improve route planning, so that it balances the need for connectivity and profitability for Mumbai's bus operator.
 
Feeder Routes
BEST act as feeder transporter supporting suburban (local) trains and trunk routes journeys. This is evident from the fact that 45% of all BEST journeys are under 3kms. Thus, BEST is responsible to provide last mile connectivity for passengers travelling on trains, including passenger movement between western, central and harbour lines in non-junction stations (i.e. except Dadar and Kurla). A correlated responsibility is to serve the people moving within the feeder area. Both shuttle (between two specific points) and circle (along specific circular route) can be used to serve these requirements.
 
In its feeder role, BEST needs to have many routes with frequent buses with lots of pick-up points covering the feeder area at regular interval. Thus, these passengers should be required to wait 3 minutes or less before boarding. These passengers will have lesser time for ticketing and their journey times may be shorter. They also do not want to pay high fares. They are balancing cost and convenience vis-a-vis bikes and shared auto-rickshaws or taxis.
 
Therefore, feeder routes needs higher number of smaller capacity buses allocated to the feeder area. The higher number will ensure that there is a bus available every 3 minutes. Lower capacity will allow faster access through crowded roads. Now, lower capacity buses have higher cost per passenger kms (cpkm) therefore tickets will be priced higher on per km basis. Another challenge will be time for ticketing will be low. Hence, such buses are ideally suited for a prepaid electronic card system with one fare system. Go anywhere you will pay one fare on this route - say Rs10. 
 
Trunk Transport Routes
BEST needs to provide a substitute for cars to allow for decongestion and reducing pollution. BEST must thus operate along trunk routes and also connect different business districts during business times. This role needs larger capacity buses at specific time departures. Thus, in the morning, these buses may leave at frequency of 15 minutes and then between peak periods this frequency can drop to 1 hour. Inter-business district operations can be shuttle-service.
 
There are two types of people on these routes - low cost and higher cost category. In the first, BEST is required to operate a low-cost alternative along trunk routes. It requires standard large capacity buses. 
 
The second type needs BEST to operate higher-speed trunk routes in comfort. Here BEST is competing with private cars or private taxis (Uber, Ola and hired cars), which are more comfortable, higher priced but convenient option. BEST may address this market through luxury AC buses and convert them into productive workplaces giving high-speed Wi-Fi, charging stations and folding tablet-ops. This functionality is not feasible in all high-end cars. 
 
Future Route Planning
The route planning strategies discussed above are classical. However, for the future, BEST needs to have modern route planning strategies. Thus, it is possible to use algorithms and apps to create pre-committed routes that users have paid in advance. Today, school bus operators use algorithms to optimise their pick-up and drops. The same principle can be used for long-haul trunk routes with pre-booked capacity. Thus, passengers on the app can indicate they want to travel between the two points at certain frequency at certain time of their choosing and the algorithm can try to assign a bus to them. Once such a bus is allotted, then the passengers pre-book this special bus for a month and pay monthly. These special routes will never make a loss. We can also operationalise the route once break even capacity is reached. We will discuss in details some ideas like efficient route strategies such as pre-committed routes and flex-capacity deployment across routes in subsequent articles. 
 
Flexible capacity deployment
The ideal bus-level capacity utilisation in any route is about 70% and peak utilisation should be 90%. Ideally, there is some buffer capacity always available. The bus capacity and demand determines the frequency. Generally, frequency is higher at peak times and low at lean times. Thus, the fleet is idle in the lean time. To improve fleet utilisation between lean times, BEST can look at alternatives and deploy the buses for new routes, which only operate at lean times. The route to be chosen depends on people movement in volumes. For example, at lunch times there is a movement from offices to restaurant complexes. In effect, the bus-on-road to idle-buses ratio has to be brought down intelligently.
 
Summary
At present BEST does not give data with respect to capacity utilisation of various routes. Still, with better route planning we can improve BEST service utilisation and facilitate return to profitability. In the next article, we look at how fleet design ties in with these and how that can further create efficiencies.
 
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(Rahul Prakash Deodhar is a lawyer, investor and author with experience spanning manufacturing, consulting, investment banking firms. He has advised a wide range of clients including Fortune 500 companies, public and private sector banks, hedge funds and private equity funds among others. He has developed econometric models for demand forecasting in real estate, metals, airlines, and shipping. He designed MIS and planning and budgeting systems, sales networks, and operations for large corporates. He has worked with Aditya Birla Group, CRISIL and Morgan Stanley. He is author of two books – Subverting Capitalism and Democracy and Understanding Firms. He can be reached at [email protected] or at his website www.rahuldeodhar.com.)
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Improving BEST: How better coordination helps increase usability and relevance –Part4
In the second article in this series, we looked at making BrihanMumbai Electric Supply & Transport (BEST), a part of Mumbai's urban transportation solution, rather than function as a stand-alone bus operator. Transportation is a problem of volume and flow, not merely volume of passengers. Any urban transportation solution requires coordinated planning across agencies. Thus, we need coordination between BEST, trains, metros, Airports, Long distance bus services, Municipal Corporations and Traffic Police, which is absent today. We also need inputs with respect to long-distance trains, and buses. This also involves the Municipal Corporation of Thane, Navi Mumbai, Kalyan-Dombivli and their transport arms. At a basic level, agencies can share passenger load and timetables. On the strategic level, it can encompass developing complementary infrastructure that eases passenger convenience.
 
Timetables and load factors
Coordination implies sharing timetables, passenger loads and timings. It allows for complementary capacity deployment. Thus, if lot of people on the Thane local get off the local trains at Ghatkopar, then BEST needs to provide commensurate capacity for last mile connections at Ghatkopar. BEST can also develop proper feeder capacity at various bus stations too so that outstation bus passengers will find it easy to use BEST services. Similarly, in collaboration with Airports, BEST can develop special services for Airport shuttle. These luxury services can include check-in facilities and other traveller-friendly services at cheaper costs than most taxis and with higher safety.
 
Coordination improves planning
Corporations can also design easier access for BEST buses to train stations. They can ease the congestion of at railway stations, which currently act as bottlenecks and impact bus timetables. At present, one of the important issues the access to commuters that is clogged by taxis and auto-rickshaws in most stations. Due to this, the aim of access points to allow crowds to diffuse out quickly gets defeated. The faster the crowd disperses the better infrastructure can serve others. For example, If Churchgate station had alternative exits on the Bombay Hospital side, where buses can pick up all passengers, it can ease congestion. More passengers will opt for BEST buses too.
 
 
Strategic Coordination will improve entire city experience
Corporations can take into account transportation requirements before approving residential and commercial projects. This is the primary reason why urban transportation solution and strategies across the world are not applicable in India. Thus, when new complexes are developed, they should have a convenient shaded access point where BEST buses can easily pick up the residents or workers in the building. If this coordination is ensured then you will encourage more people to use BEST.
 
Coordinating ticketing
Another area of strategic coordination is ticketing. Urban transportation is better served through single card payment system. The precedents are well established including Swiss Pass, London's Oyster cad, Singapore's EZ-Link, Japan's Pasmo and Hong Kong's Octopus. The card-system reduces time at ticketing centres and eases movement of people. India should take lessons from Japan's Pasmo and Hong Kong's Octopus, which both handle as much traffic as Mumbai experiences. Though, at present, Indian railway stations do not have enough space for access to card based turnstiles but some day that investment will have to be made. BEST will also need to make commensurate investment.
 
At present, if BEST is going to act as feeder service to local trains, we need to give the BEST traveller an advantage in ticketing. Thus, a passenger should be able to buy railways ticket from the BEST bus itself. Alternatively, the Railway Monthly pass can be a smart card that you can use as pre-paid card for BEST. BEST and railways can issue monthly passes together i.e. the monthly pass system can be merged into one. 
 
Coordinated fare systems
There has to be correlation between fares in BEST buses, taxis and auto rickshaws, trains and these fares have to be rooted in costs. In my opinion, fares are too low for taxis and auto rickshaws. One way to determine ratio of taxi-bus fares is by area of road occupied per 100 passengers. This will create incentives favouring mass-public transport vis-a-vis taxis. But fares cannot be increased without having alternative capacity of low cost transportation already operating. Such kind of decisions lead to chaos.
 
Coordination in the Future
At this stage, we need to remember that coordination is bigger issue in Mumbai. The coordination that will work will also involve Municipal Corporations from Thane, Navi Mumbai, Kalyan-Dombivali and Mira-Bhayandar and their respective transport departments. Needless to say, if we develop an e-card it should work on all transport systems. India may also consider and leapfrog the city level card system by creating one card for entire country, which can be used domestically in all public transportation. 
 
Summary
With better coordination, we can improve the fundamental building blocks of BEST rescue. Coordination by itself can create more convenience leading to better capacity utilisation for BEST thus aiding profitability. However, it is not entirely in control of BEST management. In the upcoming articles, we look at strategies that are under the control of BEST management. We start with route planning.
 
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(Rahul Prakash Deodhar is a lawyer, investor and author with experience spanning manufacturing, consulting, investment banking firms. He has advised a wide range of clients including Fortune 500 companies, public and private sector banks, hedge funds and private equity funds among others. He has developed econometric models for demand forecasting in real estate, metals, airlines, and shipping. He designed MIS and planning and budgeting systems, sales networks, and operations for large corporates. He has worked with Aditya Birla Group, CRISIL and Morgan Stanley. He is author of two books – Subverting Capitalism and Democracy and Understanding Firms. He can be reached at [email protected] or at his website www.rahuldeodhar.com.)
 
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Déjà Vu: Essar Yacht Seizure
Sometime in 1990, a well-known Mumbai lawyer told me how his foreign clients had got a ship belonging to Essar Shipping arrested in Dubai. Having failed in their many attempts to recover their money from the Essar group, the lenders used the more efficient justice system in the UAE to embarrass Essar Shipping into repaying them. The report was published on the front page of The Economic Times where I worked then. An upset Ravi Ruia’s reaction was to wave a heavily underlined copy of the newspaper at me and question my understanding of business and journalism. He said that my very high-profile editor those days had apologised for the report. I remember saying that as far as I was concerned, Essar’s ship had, indeed, been arrested in Dubai for failure to pay. I saw no need to apologise. That was the beginning of Essar’s many payment defaults and restructuring of loans—but none of them prevented the group’s rapid expansion and massive borrowing from lenders in India and abroad. 
 
So it was with a sense of déjà vu that one read the 5th October report of Bloomberg on how a hedge fund, David Kempner Capital Management, had ‘turned up the heat’ in its legal dispute with Essar by seizing its private jet, a Boeing 737-700, at Stansted Airport near London as part of debt recovery action that started in July 2017. It has set its eyes next on Ruia family’s luxury yacht. All this is based on a New York court order asking Essar Global Fund Ltd to pay $200 million to David Kempner Capital Management Fund  (with interest) emanating from a  $450-million guarantee it had extended to Essar Steel (Minnesota). Essar has been fighting Kemper’s recovery attempts in court. Meanwhile, Indian banks are also struggling to deal with the colossal bad loans of the group, but show little spunk in recovering money.
 
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COMMENTS

priyanka

2 years ago

They are having the worst track record for share holders also , ln India we need a Robinhood everywhere who will rob the super rich & benefit the poor .

nadeem

2 years ago

We (Indians) never take any action against the rich n powerful!
Whether Ruias, Mallyas or ......

Currently, what has been done about the Panama disclosures??

Ganesh Johnson

2 years ago

This Ravi Ruia & his brother Shashi Ruia are the biggest crooks in the Indian industry. In day-dreaming mode, I would love to seem the put away behind bars for a few years at least.

Vasudevan

2 years ago

We need people like you with spine

Arunkumar A Vijayan

2 years ago

Kudos to your firm stand to not apologise. We need more such people.

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