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Monday, August 3, 2009

 

Man Opens Taxi Service Pay What You Want

Vermont man opens Recession Taxi

 

By Joel Banner Baird

Free Press Staff Writer 

August 2, 2009

ESSEX — You read it right the first time: the message on the taxi’s back window really reads, “Pay What You Want!”

Eric Hagen, 46, an Essex resident and the SUV’s owner (and sole proprietor of Recession Ride Taxi) smiles a lot, but he isn’t joking. He’s making a profit.

“Nobody has shortchanged me yet,” he said Saturday. “Nobody’s stiffed me. I’ve decided to empower the customer; they like the fact they can decide.”

Hagen, who still works full time at the American Red Cross in Burlington, hatched his improbable business model in June.

“I hadn’t thought about it before,” he said. “I was watching CNBC — the financial station — and it suddenly hit me: Everybody’s always hearing, ‘This is what your mortgage is going to be; this is what your car payment’s going to be.’ People want to get away from that.”

Low start-up costs and low overhead prompted Hagen to get a cabbie’s license and insurance.

He printed up some business cards with his cell phone number, and waited.

The first half of July, Hagen took far more questions than fares: “People were coming up to me in parking lots and asking, ‘Is this for real?’ I’d tell them, ‘This is for real.’ And I’d give them a card.

“After two weeks, business really started picking up,” he continued. “That’s the way consumers are: they’re curious at first, and then they gain trust. And I’m trusting that the consumer is going to be fair. Maybe that’s what people need right now.”

The New York Stock Exchange, where Hagen worked in the 1990s, shaped Hagen’s take on what he liked — and didn’t like — in the world of finance.

Stints at Putnam Investments and Bombardier Capital (now GE Commercial Finance) sharpened his search for a different way to do business.

“It caused me to be more empathetic: You’d see millions of dollars in losses. You’d see corruption, and then you’d talk to people who’ve lost their entire savings, lost their retirement,” he said. “It made me think there’s got to be a different approach.”

Hagen offers Recession Ride customers an expanding selection of what he terms “the fringe benefits” of his service.

Repeat customers get their business cards punched; every seventh ride is free — as long as it’s within Chittenden County.

He keeps a cooler in the Durango loaded with pay-what-you-can iced bottles of water, Gatorade and soft drinks.

Other benefits of “membership” are still in the development stage.

Hagen’s city of Burlington permit is still in the works, but he’s taking people’s numbers for future rides. He keeps his cell phone on, day and night.

So far, he’s taken no heat from cabbies who follow more traditional codes of commerce — just a few phone calls to satisfy a growing curiosity: Is Recession Ride legit?

He tells them business is good, and growing.

Like other cabbies, Hagen keeps a detailed log. He’s earned about $600 in two weeks, working Thursday nights through Sunday evenings.

Most, but not all of his transactions are in cash. One fare, a musician, gave him a newly minted CD. Another proffered a Hannaford’s Supermarket card.
“It had $10 on it. It was a fair trade,” he said.

“I believed from the start that this would work,” he continued. “I believed that people are going to be generous enough to make it worth my while, and I’m going to be generous enough to let them decide.”


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