If you have ever observed a Zoomer (Gen-Z) in their natural habitat you would notice they have both strange and amazing habits, that have never been displayed by the generations before them. From paying exorbitant prices for fancy coffees with their names on the cup to making sure that they take out a picture of their perfectly placed food for the “gram” before tucking in. We can all agree that the “Zoomer” is both a fascinating and complex creature.
But how is this technological work from home guru shifting the scales in the way we look at financing and business as a whole?
Gen Zs were born into the digital world and thus have had access to information and education like never before, this has resulted in a generation of consumer that has ample disposable income, a head full of product knowledge and a lack for the desire to own things, a significant swing from the boomer generation that kicked off the 3 rd industrial revolution almost 50 years ago.
In recent years, the need to diversify one’s portfolio has grown and having an additional stream of income has become a trend in most South African households. The Zoomer has again proven to be a resilient species often turning a weekend side hustle into a thriving small business. In 2022 those small businesses contributed to 30% of the total employment in South Africa. Gen Zs are in fact a generation that would rather own their passion rather than the asset.
So, what does this mean for the automotive industry? Well recently after joining the Key Group under their rental division Key Hire, I have quickly learnt of the need of many small business owners for a flexible mobility solution that gives them exclusive use of a vehicle without the burden of maintenance and the anxiety off the debt on their balance sheet, a need that has experienced a significant growth in recent years in both the passenger and commercial market. This has since forced car dealerships to rethink their position in the market and produce new product offerings that meet the needs to the ever-demanding Zoomer having to assume the debt on their own balance sheet all while juggling the risk of the ever-unstable South African economy.
So how do I, the millennial “a generation caught in between” feel about the “Off balance sheet” model? Oddly excited, as a young businessman in an ever-evolving environment I think now is the time for us to invest our resources to understand the concept, weed out the flaws, master the accounting and design a product that is market leading all while satisfying our risk appetite and not losing our focus on our core business.
The future is bright and while the Zoomers overcome the hurdle of choosing their next binge-worthy show and the Boomers work hard to learn how to connect their phones to Android Auto, the market is bubbling under the surface. We as an industry need to brace ourselves for the next wave in customer trends.
If you wish to discuss this viewpoint, please contact Vireshan Mahadavu, Director Finance at KeyHire