Building new businesses for the coming mobility society Finance and Legal Compliance

Hurdles to overcome to realise new business

When transitioning from selling goods to selling experiences, it is necessary to move away from temporary monetisation through the provision of goods to continuous monetisation through the provision of services. Companies are required to develop monetisation flows and properly control financial impact, which includes the following challenges.

Issues related to monetisation flow development

Difficulty in setting fees: It is necessary to set fees and tariffs for unprecedented services and design a cash flow that ensures continuous fee collection.
Difficulty in revenue sharing among stakeholders: As the number of related stakeholders increases, the structure of beneficiaries is expected to become more complex, necessitating a new structure for revenue sharing.

Issues related to controlling financial impact

Length of time for return on investment: A shift in approach from cost recovery through short-term settlement of selling goods to investment recovery by managing the ‘number of users, contract period and churn rate’ is required.
Uncertainty of return on investment: The ability to own and manage the assets essential for the realisation of continuous service is required.
Increased complexity of financing: Collaboration with service, platform and finance providers, coordination with government and municipalities, and enhanced management of the various risks to be considered are required.

Regulations to be faced in the transition

Diversification of regulations to be considered: In addition to industry regulations that have been addressed for selling goods, it is necessary to address various regulations related to new services, such as financial regulations, transportation regulations, consumer protection, accounting and tax regulations.

The points at issue for building new businesses

Companies are required not only to develop methods of providing value to users, but also to create structures to realise sustainable provision. It is important to select the appropriate means to build the new business and to increase the certainty of its realisation.

Issues that arise in the shift to selling experiences

Value enhancement for users: It is necessary to design a system that users do not feel resistant to, such as by diversifying payment methods, which is required alongside the advancement of UX/UI.
Development of a billing system: It is necessary to design a charging system that maximises the services, such as subscription and pay-as-you-go systems.
Funding and asset management: Stakeholders should be selected to increase the certainty of realisation for funding and asset management, such as project finance and vendor finance.
Infrastructure development and government partnership in the target country: It is necessary to select the most appropriate approach to develop the business in the target region, such as PPP/PFI and tax incentives.

PwC services

When a company starts a new business, there are many challenges on the path from strategy formulation to operation design. PwC provides insights from the business and finance perspectives needed to realise new service offerings, while PwC Consulting LLC, PwC Advisory LLC, PwC Legal Japan, PwC Tax Japan and other PwC Japan Group firms work together to provide consistent, hands-on support from new business development to implementation.