However, over a period, the high tax rates, as well as the advancement of technology, have put the prices in the high range, rendering it hard for the average person, making them look for alternatives. In addition, India being a low disposable income nation, second-hand two-wheelers are a good fit for their annual expenses.
However, the used car market in India is unorganized and fragmented and is known for delivering poor customer experience. To tackle this problem, Three IIT-Bombay alumni, namely Nikhil Jain, Sumit Chhazed, and Nitin Mittal, founded CredR in the year 2015. Chhazed and Mittal quit in the year 2017.
In a conversation during an interaction with the Entrepreneur Indian, Sasidhar Nandigam, who serves as the Chief Strategist and Co-Founder of CredR, discusses the origins of the company and the speed at which they were able to get back on track.
Inspiration From Bad Experience
Looking back in time, Nandigam shares that in 2015, Jain, who was about to finish his studies at IIT Bombay, was looking for a used two-wheeler for sale. Nandigam stated that Jain looked through popular classifieds such as OLX as well as Quikr to locate a feasible alternative.
“Back in those days, if you dropped your contact numbers to any of the classified websites, you would get a slew of calls from dealers,” he stated.
Jain purchased a second-hand bike valued at INR 50,000. Nandigam claimed that Jain did not receive a charge, and after three days, his bike stopped functioning. The dealer refused to acknowledge the existence of the transaction. Incredulous, the founders of HTML0 went back to figure out the nature of this market. They conducted a market study and discovered that the majority of the customers experienced similar experiences. They decided to launch an online brand that can aid customers in buying second-hand two-wheelers with ease. CredR founded the company on February 14, 2015. The company has recently received INR 14.7 million in funding from Eight Roads Investments and ON Mauritius. In the past, it had received $6.5 million through Omidyar Network.
Customer Experience At Core
In the beginning, Nandigam said that they were looking to offer a “kickass customer experience.” “Customer fulfillment is at the heart the business we run,” added Nandigam. The company, when it was first founded, served as a liaison between used dealers and buyers. The company would list vehicles from various dealers on their site, and when buyers showed interest, a representative from the company would guide buyers to dealers directly.
However, the founders soon recognized that their business model actually led to negative user experiences and went against the concept of a startup. This was the reason why, in 2018, they started their retail stores and made changes to the occasion. The company operates in cities that are major like Pune, Bengaluru, Delhi NCR, Jaipur, Kota, and Hyderabad by using its franchise program. The showrooms provide customers with a variety of used two-wheelers refurbished with the lowest price. With its unique technology and fully integrated vertical company model, CredR aims to deliver customers a superior experience. The company promises 60-70 percent of the purchase back amount to its customers within 12 months. The company also offers a six-month guarantee on the gearbox and engine and a day purchase guarantee to fix any small issues. CredR is currently operating four warehouses across four cities, which house 500-600 two-wheelers.
The buyer can select one of the two-wheelers on the website and then pay to have their vehicle delivered to his door, or he could go to the showroom. Additionally options, customers can sell their two-wheeler on the spot or trade it in for an entirely new scooter or bike. Recently, the startup worked together with Ampere EV and Gemopai Electric in select cities to offer estimates for second-hand gasoline two-wheelers in order to make the exchange process easier.
Pandemic and Its Effect
For the rest of the month, April was tough for Nandigam, as the nation was in lockdown, and there were no requirements for travel. Once people found the motive to leave, they began looking for private vehicle alternatives. Nandigam stated that as the public transport system came to a standstill and was dangerous in the aftermath of the outbreak, sales increased slowly. According to Nandigam, in May, they saw a 50-60 percent increase in pre-COVID sales. Fast into September, they have returned to between 80 and 90 percent of pre-COVID sales and are now looking ahead to the Christmas season for a complete recovery.
He also said that second-hand items are the main beneficiaries of the spread of this pandemic. In response to questions about the idea of sharing mobility, the man explained that sharing mobility in India is in decline because of the virus. He further explained that it’s hard to implement the concept of shared mobility in India due to the fact that Indians are not able to appreciate the value of a shared product as their own. In addition, Indians take pride in having expensive items.
Nadigam stated that they are planning to see 10 to 20 percent growth in sales before the end of this fiscal year instead of 200 percent because of the pandemic.