Come floods or rains, nothing can water down Precared’s spirit
Like most entrepreneurs who were motivated to find solution to a personal problem they encountered, Tabrez Khan started Precared when he was looking for a place to sell equipments that belonged to his child. Much to his disappointment, nothing of the sort existed in India. The only option therefore was to either give it off in scrap or let it lie in his attic gathering dust.
The more he thought about it, the more he was convinced there existed an opportunity to buy and sell such used products. Lots of leg work and much conviction later, Tabrez started Precared in 2011. YourStory was following the progress of the startup closely, but of late it fell off the radar. Couple of weeks ago, we heard from Tabrez and he said he had some interesting developments to share.
Here is an account of the roller-coaster ride that Tabrez went through the last couple of years.
Since the launch Tabrez was making slow but sure progress with Precared. “I had built up a sizeable number of inventories. And there was a good number of customers registered on the platform,” says Tabrez. Precared had also managed to raise a first round of funding from MyFirstCheque in November 2011. By July 2012, Precared had managed to build up inventory worth Rs 4 lakh. But the heavy rains that lashed Mumbai in 2012 flooded the warehouse and spoilt the entire inventory.
This was a big blow to Tabrez and Precared. It had taken him a year to build the inventory which was all rendered useless because of the floods.
Precared offers used baby products which gets sanitized, cleaned and graded according to the condition of the product. On offer are toys, bathing accessories, car seats, prams, cradles, etc.
In the beginning, Precared would purchase all the products from parents, but after the floods and the resulting loss, Tabrez has changed his model. Since January 2014, all products on site are taken on partial credit from parents – 5% of the product cost is paid upfront and the balance is paid after the product is sold online. Precared is still a single-member organization, and most work has been outsourced. Tabrez manages all the pickups himself and his family also helps him with the day-to-day operations of the business.
There is a separate team that looks after product inspection, grading and packaging. And logistics is taken care of by a third team. Precared offers a 15-day return policy for all goods, but Tabrez says hardly anything comes back. “When I started I had no idea of the concept of startup, entrepreneurship and such. It was simply an idea which I thought was interesting and wanted to see the effectiveness with which I could execute it in the market,” says Tabrez. And there have been many learnings on the way.
Safety of products supplied was obviously on top, and continues to be. Next learning was their bouquet of offerings. Customers wanted variety; they were looking for more than just a handful of products to buy. This has been a challenge because the variety depends on what customers list on site, and therefore to offer more variety, customers need to list them online. The only way to overcome this challenge was to get more people to come to the site and list their products online. Slowly as the word spread and more people came onboard, the inventory increased and today there are over 300 products available online at Precared for customers to choose from.
Tabrez says a lot of traffic to the site has been organic. “When the floods washed out my inventory, I was contemplating a shut down. But what kept me going was the continuous enquires that I would receive from customers. On an average there were at least 10 enquiries each day,” he says. Tabrez has also used Google Adwords for advertising Precared.
Mumbai continues to be the main market for Precared, and Bangalore is next on the list. “Much of the demand is coming from nuclear families, and many new generation parents who are using these products. These parents are perhaps the first generation to have a demand for these products,” explains Tabrez. The average purchase value per order on site is Rs 3,500, and upto 28% customers who come on the site are repeat customers.
The products sold by Precared are 50% less than the original cost price, and according to Tabrez, many a times the products that are sold have barely been used for couple of months before they are put up on the site. The concept that Precared is based on is new to India, but the habit of recycling products is not new to Indians’ behavior. We have all been handed down toys and products of our older siblings as children, sometimes much to our annoyance.
Internationally the concept is well-entrenched and has been around for much longer. That is also because as a market international customers have been using baby care products for much longer than Indians. Tabrez pegs the market opportunity to be in the region of Rs 4,000 to Rs 6,000 crore, and Precared certainly has the first mover advantage here.
With plans of expansion – both his team and operations — Tabrez seems to have put behind his days of self-doubt. And given the booming baby market in India, he seems to have a winner on his hands.