From Rs 10,000 capital to Rs 20-cr revenue, how Jazzmyride used lean startup principles to cruise into automotive accessories industry
The motivational stories of Bill Gates, Steve Jobs, Elon Musk and Jeff Bezos inspired many to ditch their comfort zones and tread the path of risk, a key element in entrepreneurship. Sunil Dhingra is one such person. He quit his comfortable and well-paying job in the midst of a promising career to pursue his entrepreneurial dreams.
Holding an MBA from Symbiosis, Pune, Sunil (32) worked with Tata Communications, Infosys and Mahindra Comviva, in a span of about six years. The urge to build a niche business led Sunil to discover the gaps in the automotive accessories industry, which was a highly fragmented with few players. This goaded him to set up Jazzmyride, an e-commerce portal for car and bike accessories in 2012.
As part of his research before starting up, Sunil visited 200 stores and 30 new car showrooms in Delhi, NCR and Chandigarh, and read the annual report of global players in this category. He then bootstrapped Jazzmyride with a seed capital of Rs 10,000 to create and design the website and stock a handful of products. Since then, he has come a long way.
Since the initial days, we held this belief that we should develop a strong working business model that runs completely on cash flow and accumulated profits, before approaching investors. It is our opinion that funding should just help in accelerating the journey towards our pre-defined milestones. We have never even raised any debt funding,” Sunil explains.
This Delhi-based startup offers more than one lakh products across 150 categories and has more than 52 brands. The product category includes interior, styling, utility, spare parts, protection, cleaning, car audio, bike accessories, riding gears, bike spares and fashion.
Model and operations
Jazzmyride does not follow a marketplace model but purchases inventory from companies and delivers it to customers through third-party logistics. The startup has currently tied up with 10 third-party logistic players, including Bluedart, EcomExpress, DTDC and GoJavas.
"We offers user-friendly digital catalogues and product videos to bridge the gap of product discovery for the customers," says Sunil.
Recently, Jazzmyride collaborated with TVS ASL, to take on a more online-to-offline (O2O) retailing approach. TVS has invested Rs 75 crore collectively in three startups, including JazzmyRride.
On challenges, Sunil says managing an unorganised supply chain and solving the problem of product discovery for end customers had been quite difficult initially. However, with strong in-house built analytics and technical systems, the startup managed to create an intelligent and efficient stocking model.
Jazzmyride sources parts from original manufacturers or the brand’s authorised channel only. It has also an in-house team of automobile engineers for quality checks, and a strong partner for on-boarding process before initiating procurement.
“We believe in a model inspired by lean companies like WhatAapp, believing in organisational automation. Further, we have planned to grow with a non-linear headcount approach model to ensure we maximise the return on investments and stay lean and efficient,” quips Sunil.
Growing at a rate of 250 percent over the last four financial years, JazzmyRride has achieved a revenue of Rs 20 crore in the last fiscal year. It has a team of 50 people.
Expansion and future plans
By mid-July, Jazzmyride will be taking steps to move closer to achieving its O2O commerce vision, through the franchisee model, starting from Delhi and Chennai, followed by other cities as well. The startup hopes to double the size of products, product categories and brands by 2018. Geographically, the startup aims to expand to Chennai, Bengaluru, Pune, Mumbai and Hyderabad, Sri Lanka and Bangladesh.
The Indian automobile industry has witnessed an annual production of 23.37 million vehicles in FY 2014-15, and it contributes to 7.1 percent of the country’s GDP, as revealed by India Brand Equity Foundation. The automotive aftermarket comprises manufacturers, distributors, retailers, service providers and garages, which collectively spell opportunity for automobile repair services market in India.
However, India is yet to witness any specific government body or association backing the automotive maintenance and repair industry and is therefore still lacking in quality and exhibits price disparity. The authorised vehicle service centres are now striving to organise this sector to an extent.
In the last couple of years, a handful of online car repair services startups like MeriCar.com, SparesHubs.com, 3M Car Care, Cross Roads, MyTVS, CarZcare, Cartisan, Bumper and helponwheels.in have emerged to crack the business model in this space. Bengaluru-based Bumper recently raised $500,000 seed funding from SAIF Partners. Cartisan has raised an undisclosed amount in its seed round from YouWeCanVentures, Global Founders Capital, TaxiForSure’s Aprameya R and others.