How this bootstrapped home service provider hit profitability in 18 months

23rd Mar 2017
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The platform provides service management solutions and facility management for both the final customer as well as businesses 

Four years ago, Siddhant Kachroo, then 23, joined Mott MacDonald India, a management, engineering, and development consultancy. He was the youngest manager in the organisation, spearheading a team of people twice his age.

Maintenance House Team

During his stint with Mott Macdonald, he observed that there was a huge demand and service mismatch in the maintenance segment in the country. He also realised that booking a service or a technician online could never solve the real problem that end customers faced. He concluded that something had to be done to change the customer experience.

Realising that the lack of skilled professionals and proper channels made the home maintenance process cumbersome and difficult, Siddhant decided to address the maintenance issue by creating a service provision business. In May 2015, he launched Maintenance House in Delhi NCR.

“It is a service solutions provider to the end customers as well as businesses that face service process issues on a day-to-day basis,” says Siddhant, CEO and Founder of Maintenance House.

He adds that he aimed to provide a solution that addressed the core problem of end consumers — satisfactory service. The aggregators tried to address the existing demand in home service. The platform has an in-house team of 250 people to get the work done. Instead of adopting the marketplace model, he differentiates his platform as a service provision business.

The business model

The platform follows both the B2B and B2C models. Its product range includes pay-per-call services, annual maintenance contracts, process and project management solutions, and facility management for both the final customer and the business ends.

Siddhant Kachroo, Founder, Maintenance House

The B2B model constitutes service solutions, consulting projects, renovation, and property management contracts. According to Siddhant, B2B constitutes around 60 percent of the company’s revenues. In the B2C category, which makes up the remaining 40 percent, individual calls and annual maintenance contracts form the main source of revenue.

The platform claims to have offered services to over 26,000 customers and signed over 1,000 AMC contracts across industries.

Philips, Emmar MGF, M3M, OYO Rooms, AEGIS, HCL, Vardhman Group, Decathlon, and NestAway, among others, are some of the clients of Maintenance House. Besides these companies, some aggregators in the hyperlocal space that have worked with Maintenance House are UrbanClap, HouseJoy, Mr. Right, LocalOye, JustDial, and TimeSaverz. Says Siddhant,

“We have grossed over $350,000 in revenue in the first 18 months of operations. Most importantly, we are a profitable business, despite never having raised external funding.”

How it taps customers

Most of the customer acquisitions on the B2C platform come through Maintenance House’s partners, and they charge a commission of around 10 percent on such transactions. The company sees 80 to 90 percent repeat customers. It also gets 20-30 percent of its leads online through its website, Google, and social media.

In the B2B category, acquisitions are mostly through referrals from existing customers or acquired through cold calling.

The challenge faced is no different

Siddhant says the service segment is extremely challenging. There are two key risks, namely manpower and communication.

He believes that recruitment and training are uphill tasks, tasks that to many may seem unconquerable. “We counter this by partnering with NSDC (National Skill Development Corporation) and NAPS (National Apprenticeship Schemes). Our solution was to tie up with ITIs and government institutions to support and foster skill development.”

Another challenging task was ensuring that all teams were on a common information platform, with communications between clients and operations teams and internal communications running smoothly. To address the issue, Siddhant employs unified communications within the company.

Market capacity 

While there has been no proper study conducted on the exact size of the on-demand service market, industry experts estimate it to be around $20 billion, based on 300 million users in the top 20 Indian cities.

In this huge market, besides marketplaces, many other vendors are testing the waters. CrewPower, Easyfix, and many independent vendors are offering services in this category, and they expect business to soar high in the coming years.

The solution providers are creating new and innovative products and solutions across industries. From expanding into new cities to rendering solutions to different industries, the potential for growth for such vendors is considerable.

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