COVID-19 pandemic has put the focus on on-demand service providers

Not too long ago, minor household problems like water leakage or a blown fuse could cause major headaches due to the lack of availability of skilled handymen. Things are different today.

With various gadgets, appliances, and higher disposable incomes, the need for home maintenance and repair service personnel such as carpenters, plumbers, electricians, beauticians, and sanitation workers is on the rise.

It would be appropriate to credit professional home services providers as the catalysts of this change.

While the need for on-demand home maintenance services was always there, there was no consolidated one-stop shop to take care of this need.

With the power of the internet and smartphones, the opportunity eventually arose for creating web-based platforms that could cater to this massive market.

The challenges

One of the biggest challenges faced by on-demand service providers in India is the lack of trust in the quality and reliability of services.

The demand is huge, but the supply of expert handymen, especially plumbers and electricians, is often inadequate. At times, the personnel booked through the apps may not be as competent as familiar handymen hired from local shops.

So, if a person from one app-based platform fails to provide quality services, the user is likely to become apprehensive in trying such services again.

However, these are teething problems for the segment in India. The industry is maturing and the competition is becoming tougher with the entry of several new players.

Clearly, quality and convenience of services are going to be the USPs in the future.

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The impact of COVID-19

The COVID-19 pandemic disrupted all regular business activities. Except for a few essential services, including sanitisation and fumigation, all other operations were suspended during the two-month lockdown.

If we look at the short-term impact, this outbreak has adversely affected companies.

However, it has also led to an awareness of the benefits of these on-demand services. Service personnel deployed by the organised sector maintain strict hygiene protocols and are better equipped to deliver services efficiently and quickly.

Since the entire process of booking to availing the service is driven by technology, the services are more convenient and trustworthy.

In the post-lockdown phase, the demand for such services is likely to substantially increase as consumers will be wary of allowing unverified handymen to enter their homes.

Future opportunities

The market has now expanded beyond Tier I cities in India. New players are entering the segment with great frequency and the past projections put the CAGR at 52 percent up to 2022.

Until now, this market was predominantly catered to by the unorganised sector. Local electrical and hardware stores employ electricians who work according to their preferences.

Currently, about 80 to 90 percent of the market share belongs to these unorganised players. Thus, it is a prime opportunity for technology-driven platforms to capture this market.

Consumers are warming up to the idea, and various other obstacles that had previously hindered growth have now been removed.

If we look at the urban transportation sector in India, the situation was quite similar until about a decade ago. The public had to rely on private autos and taxis that had no fare or service consistency. When app-based taxi aggregators like Uber and Ola entered the market, they had to face a lot of resistance. However, their superior convenience and competitive costs made them successful and establish their presence in major Indian cities.

The time is ripe for app-based on-demand service providers to achieve similar results. Two other major factors are conducive to this growth:

Huge market potential: About 80 to 90 percent of households require services of professionals like electricians and plumbers every six to 12 months.

Convenience: With a rise in disposable incomes and busy lifestyles, Indians prefer to get quick and hassle-free service even if it costs more.

With an emphasis on service standards, cost effectiveness, transparency, and customer satisfaction, app-based service providers are in a better position to provide superior services. In times like these, it is important for app-based service providers to ensure strict adherence to hygiene and safety protocols and maintain service quality.

In the post-pandemic world, the demand for new services such as home-based beauty services, sanitation, pest control, fumigation, and more will grow rapidly. Service providers must be ready to meet this demand surge proactively and professionally.