A motor repair business started with Rs800

Entrepreneur acts as intermediary between customers and mechanics.

KARACHI: It was during a class on entrepreneurship in the final semester of BBA in late 2008 that an unusual business idea struck Shakaib Khan. He left the classroom immediately, drove to a shop on Tariq Road to get his business cards printed and started a motor repair business with total investment of Rs800.

The business model of SK Motor Syndicate (SKMS) is simple. Be it car maintenance, repair work, inspection, trading, interior fabrication, exterior add-ons or CNG installation, SKMS claims to be a one-stop shop that acts as a value-adding intermediary between the customer and about 18 authorised service-providers in different parts of Karachi.

But why would someone involve an intermediary and not deal with the car mechanic himself?

“We provide pick-and-drop service along with a seven-day workmanship warranty. We charge customers strictly the going market rates, absorb all risks and get the repair work done from a select group of service-providers at discount rates,” Khan said while talking to The Express Tribune.

Among the 10 successful entrepreneurs shortlisted for Shell Tameer Awards 2012, Khan describes himself as a “car enthusiast” from an early age. With the target market of busy corporate executives and women, he says his customers get “elite treatment” for their cars in an economical and hassle-free manner.

On the first day of its establishment, SKMS brought eight service-providers on board and found a number of ready customers among his family and friends. The business grew by 25% in the first year of its establishment while the growth rate was 15% in 2011.

It has created four jobs directly and more than 70 jobs indirectly. The business now has 42 regular customers while walk-in customers in a given month are about 20% of the regular ones.

“Passion drives this business. As a car enthusiast, I was initially looking for the little teenage luxuries. But it turned out to be a lot more than that,” he said, adding that he is the first member of his family who has started his own business.

“My total investment is Rs800. I’ve got no capital expenditure, no office, no workshop, no tools, no overheads, no rent, no utility bills and no salaries. We work on a commission basis. We make a profit when there’s business. But we make no loss when there’s little business,” he said, revealing that last year’s turnover was Rs1 million.

The authorised service-providers work with SKMS at discount rates not just because it brings them steady business. In fact, they find SKMS more valuable because Khan helps mechanics with regular service advisory. “I download car repair manuals from the internet to find the prescribed method of fixing a problem. I do the translation and help the mechanic understand how best to approach a problem. This saves him from a trial-and-error approach, which is both time-consuming and bad for the vehicle.”

Khan says he plans to expand the business by establishing his own workshop in the next one year. “I know my potential. I’m not afraid of anyone stealing my business plan.”

Published in The Express Tribune, March 15^th, 2012.