Bangladesh economy is growing steadily at around 6% over the last one decade and expected to grow at 7-8% in the next couple of years.
Economic growth has usually led to swell a large number of middle class people in emerging economies like Bangladesh, offering new business opportunities for both local and foreign companies like Carmudi, an online marketplace.
Purchasing power of middle class people increased as they spend more on non-essential goods like cars, helping to transform the economy.
Used car sales are rising fast in Bangladesh in recent years as middle class people prefer to purchase such cars.
Erwin Sikma, co-founder and managing director of Carmudi, had talks about the emerging car market in Bangladesh and shares his experiences in operating business here in an interview with the Dhaka Tribune (DT) during his recent visit to Dhaka.
DT: Where does Carmudi come from?
Sikma: Carmudi is originally founded in Berlin, Germany in 2013 by our mother company, Rocket Internet, which is a big international internet business across the world. The idea is to get all cars under one roof.
Carmudi is one of the world’s largest and fastest online marketplaces bringing together people who want to buy used or new vehicles and individuals or vehicle owners or vehicle dealers that want to sell new or used vehicles.
DT: What potentialities have brought you to Bangladesh?
Sikma: It’s a good question. Couple of things … first of all the whole country is potential itself … a lot of people here … it is a developing economy that is expected to grow fast in years to come.
On the other hand, there are also fast growing middle class people. They spend more on foods, cloths, cars and other things. This trend makes sure the strength of the car market.
Besides, there is no platform and service in this area. So, we see potentials in Bangladesh.
DT: Are you facing any challenges in operating business in Bangladesh?
Sikma: It is a developing country. So, there are always a lot of challenges here. Challenges like hartal … it is difficult to do business. Internet penetration is not also so super high. Although there are challenges, we grew extremely fast during last year. But it is not a problem for us because we don’t see challenges as problems but as opportunities in that sense. That is why we are here.
… All the time something does not go perfect … a bit problematic … if you do not start taking about risk, you will never be successful. Our philosophy is to look at the problems, fix problems … and to continue.
Regarding other official matters and tax related issues, we have a very good local team who effectively takes care of the process in a very professional and responsible manner.
DT: What’s the secret behind successful story of Carmudi?
Sikma: I can’t say all the secret of course … just find out problems from the buyers side and sellers side. We listen to that … develop products and applications what people of Bangladesh wants … we give our service getting feedback from buyers and sellers. On the other hand, we have robust central team in Germany developing products. We are also specialised and, of course, you need a lot of money. We are the only vehicle specific website in the country at the moment and our website has very high quality contents and photographs.
DT: How did you get idea to launch online marketplace platform?
Sikma: We have seen similar business models (online car classifieds) in Europe and the USA. But there is a growing need for such platforms in developing markets that we feel has not been fully met. Then, we assess how potentials they have and are there any online marketplace and start building the company.
Assessing every pros and cons, we start business in Myanmar, Nigeria, Mexico—three different regions in the world to test how it works as business model. Very quickly, it becomes popular in these developing countries.
So, we started our business operation in September 2013. Since then, we expanded in 18 countries.
DT: Are you planning to expand your business further? If so, what’s that country where you are going to operate soon?
Sikma: Yes, we are going to set foots some other countries soon. Jordan will be the next country to operate our business very soon and we are also exploring more markets in Africa and Asia.
DT: Do you think e-commerce is getting popular in Bangladesh?
Sikma: E-commerce is really booming here. Internet penetration is relatively high compared to other countries in this region.
DT: Which country is most successful for Carmudi?
Sikma: To be honest, all the country is doing very well. We start business in different stages in different countries. But business depends on how big the country is. We are already number one in Philippines, Myanmar, Sri Lanka and, of course, in Bangladesh and hoping to become number one in Indonesia soon. Our target is to establish Carmudi as the number one car classifieds in all countries across the world.
DT: How many car-sells per month make you happy in Bangladesh?
Sikma: I am happy when buyers and sellers are happy. Feedback, calls and leads from clients, dealers, buyers, seller and users certainly make my day.
DT: Why should people buy car from online market place instead of traditional market?
Sikma: Main thing is that you want to buy best car or motorcycle. First of all, it is very convenient, stress-free and saves time too.
You do not need to go to showroom. It enables customers to easily find or sell their cars, motorcycles or commercial vehicles online. At the same time, vehicle dealers and agents get a trusted online presence through a personalised web page. Carmudi has over 400 dealers listed on their website, in Bangladesh making it much more easier and convenient for individuals to find their desired vehicles from home.
We offer diverse vehicle listings, an intuitive website design and high security standards to avoid fraud as we screen every vehicle sent to us before uploading them on the site.