Opinions expressed by Entrepreneur contributors are their own.
You’re reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.
Headquartered in Muscat, Oman, Carzaty is, in layman’s terms, a virtual car showroom that allows users to choose from both new and used cars. Founded in 2017, the online car retail platform is described as “a technology-driven omnichannel automotive retailer” by co-founders Hassan Jaffar and Marwan Chaar. The firm also recently expanded into the UAE market with an office located in Umm Suqeim, Dubai.
While the business model adopted by the Carzaty owners is heavily dependent on technology, it actually involves a blend of online and physical showrooms. “Carzaty offers cars in an omni-channel approach, which means both online via our website or at our brick-and-mortar retail stores,” says Chaar. “Our CarHub, which is our digital showroom, does not have physical cars present inside the showroom. Instead, we have screens, where our CarMatchers show customers our entire inventory, digitally, meaning they are no longer limited to the 20 or so cars that can fit in a typical car showroom. Compared to traditional car showrooms, the entire process is much quicker, since the customer can simply zone in on what they’re looking for, rather than spending time explaining their requirements to a sales assistant, scheduling a test drive, and bartering the price.”
The aforementioned CarHub is described by the owners as an easily accessible location, no matter where the customer resides. Once the customer chooses a specific car via the online platform, it is delivered to said location in a matter of 15 minutes for a test drive. “In this way, we combine the best of online with the best of offline,” says Chaar. The founders also believe this blended model has helped them reduce major overhead costs that come with running a physical showroom.
What’s interesting to note here is that in addition to bringing the car to the customer for a test drive, Carzaty also offers a home delivery system. “For our new cars, we offer home delivery right away,” Chaar explains. “With used cars, we offer a test drive first so that our customers can be sure of their choice. Once their decision has been made, then we will deliver the car to their home. This just keeps it economical for us and our customers.” He also firmly believes that the standard of car safety and quality offered by the firm is trustworthy, especially when it adheres to the used car sales. “We take pride that our assured cars go through rigorous checks and are certified to the highest quality standards. For additional peace of mind, all of our cars have optional extended warranties, guaranteeing a smooth and dependable ride.”
But there were some initial hurdles the founders had to face, particularly in relation to the pricing of their used cars. Jaffar weighs in on the situation by saying that while their cars may be slightly higher priced, there is greater value-for-money through Carzaty. “Buying from us, rather than an individual, where the car’s history or maintenance can’t be guaranteed, has greater long-term economic benefits. For example, a simple change of tires can cost the customer thousands of dirhams. Our cars are checked, fixed, and serviced, so they can drive away with full confidence that nothing will go wrong. Buying cars that are lower quality will cost the customer more in the longterm,” he explains.
Amid the COVID-19 crisis, Marwan and Jaffar noted a specific change in consumer behavior– more people in the region were interested in buying secondhand cars. “A recent survey by Frost & Sullivan showed that 80% of consumers in the UAE prefer to buy a used car instead of new,” Chaar says. “Customers in a post-COVID-19 world want to buy the most economically attractive car, and that is a quality used car that they can trust. Of course, our established online presence has helped us attract customers that are more willing to search and buy online.”
When asked what the biggest advantage Carzaty offers to its customers, Chaar continues to reiterate that reliability, affordability, and convenience are the firm’s biggest USPs. “What makes us unique is our ability to tap into the latest technology and retail trends to offer a more affordable and convenient way to buy cars, and we do not see pure online sales as realistic in the short-term,” he elaborates. Customers can browse through all the inventory that is available with 30 high resolution, detailed pictures of each car along with the specifications and features, and the website has a calculator for financing and a comparison section where customers can evaluate cars side by side.”
Now, with plans of expanding to Kuwait and Saudi Arabia next, it will be interesting to see how Carzaty can take advantage of changing consumer needs and the increased shift towards ecommerce to gain more sales- all the best to the startup for the road ahead!