Fancy a brand new turbocharged BMW i8 hybrid supercar at a discount that can save you enough to buy a compact Mercedes? Or a marked-down super saloon Maserati Quattroporte that will leave you with enough money for five Maruti Suzuki Balenos?
Yes, these prized and scarce beauties can be bought from Big Boys Toyz (BBT). The rapidly expanding Gurugram-based luxury and exotic car retailer is witnessing a beeline of customers ranging from ace cricketer Virat Kohli to industrialist Sajjan Jindal.
BBT promises a whopping discount of around Rs 40 lakh on a brand new BMW i8. If you are looking for even a sweeter deal then you could even save more than Rs 1 crore on the car provided you don’t mind buying a 2015 (unused, first hand car) model. While a new 2017 version of the BMW i8 will cost Rs 2.6 crore a 2015 version is priced at Rs 1.55 crore at BBT.
Likewise a new BMW Z4 is priced at Rs 82.8 lakh in the market but a 2016 version of the car on BBT is priced at Rs 62.5 lakh.
The strategy of entrepreneur Jatin Ahuja, who is the founder and managing director of Big Boys Toys is simple – buy in bulk after a huge discount and sell them to customers making a handsome profit. For instance, BBT bought the entire stock of Maseratis from a dealer who had decided to shut shop at mouth-watering discounts.
While this may have been an one-off opportunity, Ahuja’s strategy is bulk buying directly from the manufacturer (not the dealer) and that’s why he gets a good deal. And these luxury car makers are only too happy to offload stock even if it comes at good knocked down rates.
According to Ahuja his company has retailed dozens of first hand luxury cars such as BMW i8, BMW Z4, Maserati Quattroporte and Volvo XC90 at a price tag that is much cheaper than those offered by their own authorized dealers.
“We buy cars in bulk and give them at a good price to our customers. We have sold more than 100 brand new vehicles in the last one year like Volvos and Maseratis. We bought 20 Maseratis from a dealer who was shutting down, all stock. I had three dozen BMW Z4s in my stock. I have sold more than 20 in three months. Only 10 are available now,” said Ahuja.
The new car business, however, is only testing waters, asserts Ahuja as a lion’s share of BBT’s Rs 200 crore revenue of last year came from its traditional used luxury car sales which is well into its 10 th year now.
Ahuja is a first generation entrepreneur who started dabbling in the automotive space when he was in his first year in college. He is a mechanical engineer and has an MBA degree from Delhi University. He is a car enthusiast and always wanted to do business related to cars and proudly claims that cars is the only thing he knows. In 2007 he floated Magus Cars, which was engaged in importing new luxury cars.
Used cars of world renowned brands such Ferrari, Lamborghini, Rolls Royce, Bentley, Aston Martin and even brands which are not officially available in India such as Hummer, Cadillac and Chrysler are sold by BBT whose prices typically fall in the range Rs 1-4 crore.
The market size for such cars in India is estimated at 4,500 per annum comprising little over 10 percent of the country’s overall 39,000 luxury car market which has brand like Mercedes-Benz, BMW, Audi, Volvo and Jaguar Land Rover.
But Ahuja is very conscious of the inventory he is buying. “Our rejection rate is 80 percent. We have a 151 point check on all cars. We don’t buy cars which has done 25,000 kms or when even had a bumper changed, any litigation or bad service or insurance history is also rejected. We also do not sell cars priced below Rs 50 lakh”.
So why would someone who has Rs 1 crore to spend go for a used car than spend a few lakhs more and buy a new model? A car enthusiast, as per Ahuja, typically changes his car every 6-8 months or a year. This buyer should not be confused with a typical customer who is buying for utility purpose (point to point travel).
“We sell cars to those who are passionate about owing them and who do not want to wait for six months to get behind the wheels. That is why our list includes car lover such as Cyrus Poonawala, Navin Jindal and Shivinder Mohan Singh. Sajjan Jindal bought a Maserati from us. Most of the rich don’t even know which car is best for them. So we advise them accordingly and 90 percent of them agree”, added Ahuja.
BBT has plans to expand beyond Delhi as 72 percent of its buyers are from outside of the northern states. From two outlets presently it plans to open showrooms in Mumbai, Hyderabad and Kolkata in the next two years.
“For 40 percent of the cars we sell our customers don’t even come to us. My teams keep flying to customers and on an average basis two customers fly in every day. I have a team of 150 who are dedicated to only buying cars. It’s easy to buy but not so easy to buy good quality”, added Ahuja.
BBT is expecting to clock a growth of 20 percent this year, which is lower than the previous five years when it recorded 30-35 percent growth every year.
“GST sucked out growth during the year. From 3-4 percent tax before GST to strait to 48 percent post GST and now to 18 percent after the reduction in GST. We are optimistic about the return of growth next year”, added Ahuja.[“Source-moneycontrol”]