In 2012, Patrick Patel repaired Audi cars on the driveway of his house. Today he runs a nine-bay, five-man workshop in northeast London and is eyeing another. And it is all thanks to a website.
Car repair, long the domain of oil-smeared mechanics relying on word of mouth marketing and loyal customers, is the latest industry to be shaken up by online intermediaries, following the likes of Just Eat in catering, Uber in transport and Airbnb in accommodation.
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Mr Patel is one of almost 5,000 mechanics signed up to WhoCanFixMyCar.com, a crowdsourcing website that matches and connects drivers in need of a repair with garages that bid for the business.
Like the takeaway food sector or the taxi market previously, the website’s founders say the industry is ripe for disruption and aggregation. Two-thirds of the UK’s €26bn aftercare market goes to small, independent businesses, according to a recent report by the Boston Consulting Group.
The website provides these independent garages with an online presence for an annual fee, and allows them to bid for jobs posted by customers, while taking a commission.
“It had a huge impact on my business,” says Mr Patel, who now gets 90 per cent of his custom through the site. “When I started out it was very hard to get jobs because I was not recognised as a business.
“After registering, I started bidding for jobs, started winning jobs, customers left reviews and from there my business has excelled,” he adds.
The website generates more than £1m worth of business requests every month and expects to double its number of registered mechanics by the end of the year, which would equate to more than a quarter of the UK’s 37,000 mechanics.
The internet is slowly changing the wider after-market industry. Online sales of car parts and tyres in the EU accounted for 6 per cent of all after-market sales in 2012, up from 4 per cent in 2010, according to the BCG report, which forecasts a 15 per cent compound annual growth in online sales over the next few years.
Bundled together under buzzwords such as “online marketplaces”, “crowdsourcing” and “the shared economy”, websites that aggregate customers for subscribing businesses are springing up across sectors and drawing strong investor interest.
Just Eat, which connects hungry users with takeaway food, listed in April with a £1.5bn valuation, while Zoopla, a property website, went public last month with a market capitalisation of just under £1bn.
Like these, and others such as Airbnb, customer feedback is a key part of the WhoCanFixMyCar model.
It is much nicer to be an anonymous user, post what you think is wrong and have them competing to quote you. Then you have some value
- Helen O’Neill, customer
Branded and franchised garages compete against small, family-run mechanics, with drivers making a choice based on quoted cost for the repair and reviews from previous customers.
“You are educating a quite slow-moving industry. The least sexy bit of the car industry has for long been the aftersales bit, relying on word of mouth and things like that to gain customers,” says Alistair Preston, co-founder of the website.
“There is a lot of low-hanging fruit here because this is quite an inefficient market, it is very fragmented. The whole aggregation element streamlines it for users and for the garages as well,” says Mr Preston, who left his job with Lehman Brothers to start the business. “With many garages there is no transparency at all. And this fixes that. The peer reviews are key.”
Helen O’Neill, whose Audi car was fixed by Mr Patel after she posted her breakdown on the website, says that the approach protects drivers who are unsure of how much repairs cost, and risk being overcharged by garages.
“I had been to the Audi garage a few times and had been charged a fortune,” Ms O’Neill says. “Even people who know about cars, they are still at the mercy of the garages who say what needs to be done.
“It is much nicer to be an anonymous user, post what you think is wrong and have them competing to quote you. Then you have some value,” she added.
WhoCanFixMyCar, which is part-owned by the Trinity Mirror media group and is controlled by its three co-founders, will conclude a second round of financing this month, and is also expanding into Australia.
“Our opinion is that the Australian market is perfect for aggregation,” says Matthew Clunies-Ross, a partner at Artesian Capital in Sydney, who is leading the Australia expansion. “All the issues that are prevalent in Britain, that make the model a winner, are also prevalent in the Australian market, but with an even higher ratio of vehicles per person.”
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