What’s the Problem?
Hero MotoCorp is facing tough rivalry from Honda, TVS and Suzuki Motor Cycle. And two-wheeler industry itself is also facing slow down since last one year. Therefore, for the year ending 31st March 2019, Hero’s sales reduced by 16% and it’s market share also reduced by around 2.7 %.
The Solution: Tie up with CredR
Hero MotoCorp in association with CredR will sell its scooter with a buyback scheme and resale price protection. CredR is an online market place for second-hand two-wheelers.
The scheme will allow buyers to buy new Hero scooter like Pleasure and Destiny models with guaranteed buyback certificate from CredR. Buyers will be given assured buyback price proportionately for next 5 yrs. The scheme was first introduced in Pune and performed well. Therefore, the company wants to implement in other metro cities in coming 3months.
Example: If you buy a Hero Scooter for Rs. 50,000 Ex showroom price and in the 3rd year if you sell it, you may get 60% of Ex-showroom price back. That is you will get Rs.30000 back and Rs.20000 will be your cost for 3 years. So if you calculate per day basis it will come to Rs.18.5 per day, (Rs.20000/1080days) which is quite affordable and optimum.
As per the industry experts, The Scheme will encourage the Company’s sales as it is first of its kind in the two-wheeler industry.
About the associate: CredR
CredR is online market place for used two-wheelers. It is founded by IIT- Bombay alumni Nikhil Jain, Nitin Mittal and Sumit Chhazed in 2015 with their own investment of Rs.20 Lakh. They also got mention in Forbes 30 under 30 Millennials of Asia. For the company, the market was initially difficult to crack as the second-hand vehicle market generally operates offline, but with their continuous efforts, quality driven services like warranty, insurance and after sales service, the company is able to make its mark. Read more in detail about CredR