A new iPhone may be beyond your budget but this Ahmedabad-based startup promises to provide you with a refurbished device at a more affordable price point. The refurbished phone also comes with a warranty and moreover, you are actually contributing to the environment by buying refurbished electronic gadgets.
Qarmatek was founded in 2011 by Krunal Shah and Arun Hattangadi as a repair and refurbishment business for a whole range of electronic devices. While it used to focus on business to business (B2B) segment, it is now moving up the value chain into the business to customer (B2C) segment to provide refurbished smartphones under the brand name Mobex, which was launched in 2020.
Krunal says, “We have in-house professionals who have years of expertise around technology and research and development (R&D), along with the understanding of the markets.”
Qarmatek’s experience of handling various kinds of electronic devices — set-top boxes, PCs, laptops, printers, scanners, and large consumer appliances — made it easy for the company to look into the smartphone segment as well.
According to a report done by India Cellular and Electronics Association and International Data Corporation, over 25 million units of used smartphones were traded in 2021 with an average selling price (ASP) of Rs 6,916 generating a revenue of around $2.3 billion. This is expected to touch $4.6 billion in revenue with sale of 51 million units by 2025.
“The future is all about circular economy and given our expertise, we decided to creating a brand for smartphone devices,” adds the co-founder.
Powered by data and analytics
Qarmatek’s network within the electronics industry meant the startup was able to source used smartphones without much of a challenge. However, the startup’s bigger edge USP lies in its technology platform.
“Our entire data analytics platform is built in-house, which helps us know which phones to buy based on which ones will get sold,” explains Krunal.
The moment a smartphone device lands at Mobex, the team is able to fully diagnose its issues using its technology platform to start repairs for refurbishment.
“Our predictive analysis software can decide at what price to buy these devices and only if it fits our criteria the decision is made to purchase,” he adds.
According to the co-founder, the Mobex brand will be focused on smartphones that have an ASP of Rs 21,000-22,000. However, its catalogue has devices that are both beyond and below this price point.
The target customers of Mobex are the “aspirational buyers” who would like to upgrade themselves to an iPhone, OnePlus, or Samsung smartphone, but may not want to spend as much money a new device demands.
Steady growth plans
The smartphones under the Mobex brand for the present are available only in Gujarat with plans to enter into the Bengaluru market soon and aims to get into regions such as Maharashtra, Rajasthan, NCR, Telangana, etc. The products are available only through the online channel and present on ecommerce marketplaces like Amazon.
Krunal says as Mobex starts expanding into the Tier-II+ locations, it is expected that the ASP of its devices will drop to Rs 15,000-16,000.
While Qarmatek started as a bootstrapped venture, it raised some amount of angel funding from high net-worth individuals (HNIs). It also recently raised its first round of funding from institutional investors to the tune of $3 million from Gujarat Venture Finance Limited and Caspian Debt. This will be primarily used for the growth initiatives of the Mobex brand.
Krunal claims Mobex has seen “strong traction” from the market at a growth rate of 50 percent. He adds that the startup began by selling a few hundred such phones in a month, which now run into thousands.
It aims to sell 15,000-20,000 refurbished smartphones in a month in the next one year.
Qarmatek will continue to have its presence in both B2B and B2C segments, repairing and refurbishing a host of electronic devices for various companies. In this business, it has more than 220,000 square feet of workspace spread across the country, with the largest centre in Ahmedabad.
The company started with just five people repairing power adapters. At present, it has 850 employees who repair more than two lakh electronics a month. Now with Mobex, Qarmatek looks to chart a new path.
Other startups in the same business are the likes of Cashify, Budli, Instacash, etc.
However, Krunal says, “Our strongest point is delivering a high-quality product at a competitive price point.”
