Translating passion into viable business proposition4 min read . Updated: 06 Jan 2013, 11:01 PM IST
Starting with a capital of `100, Saurabh Katar now owns a `30 lakh company making Royal Enfield enhancements
New Delhi: Clad in a black leather jacket, a pair of denims and leather shoes, Saurabh Katar looks like a quintessential biker. He is indeed among the lucky few who have been able to translate a passion for long bike journeys into a viable business.
It started in 2008 when Katar was a Delhi university student pursuing a bachelor in business economics with an initial capital of just ₹ 100. Five years later, he now manufactures performance-enhancing exhaust systems and other kits to modify Royal Enfield bikes, which has a cult following in India. His company, Sans Classic Parts, is now a ₹ 30 lakh venture.
“We started primarily as a trading firm for the silencers and other accessories for Royal Enfield motorcycles," Katar said. “The business started with three silencers. With time, we have diversified our portfolio."
The five-year-old start-up Sans Classic provides performance exhausts or silencers, popular accessories ranging from saddle bags to spring seats, bolt-on kits (that can give a Royal Enfield a vintage look) and sells online biking leather gear. His firm’s Goldstar exhaust pipes gives the iconic motorcycle a thumping sound that its lovers associate with, Katar says, adding that it also enhances acceleration.
The exhaust leads to a slight change in the initial pick-up and better achievability of top speed, he claims. The reason is the pressurized outflow from the conical baffles equipped in the customized exhaust. The Goldstar thump is better than the sound from the regular exhaust when one races a bike to 70-80 km per hour but medium at low speeds, the company’s website says.
The bolt-on kit the firm sells is a custom modification pack of 16 components to overhaul a Royal Enfield for a classic look.
“Me and my customers are driven by the same ideology, passion for Royal Enfield," said Katar, who has also completed a Master in Business Administration from Christ University, Bangalore. “And finance is never a constraint to achieve your craze."
Coming from a family of salaried parents—his father was in the Indian Railways and mother a nurse in a Delhi hospital—Katar faced the usual pressures of getting into a regular job. He started working in a private financial research firm, only to quit and give his full attention to his start-up.
San Classic has at least 10,000 customers who have either purchased the exhaust pipes or the bolt-on kit, according to Katar. The allied items have numerous customers, he said. Interestingly, the company grew from being a local firm to grabbing export orders from distributors based in West Asia, Canada, South Africa and Argentina.
In India, San Classic finds most customers in Bangalore, Pune, Mumbai and Chennai. Besides, Himachal Pradesh and Ladakh are new destinations for business as biking is picking up as a hobby and as a sport in these areas.
“The disposable income and growth of the IT (information technology) industry in places like Bangalore and Pune has given us a good business. If somebody can afford a Royal Enfield worth ₹ 175,000, he would not mind spending a couple of thousand to get a performance exhaust or little more for the bolt-on kit," said Katar. The bolt-on kit is priced around ₹ 40,000.
“The opportunity is immense. Now we are only focusing on the 350CC to 500CC Royal Enfield. We have our plans to cater to below 350CC motorcycles where the business opportunity is large enough. If we can develop our capacity and cater to this mass segment, then the whole country will be a marketplace," he said while showing the changes he has made to his motorcycle.
To be sure, Katar faced his quota of challenges. Since he is a management graduate and does not have deep knowledge about automobile engineering, he and his team is a little soft on product design, which is a must to scale up the business. “Now, I make some design on paper and then give it in the factory to mould the silencers. For me, it’s so far a business of experience and not of expertise," he said. “But, while scaling up, we need domain experts."
Besides, Katar says some of his exhaust systems “are not road-legal," meaning that they produce “pollution more than the original product" of Royal Enfield. And here, he needs to build expertise to check pollution. But the good part is the Sans Classic products “do not have any adverse impact" on the engine, Katar claims. “But, once we scale up (product ranges for the under 350CC bikes), this may not be the case. Here, we have to build the expertise and hire more people."
But that would also mean bigger investment, in the range of at least ₹ 50 lakh, Katar said. He has spoken with a few private equity and venture capital firms. “The problem is once they invest, there will be interference in decision-making," he said. “I am an independent person and it will be a problem for me."
Till that time, the passionate entrepreneur is happy with his current growth. “The buyer-seller connect is very strong and my business is getting word-of-mouth publicity for the quality we are providing,’ said Katar. Moreover, free social media marketing is helping in expanding connections and in marketing the products, he said.
Mint is a strategic partner of National Entrepreneurship Network, which hosts the Tata First Dot competition.