Moving in the right direction
By Chong Jinn Xiung December 6, 2016
- Self-funded startup seeks to solve the logistics problems of the Klang Valley
- Aims to expand its courier and ridesharing service nationwide
GROWING a startup is never easy and Nabil Feisal Bamadhaj (pic) has seen his share of ups and downs. Having run three local e-commerce sites, he came to the realisation that the biggest impediment to growth and sales was logistics.
This realisation started him down the path towards solving logistics problems in the Klang Valley. In 2014, he played an instrumental role in RocketUncle’s entry into Malaysia. It later became known as Zyllem.
Up until a few months ago, Nabil was Zyllem’s country manager for Malaysia but in August 2016 the company changed its business model and pulled its operations out from Malaysia, the Philippines and Singapore.
Left with 1,500 e-commerce customers and 3,000 courier partners, Nabil knew he had to act fast to get back on his feet again and set up a second business model to transition his existing business into.
With that he founded a new service called Dego within a span of just two months. Dego is a self-funded startup raised he likens to being Malaysia’s Go-Jek, the popular Indonesian tech startup that offers courier and transport services using motorcycles.
Shifting from one logistics platform to another was a real challenge for Nabil as he was not able to bring onboard technology from Zyllem.
“We had to look for an alternate solution in a short period of time in order to bring all our existing customers onboard. It’s not perfect but the system works and we managed to complete our transition,” said Nabil who is Dego’s chief executive officer and founder.
Impressively, Dego managed to grow its fleet from an initial number of 3,500 in October, which mainly comprised of Dego Send partners to over 5,500 by the end of November when an additional 2,000 partners joined thanks to coverage by the local media.
“People from all over Klang Valley wanted to be a part of the service and saw it as a good income stream. Even taxi drivers were signing up as it just made sense for them to use their own motorcycles to ferry passengers instead of paying rental for a taxi,” said Nabil.
Meeting business needs
Taking a two-pronged approach, Nabil sought to address the needs of his existing customer base with a new courier service named Dego Send. At the same time, he wanted to address gaps in the market that few businesses actually pay attention to, by focusing on the needs of low-income earners with Dego Ride.
Competition in the logistics segment is tough. Dego Send hopes to compete against other players with an aggressive rate of RM7 to deliver parcels up to 2kg in weight anywhere in the Klang Valley, from Klang up to KLIA.
“The last few months of operations have been good and we have both real-time jobs and pre-booked jobs between the hours of 10am to 10pm,” said Nabil.
He also aims to extend delivery services to businesses with an express delivery option at the same rate of RM7 but within a 5km radius.
The idea is that this would allow restaurants to use Dego’s service to perform food deliveries and even fulfil e-commerce orders. Nabil claims that the pricing is cheaper than competing services.
Addressing an untapped market
Nabil explained that he recognised the potential for Dego Ride as commuters in large urban centres like Kuala Lumpur who use public transportation face a problem at the last mile of their journey where their destination is not within walking distance to the bus or train station.
Launched in November, Dego Ride’s strategy is to be a complementary service for public transport by having its riders positioned near transport hubs to pick up passengers.
It is interesting to note that Dego Ride does not even have an app for customers to interact with the partners.
Only riders have access to an app from Dego that notifies them about upcoming jobs but for customers, they need only book their ride via WhatsApp where they can receive an automated message and also converse with a customer service representative.
“We take a different approach to the typical ride-hailing app as we understand that our target market group is not necessarily very tech savvy, neither are they familiar with the app economy. The only way we could reach them is WhatsApp which is a powerful tool to brand and educate them about our services,” he explained.
“At the end of the day, it is a service that provides convenience and opportunities both for commuters and our partners,” said Nabil.
Though the service is still limited to the Klang Valley, Nabil says that he hopes to spread Dego’s services nationwide, including to Sabah and Sarawak.
“We are not eyeing regional expansion just yet because within Malaysia there’s enough volume and revenue to draw even with competitors in the market,” he said. However, he is not ruling out the possibility of regional expansion once Dego becomes a household name in Malaysia.