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“Stranded in the middle of the road?”

Chuck your worries. Little Red-Riding-Hoods are here for help!

Led off from a casual chit-chat over coffee, Radio Tuk Tuk, a door-to-door auto-rickshaw service, is literally out to paint the city red.

Sulabh Mehra, a hotel management graduate from IIMT, determined to ease off the predicament of those sans the luxury of personal transport, launched Radio Tuk Tuk in Gurgaon on November 22, 2010.

Barely a month in run, the service has witnessed an overwhelming response from harried commuters of the industrial and financial capital of Haryana. The only available option for public transportation in Gurgaon is a pitiful number of rundown buses or autos that charge exorbitantly. The commoners have little choice.

Sulabh Mehra Head Operations, Radio Tuk Tuk

However, with the red-hoods zooming across the city, the situation will gradually improve. The 25-year old enthusiastic entrepreneur says, “I started Radio Tuk Tuk to make commuting easy and organise the auto rickshaw industry.”

While fixated on the idea, he knew it was crucial to first learn about the various aspects including the myths and secrets of the trade. Eager to learn and kick-start his dream, Sulabh did everything he possibly could to widen his scope of knowledge. He sat down with the local autowalas of the area, spoke to commuters, bankers, and many others before he set sail.

Convinced, it was time to make the move, he quit his high-paying job with an IT company and chose to go ahead with his ambition to serve the society.

He bought a fleet of 50 autos from TVS that are fitted with a panic button, mobile charger, Global Positioning System (GPS), current immobilizer and battery back-up for `1,50,000-1,60,000. Additionally, he rented out a room, and installed five to seven workstations and phone connections, from where his 10 member-team works.

Based on the successful model of Radio taxi; Tuk Tuk has picked up pace soon. Partly excited and partly worried about the pouring demand, Sulabh says, “The phone just doesn’t stop ringing. We get around 500-600 calls everyday of which we convert more than
50 per cent.”

Though the red-hoods are gaining quick acceptance among commuters, the service charges remain a concern among many. The auto-service charges `50 for the first three kilometres and `8 for every km thereafter which is it quite high compared to the prevalent auto fare in Delhi. Autos in Delhi charge `19 for the first two kilometers and `6.50 for every additional kilometre.

However, clearly, Sulabh doesn’t consider this to be a challenge that could prove detrimental to his business. He justifies the fare with the increasing cost of CNG, security features and its door-to-door service. “I have fixed up the price taking the market scenario in consideration and the security features embedded in the Tuk Tuk,” says he.

According to him, his challenge was basically in convincing the bankers and grooming illiterate auto-drivers, who were picked from the pool of drivers in Gurgaon for a fixed salary every month.

“In fact, training drivers was more difficult than convincing bankers,” quips Sulabh. However, the former has always held his interest. He says he enjoyed and continues to enjoy it every bit as his ultimate aim is to organise the auto rickshaw industry.

Working towards his vision, Sulabh realises that he should think ‘expansion’ soon, as he is already struggling to meet the current demand with his measly 50 autos. He says, “We are planning to buy more autos to meet the demand, which is much more than the current supply.”

However, expansion may result in delay in Tuk Tuk’s break even time, which it expects to reach in around two years time. “We are looking forward to breaking even within two to two and a half years’ time,” says a charged up Sulabh.

Hoping it soon comes true; we wish Sulabh all the best in his future endeavours.

Expert Speaks
	Alok Mittal Canaan Partners
Interesting Business Ownership model – Since Radio Tuk Tuk owns the autos, it will face more challeneges in ensuring the quality in service and also the capex will be quite high unlike in the radio cabs business, which now allows individual drivers to own the vehicle, and charge a subscription fee. In that case, capex gets percolated down, and drivers take better care of vehicles because it's their vehicle. This model allows for faster growth. Pricing – Seems high. It will be interesting to see how it evolves – taxis are available in Gurgaon at `10/km. Since autos may get used for short distance, the `50 minimum charge might also be a deterrent. On Call – Most of the phone call behavior currently seems (like in the case of taxis) for longer duration/distance travel. It will be interesting to see how that behavior translates for autos, which is primarily used for short distances. It might be important to provide faster access, when needed perhaps even have them on stands in high traffic areas (this can reduce the importance of centralized entity, however) or promise a 5-minutes to door service. Ratings by the Expert Ratings by the ExpertInnovation element: 2/5 Market attractiveness: 3/5 Execution complexity: 4/5 Ability to build a large company: 4/5