CHENNAI: A few years ago, the on-demand economy was considered a bubble, an exception. However, over time, with a change in consumer behaviour for a more time-efficient, tech-driven solution for all their needs, the niche economy replaced traditional business models faster than anyone anticipated. In the wake of such disruption, different verticals of businesses — food, transportation, healthcare, groceries, pharmacy and other hyper-local services — began reimagining demand, provisioning supply and delivering them.
Today, this slice of the economy has organically grown, driving multiple service industries, catering to millions of customers annually, and building a strong space for future start-ups to thrive. One such vertical, which has benefitted from this transition, is the fuel industry and a testimony to this is We Fuel, a newly-launched on-demand fuel delivery start-up in the city.
The origin
Arjun Somayajula, co-founder and director of the start-up recalls how a fuel price hike in the city paved the way for this niche business idea. “Earlier last year, along with a few like-minded individuals, I was looking for ideas to step into the B2C segment. One day, as we were passing over the Gemini Flyover, we needed to refuel our car. This was on a day when there was a fuel price hike, which meant snaking queues at the gas station and long hours of waiting. After around an hour and half of waiting, we finally filled the vehicle’s tank and that’s when we realised a need for an on-demand service in the segment,” shares the engineering graduate with five years of experience in waste management, alternative fuels and bulk supply of diesel.
Soon, along with SV Chalapathy Rao, co-founder and director of We Fuel and Raghav, the operations manager of the company, Arjun began researching regulatory compliance and conducting market studies. “While we were not the first players in the space, the market was still in the nascent stage. Luckily, by May 2020, the government released a set of regulations on the doorstep fuel space and this helped us gauge the future and chalk a plan. The fuel industry is like the finance industry and we have to be compliant on multiple platforms, over multiple levels at multiple times. So we trod carefully,” he says.
Initially, the company approached a local Hindustan Petroleum (HP) dealer, borrowed a vehicle and turned it into a dispensing unit to cater to potential customers — primarily fleets, heavy vehicles, construction sites and generators — to test their capacity. “Usually, heavy vehicles, minivans and trucks load empty barrels and jerry cans with fuel from gas stations. There is no possible way of realising how much is being filled in the barrel. One might not be able to gauge if there is a difference of one centimetre of fuel (which makes a major difference of a couple of litres in fumes). The average generator user and an earthmover spend anything between `1,000 to `1,500 for fuel procurement. We wanted to address this,” he details.
Software model
With the dealer vehicle, Arjun and his team completed 12 orders and when recurring orders came their way, the team decided to build a tech-driven model integrating customers, payments and backend, topped with IoT backed authentication and safety features. The idea to make the concept convenient and accessible for all took over seven months to take shape and the start-up was launched earlier in February. The launch was chaired by Sandeep Maheshwari, chief general manager, HPCL. “Currently, we have only a single unit and to cater to the demand, we have made our services 24x7. The response has been overwhelming and we plan to expand within the year. We are currently waiting for the government to announce regulations for fuel so that the idea, where individual owners can order petrol and get them filled at a time and place of their convenience becomes a reality,” he shares.
We Fuel’s current stakeholders in the ecosystem include generator users, construction sites and heavy vehicle fleets. “We have so far serviced 18 construction clients and about 9 generator owners. With the word spreading, we are also trying to tap on an aggregator model, firing dealer vehicles to fulfil the needs,” he details.
Overcoming dead mileage
The first on-demand fuel service in the south zone to receive a terminal licence, Arjun emphasises how their services will enable those in the space to save money during fuel procurement. “On average, heavy vehicles, which are slow-moving and low on mileage, waste six litres on every filling (travelling to a gas station and back). In such an industry where fleets are involved, there is a fuel loss of 18-20 per cent. There is fuel pilferage too. So, the motto of We Fuel is to remove such elements from the equation. This will save the owner money, dead mileage and there will be better accounting,” he shares.A bootstrapped venture, We Fuel is looking for investors and partners in the space.
“We are also working on an electric vehicle prototype, where we will be using the same software application to connect electric vehicle users to the nearest charging point. We plan to mark our presence in 15 cities by the end of 2022. The aim is to become a one-stop solution for all fuel needs — petrol, diesel, CNG and electric vehicles (charging points),” he says.
For details, visit: www.wefuel.in or call 9500006562.