Doorstep fuel delivery: The interesting story of Ratan Tata backed Repos Energy

Doorstep fuel delivery: The interesting story of Ratan Tata backed Repos Energy

Imagine yourself running a hotel or a mall and having several generators as power backups. Come a power cut and you’d need the diesel in those generators to come to the rescue. Wouldn’t it be good if someone delivered that fuel regularly to you and without any hassle? Wouldn’t it be even better if you could order it online- through an app? Sounds great right? That is exactly what Repos Energy does.

The thought behind the idea is to “save diesel that’s burnt to get diesel“, as the founders said. Repos is on a mission to reduce the country’s fuel consumption by 8-10% by popularizing this distribution model. In India, fuel is often wasted through spillage, leakage, dead mileage and there is no track of it. Repos aims to curb that by delivering fuel to doorsteps as well as letting the customers keep a track of the usage of the fuel.

Repos Energy was founded by Chetan Walunj and his wife Aditi Bhosale-Walunj, both hailing from Maharashtra. The company started as a bootstrapped firm with some financial support from Chetan’s father.

Now you may wonder how did the two decide one day to open doorstep delivery of fuel? Well, as Plato famously wrote: “Our need will be the real creator”, the case here is no different.

Chetan was already operating a fuel station in Rajgurunagar which was opened by his father in 2006. After completing his graduation in engineering in the year 2013, he wanted to expand the fuel business to Pune. This was the time when the Rajgurunagar-Chakan region was seeing rapid industrialization and there was rising demand for diesel as a backup on-site for generators.

The fuel pumps were situated on the highways, away from the industrial areas. Companies had to transport the fuel via jerry cans or fuel tankers which was highly inefficient as no one kept a check on wastage and theft. It then occurred to Chetan that the best way to deliver fuel to these sites would be to have metered vehicles and deliver fuel door-to-door, be it a mall, hotel or factory.

Though the initial idea when proposed to the hotel and mall owners did not receive a positive response, Chetan went ahead and built 20 vehicles that could deliver fuel. It become quite a hit; they went up from selling 3 Lac to 30 Lac Litres a month. It didn’t stop there.

Due to heavy rains in that area during that time, the power supply was disrupted and all the hotels, malls and other public places had to rely on diesel generators for power. Chetan would get frantic calls from the owners and he’d be burdened with multiple calls from owners to his drivers just to manage the demand and also take care of the operations. On the very same day, he had received a parcel from Amazon and the idea of fuel e-commerce struck him then.

The idea could not have been realized then as e-commerce for fuel was not legal. They needed to push the idea to the government to make things progress. Luckily during the visit of the then Petroleum Minister, Dharmendra Pradhan to Pune regarding a summit on biofuel, Repos got a chance to pitch their idea in brief. A few days after the summit, the minister tweeted saying that the government was thinking of launching e-commerce for fuels.

The tweet sparked a sense of optimism in the two. It was the start of something revolutionary. They quickly started to build on the product and hired some people. 2017 was the turning point of Repos as the then commerce minister, Suresh Prabhu, organized a meeting with all OMCs(Oil Marketing Companies), startups and government officials to discuss the idea of doorstep diesel delivery.

It was decided in the meeting that pilots would be conducted in Mumbai, Delhi and Pune and the OMCs will partner will the startups to conduct a pilot run of doorstep delivery of diesel. Repos did 32 of the 36 pilots and it was slowly making a mark in this space.

It was the same year when Repos got an investment from Ratan Tata. Ratan Tata emphasized the importance of manufacturing the vehicles at their own factory as that was the core of their business. He also assured support and help from Tata Motors for manufacturing purposes. Repos finally launched their first mobile petrol pump in the year 2018 in Varanasi.

The first model was known as the Repos Alpha. It is available in 4000 and 6000L capacity. It is designed to meet industrial and bulk demands. It requires less refilling due to the large capacity. The price of the Alpha starts from Rs. 22 Lacs.

The government of India legalized e-commerce for fuel right after the general elections in 2019 and thus it was time for Repos to take it to the next level. Production of their own fuel delivery vehicles was in full flow, and they were also known as RMPP or Repos Mobile Petrol Pump. All vehicles are equipped with GPS and Geo-fencing technology which allows them to be monitored in real-time.

Repos Mobile Petrol Pump Beta | Image sourced from http://www.reposenergy.com

An important thing to note is that Repos doesn’t just sell diesel, its primary activity is diesel management. It’s primarily a tech company. It uses its AI and ML tools to study consumption patterns and gives inputs to its customers.

In addition to RMPP, Repos also developed DATUM or Data Automated Teller Ultimate Machine. Sounds pretty heavy right? So what exactly is this technology? Well, to simplify it’s basically a piece of stationary equipment attached to the on-site fuel storage that acts like a diesel management device. It is generally known as ATG or Automatic Tank Gauge device.

The user, through this device and the Repos DATUM app, can control the diesel being dispensed, see the exact amount of diesel being filled in the storage, and access records relating to the consumption patterns. The sensor devices are sold to customers for ₹35,000 to ₹5,00,000 and placed on their machines to collect data which would then be analyzed to give the inputs to the clients.

DATUM Device | Image sourced from www.reposenergy.com

Now we have understood the concept but to understand the implementation let’s dive deep into their business model. Well, to run such an idea you need purchasers for what you manufacture. Here they were manufacturing vehicles that could deliver fuels to customers but overseeing logistical operations across multiple cities would take their focus from R&D development to taking the burden of managing deliveries.

Repos did figure a way out to solve this and the government played a major role in boosting their mission. The government propagated the idea of ‘fueltrepreneurs’-entrepreneurs selling fuel. If you want to open a petrol pump you’d need to buy land, invest in infrastructure, hire workers and manage operations- well, not anymore! By being a mobile fuel entrepreneur you could just buy an AI-enabled mobile fuel station from a start-up(Repos and others) and start reselling fuel. The first year was a massive success as Repos could onboard 600 such fuel entrepreneurs.

Back then, Repos made a target to sell 3,200 mobile fuel pumps by 2022. Now comes their journey during the devastating times of the Covid pandemic. The customer base drastically changed during the pandemic months. The customers before the pandemic began were mostly hotels, malls, and industries. After the pandemic hit, the customers were mostly hospitals, residential societies, government institutions, and utility stores.

The hospitals need a power backup for crucial machineries like ventilators and smooth operations of ICUs. The RMPPs were serving as a lifeline to small hospitals during the lockdown period and catering to their fuel needs. March 2020 saw a dip of 24.2% in diesel sales from the previous year and this affected the fuel companies adversely. On top of that, travel restrictions were imposed and industrial activity went down drastically.

In spite of the pandemic-induced challenges, Repos could carry on operations by catering to the newer clientele while also working on their next vehicle. Repos launched the Beta version of RMPP in the December of 2021. As compared to the Alpha version launched in 2018, the Beta is designed to cater to smaller volumes of demand in the city. It can carry up to 3000L of fuel as compared to 6000L by the earlier model. Due to the lower capacity, the pricing is a bit lower than the Aplha- starting around Rs. 17 Lacs.

The Beta version was the next milestone in their journey and the product was well received by the customers. By 2021 end, this new way of fuel distribution slowly became a necessity for small institutions and more and more fuel startups were popping up throughout the country. Repos’ innovation and disruptive technology won them the 2021 National Startup award in the energy distribution category. It was a remarkable recognition bestowed by the central government which would give them the impetus to carry on their innovations.

Recently in May 2022, Repos announced a partnership with Mahindra & Mahindra to cater to the doorstep diesel delivery demand. The partnership involves building their flagship Repos Alpha model on the Mahindra Furio 11 Truck. As things stand, there is an exorbitant demand for doorstep fuel delivery and Repos is leading the race in this space. With the backing of Ratan Tata and partnering with brands like Mahindra, Repos is on track to become the flagbearer of the next energy distribution revolution.

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