Auto dealer records growth, calls for better industry laws
SCI & TECH
By Standard Reporter | July 3rd 2019
NAIROBI, KENYA: Car importer Seaways Kenya has reported a 30 per cent revenue growth, a jump linked to car portal, Garimoto.
This is despite the myriad of challenges that the automotive industry has suffered because of high taxes, punitive policies and delayed issuance of licensed plates for used and newly imported vehicles.
Garimoto portal, which was recently recognised, as the most preferred Automotive Importation Portal by Automotive Industry Excellence Awards, has seen Seaways increase efficiency levels, cut down on communication costs and achieved a higher customer satisfaction.
According to Joshua Babu, Managing Director Seaways Kenya Limited, the company is in the process of completing an even improved version of its portal which has API's linking directly to other portals owned by its partners in order to provide a seamless integration on a B2B platform and serve all its customers better:
“It is increasingly becoming difficult to survive in business without embracing digital solutions. The growing number of a young generation of middle class who run their life through digital platforms means that any business without a clear digital strategy will miss the business from this class. Digital solutions also help in cutting down costs of doing business making it possible to offer services at more competitive rates. With digital solutions a business is able to scale and grow faster without getting overwhelmed by the growth,”
He says the portal has also helped customers to make informed decisions on the overall cost of importing a car, as they are able to calculate the entire cost of clearing and transportation to final destination, a critical cost in car importation business:
“I need to dedicate this achievement to my son Jared Babu Mwazo who was the real brains behind the portal. Jared is my late son who passed on in the recent Ethiopian Airline crash together with his wife.”
Having been in business for 32 years, Babu says that being a licensed customs agent, this has given them credibility and trust with clients beyond just having the portal.
The licensing has also given the business a unique edge to competition since they can handle the entire shipping and customs clearance process until delivery to the clients in-house.
With clientele base of over 10,000 customers, Seaways Limited have customer base spanning Kenya, Uganda, Tanzania, DRC and South Sudan.
To ensure effective business operation, Seaways has deployed other business tools and measures including instant messaging that keeps customers updated on the progress of their shipment from the source to final delivery.
At the same time, the business offers concessionary rates for port charges and extended free storage at Mombasa port to save clients on exorbitant port charges in the event there is any delay in the customs clearance process.
On the other hand, Seaways has also provides after sales support in providing negotiated and very affordable rates for motor insurance with added benefits and privileges and special claims processing arrangements:
“Our marine insurance portal mymarine.seaways.net has been an important tool not only for local car importers but also car exporters to Kenya from around the world.”
Meanwhile, Babu is calling on the government to remove punitive taxes on motor vehicle business:
“As we speak, the Government has increased the taxes again in the last budget. Since taxes for used motor vehicles are calculated based on the CRSP values (Current Resale Price of New cars) KRA can review these prices anytime always upward despite the falling prices of cars in the world, CRSP figures keep going up hence pushing the taxes up even when the tax percentages remain the same.”
He also notes that delay in issuance of registration number plates by NTSA to match the number of car imports is such a challenge for the business. Kenya is still using pre-independence designed plates done manually by prisoners. Efforts to introduce new techniques and design of making plates have always be dogged by controversy.
“KRA insist that cars should not be released from the port without Number plates yet NTSA is unable to avail the very plates which are required to facilitate release. This has led to a number of importers who do not enjoy special extended free storage like the one we arrange, to pay exorbitant port charges.”
Babu says the future of automotive industry will be on electric cars as the Government of Kenya have recognized this development by making tax concessions on importation of electric vehicles. “This is definitely a step in the right direction as increased numbers of such vehicles will not only help with our environment but will significantly cut on the country's fuel import bill and save on foreign exchange.”
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