Interview with Omar Farra (Scooter City)
Scooter City are UK distributors of the latest brands of mopeds and scooters as well as accessories and parts.
I interviewed Omar Farra, Scooter City founder to find out more. This interview is the third in a series of DW ecommerce interviews. Big thank you to Omar!
You’ve been in e-commerce for over 10 years. Tell us how it all started.
It all started like a lot of E-commerce companies do, in my garage. I saved up £5000 and went to a local computer components wholesaler and purchased the cheapest motherboards, graphics cards etc I could find. I would then build the components up into completed computers and sell them on eBay, through local newspapers and at the Manchester computer fair. Once I had built up a little profit I started to buy consumer electronics and toys from auctions in the UK and from wholesalers in China. One of the products I was bringing in from China turned out to be very popular, miniature video CCTV cameras and at that time I was the only person selling them on eBay so they were flying out at a good margin.
Tell us a bit about each of your current businesses including Nitrotek, Scooter City and eComm Angels.
Nitrotek is a distributor of radio controlled models. We sell online through our site but also dropship for many other companies. We also have nine European sites such as Nitrotek.fr, Nitrotek.nl and sell both to the retail and wholesale markets in those countries.
Scooter City is our new site launched this year selling both toy micro scooters and proper road legal scooters. Like with any new company there is always teething problems but overall it has been a good start and we expect to have a good 2013 as demand for scooters increases in these tough economic times.
We have an office in Asia that employs local IT professionals who do tasks for us such as data entry and SEO work. These guys are very useful for eCommerce company tasks so we have just started eComm Angels that will allow other companies to hire their own full time staff like this for a very low monthly fee.
What got you into the business of remote-controlled toys and scooters?
In 2004 one of my contacts in China opened a new factory making gas powered radio controlled cars and asked me if I wanted to be the UK distributor. I agreed and put every penny I had into buying a full container of stock and Nitrotek Ltd was born. The agreement was that I had to buy $350,000 worth of stock a year to be the exclusive distributor which at the time was very scary. It’s good to have a little pressure like this and we ended up doing a lot more than this. We still distribute for that factory and many others.
In the recession the radio controlled toys market has got more difficult as it’s a luxury product market so we started to look at products that would sell well in a recession. Our first idea was Bogo.co.uk which is a site that buys people’s electronics and media for cash and then re-sells it. It was going pretty well and we were getting a lot of stuff sent through but sorting it and testing everything was turning into a nightmare. If it was going to work out it would need going all in 100% and I decided that was not what I wanted to be doing so I put that project on hold for now. I saw on Dragons Den last week a new company doing the same thing and they got investment so maybe it was a mistake to put it on hold.
Anyway, instead we started Scooter City as the savings from running a scooter instead of a car are very big. Nitrotek already employs mechanics and has a warehouse so it’s a perfect match.
Do you have a scooter yourself?
I used to have one before I had a car and I used to love it. I’m going to get one again in Spring, they are a lot of fun.
What e-commerce platform do you use?
We use Magento. We have tried a few other in the past but will stick with Magento now, it can do everything you could possibly ever want.
You have found a way to combat the recession by offering customers who qualify interest-free credit for six months. What made you decide to implement this payment option?
Well this was probably our customers’ idea. We kept getting customers ask for it so clearly the demand was there. Many customers will probably save more by driving a scooter instead of a car than the monthly payments for the scooter itself so it is perfect for a recession.
Has there been much of an increase in sales since you implemented this payment option?
Yes the sales have increased a lot. It’s difficult to put an exact figure on it because a new company’s sales will always increase as initial marketing starts to kick in, but for sure it has made a big impact.
What do you wish you’d have known 10 years ago that you know now?
So many things, I don’t even know where to begin! Everything has been started from scratch so every lesson has been learnt the hard way. There are little things like we did a television marketing campaign that cost a fortune which did not pay off or I paid for a consulting company that again cost a lot but was a complete waste of money. But on a bigger scale if I had known how some online markets were going to grow such as online fashion then I may have gone for a bigger market.
Has Scooter City got the demand and growth you expected?
It’s still early days but considering this is a new project I am very pleased with how quickly it has grown. We link to Scooter City from the Nitrotek site which has helped to boost sales.
What are you working on right now?
We have a few startup projects we are working on. Nitrotek has an office and warehouse in Poland also so we have built up some good contacts in Eastern Europe. For example Poland is a big manufacturer of furniture, so we are currently working on a new furniture site that will sell high quality low cost furniture that will be made by factories we have partnered with over there. Also there is a lot of work to do with the eComm Angels startup. We hope this will do well in the recession as there are big savings to be made by employing one of our agents compared to employing an on site full time member of staff.
What is one mistake you’ve made, and what did you learn from it?
I started a whole airsoft toys site and purchased a container of airsoft products. Then a few months later airsoft was basically banned in the UK! I’ve learnt to look into things more and to be more cautious before jumping in. If I had done proper research I would have found out that there was already talks about banning these types of toys in the UK.
With over 10 years experience in e-commerce, what one piece of advice would you give to someone starting an e-commerce business?
Keep control of your costs. Don’t blow your budget on a fancy office, the best website and staff you don’t need. There are always unexpected costs so you are better keeping this money in reserves.
What are you most excited about at the moment?
On Nitrotek over the next few months most models we sell will have a QVC type video presentation that will be neatly displayed below the picture gallery. I think this will increase sales and also make us really stand out from our competitors.
On Scooter City we are looking at how we can increase the number of customers that will be approved for finance and if we can make that happen we should see sales increase a lot. Plus there are all the new projects that I am very excited about. I think 2013 is going to be a busy but exciting year.
Finished reading? Check out Scooter City!