Careem, an online cab-booking app, aims to achieve a monthly growth rate of 30% in 2017, according to the Hadeer Shalaby, general manager of Careem Cairo.
Shalaby says that Careem agreed with financing companies to fund the purchase of new cars for those who are willing to work for Careem and do not have a car, offering financing of EGP 30,000 for each new car.
Careem is one of the largest transportation service applications on the regional level, but it faces strong competition in the Egyptian market. How do you see that competition and what are your competitive advantages?
Competition is very important and motivates us to improve our services to provide high quality services for customers. Our service is growing very quickly due to being new, and we aim to increase our growth in Egypt rapidly, so we are not worried about the competition. Actually, it is in the interest of the client, because every company seeks to provide the best quality service at the lowest prices, and this contributes to enlarging the size of the market.
In regard to our competitive advantages, we are a local and regional company; therefore, we focus on Arab clients in general, and Egyptians in particular. We are looking forward to offer the service that fits with the Arab clients’ needs, and we also have the flexibility to modify and develop our application in line with the needs of the Egyptian customer.
For example, after the launch of the service in Egypt we found that most of our customers in Egypt cannot pay by credit card, since only 3% of the Egyptian population owns a credit card. Therefore, we amended the application within less than a month to allow cash payment. The same thing happened when we decided to offer taxi services. This proves our flexibility, especially as Cairo represents the largest market for Careem, amounting to 38% of the company’s total business, so Egyptian customers are a top priority for us.
What are the most prominent requirements by Egyptian customers?
Safety, quality, and affordable prices. For Egyptians, the price is one of the most important points, and it should be appropriate in order to stimulate the Egyptian customer to leave his car and use the Careem service.
Will Careem change its drivers’ commission after the change of service prices?
We did not increase or reduce the prices. We have just modified the pricing system, so as to ensure the customer has the highest benefit. We have reduced the initial fees to encourage clients who want short rides, and we raised the charges of each kilometre. Additionally, we reduced the waiting fees, making our services the cheapest during traffic jams.
How many drivers are working for Careem?
We have about 50,000 drivers and aim to increase their number to 200,000 by the end of this year, as we now recruit nearly 10,000 drivers monthly.
What is the company’s turnover rate?
There was a high turnover rate in the beginning, but it decreased significantly after the drivers now feel that they are partners in the company, as we have provided health insurance as well as discounts at many clothing stores and food markets.
What is the company’s targeted growth rate in Egypt?
We are targeting a growth rate of 30% per month during the current year.
Careem has recently obtained new investments. How do you plan to use these investments?
We obtained an investment of $350m, taking our market value to about $1bn in the fourth quarter of last year. We became the first company in the Middle East, whose market value recorded $1bn. Elsewedy Electric, owned by Egyptian businessman Mohammed Elsewedy, is the main investor in Careem.
We aim to use this investment to develop our services and ensure that they are of high quality by hiring employees who examine the quality of Careem’s service. Those employees would use the service like ordinary customers to test the quality of service provided.
We also aim to expand our services nationwide. Careem currently offer its services in seven cities, and we aim to reach 30-40 cities by the end of this year. We also plan to increase the number of our call centre staff to reach 1,000 employees by the end of this year, compared to 300 now. Additionally, we study offering a new product in the next three months.
One of your competitors has agreed with a financing firm to finance the purchase of cars for those who interested in working with them. Do you have similar plans?
We have already agreed with a financing company to fund the purchase of new cars for those willing to work for Careem and do not have cars—with EGP 30,000 per new car. In addition, we have agreements with Ghabbour Group and Kia to provide special discounts for our drivers in cases of purchase or maintenance.