Assessment of the Spare Parts Sector in Kenya by Tushar Bagda of Bagda’s Auto Spares

Tushar Bagda, Managing Director of Bagda’s Auto Spares Limited, shares his assessment of the spare parts sector in Kenya.

“The spare parts sector is very different from other sectors. In terms of where our location is physically, one great thing is that there must be about 500 shops from one end of this road to the other. You can get anything you can afford. You can get the cheapest Chinese part for 100 Shillings or a genuine part from our location for 500 Shillings. Affordability is really there in the spare parts industry. However, this comes at a price because many of these cheaper parts are very substandard quality. It is a disaster if they are put into commercial vehicles or school buses. These small things can cause accidents and loss of life. It is a shame and hurts when you read about those things. Unscrupulous businessmen will take advantage of this just to save a few Shillings. But the government is cracking down through the Kenya Bureau of Standards. There is greater scrutiny on the importation of these goods to make sure that they are higher quality. As this is happening, we see that there is a change in people’s thinking as well. This is partly because they are forced to change with the times because of better regulation, but also because they see the value in this. It is good for us because we specialize in genuine parts. Until now, we had a few niche customers like corporates because they cannot have their fleet down for an extended period. Genuine parts are guaranteed to run your vehicle at optimum performance without issues and with other parts you cannot be sure. Those were our main customers but we are now seeing a lot of cash customers who believe in quality and are willing to pay a premium for that. Before it was difficult to convince customers, but it is becoming more acceptable. There is a lot of competition. At a global level, it is not a huge industry like the motor industry here. There are not that many cars and the newer car sales are not very high. But the players that are in the market think it is very lucrative and try to enter. Unfortunately, it often does not work out for them. There are no major barriers to entry. You just import something and try to sell it. Much of the time, they are briefcase suppliers and do not have a good setup. It brings a bad name to spare parts dealers in general when this happens”, says Tushar Bagda.

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