Zoomcar: Constrained by Supply Issues

The chief executive officer of Zoomcar, an Indian car-rental company, had recognized that the costs of vehicle ownership were high for many individuals who needed vehicles only sporadically. The venture capital-funded, entrepreneur-driven business had launched in 2013, gone through three changes in its business model between 2016 and 2019, and identified a gap in the market with adequate demand to be fulfilled. Having adjusted its business model twice to circumvent the issue of supply, in 2020 it believed that it had identified the perfect product-market fit that would solve consumers’ concerns over owning versus hiring vehicles. The business's shared-mobility model would allow customers to reduce the total cost of vehicle ownership by offering their vehicles for short-term hires to other users on the Zoomcar platform. Now, it needed to resolve three issues: First, how could it get more cars on the platform? Second, even if it had the cars, how could it get people to adapt to a shared-mobility ecosystem? Third, how could it manage all of this while maintaining viable unit economics and ensuring long-term profitability?

This case can be used in graduate- and executive-level courses on ecommerce, marketplace, and Internet business models. It can also be used as an entrepreneurship case or for management development training sessions or workshops. After working through the case and assignment questions, students will be able to do the following: <ul><li>Define a company’s business strategy, and explain whether the company has applied adequate rigor to its business strategy before pivoting.</li><li>Assess whether a company that has changed its business model three times has gained traction with its latest model or is still floundering, and analyze what the company can do to stabilize. </li><li>Apply the concept of supply-side economics to explain how a car company can increase supply when demand exists.</li></ul>

• supply side platform
• marketplace