It must be an attractive experience; to sit in your house and choose a product from a site in another part of the world and order some people to buy and bring it to you.
Mohammad Farmad and his colleagues offer this experience by launching “Laklak”. Different products can be ordered here from a pin to a robot. Laklak has delivered more than 20,000 products.
It must be an attractive experience; to sit in your house and choose a product from a site in another part of the world and order some people to buy and bring it to you.
Farmad has laso talked about news of this ecosystem; about Shabnameh and etc. He says that this field belongs to those born in 1360s; those who don’t have money but have computer knowledge and can make money.
Let’s start our conversation with “Laklak” startup; from when its idea formed towards the time you worked on it seriously?
Laklak was started with an idea and a room which was for entrepreneurship college of Tehran University. This college supported us and gave us a building with low rent for six months.
At first I worked with Naskavar group. But we wanted to bring different products from a hat and required tools for academic society to Industry-specific parts from all around the world to Iran; those that are within the laws of our country.
Is Laklak a developed version of Naskavar? Does it cover books too?
We have developed book business. I have the experience of working in commercial companies and we started our business with my commercial experience and others’ expertise in transportation of books.
We were four in the beginning but now Laklak has three founders. I can say that book business became a source for businesses like Laklak and now we are 4 or 5 companies that work under the company of Naskavar.
Laklak and Nask has become united but Nask does its book business separately.
How many people are employed by your business?
Laklak team has employed 20 people directly so far.
How does Laklak work and which need is met by this startup?
Laklak meet needs of those who want a product which doesn’t exist in the country and they can’t access it with low price.
On the other hand, they may want a product which is bought and sold only in the producing country and it is not sold globally or it is not sent to Iran.
Also it may be sent to Iran but because of some limitations like sanctions, the customer can’t pay for it and receive it in Iran.
There may be different reasons so that Iranian customers can’t have such an access. Thus Laklak buy the required product for the customer.
But not every product and not from any place; it just buys products according to Iran laws and international rules.
Do you order from physical stores as well? Can customers give you the physical address in one of European cities?
Currently we just want to buy from online stores. Altuough about 90% of the products in physical stores are sold in online stores.
But if it worth it, we buy from physical stores and bring it to Iran. But this special service is for our special customers.
How do you find the ordered product? Do they offer an address to you?
The customer sees a product in a site and chooses it and then gives its link to Laklak. We have price inquiry on our site as well.
Assessment team of Laklak check the order so that it is according to Iran and other countries’ rules, custom rules and international delivery rules.
How much of the price should be paid before delivery?
If the product is more than 300 dollars, the customer should pay 70% of the price in advance and 30% would be paid upon delivery but price of products under 300 dollars should be prepaid.
Which products are ordered?
Many strange products are ordered.
Tell us some details.
From pins to complicated industrial parts and even many orders for drones for which we don’t have any order part because of security issues.
Does ordering pins have economical profit for the person who orders it?
Those who order these kinds of products have special lifestyles. For example there are people who want all their goods to be from a special brand or from main brands.
That is, we have even orders for goods which are available in the country and they can buy them very easily.
Does Laklak a competitor or an alternative for these stores?
It isn’t because physical and even internet stores buy goods, store them and sell them.
So why should people buy from Laklak?
An ordinary buyer doesn’t buy from Laklak. Laklak sells a product that is undoubtedly original; that is the customer wants to be sure that his/her shoe is from U.S.A.
Nike.com and pays the price. Or some customers are eco-tourists who need special tools. For example the one who orders pins has ecotourism tools which are from a special brand and original and wants to have a pin which is original.
There are people who love brands and original goods. I should mention again that we sell special goods. In other words, we sell goods which don’t exist in agencies of that brand in Iran.
Do customers of Laklak have above average financial status?
It’s not the case although expensive and lightweight goods are attractive for our customers; customers who have good financial status.
But we have transactions under one dollar as well and customers who are very ordinary.
You receive up to 15000 tomans for most lightweight goods ordered. Why do they have to pay such a cost?
Yes this cost is claimed for a good as light as a feather. There are other goods with higher costs.
Even if a good which is one dollar is bought from America, its delivery cost would be up to 150,000 tomans. It happened that people paid 200,000 tomans for a one-dollar product.
Do you send products to other countries?
We are working on it. We have received demands in this area and we would add this function to Laklak.
Which products are offered to you for sending abroad?
From different nuts and saffron to works of artists who want to sell them abroad.
Delivery costs are high; how do you manage these costs and how does it affect the number of customers or probable reduction of them?
Delivery cost, total price and price offered to the customer are very high; this doesn’t mean that we gain a lot of profit, the reason is sending costs.
For example, if a person buys a one-dollar T-shirt which is less than one kilo and another person buys a 10,000 dollar product with the same weight which is very expensive, the cost of delivery for both goods would be 200,000 tomans.
Which type of customers do you have more: families or industrial companies?
We have different types of customers; sometimes a factory needs a very expensive machine and it can’t buy it itself.
Then Laklak uses its relations and buys the machine. Some of our customers are those who wear luxury and original products and pay their prices.
Another type of customers buy half-a-dollar goods who are ordinary people and don’t have much money and want to experience purchase from abroad or want to wear an original T-shirt.
Which records are gained by Laklak in good delivery so far?
We had 4 or 5 day records in which we bought a product from Amazon in America and delivered it within 5 days in a city in Iran.
We usually consider a period of 10 to 15 days for purchase and delivery. Due to holidays in Iran and outside Iran, this period can be extended up to one month.
Which products are usually ordered? Is it from clothing or industry or other fields?
Clothing, shoes and the like are the most common orders. But there are many weird products ordered.
There must be sensitivities on Laklak due to its scope and access; have you faced a problem in this regard?
Because of relations we have with organizations and scientific centers and as Laklak grows bigger and bigger, there are some sensitivities.
But when they see that we have many sensitivities in this field and use many filters, they understand that we work within the framework of laws of our country.
Can you import foods and have demands in this field?
This can be done with many limitations. For example, we don’t accept orders for perishable foods. In general there are sensitivities in transportation of foods in many countries.
Thus in customs, foods are placed in labs and standard centers and it requires high costs.
For which foods are orders registered?
For example for reverse engineering, they order special foods in order to produce them in Iran. These foods are usually registered by companies.
Do you receive orders for gold and jewelry?
We have orders but as much as the law permits. We don’t accept orders for raw gold.
According to problems in payment and international bank network in Iran, how do you do this?
Currency exchanges have done this for years and many of current businesses in Iran have this role.
Does Laklak just receive orders or sell services like foreign gift cards as well?
Another company which is a subcategory of Laklak offers these services. If a person refers to Laklak for cards like Visa card and Master card, we connect him to related company.
You have agencies in 12 countries. In which country do you have the most purchases?
The focus of orders is on countries like Emirates, Turkey, Europe, America and China. Most purchases are related to America.
In past, China sent directly to Iran but as those Chinese companies that worked with Iran, found partners in America, we have problems with them which we had with America.
You started in 1392 and we are in 1395. What has changed in the type of orders people make?
We haven’t had a special change in the type of orders; but we can say that clothing has more orders and people tend to buy from famous brands in the world.
Do you have a figure about the number of orders registered?
I prefer not to mention some figures.
Which figures can you mention to?
For example, more than 10,000 people have used Laklak services and most of them are our loyal customers who buy from Laklak frequently.
I think you can tell us about the number of delivered orders.
It is about 21500 orders.
Because the name of your business is Laklak, we can talk about flight and your goods are sent by air. How many kilometers has your business flown so far?
We have calculated these distances and put it on the site. It reaches 14 million kilometers. The exact figure is 13,858,906 kilometers.
How much was the highest and lowest price you have received for an order?
We even had one-dollar, two-dollar and three-dollar orders. We even had orders under one dollar and we have many 10,000 dollar orders as well.
Which products are usually 10,000 dollars?
Industrial parts and goods like glasses, watches and etc. I should mention that 10,000 dollars is not a high price in industrial and luxury spaces.
Which are the most important issues that Laklak solves and causes customers to buy from it?
The customer only have to register link of the store in which its desired good in offered, in Laklak and pays the price.He/she pays in Rial.
Laklak knows that which products can be bought and released in customs. But there are people who have international credit cards and can buy from foreign sites but don’t know anything about related laws.
But Laklak gives all the information to customers. We have commercial experts and can solve the problems. For example, if a product is lost, Laklak can support and cover high costs.
Your business is strategically important and you may probably buy special goods for vital parts of the country?
We have very special customers; especially in industry and science field. For example we provided some parts for Ghazaal project of Tehran University which is a solar project.
In this project they produce cars that work with solar energy. They needed parts whose production in Iran didn’t have economic justification.
Laklak provided them. We have very special customers who don’t have access to some products and we provide those products to them.
Do you have relations with public companies?
Public and private companies and universities refer to Laklak but our goal isn’t focusing on them.
Your work has been widespread and you costs have increased; have you had capital attraction?
We don’t have investors and haven’t attracted any capital so far.
Why haven’t you attracted investment?
I have found out that people in this ecosystem have concerns about attracting investors.
In fact the goal has changed and people are looking for a person who gives them an amount of money so that they can move their business forward rather than working on their ideas and expanding it.
We received many offers for investment but we preferred not to it. When a business is good, investors come to it. We focus more on having a successful business.
How much was Laklak initial capital?
We had only 7 million tomans and a desk in a room with a telephone and we several free ads in sites in which they offer free advertisement.
Our site was launched with many problems but I didn’t think that everything should be perfect from the beginning.
You believe that one should invest based on its own earnings. But sometimes you may have no earning; when did you receive the first order?
Our first customer ordered us very soon. Even we received orders via emails when we have a free blog. We didn’t have in person negotiation with any company but we became successful very soon. T
he first email we received was from Ahwaz. He wanted a camera base and he didn’t buy from us at last. We have one or two orders in the first month and then we had one order per week.
Did you think that selling one product per month is good? Because you were going to be married and didn’t have a good financial status. How did you succeed? It seems that you made many risks.
When I became a partner in Naskavar, I guaranteed a part of links for myself and could use Naskavar links and earned small amount of money.
I knew that I didn’t have another choice and couldn’t go back to my previous job.
Let’s talk about investment offers and transfer of shares. How much money was offered to you?
We didn’t go this far and haven’t come to an agreement.
How much Laklak cost in your opinion?
A business like Laklak has crossed a scale of hundreds of million tomans and it has reached billion scales.
Can you refer to a number as the value of Laklak?
It depends on many factors. Potential of a business is also very important and even if Laklak has the value of 10 billion tomans right now, after implementing plans we have considered, its value would become more and more.
How is the share of Laklak calculated and what percent is it?
Depending on the type of product and its price, it is between 10 to 100 percent. Sometimes they want services, for example a hotel or they want to pay an amount of money for which no product is going to be imported to Iran for which we receive 10 percent as a handling fee.
We have fees up to 100%. But the average fee for ordinary products is between 20 to 30 percent. The fee depends directly on the type of product, its country and its site.
You provide products from foreign stores; you have put a figure in Laklak site for example you have provided a way for purchase and registering orders several days before Black Friday but there are stores that have used Black Friday for selling domestic products. What is your opinion about this?
Black Friday has been epidemic for one or two years and there isn’t a positive view about it. Because we have national and religious events in Iran, we should plan based on these events.
Although using such events is a kind of cultural interaction and many countries know Newroz but we shouldn’t emphasize on events like Black Friday. We have just used Black Friday to inform customers of foreign sales.
Who are the competitors in your market?
We don’t have a serious competitor but there are some who use Telegram and Instagram for businesses like Laklak.
Even many of Laklak customers reorder products for sale. There are groups who sell Master card and Visa card and buy them from us.
But we don’t consider them as our competitors. I just can refer to groups like Phoenix Shipping and Iran Deliver in Shiraz that have started even before us and I have great respect for them.
If post and multi-national companies enter Iran, what would happen to Laklak? Because they are big competitors and can’t be neglected.
If it happens, there would be more employment. We even have plans for this situation and don’t consider it a threat.
We can even cooperate with them. Right now in neighboring countries there is a group named Desert Card which is a company like us and works well despite of presence of multinational companies.
There are many spaces in our field. Thus we don’t have any fear about these kinds of companies.
You, as a member of Iran startup ecosystem, are certainly aware of Shabnameh news. Which fears have led to such behaviors and what are the consequences for the ecosystem?
I understand both parties and think that they are both right. Our country is a special one. It has a special position in the area that has major strategies and any issue in this field would bring out sensitivities.
Maybe the government is worried about issues like penetration for gaining information. But if they suspect someone, they should act against him.
They’d better not to question the whole ecosystem. Such words should not be on the media. I myself love online field and believe that it belongs to young people of 1360s.
This generation don’t have money but know computer and internet very well and launch a business with one mobile number and make money.
I wanted to become a businessman
He was born in Khordad 1362. He studied math in high school and got BS in chemistry engineering from Tehran University.
Then he entered the market and worked with oil and gas companies for three years. But after a while he went to Tehran University and studied entrepreneurship.
During his study, he worked in the field of oil and gas but little by little he went to a department that provided equipment for the projects.
A traveller with cartoons
He had said that he wanted to be a businessman since his childhood. He was interested in cartoons in which businessmen travelled from a city to another.
He didn’t have financial problems but due to his interest, he made money with his shotgun during summer. He loved computer and taught it to his friends when he attended high school.
He was so interested in computer that he read all the magazines about this field; such as Asre Shabake, Donyaye Riz Pardazandeh and Asre Ertebat.
When he went to university, he studied chemistry and opened a company with his friends. He launched a company named Nanotech in the first year of university.
This company offered network and hardware services but because he should work full time and couldn’t study, he quit the job.
He learned that a founder had to accept many responsibilities and he had to spend much time and energy for a full-time job.
Ideas for niche market
It’s 1391. His idea has come from his former workplace: “we faced requests in this company like some products that should be bought from other countries.
Meanwhile buyer and the one who ordered must wait for 4 months in order to receive the product and this had led to dissatisfaction.
I came to this idea that if this need exists in our business, then it is in other industrial and non-industrial fields and those goods that were unimportant for us, if were put together, would become important.
This is called niche market; that is, very small markets that exist around big markets.”
A crazy person who quit being a clerk!
He met people who imported books from Amazon site to Iran and sold them. They had started from 1384 and worked with the name of Naskavar.
He offered to become their partner so that he worked with them and used a part of their office: “I was to support logistics and they did customer response and paperwork.” But it didn’t work because they did other works.
He quit and in 1392 he decided to work on Laklak project. He had worked in a commercial company and earned about 2 million tomans per month but he left the job and didn’t even tell his family anything about it:
“I was going to be married and had little money but I took the risk because I believed in my idea.”
Online space is positive and attractive in my opinion and I think there are a lot of works to do and many startups can be launched; even in the fields in which there are some startups.
I have suggestions for those who are interested in this field; we have the problem of human resource. I have worked as both an employer and an employee and have seen this problem from both sides.
Graduates must learn how to write a resume. Today these skills are part of the abilities of human resource; both for finding jobs and increasing work knowledge.
But people refer to us for interview, don’t know anything about its practices. Some of them think that they should be the boss from the very beginning; especially those graduated from top universities think about major management and high earnings.
But they should become determined and start from the lowest level. I started from being a trainee and earned low income.
They should even have part-time jobs. I myself think that a person with GPA of 18 who has work experience is better than a person with GPA of 20 without any experience.