When we are last wrote o BeliGas, the social enterprise prided itself on being not only a more affordable option for securing LPG bottles, but also with its mission to employ Malaysians B40 and former convicts.
Six months later, he found a way to add value to his services. As of June 2021, it has enabled customers purchasing LPG gas to donate 1-10 L of used cooking oil to receive a subsidy for their gas.
BeliGas CEO Suthan Mookaiah told the Vulcan Post that it has always been part of the business plan.
“But since we initially worked on a lean model, we first had to focus on building the core business, which is establishing logistics and contact points in a wide geographical area, and then establishing relationships and trust in the local communities we serve. “
He believes that BeliGas is now ready to enter and establish itself as a player in waste oil collection.
Address multiple customer points
From his POV, customers are more prudent today, and a job that can help them cut costs while they are socially responsible will gain their loyalty.
With that in mind, using donations of waste cooking oil to subsidize gas prices just made sense. It is a method that kills two birds with one stone: it lowers their retail gas price by RM0.80 per liter of donated oil and helps users properly dispose of and recycle waste oil.
Currently, BeliGas limits oil donations to a maximum of 10 liters per customer at any one time while establishing logistics at pickups.
Since they deliver gas to the house on bicycles, it is not possible for them to take large amounts of donations at once. This is not a problem for their B2B customers, because they deliver trucks for them.
To prevent misuse of this system, BeliGas also set out clear technical conditions in its application, including instructions not to add oil to other parts to increase its quantity and to avoid passing hot oil to the team.
So where does the oil go?
The headquarters of BeliGas and its dealers (points of sale) operate separately, so when drivers collect oil from dealers, the headquarters will buy it. This allows BeliGas distributors to make more money in their areas from sources other than just selling gas.
Then the seat oil is converted to biodiesel for its own trucks or for sale to other biodiesel users. It is a procedure that is effective and safe to use with several modifications, Suthan said.
There are other used by-products like glycerin that lubricant manufacturers can use, but it’s a plan that BeliGas will explore only when it builds a significant-volume operation and creates its own experiment lab.
So far, the user reception of this new initiative has been excellent, Suthan said. “It’s still new, of course, so we expect more and more people to start collecting and disposing with us in the coming months (as their gas runs out). Even then, we had already taken over homes several times. “
The team has since collected 500L of used cooking oil. Compared to their plan to collect 15,000 L by the second year of the initiative, they have only taken childish steps, but that is still a good start.
A model that works to run
Suthan said that this initiative is a permanent addition to BeliGas services and that they are working on its promotion in order to raise the awareness of their end consumers.
“In the future, we hope to be able to collect about 3-5 liters of oil with each consumer we serve. We hope to grow to serve 100,000 consumers, and if we achieve that, we really do a major part in cleaning our pipes, rivers and sea of waste oil pollutants. “
In addition to providing value to its customers, BeliGas wants to continue to provide employment to poor communities in Malaysia, especially during this pandemic.
There are currently over 66 low-service individuals on their payroll, and they too are not limited to delivery driver roles; some are hired to work at BeliGas hubs and its headquarters.
The model used by BeliGas seems to work well for him; in just one year (July 2021 will mark one official year), the social enterprise generated revenue of around RM 2.7 million.
To add, Suthan gratefully shared that the business is also profitable, attributing to it their differentiated value among traditional suppliers.
As of now, BeliGas is already serving households and businesses at 214 locations in the Klang Valley, with plans to launch in other Malaysian states once the locks are lifted.
- You can find out more about BeliGas here.
- You can read about other Malaysian startup companies here.
Credits for prominent paintings: Suthan Mookaiah, CEO of BeliGas