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| Edited By: Ashish K Tiwari |Source: DNA |Updated: Mar 21, 2018, 03:54 AM IST
Could you give us a sense of your business and how it is different?
We are a business-to-retail platform that focuses on selling to the kirana stores. It is a very unique model not only in India, but globally as well. We are very different from what e-marketplace operators like Amazon, Snapdeal, Flipkart, etc., as well as food and grocery e-tailers like BigBasket, Grofers, etc., because what they are doing is selling to the customer who is also the end-user of the product. We have nothing to do with the retail market. Our role is that of a supplier to businesses who will then sell to their retail customers. While all of start-up India is focused on solving a bit of the problem, we have attempted at replicating the entire process (of distribution chain in India) using technology. Ours is a back-end chain with the objective of offering a solution to the dukaandar, mom-n-pop stores and kiranas to buy food, beverages, stationery, toys / games, frozen products, non-prescription pharmaceutical products, baby food, sarees, fashion, etc. So instead of the product travelling from the brand to the distributor(s) and then to the retailer, it will now be just the brands and the retailer and Just Buy Live will play the role of the facilitator or the quasi-distributor. We are a true aggregator of products, but for the back-end. We are using technology to ensure the entire back-end part becomes efficient and not just one part of it. Through our platform retailers will be able to have the advantage of buying directly from the brands at lower prices and enjoy higher margins. This way they will be able to compete with the e-tailers that are largely banking on discounting model for their operations.
But that's exactly what Walmart, Metro Cash & Carry and Reliance Mart are doing through their respective operations.
We have gone a step ahead by offering credit lines as well. We are not a big-box operator, but a big tech company that offers all the price advantages of a volume buy by all the big brands and gives credit facility which is very crucial for a mom-n-pop store or a kirana store operator. We are also the first delivery and credit provider that sells competitor products which is not the case with physical distributors. We offer a 30 days (free) credit line that can be extended further for up to 120 days. Even on the payments part, we have both digital and physical payment options. As for delivery, we have partnered Delhivery, GoJavas and FedEx as logistics partners to pick it up from the brand's warehouse and send it to the retailer.
How many brands are listed and what is the pricing mechanism on your platform?
There are currently 1,100 brands on board, of which we have 80 out of India's most trusted 100 brands. In fact, every retailer on our platform also get access to a host of local brands that don't have national presence or distribution. The pricing is very standard and decided by the brands in real time. While we don't have a price advantage, there certainly is a process advantage. And because we are a large aggregated supplier, retailers place much higher orders on our platform as compared to traditional suppliers. So our margins are better. We are then able to incentivise further and give better deals on the platform.
Bigger brands already have the distribution network. So what do they gain by being on your platform?
Real-time access to buyers of their products which is very crucial in this day and age. Also, brands don't need to move inventory all over the country from their manufacturing units. For example, in case of Unilever launching a pink Lux, the company can now launch it on the platform, get orders for the product, plan their inventory accordingly and then get into production. So efficiencies of a different kind are now available to brands. Distribution chain can now shift from inventory-led model to just-in-time model. Thus, there will be no wastage or spillage, no resource crunch. Working capital lines can be reduced significantly because we will also be an analytics company that will help brands decide or predict.
What has been the market response like? How many retailers have enrolled on the platform?
We have 40,000 retailers on the platform and are adding 1,500 daily at today's run rate. We have created a completely new category in terms of a business model, but we are still governed by India's cash and carry laws that allow us to sell only to verified (VAT / Sales / Excise Tax number, shops and establishment number, hawker's licence etc) registered retailers. So we have built a tech process that allows us to speed up registration by verifying the valid documents in real time. Thus, the plan gradually is to take that number to 5,000 additions daily.
What have been your major learnings since launching operations?
One major learning was that people believed retailers were not tech-savvy. Let me tell you, 93% of them have smartphones and that is very good for our business. Besides, as the bandwidth increases with the launch of Reliance Jio, things will only get better in the days to come. Surprisingly, these retailers are also vary of banking institutions. If banks approach them with loans, they say we don't need a loan. There is a difference between 'need' and 'want' a loan. That's when we (along with banking partners) thought of approaching them with a credit line. Similarly, on the interface – android v/s iOS, you'll be surprised 45% of retailers in Gujarat use an Apple iPhone. So we had to simultaneously develop an iOS app to be able to do business there. However, our biggest learning has been 'Don't change India, but work with it'.
