Archive for August, 2008

Indian SMBs to spend $1.26 billion for Internet services in ’08

A report by market research firm Access Markets International Partners estimates that Indian SMBs will spend $1.26 billion on Internet-related products and services in 2008, an amazing 35% increase from the last year. Considering the fact that data security and compliance is generally the third or fourth factor in the priority-list of SMBs (after things like infrastructure and accessibility), I am just wondering how much of it can be tapped by non-intrusive and hassle-free models like security-as-a-service? SMBs are still sticking to contemporary offerings due to the lack of awareness. Even a small chunk of the pie will be plentiful. Security companies need special action plan for India now.

Two new web security (SaaS) startups

I was just waiting for something like this to happen. Purewire and ZScaler will be upping the ante in the lucrative managed services market. The companies are backed by security superstars like Jay Chaudhary and veterans from CipherTrust and ISS. Prices range roughly from $1-$5 (per user per month) and $30 (per user per year) for ZScaler and Purewire respectively. Way to go!

TiE Retail Summit 2008, Aug 1st New Delhi

I had the opportunity to check out the TiE India Retail Summit 2008- not all of it—but a few hours towards the end and I’m using this platform to put down a brief account of the same—all comments, questions, suggestions and queries are welcome, either here or by mailing me on nsnsns(at)gmail(dot)com- also, incase you’d like me to add to this article, if you want me to make corrections or if you want me add specific details I may have missed out, please feel free to mail me.

For information on author’s copyright, reprint-permissions and mirrors of this article, please scroll to the notice at the end of this post.

The TiE India Retail Summit 2008 was held at the Sheraton Hotel, Saket, on August 1st 2008 and it had one main conference session, with numerous simultaneous workshops, and focussed on various aspects of organized retail in India.

This is by no means a complete account of the event- but rather a synopsis, followed by some of what I saw and really liked about the event.

I’ve attended a lot of tech events but not many on retail, and I’m blogging this account to benefit people like myself who wonder how’s TiE’s retail event would be- from a human perspective, beyond the networking-value and beyond what a layperson or a journalist would talk about. Also, since a picture is worth a thousand words, I’m posting here a few snaps I clicked there.

The session kicked off at 9:00 in the morning, and the schedule as per the pre-published program mailer was as below:

Introduction and Opening Remarks
• Arvind Singhal, Chairman, Technopak Advisors
Keynote Session – The India Story
• William Bissell, Managing Director, Fabindia Ltd
• Arvind Singhal, Chairman, Technopak Advisors – Chair
Learnings from Indian & Western Retail Models
• Viney Singh, Managing Director, Max Hyper Market India
• Mark Ashman, CEO, Marks & Spencer
• Andrew Levermore, CEO, HyperCITY Retail
• Himanshu Chakrawarti, COO, Landmark (Trent Ltd). – Chair
Tea

Hot New Retail Stories
• Rajiv Agarwal, CEO & Director, The Mobile Store
• Ashutosh Garg, Chairman & Managing Director, Guardian Life Care
• Kamal Oswal, Cotton County (tbc)
• Anurag Batra, Editor –in Chief & Publisher, exchange4media Group – Chair
LUNCH

Workshops
• TiE – Milagrow: How Small Will Become Bigger
Rajeev Karwal, Founder & CEO, Milagrow
Sanjay Shani, Director, Ritu Wears
• TiE – KPMG: Retail Financing
Narayanan Ramaswamy, Executive Director, KPMG Advisory Services
• TiE – IBM: Retail IT
Rafiq Shafi, Retail Industry Solutions, IBM India
Tea Break

Workshops
• TiE – Technopak: Retail Operations
Krishna Kumar, AVP-Retail Operations Practice, Technopak
• TiE – Cushman & Wakefield: Retail Property & Infrastructure
Rajneesh Mahajan, Director, Retail Services, Cushman & Wakefield
• Guru Session/Mentoring Clinic

Venue: The event was held at the Sheraton Hotel, Saket. A great venue that offers superb ambience. There was a session happening in the Dynasty ballroom with 3 other parallel tracks happening simultaneously.
The Sheraton, Saket was earlier called the Marriot, Saket. In it’s current avatar as the Sheraton- a Starwood Property- this hotel definitely lives up to Starwood’s legendary standards of elegance, ambience and hospitality- which are world-class.

Event: I showed up sometime after the tea break; and after running through the Tea Break, I had the chance to attend the session on “Retail Operations” by Mr.Zahir Abbas, Mr Kostubh Rishi and Mr.Bikram Chatterji of TechnoPak.

Takeaways:

Informative Sponsor driven sessions are often long and theoretical, but this “Retail Operations” session; though 120 slides long, was one of the most informative and thought provoking.

Zahir spoke at length about key factors, choice points, criteria involved in the organized retail industry.
Subsequently, Kostubh, spoke about a consulting assignment in which technopak had helped a major retail chain expand and set-up stores in South Indian cities that involved selling farm produce and groceries among other things to Sec-A and Sec-B households, where-in the retail chain depended to a extent on the local milk-men and newspaper-sellers to fulfil orders.

Just summarizing Zahir and Kostubh’s responses to some of the “after-session questions” will give the reader a idea of the sheer depth and hands-on practicality of the session:

When asked by a IT professional for a example of the role of IT Infrastructure in Organized Retail ?

Zahir’s Answer: If you have a pen-and-paper note-book type of accounting and billing mechanism, a item gets sold, and it takes over a month for information about the sales-figures, transaction-times and selling prices to reach head-quarters if at all, while if you have a point-of-sale (POS) system with a centrally accessible database, someone managing operations and sitting in another city can instantly or at the end of the day see, who bought what, at what price and what quantity remains in inventory- which is important because 80% of the sales comes from 20% of the items in stock.

A interesting answer I must say, and refreshingly simple and totally free from all the jargon we hear today about SCM, CRM and ERP- even though the description provided would encompass all these buzzwords.

When asked by a professor of retail marketing from IIM-Lucknow about whether connecting with the consumer through milkmen and newspaper-boys is a good idea- might not it be better not to connect to consumers through government census data and vehicle registration databases ?
Zahir and Kostubh’s Answer: Milkmen and newspaperboys- because they deliver daily and show up with bills each month, typically have better information about the socio-economic status of each household than most surveys and statically collected data- and moreover if a retail chain wishes to distribute a free-sample or introduce itself, then the milk-men and newspaper-boys would have better and freer entry into the house-hold than say a team hired to survey the neighbourhood or a team hired to sell or distribute free-samples which does not already have a existing business relationship with each house-hold.
Technopak incidentally talked to and collected information from over 1000 such milk and newspaper vendors for this particular consulting project.

New Products and Brands:
I saw a product called VFConnect, which lets retailers use Bluetooth wireless networks to connect with consumers- send consumers a image or text about their shop/retailing outlet- which it broadcasts to consumers mobile phones as they walk past a shop or cinema-hall, and the a person can see the picture/advertisement OR text on their mobile which tells them about the shop/brand or about special offers available.

NIIT I had assumed was out of the training for retail space after it sold off NIS (National Institute for Sales) to Reliance, but I was pleasantly surprised to see a new brand called NIIT Imperia- in collaboration with the IIMs, NIIT Imperia tries to provide “advanced higher education” to those who’re already working.

Whenever I surf to shopping.Indiatimes.com or to MagicBrix.com, I assume these companies have in-house developer teams working on their online shops—so I was pleasantly surprised to learn that these names, and others actually depend on a company to provide the software backend for their virtual shops- and ANMSoft – a Mumbai based company is the one that provides the e-commerce software backend for these sites.

Presence of Academia: Another thing I found interesting about TiE’s retail conference compared to other similar industry events was the visible and active presence of youngsters and faculty from a cross section of academia, famous-name colleges, but also colleges I haven’t heard much of but which are actively absorbing what’s happening in the world and in the process actively building their brand, and this is one thing I really liked and appreciated.
And active as-in really active, both in asking questions and in trying to go beyond the answers of the speakers to volunteer answers to audience questions.

Some of the colleges present included:
(1) BIMTECH – Birla Institute of Management and Technology- This is primarily a MBA college, which to encourage interaction with industry has a Center for Retail, a Center for International Business and a Center for Insurance and Risk management, and the student attendees from the Center for Retail it seems had been notified about this event by their inhouse mailing-list- interesting. To say the least

(2) Design and Innovation Academy – This college in Sector-58 Noida teaches students design- all the various facets of design which include jewellery design and multimedia, amongst others—definitely sounds like a interesting course atleast to me.

(3) NIFT – yes indeed; the National Institute of Fashion Technology.

(4) IIM Lucknow- that’s right, there was Professor B.S.Nayyar, Professor of Retail Marketting from IIM Lucknow attending and he’s the gentleman who I mentioned earlier in the bit about the question-answer session.

Some Photos from the Event: (a picture says a thousand words- and if you want, you can click on many of these photos to see larger sized high-resolution pictures)

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Here’s one session I would have loved to attend but which I regretfully missed, anyone know of a blog that covers this OR if you have the slides from this, do drop me a mail!!!

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VFConnect: This company makes Bluetooth advertising technology- broadcasts to the mobiles of passer-bys information about a retailer’s shop or about special offers

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A Upcoming TiE event

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Lounge Conference: As the conference proceeds, the lounge area is filled with folks interacting and networking
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Tea-Time- The rush for food.

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A Cross Section of the Attendees at Tea time

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Pradeep Sonthalia (Langham Capital) and Avinash Aggarwal (RouteGuru.com) pose for a photo at Tea-time

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Vishal Singhal of CellStrat looks on as Tea-time proceeds in the background.

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Mr.Ranjit – of the Indian Venture Capital Association takes the stage before Technopak’s 120-slide long (but extremely interesting) presentation on retail operations commences.
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Zahir Abbas of Technopak presents- while Bikram Chatterji and Kostubh Rishi (sitting, also from Technopak) Look on

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A Member of the Audience takes the mike as a very informative and lively QA Session proceeds.

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We are all students- of life!!! but here’s a snap of some students of the Design and Innovation Academy who had come to attend the TiE Retail Summit 2008- was great seeing active student participation at a event like this– see article above.

With most events, I tend to be atleast a bit critical, suggest something for the better, but this is one event which I found perfect; and I’d like to compliment and commend Ms.Geetika Dayal (Executive Director TiE New Delhi, geetika(at)tienewdelhi(dot)org) and Mr.Nitin Aggarwal (Assistant Director TiE New Delhi, nitin(at)tienewdelhi(dot)org) of TiE New Delhi for a job well done.

Also, my special thanks once again to Mr.Nitin Aggarwal of Tie New Delhi.

Author’s Note: This post and accompanying photographs are copyrighted by the author; and any unauthorized replication, storage or publishing of this material without the author’s express written (and signed on paper) permission is prohibited.
The author has been in the High Tech industry for over a decade; and can be reached on nsnsns(at)gmail(dot)com or mobile: 9811109407 and is happy to attend and blog about events, product launches and technology news; please feel free to contact him with your questions, comments, opinions and info about tech events.

This post is a mirror of a article I published on my Delhi Voice Blog.

I look forward to seeing your comments about this post, you can post comments here, at Venturewoods.com itself or you can mail me..

Voice your opinion on the Killer App for Mobile Phones

We at Mobisy always strive to build concepts & applications that would put a smile on your face. As a part of understanding user preferences for mobile applications, we’d like to hear from you about what excites you as a user. We would really appreciate if you take the on-line survey here. We heartily welcome your suggestions. As a token of appreciation, the most interesting and useful suggestion/ comment will win a Nokia S60 3rd edition handset from Mobisy. I will also post the consolidated results of survey here once the survey is complete. Thanks a lot for your time.

*only the responses received till Monday 11th August will be considered for the prize.

Call Taxi India

This is a post on Radio Taxi business in India. I am using Meru just as an example to understand the economics of business. There are simple back of an envelop calculations and hope someone gives me a better insight on this business. The numbers look too tempting to be real.

I was traveling with Meru yesterday (27th July 2008) and I happened to strike a conversation with the driver. During our conversation, he gave me following stats

  1. No of Meru taxis on Mumbai roads: 800
  2. No of taxis by EOY in Mumbai: 1300
  3. Average occupancy: 100% in peak-hours and 80%+ in non-peak hours
  4. Peak Hours: 7AM to 10AM and 6PM to 10PM. He said that its impossible to get a Meru Cab in peak hours. This vindicates the business model and demand in the market for these call cabs.
  5. Average Fare: Rs. 15 per KM. Compare this with regular taxis in Mumbai. A regular taxi is Rs. 13 per KM and a premium of Rs. 2 is not very steep considering the convenience and comfort of a call cab.

With these numbers the business sure makes a lot of sense. Only deterrents I can think of are:

  1. High fixed cost of acquiring taxis. Not a huge problem. They can take long term loans from banks or PE players. They can also acquire more cabs by using the part-ownership model (where each driver pools in some money to own the taxi and Meru is just a brand name).
  2. Setup of call center. Obviously each taxi needs to have a GPS device and a two-way radio. There has to be a way to connect the cab with the nearest available free taxi. And since this is a pure service offering, call center is very important.
  3. Capped Potential: The earnings is directly proportional to number of taxis on the road. The scope of innovating on income stream is really low. At max you can use your taxi as an advertising medium.
  4. Traffic rules and regulations: Registration with transport authorities in India is a very cumbersome and long process. Although this is a one-time stumbling block, companies would have to divert a lot of attention there initially.
  5. What else? Am I missing something here?

Business Sense

  1. I would want to what percentage of bookings is done for immediate travel and what percentage is booked at least 2 hours in advance. If the pre-planned travel is very high, then these companies can better utilize their capacities and go for some kind of planning.
  2. I would also want to know what percentage of bookings is for large corporates (say institutional). Because moment Meru gets institutional bookings, they can again manage the fleet better and can be assured of certain minimum number of bookings.

Future

  1. Is their a merit in getting into contracts with airlines, hotels,
    coporate parks etc to manage their taxi services? Again its of those
    things where you convert huge one time capex for companies into on-demand opex.
  2. What innovations are possible so as to maximize the utilization of fleet and make more money from the same number of taxis? Would a thing like car-pooling work with radio taxis? Say junta going from Andheri to Town everyday can pool a Meru.
  3. What else? Please send in your suggestions.

From the Meru website, I could get following details

  1. After Mumbai, Meru is now available in Hyderabad, Bangalore and Delhi. As I said earlier also, the business potential is vindicated by simple calculations.
  2. India Value Fund has already invested in Meru. Although I am no fortune teller, but I can easily foresee a handsome return on the investment. And I can’t understand why the Penguin effect is absent in this industry. If I had money, I would have loved to get into this business. Obviously at the right time and right price.

Other Radio Taxi Players in India

  1. Meru
  2. MegaCabs
  3. Orix

If anyone can help me connect to someone with Meru or any other radio cab owners/managers, please drop a line. I will keep on updating this post on my wiki at s4ur4bh.pbwiki.com.

Image Credits: Andertho via Flickr

Disclaimer: I am assuming that the occupancy rates given by that driver are correct and the taxi service would have similar occupancy numbers in other cities.

Posted originally on my blog here.