Re-Inventing of Business

METRO AG is a German wholesale giant , having 22 stores in 13 Indian cities , from where your local grocers buy goods at " Wholesale Prices " , for retailing in your neighborhood at " Retail Prices "

It plans to invest Rs 2100 cr in India , to open 50 stores by 2020

Now , out of self interest , METRO is reaching out to help create thousands of " Start Ups " all over India

These could be , small hotels / catering businesses / dhabas / kirana stores etc

METRO is helping " Create " these brick-and-mortar Start-Ups ( as opposed to Online web sites ) by :

#   Sharing expertise and business secrets /  Providing office equipment at competitive prices

#   Designing an exciting menu / Putting you in touch with chefs / Kitchen Supplies / Food Safety ( for hotels )

#   Help you manage your back-end operations  /  Keeping costs low  /  Streamlining supply chain

#   Managing your stocks / Inventory Management / Displaying your products

#   Helping entrepreneurs understand customer demand and market trends  / Quality standards and hygiene

#   Plan more efficiently / provide better customer service and delivery techniques

No doubt METRO's competitors ( Ambani / Adani / Biyani / Tata / Walmart etc ) , are keenly watching !

But METRO is not the only one " mentoring / guiding / lending a helping hand " to small retail businesses

To know how a new set of " Online Middlemen" are also helping India's retail shops ,read my following earlier blog :

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Wednesday, 18 November 2015

Rise of the Middlemen ?

For long , marketing pundits have been telling us :

"  Internet is all about disintermediation . There is no place for middlemen .

   Distributors / Dealers / Agents / Retailers etc , will gradually become redundant .

   With arrival of Online Market Platforms ( aka, e-Commerce web sites ) , manufacturers

   will accept orders online and directly deliver to end users , bypassing supply chain  "

Coming from Marketing Gurus of Harvard etc, this was accepted as Gospel Truth  !

Now a bunch of Indian Start-ups are proving them wrong !

These are , Bluebox / Browntape / Unicommerce ( and others I have not heard of  )

How  ?

By acting as " Middlemen " ( of some sort  ) between e-Commerce web sites and MSMEs of India

And what role do these " Middlemen " play ?

*   Getting MSME listed on e-Commerce web sites as " Sellers "

*   Cataloguing their products

*   Managing their inventories

*   Reconciling payments

*   Maximizing Sales

*   Photo-shooting products.......etc

Is there a big enough " Market " for such " Middlemen " Start-ups  ?

Consider this :

#   There are 500 lakh MSMEs in India

#   Of these , barely 3.6 lakhs are currently registered as " Sellers " on e-Commerce web

     sites , distributed as follows :

     *   Flipkart...............  60,000    sellers

     *   Amazon.............. 100,000   sellers

     *   Snapdeal............  200,000   sellers

#   Indian e-Commerce market was worth mere $ 5.3 billion in 2014

#   As per Merril Lynch , this would go up to $ 220 billion by 2025, with 530 million buyers

So , there is scope for many more of such " Mentoring Middlemen "

May be some such " Middlemen " can help the MSME to export their products, considering that India's exports have been continuously shrinking for past 10 months

Is there a " Scope " to increase exports from MSME  ?

Take a look at the following :

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Country         /     No of  MSME     /     Ave Export / year ( $ )

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Singapore     /    9,296                /       6.74    Million

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Malaysia       /    28,840               /       2.05    Million 

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S.Korea        /    2.9 million           /      45 , 000

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India            /   30 million        /            4, 000

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Now , even if each of our MSME succeeds in exporting just $ 40,000 worth of exports per year , that would amount to ,

$ 40,000*50 million  !

Currently each MSME ( on an average ) employs 2.5 persons

How many more persons would 50 million MSME need to employ , if each were to raise exports by 10  times ? ( from $ 4000 to $ 40,000 )

It is reported that , even at the current level of operations , India's MSME sector creates 1.3 million jobs every year

For raising (Ave) MSME exports by 10 times , would that figure go up to 13 million new jobs / year  ?

Enough to absorb the 12 million persons joining our job market each year ?

It is time for Indian Governments ( Central + States ) , to encourage these " Mentoring Middlemen " Start-ups , by abolishing for them , Corporate Income Tax , for next 10 years

Anything other than such a " BIG  BANG  REFORM " , will amount to tinkering !

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20  Aug  2016

www.hemenparekh.in / blogs

 

  

A Radical Radial Revolution !

Here is an opportunity ( or a threat ? ), for India's " Organized / Large Scale Bi-cycle Manufacturers " 

May be , between them , HERO / BSA / TI / ATLAS etc large scale manufacturers , produce close to 50 % of India's production of 15 million bicycles per year ( second largest in the World ) , rest being manufactured by hundreds of small scale manufacturers , spread all over the country . Between them , they also export some 3 million bicycles every year !

Bicycles costing Rs 10,000 / - to Rs 20,000 / - each ( going down to Rs 5,000 for locally made cheap versions )

Cambridge ( USA ) based  GeoOrbital  has come out with a unique bicycle wheel for replacing the Front Wheel of any standard ( 26 " / 28 " ) existing bicycle , to convert it into an " Electric Bicycle " in ONE minute and without any tools !  

Changing back to original Front Wheel of your vintage bicycle , will also take no more than ONE minute

GeoOrbital  Front Wheel carries a 500 Watt DC motor / a removable Lithium-Io battery / Wheel lock and a Motor Controller ( a simple thumb activated throttle, which is easily clipped onto your handlebar )

Battery needs 3 / 4 hours to recharge ( depending upon capacity ) but gets Regenerative Charge when you pedal !

It will give a range of 20 miles (50 miles if you pedal for exercise ) with a speed of 20 MPH ( without pedaling )

Launched in May 2016 , bulk deliveries will start in Feb 2017 . Overseas orders will be accepted online @ $ 800  

If this  GeoOrbital  front wheel was to be manufactured in India ( in a Joint Venture with GeoOrbital ? ) , then I believe , the selling price could be brought down to Rs 10,000 / - ( opportunity for Indian Bicycle Manufacturers ? )

Can our Policy Makers dream of an  URBAN  TRANSPORT REVOLUTION  ( an Orchestra super-conducted by

Shri Nitin Gadkari ? ) as follows :

#  ROLE  OF   CENTRAL  GOVERNMENT

    Encourage " Bike Share Taxi " ventures using Electric Bicycles by offering them all sorts of incentives , such as :

   *  50 % subsidy on refitting of newly purchased plain bicycles with  GeoOrbital  Front Wheels

   *  No Corporate or Personal Income Tax for 10 years

     Of course , existence of similar " Bike Share Taxi " ventures in many cities around the World , have already

     proved this as a viable model for reducing traffic congestions / vehicle pollution

  

      

#  ROLE  OF  CITY  MUNICIPALITIES

   *   Municipalities to make available free " Parking " spaces , all over their cities for such ventures .

   *   Give 10 % rebate in Property Tax to Co-op Housing Societies which provide 400 sq ft space to " Bike Share

        Taxi " ventures , within their compounds , FREE OF  RENTAL

   *   " Bike Share Taxi " scheme may be modeled around similar successful scheme  BIXI  of Montreal Municipality

#  ROLE  OF  START UP VENTURES

      *  These Ventures will construct / install their " Docking Stations " at these parking spaces ( GPS connected /

         Wi-Fi enabled )

         Each Docking Station will automatically recharge  built-in Battery, while cycle is parked ( stationary )

     *   All bicycles owned by these ventures to be GPS enabled for easy tracking by the Venture Owners

     *   A Digi-Met ( digital meter ) to be fixed on all such bicycles where payment can be made by UPI ( Universal

         Payment Interface ) , about to be launched , across entire country ( a vastly user-friendly , Mobile Wallet )

    *   Rates ( per km or per hour ) to be fixed by a RTO designed fare calculating software , running on Digi-Met

#   ROLE  OF  MANOJ  BHARGAVA ( www.BillionsinChange.com )

     *  Come up with a higher capacity electricity generating bicycle device , which can charge FlashBattery charger

        of  Start Up , StoresDot

        May be he can pre-install that  StoresDot's  FlashBattery charger into the electricity generating device itself !

#   ROLE  OF  StoresDot

    *  Modify their FlashBattery Charger ( which is capable of charging a Electric Car Battery in 5 MINUTES ) , to be

       able to charge  GeoOrbital's  replaceable battery pack , within ONE MINUTE 

!

#   ROLE  OF  COOPERATIVE  HOUSING  SOCIETIES

   *   As an alternative to providing 400 sq ft open space to " Bike Share Taxi " ventures , build a GYM within the

       Society compound ( no need for FSI / no permission from local Municipality / just file plans-drawings ) , which

       will house :

       #  Manoj Bhargava's  higher capacity electricity generating bicycles (at least 5)  and encourage Members

           to  exercise on these ( 24 hours open ) , to generate / store electric power for charging  StoreDot's

           FlashBattery . Credit exercising members with " 5 credit points " for charging their own private GeoOrbital

           installed bicycles for each hour of exercise

       #  Install StoreDot's FlashBattery Chargers , duly connected to those devices for getting charged and make

           these available to Society Members who have earned credit points ( Rich members may depute their

          domestic servants to exercise on their behalf ! )

This simple innovation / intervention , has the potential to :

#    Dramatically reduce traffic congestion in big cities

#    Reduce demand for new air-polluting cars using fossil fuel

#    Even reduce dependence on Public Transport ( Bus / Metro / Local trains / Taxis )

#    Reduce need for car parking spaces on streets

#    Improve health of citizens who switch over from car driving to  GeoOrbital  bicycle pedaling !

#    Become a Flag-Bearer to National Electric Mobility Mission Plan ( NEMMP ) which aims to put 6

      million Electric Vehicles on our roads by 2020 ; totally possible if those vehicles are " Electric Bicycles " , not

     Cars !

     

I hope  Shri Nitin Gadkariji  and  Shri Piyush Goyalji , will acknowledge this suggestion , even if they do not agree !

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19  Aug  2016

www.hemenparekh.in / blogs

Congratulations , BJP !

Congratulations , BJP ! ( - in this case , Shri B J Pawar )

Hindustan Times ( 15 Aug 2016 ) carries a news report , titled :

" Housing Societies that go green , to get rebate on property tax "

The report is about BMC ( Municipal Corporation of Greater Mumbai ) announcing a discount ( in the property tax ), to bring down the load on over-burdened landfills

Mr B J Pawar ( Deputy Municipal Commissioner ) is quoted as :

"  The rebate will depend on how the Societies have reduced the three-step work of the Civic body i.e. collection , transportation and disposal of waste "

Under the Scheme , if a Society segregates waste into wet and dry , processes it through composting or any other method , has reduced its energy consumption by using solar panels , uses grey water and has in turn reduced its consumption of potable water , will get the discount ( which , according to a TV Channel news last evening , would range from 10 % to a max of 20 % )

India's policy makers have started to listen to - and implement suggestions given by ordinary citizens !

Thank you , Shri Pawar !

PROOF  ?

My following blog / email sent to all concerned ( Central / State Ministers / BMC Officers etc ) :

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Wednesday, 27 April 2016

Incentivize Housing Societies

Disposal of garbage ( wet and dry ), is a big problem for all Municipalities

In Mumbai , it is a daily 8,000 ton problem

Despite a large fleet of garbage collection trucks and thousands of municipal employees ( including employees of contractors ), streets remain littered and garbage dumps keep overflowing ( when not burning ! )

All kinds of solutions have been attempted in the past to solve this problem, without much success

This is because current perception of the garbage generating households ( and of the office bearers of the housing societies ) , is :

 *  Garbage collection / disposal is Municipality's responsibility

This problem will persist till we succeed in changing this perception to :

*  Garbage disposal is our responsibility "

This change of attitude can be brought about by " Incentivizing " the members of the Housing Societies

HERE  IS  HOW  :

*  The society where I live ( Marol / Mumbai ) has 200 Members ( flats )

*  Each member pays monthly Municipal Tax of ( approx ) , Rs 600

*  That translates to Rs 1.2 lakh per month ( Rs 14.4 lakh / year )

*  In 5 years , Society pays to Municipality, Rs 72 lakhs

*  Govt / Municipality to make it compulsory for each big society ( size to be

    decided ), to install on its premises :

    #  Methane gas generating plant or Compost Fertilizer plant

         (  to take care of wet / organic garbage )

    #   Water recycling plant ( to filter and reuse water from shower / wash

          basin / kitchen sink for toilet flushing purpose )

    #   A Compacting Press for dry waste ( paper / bags / cartons etc )

*   Towards installation of such plants , Municipality to give a discount of

     25 % to the Society in monthly taxes , for a period of 5 years

     That is a rebate of Rs 150 / month / flat for 5 years

     This would work out to a saving of Rs 18 lakh ( 25 % of Rs 72 lakh )

*   This amount should be sufficient for the Society to invest in these plants

     and for paying wages for persons needed to look after their operations

I believe such a positive incentive will motivate most of the Societies to undertake to install such facilities

As a negative incentive , Govt / Municipality should levy additional surcharge of 25 % on the monthly taxes ( ie raise to Rs 750 / month in our case ) to those societies which fail to implement this scheme within ONE YEAR of notification

It is high time citizens are involved and motivated ( through negative as well as positive incentives ) in keeping their cities clean and its environment pleasant

I am sure such an experiment will find a far better response from the public as compared to the ODD-EVEN scheme of Delhi ( which too will succeed when Delhi-ites find plenty of Public Transport )

Incidentally , Shri Arvind Kejriwal and his team should study ( without sending a delegation abroad ! ),

*  " Share - a - Bike " taxi scheme ( BIXI )

which has successfully solved the traffic congestion problem in Montreal ( Canada )

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17  Aug  2016

www.hemenparekh.in / blogs

All Charged Up ?

Economic Times ( 21 July 2016 ) carried a news report titled ,

"  All Charged Up , Tesla could Make in India "

It talks about Shri Nitin Gadkari's visit to Tesla's electric car plant in USA , and his talks with Elon Musk

Upon return to India , here is what Shri Gadkari said :

" They ( Tesla ) have path breaking energy storage technology . I told them , India could be one of their largest manufacturing facility and we would be the most cost effective "

Shri Gadkari has invited Tesla to set up a manufacturing plant in India ( next to a port of their choice ) and make it , its export base for the rest of Asia . All facilities / support / changes in rules-regulations are promised

The fact that Tesla Electric Car Model 3 , costs approx Rs 23 lakhs is not much of an issue for thousands of rich Indian buyers

And those rich Indian buyers will also be more than satisfied with the following features of Model 3 :

Size / Sitting Capacity / Interior  / Design / Style / Auto Pilot / Navigation Console / Acceleration / Battery Life etc

They would also feel quite comfortable with its " Range " of 346 Km per charge ( 215 miles )

And , as far as the " Charge Time " of 75 minutes is concerned , India's rich will ask their drivers to go to a Charging Station , late into night , to ensure that they don't have to wait at the station , during office rush hour !

Nor would India's rich be worried if their charging cost per km ( for an electric car ) , goes up to , equivalent to Rs 10 per km ! ( @ Rs 70 per litre of petrol , giving 10 km per litre for existing expensive cars )

But will that motivate Elon Musk to consider India , over his declared intention of putting up a plant in China ?

I seriously doubt !

Consider the following :

#  In 2015 , China produced 142,800 battery operated electric vehicles ( mostly cars )

#  By that time , China also had a nation-wide network of 160,000 " Electric Charging Piles " ( 50,000 Public /

    50,000 Private / 60,000 Commercial )

#  By now , Tesla itself has managed to put up only 624 Electric Super-Charging Stations world-wide ( of which,

    500 in USA itself ) - with 480 V power supply

   

Setting up lakhs of electric charging stations , all over India , is unlikely to happen anytime soon , due to :

#  It is a " Chicken or the Egg First " type of situation !

    No one will buy an electric car unless there already exists , a wide spread network of electric charging stations

   { and obviously , if no one buys, then no one would want to manufacture ! }

    No one will send his driver ( even after 8 pm ) , if the nearest charging station is 30 km away !

    And which private owner would set up a charging station where only 3 vehicles turn up for charging in a day ?

   (  I mean , in a night ! )

WHAT  IS  THE   BREAK-THROUGH  NEEDED ?

#   A " LOW COST " Charging Station that can fully charge an electric car in " 5 MINUTES " - and at " HOME " !

    ( or , at the most , in the  Cooperative Housing Society , where you live )

IS  SUCH  TECHNOLOGY  AVAILABLE  ?

The three-year old Israeli startup, named StoreDot, is working on a prototype EV battery that can charge in as few as  FIVE MINUTES , and provide 300 miles of driving range.

StoreDot’s  “ FlashBattery ” technology is based on proprietary inorganic compounds and a hybrid multifunction electrode (MFE) and promises a theoretical “instant” charge for smart phones and electric vehicles.

 “If this chemistry works as we show, there’s no reason we couldn’t charge a car in FIVE MINUTES ,” says CEO / Founder of StoreDot , Doron Myersdorf.

LESSON :

#  We don't need Tesla to set up a plant to produce a Rs 23 lakh car when our own Mahindra's REVA e20 model

    [ costing Rs 7 lakhs ] , can run 90-100 km on a single charge ( but needing 1-5 hours for charging ! )

    All that is needed to replace millions of smoking / polluting / killing , petrol / diesel vehicles is a Joint

    Venture Collaboration between :

   #  Manoj Bhargava  ( Free Electric  /  BillionsinChange.com )

       I am sure , given a challenge , he will come up with  higher capacity Electric Power Generating Bicycles which

       can charge  StoreDot's  FlashBattery , which , in turn will charge the electric cars at night , parked in the

       compound of a Cooperative Housing Society

      Health-conscious Members of the Society , will be , more than happy to " pedal " such bicycles , housed in the

      common Gym of the Society , after returning from office !  

     What's more , each Member's " One Hour of      Pedaling " will earn him , one car recharge of 5 MINUTES !

     Besides providing a " vastly economic ( free ? ) " car recharging solution , this will improve the health !

   #    StoreDot

      I believe , Doron Myersdorf will be too happy to provide FlashBattery technology, considering our, about to be

      rolled out , NATIONAL ELECTRIC MOBILITY  MISSION  ( NEMMP ) , which aims to get  6 Million

      electric vehicles on the roads by 2020

  #   SOCIETY  of  INDIAN  AUTOMOBILE  MANUFACTURERS  ( SIAM )

     SIAM will lay down the  Design Specifications  for :

     #  2 or 3  " Standard " models of Rechargeable Battery Power-packs to be installed in Electric Vehicles

     #  Standardized " Replacement Cycle Times "  for these power packs ( Battery Pack Life )

     #  Output parameters for Electric Power Generating Bicycles ( Voltage / Kwh etc )  

     #  Charging Standards for FlashBattery ( Ampere-Hour / Time etc )

In past 3 years  ( 2012-13 to 2015-16 ) , the total number of vehicles on Indian roads has gone up from 172 million to 186 million ( some 4.5 million per year ! )

For " Implementing NEMMP , and to strengthen the charging infrastructure for electric vehicles " , government has set up a committee consisting of Transport Ministry / Power Ministry / Heavy Industries Ministry and Environment Ministry

To those who agree with my suggestion , I request that they share this blog among their contacts and request them to do likewise

If implemented in a hurry , I believe Shri Narendra Modi would want to speak about this achievement in his Independence Day speech from the ramparts of Red Fort on 15 Aug 2017  !

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15  Aug  2016

www.hemenparekh.in / blogs