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Seeking success in India’s heartlands

Seeking success in India’s heartlands
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A never-say-never attitude is what defines Jitender Singh best. After completing his graduation in 1997, he joined Uncle Chips as a sales trainee, while his peers were pursuing an MBA degree. And rather than becoming disheartened by the meagre salary he was offered, he took the opportunity to understand the nuances of channel sales. His hard work and perseverance paid off, when he was promoted within a year of his job.

This confirmed his belief that things don’t get tougher, people get stronger.

During his 13-year career with various companies, Jitender went on to manage large teams and create networks in different fields including FMCG, telecom and travel. This experience came handy when he switched tracks to become an entrepreneur in 2010.

Unfortunately, he incurred heavy losses after the startup failed. Undeterred by this experience, and much to his family’s chagrin, he decided to start all over again.

He pivoted the business model for the company, Starfin India, which went on to become one of the largest banking correspondents for State Bank of India in Northern India with Customer Service Points (CSPs) across 11 states providing banking services to millions of customers. Jitender successfully exited the company earlier this year, after it was acquired by BLS E-services.

But that did not put the brakes on his entrepreneurial spirit, no sir.  

In 2018, he co-founded MiniDukan with Harsh Chauhan with an aim to revolutionize the e-commerce business in rural India. The hyperlocal service empowers customers across tier 4 to tier 6 towns to shop a wide range of products from general merchandise and fashion to electronics, at the click of a finger.

Talking about this venture, Jitender said, “We are empowering rural literate youth to earn a living by opening a collection and delivery center (CDC) at the village level. They are in turn connected with our nearest logistic hub for a smooth supply of products. MiniDukan offers an enhanced customer experience with deliveries at zero charges and no Minimum Order Value (MOV). Our app plus kiosk-based hyper-local service sources products from vendors and ensures delivery within 48 to 96 hours.”

Jitender Singh, Co-founder & CEO, MiniDukan.

TUG OF THE RURAL HEARTSTRINGS

The idea of getting into rural ecommerce came to Jitender when he was operating Starfin, which focused on Northern India. At that time, he noticed that the rural landscape was defined by a positive agricultural outlook, growing household income as well as rising consumerism that was propelled by digital exposure. This was giving India’s rural e-commerce a boost and EY India estimated that this market had the potential to touch $11 billion within four years.

Encouraged by these findings, Jitender ran a pilot for MiniDukan in 2017 with basic technology across 50 villages. Initially, the technology failed and the app crashed after 3000 downloads. However, it built his confidence that this was doable with right technology, right merchandise and marketing.

To create a distinction from other leading marketplace platforms, which also deliver to over 15,000 pin codes across 56 cities and 1,000 towns, MiniDukan decided to address the challenges faced by the e-commerce sector. This included logistics, vendor retention, timely payments, employment generation and customer education.

“Our hyperlocal service empowers customers across tier-4 to tier-6 towns to shop a wide range of products from general merchandise and fashion to electronics, at the click of a finger. Our business model is more of the village, block, and district-level coverage rather than PIN coverage modules. We are currently present in 11 districts in Uttar Pradesh, managing end-to-end logistics at villages through our unique business model,” Jitender explained.

Harsh Chauhan, Co-Founder and CTO, MiniDukan.

THE UNTAPPED POTENTIAL

More than 90% of the Indian retail business is unorganized and majority of it is in the rural areas. It is, therefore, critical for any business operating in this regions to build a strong network and keep networking to get brand visibility across a larger customer base. However, building this network becomes challenging in small towns and rural areas. It is basically due to the lack of technological advancement in these areas. This posed a major challenge for MiniDukan in its initial days.

Additionally, the company had to use its marketing budget judiciously as it was bootstrapped. “Funding is imperative for any company to function and progress. So far, Harsh, who is also the CTO, and I have invested $1 million, which we have taken from family and friends,” Jitendra stated.

Starting small in 2018, MiniDukan has established its presence across 11 districts in Uttar Pradesh with 20 logistic warehouses, 2,500 CDC or kiosks and a one-lakh customer base. This year, it plans to add two more states, 10,000 villages and touch 20-lakh customer base network with 20,000 of orders per day. 

Does this sound ambitious? Not to Jitender.

“We are constantly striving to come up with innovative ideas to expand our business and overcome any hurdle on the way. For instance, during the pilot phase and while building the technology for rural channels, we started with our own inventory. From December 2018, we launched the virtual inventory model for third party vendors to sell their products on our platform. Now we are acquiring rural retailers to sell their inventories so that we can deliver within the timelines we are committing to our customers,” he confidently said.

By end of 2019, MiniDukan aims to establish its presence across Northern India with 40,000 CDCs and 400 logistic warehouses. It also wants to appoint an exclusive third party logistic partner at the block level, who can supply orders at the village level. 

GOING WITH THE FLOW

However, while it might appear that rural ecommerce is up for grabs, the fact is that it can be a hit-or-miss opportunity. There are no linear rules to business, which Jitender has well realised.

“The problem with the rural market is that there is limited access to products that add value to their business. Through their interactions on our omnichannel network, we are matching retailers with manufacturers – or vendors – who are capable of providing the correct products. Our experience in this field is, of course, a benefit as it helps create these connections,” he emphasised.

While the rural ecommerce business beckons for the market potential it offers, Jitender is await that he needs to keep investing in technology and manpower to hold on to the first-mover edge that MiniDukan has. That, and understanding the shifting needs of the customers in this strata. But he is confident he will be able to achieve it.

Like we said, he does have a never-say-never attitude.  

Cover image courtesy: Aditya Narayan, Pexels

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