Global Sparenparts Aims to Serve All Indian States Through Warehousing Operations
Global Sparenparts Pvt. Ltd. (SNP) is a B2B e-commerce organization which lists only genuine and branded industrial products (spares and consumable) and allows the customer chose from the varied assortment available in the site. The startup was officially launched on 23rd October, 2015
The Men behind It
Mr. Ashok Gupta is an industry veteran who carries over 30 years of experience predominantly in steel industry in handling multiple senior level roles with companies such as SAIL, Bhushan Steel, LN Mittal Group (African Continent) among others. He is currently Managing Director with APL Apollo Tubes Ltd. and Director at Jindal Stainless Ltd.
Mr. Dinesh K. Agrawal is a fellow chartered accountant with more than a decade of experience in business advisory, strategy, system development, auditing & assurance, taxation. He is a board member of Oriental Bank of Commerce and also associated with First Global Business Chambers.
Genesis
Mr Ashok Gupta and Mr Dinesh Agarwal idealized the concept of a B2B marketplace to address the same need focused solely on spares and consumable which will deliver only genuine products in shortest time frame.
Unique key features/services offered
· Provides a discovery platform where over 1,500,000 products across 23 major categories from different suppliers covering all industry needs are present on one platform
· Allows only from OEM or OEM authorized distributors to assure 100% genuineness of products with original warranty and service assurance.
· Automates the current industry best practices to drive efficiency in the existing processes
· Lists the products from different sellers on a single platform to ensure fair and transparent pricing as sellers would be inclined to give their best prices to generate sales.
· Ensuring timely delivery of all the products so that the customers focus on their core activities and need not worry about the delivery of the spares. In case of breakdowns and emergencies expedited shipping options are available to minimize the down time.
· Develop a better understanding of the consumer needs to better forecast their demand of spares and ensure automatic re-order of all regular purchases
Differentiation factors
· Allows customer to claim CENVAT benefits where available
· Allows customer choice to purchase on VAT / CST (on availing c-form)
· Concept of Virtual Store – where customer’s inventory is mapped to its products data base to allow easier purchase based on customer codes
Funding status
At present the company is 100% funded by the founders. The first round of fund raising is expected once the proof of concept is ready. The funding will be used to strengthen the logistic capabilities and expand to new geographies.
Monetization model
· SNP acts as a consolidator and facilities the discovery of the products by the buyer, ensures the timely delivery of the goods, provides the payment facilitation and for these services the company will charge the seller a small fee for every transaction carried out on its platform.
· In the future SNP will also offer visibility for brands which wish to be associated with it on the website to run their promotional activities.
Traction details
· The portal contains over 100,000 products from 260 suppliers across NCR and Punjab. The other geographies will be covered in phases.
Future plans
· By 2015 the B2B industrial market for spares and parts was estimated to be $60 BN. At present this is highly unorganized, has a huge number of spurious products available, and the distribution is multi layered, which increases the price to end user and results in high lead time.
· SNP aims to organize the market and bring the end user closer to the manufacturer so that they can get assured supply of genuine branded products.
· The company aims to stabilize its operations in the North of India and then expand geographic coverage to cover the whole of India and also starts its warehousing operations to ensure better customer fulfillment.
Marketing plans
· SNP aims to use the digital marketing space to reach its customer base
· Also the firm is in the process to create exclusive tie ups with few brands which will give it to the visibility in consumer space
· Sparenparts has created offline channel to assist customer to get accustomed with the technology
· Also it is planning to maximize its presence in various industry exhibition where the company can reach its customers directly.
Challenges faced
· The market is highly unorganized with vendors of various sizes fragmented and spread across geographies. There is no inventory visibility with the various suppliers as they generally don’t have systematic methods of keeping track of inventories
· There is a large number of spurious products available in the market and one has to tie up with only OEMs to get the right product
· Many cases there is lack of transparency in purchase resulting in favoritism for particular vendors
· Buyer behaviors needs to move from online and offline which is happening at a slow pace
Market size & opportunity
· In 2015 the B2B industrial market for spares and parts was estimated to be $60 BN which is today primarily unorganized and expected to grow at a faster rate than the B2C market.
· With the booming of the B2C e-commerce market a number of businesses are now recognizing the value which e-commerce can add to their purchase and are quicker to adopt such solutions
· The average age of purchaser in industry is decreasing with the younger demographic of the country. The younger purchase managers are expect to adapt to technology platform much sooner.
· The startup expects the Make in India and Digital India initiatives to also give a boost to the B2B e-commerce
