GOPI Primer 5

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Andheri) Borivali I Powai I Vile Parle I Churchgate I Pune I Online 8999-11-8999 I www.catking.in
For more queries for GDPI Mentoring Contact: 9833982635
 t online grocery start-up Grofer's aggregation
centre in Gurgaon. Co-founder .I\lbinder Dhlndsa
. an orange-roloured delivery bag, one
that his delivery boys once carried on their
backs. zipping across more than 20 cities in
bikes to deliver everything &om lemons to de­
tergent powder. From the time the orders were placed by
customers. they had two hours to deliver. That's the na­
ture of the hyper-local. on-demand business Grofers
played in. But the bag would hold only two crates. As
volumes shot up in many cities. the company employed
more and more bikers. One delivery boy couldn't do more
thaI! nine ordet·s a day; the size of the bag limited the vol·
ume they could execute.
Realisation struck Dhindsa early in 2016. The on­
demand model would work but at a huge scale.
However. investors no longer had the appetite for the
amount ofcapital it could require - in people, aggrega­
tion centres. and other parts of the supply-chain.
Although Grofers had raised $120 million in November
2015. the funding climate was getting chillier. The on­
line grocery sector. itself. was in a crisis; Grofers dosed
down operations in nine cities in January last year as
scale remained elusive even after a marketing blitz.
In May 2016. the start-up pivoted to a next-day de­
livery model that gave it more time. to plan the delivery.
Instead of bikes. itswttched to vans that could do 22 or­
ders a day. Vans also accommodated bigger orders with
higher margins. The value of goods delivered more
than doubled. While a bike delivered orders worth
~ .000 a day. a van can carry groceries worth
,{25,OOO, "Our operational costs last year were at 100
per cent ofsales. Currently, it is close to 25 per cent."
says Dhindsa. "We were running four aggregation cen­
tres in Gurgaon alone because you had to get to the
customer in two hours. Now, we are running just one,"
fn 2015. Grofers employed 4.000 people. The head­
count has hal"ed to about 2.000 at present.

January 29 2017 BUSfNP,SS TODAY 19

 IN 2016
(R'I'13iti('lil'lStart-ups -----------------+---------------­
Not Iusl (:rofers - mostlurxe and mid-sized con­ Nlkesh /\rom. r"nncr I're:<klent & Chl.f()per~II1111 Omcer "'inves[()!"S have tried to oonlrol expenditure by saying !lIe:< lIot cllmed away by the reck)•.,.. rundlng environ·
• ,umer h"ornel buslnt:SlreS. Including 1111 c~ommcn:c ofSonBank. une aflhe blgsest dell/maker.< In Ihe I"dlll" you need hlting L'OllllCnl u!lave II celtuln bn.ckc{, Or Ir mentorllll4 and lUI S and spent their' way Into the
.Utn-ups - urc now rocused un stemming their fixed and Intemet consumer play with InVClllmCIIIS In SlIupdcul you take 1110011 beyond 1\ certilin (hre:<hald. yuu ne«! hl~ heariS and mlndso(the Indiun con;umer. "'II wusillav­
v~ri.ble eXp'~nses. Mynlnl. (or Inslance. SlIys II hilS re­ lind (lIacubs. populurilled u new term among lIS portroliu ·consent. They L"Quld also usk ror monthly Income slat.­ I~h organilmUon In that sen$<' becuuse there is abun­
duced di.>coul1ls by SOU basis points overtime; Pllpkalt L"OIllJlllnles: thlnkinll about the "Islunds of proRtablllly". ment to ilIie how the money Is being spent." she says. dunce ofmoney."1-1tpkllrt's ronner~O Sanlay Baweja
hus been uble to ~lTest the Browth oflbllll!lling. geneml Lawyer Roma Prly.. FoundlngPartnerofllurxeoll According to data from the Ministry of Corporute told BIUIIlI'M TodnJl on ph,one. "Unless money Is COil­
. and adrninistrati ve (SC&A) expenses: Smlpdeal's nel reve­
Bb:support. which repteSlHllI both slart-ups and Inves· Affairs. the L"OOlblned l(mes o((ndlll'$ top eight con· stflllned.lt gets used up very quickly."
nues have grown three times over the last year:
tors. says that while most 'amrmatlve rights' - right' In­ sumer Internet rompunles. which Indude !'Ilpkarl. !l-wllcrs and other>'\lIrt·ups mllY huve ll11ully.swried
Shopelu",,' .hipping costs huve dropped 2(1·25 per cent a
vestors have II veto power on - huven't chanb-ed. In­ AmulIOn. Snapdeul. ShopCIues. Ola. Qulkr. Paylm. and IreaUng cupltal asa IInlle commodlly, .
unit: budget hotel aggrega[()rOYIJ Rooms hllS$!Ived up
creasingly In 2(J16. some rlgbts Ihul help venture capl­ Zomato. has mol'\! than quadrupled from~) ,llO erore
30 per cent month-on·month In IllIveJ experuJI!$: Zamato
tallstsexert glealercontrol over a stwt-up's spending , in the year ending March 2014 to ,{5.885 crore In SG&A: Caution in the wind
has neduced its monthly bum by 89 per cent. /rom about
und operadons have round their way.lnto agreements. ,March 201 S. That number would have Curther bloated Bu.sillus Today metSwIlU Bhargava. the Co-Founder oC
$9 million In mJd·20 15 to a million
In the year ending Mareh 2016 -loss data for every aJliuale marketing company CashJ(aro.com. II day beCore
by the end of20 16 - as It redl·
company Is not yet available. Notably. there Is one cate­ Amazon's Greatlndlan Fatlval Sale. Herom...·ln
rected Its geographic focus. cut
gmy of companies that Is weJlcapltall.sed and sustains Gurgaon. was being decked up with blliloons. "Today.
down on non-(jlscretlonary spend­ high decibel marketlng campaigns. Paytm (One97. the whole sector Is so energised. It IIlmost feels Illee the
ing. and Improved eIlIelendes.
· which runs Paytm. bad a lossof~1.535 crorein battle ground Is set.• she quipped, gleefully. "It's Amazon

At an industry level. expenses

· l015/16) Is on a markellng overdrive. particu­ and Shopclues tomorrow; Flipkart and Snapdeal come
on logIStics may be down 10-20
larly after Ihe government's demonltlsatlon next. Evezy employee will be here at midnight. There wi"
percent versus 201 S. Manpower
move In November, Aml\%On lost be p12zas. Tbls Dlwail will be bigger than last year: she
is dow!> about) 5 per cent. advi­
USi2erorein l01S1l6. 0 predicted.
sory flrm RedSeer says. For S()me

e-tailers. 85 per cent of the

· Ne\'ertheless, there Is no
break In Its spend-
0I
"'"
(j ,
In hindsight. she was correct, October 2016 was a
bumper month for the e-taJltng Industry as festival sales
monthly bum i.s In marketing.

">There Is more rationality kicking

Ing. [n a lalk
wlDe,y
f iJP
...
t</4'" tr Ifed
O
raked in a grossGMV 0(52.25 billion versus $ L 5 billion
ill the same month Ibe year before. research from
in discounting and coupons.
RedSeer states.

II Telel'ision advertisement has sig­

Wt.f/41 t naS cr:s and But there was a malar change in tne way discoun fing
added up.!l-Iallers got banks to fund the discounts. o,a

crpkar ·ts sa
nific!ll'itly gone down. Outdoor

I'
! and print i.s much lower. In my
part oW. This could have reduced the burn they would
,'iew, there is at least 50 per L'enl
have otberwlse Incurred. ">Every retailer negotiated a.
decline in advertISing on a year·
» r I tn of I nses d bank card discount. which is often funded part by the re­
oll·year basi~." says Sandeep

Aggarwal. founder of e-commerce

qroW I eJ{pe . nalise tailer and part by the bank. But never before have we
seen every offer acrornpanled by a card alTer." Bhargava
genera we( ratIO
I
marketplace Shopclu"" and used
says. Just before Fllpkart's 'The Big Billion Days Sale' .
vdude marketplace Droom. He
that ran from October 2-6. the company nudged custOm­
estimates that e-commerce com­
ers to "apply rigbt away (or SBI credit cards and debit
panies. put together. spent be­
tween $ L1 billion aDd 1.5 bUllon
,\ lAanpoerCFO)
), 1'1. 10 fo(fII
lated on
circu­ cards that wlH fetch you the biggest. Juiciest deals", Bank
offers went up to UOO0-3000. where as last year it was
on every type or marketing In 0(6,09 YouTube, Scott much lesser. says Bhargava.
2015. "'In 2016. it Is more In the lace Galloway. an Adjunct J:leclml.ber-end. PJipkart was still sending conSUmers
S800mlUion·900 million range." Professor of Madceting at the mailers with the subject line. "We are reeling generous
Companies did splurge on market­ NYU Stem Scbool orOuslness. says today". However. the company' s SG&A expenses are ta­
ing during the festival season. In that no company In the world bas ever pering off. SanJay HaweJs told this writer S()On after he
the run up to Dlwall. Snapdeal had access to cheap capital In a way Amazon quit. around October last year. When he joined FUpkart
said it will spend more than f200
did and now tbey are taking advantage oflt. "They In November 2014, he wrote on Unkedln: "Moved here
crore on marketing campaigns
are going underwater Inlo the world oHulllllment to the hugely exclting and the very rast moving world of
over the next 60 days. But most
which Is vezy expensive. with the largest oxygen tanks. E- Commerce, the Sunrise lDdustry of today". He $!lid he
companies ran low-declbel cam­ (orclng every other retaJler to follow them. But every­ resigned because "the company Is In a dillerent mode and
paigns or none (or most months oC one else Is following with a sr;naller oxygen tank and it Is a continuous r:estructurlng process. I thought It best
the year as wary investors InCl'ellS­ will begin drowning." that t should move Into a dilfenmt area". BaweJa denied
Ingly demand a path to profitabll· You can sense that presIIure when Indian market­ rumoursofanyconlllct with the company's board. par­
Ity. They want e-commerce com­ places talk of "capital dumping" and.seek a "level-playing ticularly one that relates to cash burn.
panies to reduce cash bum. field" from the govenunent. Many orthe same compa· "If you were to look at SG&A elq)enses. -and If you

30 BUStNFSS rODA Y !anua,y 29 2017 1.....'8292017 BUSINESS TODAY 11

 /
(RilqjjliitljtlStart-ups -------­
I
i
I
I were to
compare what
was the trend two
ro
YC!fS ago. fItS! 1waS able
stabilise It as a straight line and
then now It Is coming 00:" Baweja says.
"We have been able to stem the growth of that
expense completely. It Is now about getting the unit
economics right and then the scale benefits will con­
tinue to come." Baweja says SG&A expenses were con­
. trolled because of manpower rationalization. '"The only
I growth in manpower we allowed was In the tech team.
what bour of the day we should incentlvlse a clIstomer
I
There was a contraction In some 6fthe other teams' <­
that were over stalTed. Other frivolous expenses were
done away with." huays.
Accounting In l'IIpkart was In a "desperate" situa­
tion wben BawejaJolned In 2014. "Now. we are In a
place where we are able to get our monthly numbers in
quickly. Lot of the numbers are available on a daiJy and
a weekly basis. Taking decisions Is therefore much faster
and importantly, there weeeexpenses thatshouldn't
have been there. That Is taken care of," Baweja says. He
dld not waht to taIk numbers but Plipkart burnt U 92
crore a month. going by Its IilIngs. In the year ending
March 2016. FUpkart Internet lost U,306 crore on rev­
enuesof~I.952 crore.
At some companies. data sclence Is being used ef·
I
fectlvely to check marketing expenses. Rltesh Agarwal.
CEO of OYO Roo",". says his cost of customer acqulsl~on
has dived at least by halfvel'llus 2015. ·We are spend.
Ing our dollars In a way more Intelligent manner than
earlier. Data science now says which channels we
3l aUSINESSTODAY /anuary ~9 ~017
should be on and at what hOllr. Data also tells us at
Gurgaon's Sector 69. Agarwal had negoti­
for downloads: he says.
LIke PIlpkart. OYO. too. has buUt processes arollnd
managing SG&A expenses. A case In point is the I11ght.
train. and bus IiCke!s booked by employees travelUng on
company asslglllllelllll. A while back. they booked the
tickets themselves and appUed for relmbursements later<
"Now. we have partoered an agency that has a lotof
RIghts they pre.buy. They are able to give us cheaper op-­
tlnns." says Agarwal. "Then there are best practices like
booklngseven days In advance for a OIght And when­
ever you travel to anew cfty. there wiD be a per diem and
no qUestiON are asked on wbere you spent It. Earlier.
~ people spent time appro\l1ng It,· he adds. P.or OYO.
these measures corresponded with the recruitment of
. the CPO. Abhlsbek Gupta. In June 2015. "The mandate
for him was to IteIp the organisation operate more
sanely. He brought In a lot of the systems and'processes.
We haveSllved mote than 20 per cent on a month-on·
month basis in tenn:J of travel expenses." Agarwal says.
OYO recenlly moved to a spanking new office In
ers: a cash collection fee: a small com­
MANPOWER
ated a rent·free period ofsix months­
OYO Is the anchor tenant for the builder,
One of Agarwal's quirkiness was to move
around the office bare-feet. But the day this
writer met him. he 1\'85 wearing shoes_ He
had Important "lsi tors. And this office was
DOWN
150/0
100 huge to be a fashionable, bare-footed
entrepreneur,
SUPPLY-CtjAIN: Redesigned
Things changed In six months for this large lingerie
maker who sells backless braS, balconettes. G-strings
and thongs on all marketplaces. Very little commission
waS initially charged bl' e-taUers on the category and
the seller was encouraged to make prices attractive tor
customers. They dld. However. since March 2016.
commissions rose. Marketplaces started charging be­
tween 12 and 20 per cent. Many other rees were
slapped as well: for the units stored at the e·taller·s
warehouse: for the goods that are returned by custom­
ponent of the marketing fee. even.
"None of these were there before March.
The storage fee ne~r existed. Por any
Item we sell, these charges take up
'U 30-140." says the lingerie maker,
who didn't want to be identified,
What's happening here? Many e­
tallers, according to Sreedhar Prasad, Partner
B-Commerc.e at KPMG. have worked on reducing logis­
tics expenses, "Today. we see many initiatives. Some
have start¢ charging both customers and sellers.
Categories <Where the average order value is smaU. like
in electronlC8 accessories, toys. books etc, have a deliv­
ery charge associated wlth it. Further, e-tallers today
are evaluallng multiple delivery models and alliances
for last mJle delivery. Ifimplemellted well. these have
the potential to reduce the Impact due to logistics costs
by 20 per cent," he estimates.
ShopCiues, for Instance. Is one company that has
started charging for sh/pptog. "Because of the sanity !n
'anuary29 2017 BUSINIlSSTODAY II
 (~IIfl~i"i(']:''Istart'1lPS - - - - - - - - - - - - - - - - - -........­

Ih., m"l'i<clplucc. evt:tyune .iunw puylng IIllcntioll W

shipping c",,1.~. We we." ul'iO l,hIe Wchlll'J:c ror shIpping."
m l IIfShullCluc'S Sanl_y Sethl SIIyS. "We wllllllvc you p
I rn:c shipping if you buy muny pnldu\.'\S bullfyou huppen
lot>cil1.rI.~lloteplace.youmuyhHvelupuy~lOforli
~hirt. This Is U/1 sInce May lU16." he 1lIkls,
$hupChOC$ u!soirlelllouyoid Hir shipping by show­
ingshoppersinvenlorydoscrlolhelrluc:aUon, "As
aJO
PCIIJ~
...
,.,A·1 $'-' tr,'eS penSIV

I
to aVO '"e
5 pi
'd ~;¥ tI

soun .s you move awuy from Hirshipplnll. your "0.1

W eLII'leS rf'Ioree"
,. "

drops by .smuch Wi 70 per cenl. Th"dlstancelruvelled

ShOP 'ar II rt ed
is less whcll ilisu rcglonalsupply-chaln: Sethi ex·
plains. The company's courier plIltnenr now run dedl­
}} 'pp"tJl1 J .It'ratlSPO drOPP
I

cated trucks. ShopClues also hIlS 48 courier partners:

(he large number ensures II better bargaining chip. and ,,'j I'
lhereby.bellerroles, "Our shipping cost perunlttsdro­
matically,low and that Is because we have a large
Shl t rO ad sts I'l1avertit
calchmentofsuppliers. We have seen about 2()"25per tho . CO er UII
snipplnqcent P
I cenl drop in shipping costs perunll." Ihe CEO says.
Snapdeal is another compuny W have wol'i<ed ag­
gressivell' on reducing supply-chllin costs. When
IlILlimss Today met Kunal Bahl.lW ofSnapdeal. In
AprillaSI year to talk aboul Ihe InOuenc. orSoftbank.
)}
20"'"? 5
1
per ,.'

he sald that "Nikesh {Arora) S1anw pushing us to find

tr.e islands of profitability in our rompany": that the
compa1l y' S gross margins tripled In the last six
£.. . . . . . .,.,"

a'----V-
( months and "its fulfilment co..t as a percentage of
sales is the lowest in the industry".
How did the company achieve this, Snapdeal slocks
goods closest to where they seU. "We intelligently use
data. If you want to sell sorn.thjn~ In western India,
Ille gO(){i.s are stocked in warehouses in Ihe wesr, not in
the !lorlh, (;0005 move much 1...'15. which means there is
much I"ss transportation cost." says a spokesperson.
~
des b)' lIlI
huur, "Earlier, a
vehicle carried thrcc 10­
caUon shipments in llelhl. By
prep(lllJng the deplll1ur-e lime. we have
added one more location:' says Santee\'
SlIXena. Co-Ionnder offL'Om El.'qlress, 'nli~ war. Ihe
compaoy requires lel'.<er nUOlberor"ehides Ivr a ,·ity.
Vehidecosts. according to him. arc 30pcrcent "rthe 10..
gistic, cost. "We hal'e cui aboul 8.. 10 Jler:enl." '
I

I
Second.lhecompany prefers shipping the or:dered
goodsfaster. "There Is a high levet ofcorrelation be..
tween fast deliveries and returns, Irttls delivered In one
Or two da)'s. a consumer Is still In the purchase mooe.
After a week. you may change your mind," he explains.
Third, almost 80 per cenl of the goods now go through
Snapdeal's own fulfilment centres. This way, the com­
pany is able to scan the goods - either through X-ray
machines or even open the plICkets. It cuts down Incl­
dents ofinccrrect shipping, "Because incidents orreturns
come down a lot it helps the seUer reduce his costs and
also helps UHeduce our logistics cost." the
spokesperson says.
~1lakh a Illonth rrom a slllall start-up like us. These
PEOPLE 1: The age of reason
Sanlay Sethi Is lean and tall. He explains everylhing in
great detail and smiles a lot. But he is rarely !Ulimated.
His eyes must have popped after this com·frsalion.
In June 2015. the CEO ot'ShopClues wanted 10 hire
a head of product. Aftertwo rounds ol'intervicws with
a candidate, Sethllnltlated a chat on salary expecta­
tlons. The candidate. who lived In the us. said he was Co-founder of Quickll. a hyper-local delivery s,tart-up, of 30 guys walt1ng to Joio. And a fresher is accepting a
pald $3 mllIlon a year. Stock options extra. says that a year back. the biggest challenge in doing a ~121akh olTer: Dlwan says.
"There was no conversallon to be had after Ihat. r slart-up in Bangalore or the NCR was Ilnding tech tal­ The reason Is many companies are cutting head­
had to tell my recruiters not to Introduce me to any.. ent. "They were very expensive. Someone who was colUltoraren't hlrlng In the same breadth they were
body who Is above the U crore being paid ~50.000 by an Inrosys or TCS. would expect last year, Grofers went on a hiring spree to bu~d capac­
bracket." Sethi recalls. "In the past six

50OM'0
The pressure ondellVt:ty companies ADVERTISING
were people with one and hair-two years ofexped­
for better rates and effidency has driven DECLINED NEARLY
ence." he says. "They would releCt our olTers because
them to rethink network design. Beom
a Paytm. a Snapdeal. or u FlIpkart would olTer them a
Express. for Instance. now covers more
~8lakh package." he adds. ThIs has changed. "We
locations with the same numberofOeet It . "
are now getting a massive surge In resumes since the
operates. In many cases. the company
last three months. Earlier. we were running helter­
has preponed the deplll1ute time ofveht- IN 2016
skeller to find an ....ndrold guy: I now have a pipeline
Ity before demand materialised, Many other companies
months. people have become much
did that too - bired candidates with a one year outlook.
more reasonable In their remuneration
But tough times meant tougher caHs. They now hire
expectation.... product manager would
with a three month outlook In fact. a panel responsible
now cost between from ~70 lakl! and
for campus hiring at the Indian Institute ofTechoology
.' . U.4 crore: he adds,
(111') blacld!sted 31 start.ups In August after many of
Salary expectations have moderated
them revoked lob olI'ers or delayed hiring. In 2015.
even at the entry leveL Rohan Dlwan,
FlIpkart hlri:d 250 across busineSs schools, Nitin Seth.

l4 BUSINCSS TODAY 'anua,y 29 201? ,a.ua,y 292017 BliSINI!SSTOD.'IY H

:' ' ,. .. '

 (H.t?*,iitlii'Start-ups --------..
I SOlO
Of£~
!
III G~
VI 'voted t del fr
\It,,d ar
t"I}\1 Oanel' an
OrJ1
\I
» p! rY J110' od eJ
015
dellJ:rnand rn 05t5 in saleS;
. on" .anal Cent 0
f (inal1l'l: will}.:,. SUBder hiuts tit Whilllllill'kctphtn:s will
OperatbO per ~nt nO'll
» eat 1, per c . even after d.mnnllisHlion.
er
I w to 2;;
close . . .
-/ .'
istra~~:ec;;'!::;:I11-
flipkart. told Busilless
L·····......
a
1o...-oII_-V-.--·····
Today's E. Kumar Sharma re-
centiy. The company had deferred jOin~
ing dales for those picked from lune to
December since Fllpkart"was undergoing a major re­
structuring" and was no! ideally·placed to .. oITer the
learning opportunity to the 250." Without citing num­
bers for hlring in the current flSC8l year. Seth said that
"the management philosophy is that we want to be 101
more prudent in terms of our planning."
Uke in marketing or logistics. technology is playing
a part in making the workforce more efficient. or even
I keep employee costs in check. Automation is playing'"
role in customer service. Which Can account for uplo 25­
30 per cent of an NaUer's workforce. Fashion e-tailer
LitneRoad says its 'contact per order' - the number of
times a customer contacts the service centre for an order
has dived 35-40 perc.ent In a year's time. "We have
deployed technology so that ciiStomers contact you less.
for example. if I know your package is running late. I
will pre-<mlptlvely message so that you don't have to call
us... says CEO of LirneRoad Suchi Mukherjee. The com·
pany's refund related querles have reduced afler it im·
plemen ted a one-cllck refund process. LlmeRoad's cost
. per order is down signllicantly since October 2015 when
it was at ~19.S per order. In September 2016.lt trended
at~8.8 an order. rrftrst time resolution Improvesdra­
maticaUy,lt reduces the need for repeat contacis per or­
der. By extension, It can potentlaUy cut the need for cus­
tomer support employees.
The fact that wmeRoad has an Inventory-less model
helps In cash preservation. Mukherjee fiercely scribbles
l6BUSfNESSTOOAY jnnuarvJ9J017
N.lfHitil.lir, Start-ups - - - - - - - - - - - - - - - - ­
ubout prcstrvill~ "lIsh. . "
This wrher mel the lIewJ}, hired ('F()nt fashuUll1mr.
kelpl.c" V'K,ulk I'rubhnk"r Sunder in Ib!llgalflrc's
~H (OCt hi~h hl·t'flU~"t' it st.'mls II Wrofl~ 1I)(,.'.%'a~l· tu the :\t'U,
crs. Tlu:y would Icd lum Illakinl! money illlhcirt:m;C"
he ~l!yS. her"r. lidding: "Bul if I Get \0 u three· four tillY"
n,,"t.1 will he extrcmdy h"ppy:' Third parlY logistics
I'Hrk where the ('mnpany ~s
Mililylitil HmblisNY Uu:;lnc:..'S
lotulCd. HI." joiHcd VWlIlik uri,:f Sl'\'L'H yt'ars in M)'nfra s c;ompunics('uuld (1(:' s'luce~J.,'t1 more. Sunder ~ayN tlwt
wurk (m. ~oill" ahemf. tu Ilrt'scn'c l"a~h ilml ensure H
ht'ahhv Wt JrkinJ! eHpit ill. 1.i1J'J!t.' (,'om,liUl ics c( tll III Ii I­
I.!re~Sil;gJy try to crCiilc illljgllcr 'Ut'il(' hct'(lUSI,.· 1~(li~1 is
nisi) L'Vt:It.'" (.",,,tld impro\,l' irnturi!.·r (.'ltrllpmlieS'dt·liver
mldt.'t;II(.·L'( thL'cu~h fi,st enuu~h" ""I'Iu,'I1 push (hem to
~i\'L'lhall'ash to yuu in It short sc:rVil:c k'vcI ugfl.'CIllCHI.-'
MUllish IJUlo:i.ll' IHUJ hllph.·IHCI1lt.'t1 n hOT iO·j () rull' ill
still tI C.'iISh nmrkcl Hild !,.'ush on deliVer)' (t'(tl>.·O) stlU rc· InMohi: hcisdolng lhe sume oll'racw. hO percellt of"
~ajns a chunkymudt for c<ommercc payments. Yc:s. (,'wllptlny"s muncy l:tocs: Llltu the hn.:atl and buW.or husiuess.
whid. gCllcr..11$ cash. 10 per cent is for moonshots: 1O
per ccnl urthe HI pert'enl may have lhe potential to be·
"let's say I am able (0 collccl the moncy rrom couricr
c"mpani"" in Ihree duys bUI the liubilily to sellers is ill
five davs. I haye" two day Roat. .-\s the company grows.
the two tiny Roat will keep increasing. This is where cash
is generilled. "ou have rush 10 run yourbusinesse:;. Thill
come '!>lIllllerl'iully relfsiblc.
In $ill1pler terms. this rule means shutting
down eXOllC products thul don'\ make
much tu!ur*tcnn $Cn~c ur iSH't
scaling. "It is Ihe fI",mcc
is Whitllllillters." Sunder .a)·s.
'!ion
I'nollikcurrently hils" day's 110.1. "I don't wanl it to l!uy whu h.cls to
010 AI1U iSI
0
oy· er at.4
IIStOrfl 2015
.atH,41
v y
f eLl uS
cost 0 dve rs
,
on a board. "There are two evils in the P&L." she ex­
lit to UI
plains. "Oiscountlng and Inventory. These are two bad » halve .oW b eral
words. scary." Those building private label businesses
haS. sesn dge n
will have stock. Some will sell while some may not.
Stock. therefore. 15 a negative drain on thc cash. "To
clear this stock. you wID have to drop prices. Its the big­
gest folly," Mukherjee says.
proceS le san
». tr ol sa
;~~e05e5//
To cut down on such follies. consumer Internet
businesses have been hiring folks that can carry out
surgical strlkes.
a /.....~.......
PEOPLE 2= The rise of CFOs do the surgery.
You could conclude It Is a·slgn of the e-commerce Indus· HehaSlositwiththe
try's growing matudty. Most large companies have ap­ founders and say this is not
pointed experienced Cl'Ot over the past one year. In working:' Dugar says.
October 2016, Paytm appointed fOl1ller Cltlgroup execu­ No doubt. CFOs are becoming increasingly
tive Madhur Decca asCPO; the former CPO of Wlpro. RPG heny peoplt! In Indian e-commerce ... Alter the CEO.
llntetpdses and InMabl Manlsh Dugar joined online the second most pOwerful guy I am starting to see is
healthcan=1Irm Practo In May: Rallv Bansal Joined Ola the el'O," says OYO's Rltesh Agarwal. That is good
after many yean ofworldng In IT servtces exporter news for the Industry. lis employees and Investors. If
lnfosys; SlIlIpdeal appointed AOup Vlkal In 2015, who In 2016 was 8 year ofrealism. 20171s heading ta­
his last role was the CPO ofmobUe network operator wards Realism 2.0.
AIrceI.1t Is sort of a .1gnaI to Investors. They are serious CFOs may ensure theee Is no irrational exuber­
ance. only cautious optimism.•
11lGoutam20