ValueNotes Connect
Welcome to the February’s issue of ValueNotes Connect.

The global e-commerce market has grown exponentially in the last few years, driven largely by the Internet, smart phones, online payments, and businesses offering their products and services online. Things are no different in India. According to a recent report published by PwC, the country’s e-commerce sector has grown by 34% (CAGR) since 2009 to touch USD 16.4 billion in 2014; and it is expected to be in the range of USD 22 billion in 2015.

While e-commerce has lowered the barriers to entry for new businesses, a strong distribution network is vital for manufacturers of consumer goods in a large and diverse country like India. Varsha Chitale argues that despite the hype around e-commerce, brick and mortar will remain the dominant mode of retail, and distribution networks will continue to be a source of competitive advantage.

Varsha also tells us why setting up a distribution network in a B2B industry in India – like medical devices – is a challenge for manufacturers. She believes that partnering with a local company might be their best option.

On another note, we’d like to share with you our latest research report on India’s faucets industry.

As always, we hope you enjoy reading our newsletter, and we look forward to your comments.

Best regards.

Breaking the distribution barrier in retail?
by Varsha Chitale
Breaking the distribution barrier in retail? Distribution networks are vital to manufacturers of consumer goods in a large and diverse country like India. They have served as significant barriers to entry for new entrants. However, e-commerce seems to be lowering these barriers, at least in some product segments. Online retailers and market places like Flipkart offer an opportunity for newcomers to reach out to customers without worrying about the logistics of moving the products around the country. The phenomenal success of a few recent launches through online channels could be a glimpse of things to come.
Distribution challenges for medical equipment & devices in India
by Varsha Chitale
Distribution challenges for medical devices India has a huge unmet demand for healthcare and consequently for medical devices and equipment. Most global companies, large and small, are either already selling products in India or are planning to enter the market. However, setting up a distribution network for selling in India is no mean task. Distribution systems are complex with multiple layers. A key factor contributing to the complexity of the Indian market is its heterogeneity and diversity – 29 states, each with its own set of health policies, and around 50 cities with populations of over a million each. Companies selling to these diverse sets of markets need to customize their strategies for each.
Latest Research
Commissioned research
Some client problems we have solved:
  • Sales & distribution strategies of FMCG companies
  • Study on e-commerce business models in the FMCG sector
  • Market assessment study of diagnostic reagents
  • Competitive intelligence on leading analytical instruments organisations in India
  • Channel partner margin study for tissue paper converters
  • Electronic components market sizing and distributor identification
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