ValueNotes Connect – March 2016

ValueNotes Connect
Welcome to the March issue of ValueNotes Connect.

India is an enormous country, and challenging to say the least. Infrastructure is poor; regulations and tax structures, which vary by state (29 in total!), are complex. Things are further complicated by the country’s cultural and linguistic diversity.

As consumer buying preferences continue to evolve in a market like India, distribution is one of the most critical competitive advantages (or barriers). However the “distribution” industry itself is unorganized and localized for the most part, and plugging into a national network isn’t quite an option. It must be built out (and maintained) slowly and painstakingly. And to do this, an understanding of how it works is crucial.

In some product categories, eCommerce may have helped circumvent distribution barriers. However, this comes at a cost, especially in the discount-driven Indian market. Successful companies (or those that want to succeed in India) have no option but to build distribution – with eCommerce as a part of the chain.

We recently helped a manufacturer of air-conditioners penetrate India’s tier 2 & 3 markets – do read our case study. And here’s how we helped an FMCG firm understand the sales and distribution models of their peers so they could strengthen their go-to-market strategy.

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

Best regards.

The distribution advantage in Indian markets
by Arun Jethmalani
medical-equipment In a market like India, distribution is one of the most critical competitive advantages (or barriers). India is a large country. So it’s not enough to make a product – one has to get it to the customer. The poor infrastructure (transportation, warehouses, cold-chain, etc.) makes it even more challenging. This is further complicated by language, customs and local regulations. What makes it even more difficult is that the “distribution” industry itself is unorganized …
Breaking the distribution barrier in retail?
by Varsha Chitale
medical-equipment 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, ecommerce 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.

Commissioned research
Some client problems we have solved:
  • Distribution network study of competitors for a manufacturer of pneumatic products
  • Sales & distribution strategies of FMCG companies in India
  • Supply chain analysis in agriculture & dairy
  • Channel partner margin study for tissue paper converters
  • Electronic components market sizing and distributor identification
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