Tuesday, January 27, 2009
Sunday, January 25, 2009
Mathura - Field visit
Spent last Thursday (Jan 22nd) in the field. Day started in Delhi at 5:00 am with Daniel (fellow Drishtee employee) and I trekking out to Mathura to spend the day with one of the delivery vans (which had no shocks to speak of) to get a first hand perspective of what the challenges are at the rural level.
Overall, I was amazed at how much they are doing just through hard work and perseverance. Starting from the stock room to the end delivery there is just chaos. The good aren't organized, and the guy in charge essentially just has everything in his head, and directs people about. There is no clear system of inventory management. Retailers aren't buying boxes or packets of stuff, but individual items (2 soaps, 5 cookie packets) so loose goods abound in the stock room.
It was interesting to see the laid back attitude of the village retailers. 55% felt it was no big deal to reduce the order at the time of delivery. Either they couldn't recall what they ordered, or they didn't have the money at hand to pay for the order. And the women retailers were clearly the most interested in growing their business, the men were just sort of content and laid back.
We visited 18 RRP's, out of which 2 canceled their orders. Our target for the day was Rs 25,000, we hit Rs 16,992. That's an average of Rs 1062/RRP (around $22). And the margins are razor thin, around 3%. There is just no way they can make money with this kind of efficiency and such low volumes. To be profitable they have to have a higher saturation of RRP's per route and need to quickly scale up. I think they are losing money right now. It's a volume business and they lack volume!
People are working 9+ hours a day and it's at a breaking point. Fortunately there are some clear solutions that we've seen that can help, and its exciting to have this kind of impact.
Ending this post with a picture of Dunkin Donuts coffee in a small retail shop in a village with a population of around 500 people. This is the kind of consumer product penetration in India today! There is demand, the market exists. Let's see who is the first to figure out how to service this demand.
Overall, I was amazed at how much they are doing just through hard work and perseverance. Starting from the stock room to the end delivery there is just chaos. The good aren't organized, and the guy in charge essentially just has everything in his head, and directs people about. There is no clear system of inventory management. Retailers aren't buying boxes or packets of stuff, but individual items (2 soaps, 5 cookie packets) so loose goods abound in the stock room.
Then Daniel and I spent the rest of the back breaking day in the back of a small truck making deliveries to different RRP's (rural retail points). Here is a sample picture of the roads we crossed. This was an open drain that had a makeshift "bridge" for cars to go over. In this case, our van of course couldn't make it and we had to hand deliver the goods. |  |
It was interesting to see the laid back attitude of the village retailers. 55% felt it was no big deal to reduce the order at the time of delivery. Either they couldn't recall what they ordered, or they didn't have the money at hand to pay for the order. And the women retailers were clearly the most interested in growing their business, the men were just sort of content and laid back.
We visited 18 RRP's, out of which 2 canceled their orders. Our target for the day was Rs 25,000, we hit Rs 16,992. That's an average of Rs 1062/RRP (around $22). And the margins are razor thin, around 3%. There is just no way they can make money with this kind of efficiency and such low volumes. To be profitable they have to have a higher saturation of RRP's per route and need to quickly scale up. I think they are losing money right now. It's a volume business and they lack volume!
People are working 9+ hours a day and it's at a breaking point. Fortunately there are some clear solutions that we've seen that can help, and its exciting to have this kind of impact.
Ending this post with a picture of Dunkin Donuts coffee in a small retail shop in a village with a population of around 500 people. This is the kind of consumer product penetration in India today! There is demand, the market exists. Let's see who is the first to figure out how to service this demand.
Sunday, January 18, 2009
Cashnxt: Low-Cost Banking for the Rural Poor
Came across this really interesting article on the CGAP Technology blog on what this team of entrepreneurs is doing with emerging technologies to transform rural banking. Intriguing approach.
Rural india has poor broadband/GPRS access, but cell phones have really penetrated this space. Interesting use of cell phones and audio technology to overcome some of the infrastructure challenges of providing financial services here.
Rural india has poor broadband/GPRS access, but cell phones have really penetrated this space. Interesting use of cell phones and audio technology to overcome some of the infrastructure challenges of providing financial services here.
Details on Mathura
So my first foray out into the field was semi successful.
I spent Friday in Mathura, and participated in the block manager training. It's interesting to see another company talk about it's values and mission and how that permeates into everything including the training session. The training is really meant to inculcate a sense of pride in what the managers do, because they have to project it to transfer this attitude of self reliance at the rural village level. But instead of going into the details on the training, I think talking about the back end supply chain process is more interesting.
The "call center" is basically a cubicle with 2 computers manned by 5 women. The girls basically call up the rural retailers and take delivery orders. The power went out 3-4 times in the 2 hours I was there, and whenever it went out they lost all the work they were doing in excel (they really need to start using auto save). But apparently this is not a common occurrence, I just happened to come in on a bad day. More interesting was the data entry process. The most time consuming and manual process you can imagine. To enter data for one delivery route take approx 9 hrs worst case. They have 6 delivery routes, so they need to hire 6 data entry operators just to keep up. Currently they have only 3! And I can see why it's so error prone. The poor guys work up till 1 to 3 am and they are behind by 3-4 weeks. It was good to finally observe the process, and see the issues they face.
At the end of the day, I asked the territory manager what delivery car I was going to go out with the next day so I can observe the final delivery leg of the operation. That's when it struck him that there are no delivery's the next day since it was a Saturday. Apparently this small fact had escaped everyone's attention when they planned this trip. So instead of spending the weekend there, I came back the same day.
Regardless, the day I spent there was productive. I'll just have to go back to Mathura sometime this week.
I spent Friday in Mathura, and participated in the block manager training. It's interesting to see another company talk about it's values and mission and how that permeates into everything including the training session. The training is really meant to inculcate a sense of pride in what the managers do, because they have to project it to transfer this attitude of self reliance at the rural village level. But instead of going into the details on the training, I think talking about the back end supply chain process is more interesting.
The "call center" is basically a cubicle with 2 computers manned by 5 women. The girls basically call up the rural retailers and take delivery orders. The power went out 3-4 times in the 2 hours I was there, and whenever it went out they lost all the work they were doing in excel (they really need to start using auto save). But apparently this is not a common occurrence, I just happened to come in on a bad day. More interesting was the data entry process. The most time consuming and manual process you can imagine. To enter data for one delivery route take approx 9 hrs worst case. They have 6 delivery routes, so they need to hire 6 data entry operators just to keep up. Currently they have only 3! And I can see why it's so error prone. The poor guys work up till 1 to 3 am and they are behind by 3-4 weeks. It was good to finally observe the process, and see the issues they face.
At the end of the day, I asked the territory manager what delivery car I was going to go out with the next day so I can observe the final delivery leg of the operation. That's when it struck him that there are no delivery's the next day since it was a Saturday. Apparently this small fact had escaped everyone's attention when they planned this trip. So instead of spending the weekend there, I came back the same day.
Regardless, the day I spent there was productive. I'll just have to go back to Mathura sometime this week.
Wednesday, January 14, 2009
What is it that you're doing Rahil?
I owe you guys a bit of information about what I will be doing at Drishtee. Originally the plan was for me to get involved in the finance or education vertical and help them analyze/redesign their business process. Plans changed.
Just some background about Drishtee first.
Drishtee has created a network of rural entrepreneurs and the basic value Drishtee provides is the vital link between manufacturers and the rural retail owners (kirana stores in Hindi). And when I say rural, I'm talking about villages that big distributors ignore (even by the likes of Reliance). As an aside the numbers here are staggering. There are 600,000 villages across India (accounting for 70% of the population). Out of these 100,000 can be labeled as medium size villages, having an average of 1000 households. Household income ranges from Rs 3000 - Rs 5000 per month (that's around $50). This is a market of at least $10-$15 billion dollars (this is a conservative number). Now all someone needs to do is figure out creative ways to link up and provide value. And from the little I have seen, the way people are using technology to bridge this is pretty exciting.
Anyways - back to what I am doing for Drishtee. Drishtee plans to scale up to become sustainable but can't because it's existing supply chain process is paper based, data entry intensive and error prone (the error rate is whats killing them). I am basically trying to find a solution to this problem. Can't really use the existing Supply Chain Management (SCM) solutions, because there is generally no internet access, no computers etc. - very poor infrastructure in general. So something that is cell phone based, with maybe some portable printers. And it has to be easy to use - the guys in the field aren't "tech savvy". We also want to find ways for the finance vertical to leverage this model (think mobile wallets - pay with your cell phone etc.). The ultimate goal is to get all the different verticals at Drishtee on to one SCM backbone. Cell phone's have really opened up a broad array of opportunities for the rural landscape in India. Right now the overhead in the retail space is too high to make the operation sustainable, and Drishtee wants to figure out a way to create a sustainable model here.
So the project is essentially - to research options, run field studies, make recommendations and then run a pilot. All in the span of 5 months.
It doesn't sound too complicated, but I have no clue what I'm talking about. This Friday I go to the district office in Mathura, to participate in the "block manager" training and then on Saturday I get a glimpse of what it is like for an executive to spend a day in the field going from one rural retail point to the next. I've been warned it's going to be a long and rough day. Stay tuned...
Just some background about Drishtee first.
Drishtee has created a network of rural entrepreneurs and the basic value Drishtee provides is the vital link between manufacturers and the rural retail owners (kirana stores in Hindi). And when I say rural, I'm talking about villages that big distributors ignore (even by the likes of Reliance). As an aside the numbers here are staggering. There are 600,000 villages across India (accounting for 70% of the population). Out of these 100,000 can be labeled as medium size villages, having an average of 1000 households. Household income ranges from Rs 3000 - Rs 5000 per month (that's around $50). This is a market of at least $10-$15 billion dollars (this is a conservative number). Now all someone needs to do is figure out creative ways to link up and provide value. And from the little I have seen, the way people are using technology to bridge this is pretty exciting.
Anyways - back to what I am doing for Drishtee. Drishtee plans to scale up to become sustainable but can't because it's existing supply chain process is paper based, data entry intensive and error prone (the error rate is whats killing them). I am basically trying to find a solution to this problem. Can't really use the existing Supply Chain Management (SCM) solutions, because there is generally no internet access, no computers etc. - very poor infrastructure in general. So something that is cell phone based, with maybe some portable printers. And it has to be easy to use - the guys in the field aren't "tech savvy". We also want to find ways for the finance vertical to leverage this model (think mobile wallets - pay with your cell phone etc.). The ultimate goal is to get all the different verticals at Drishtee on to one SCM backbone. Cell phone's have really opened up a broad array of opportunities for the rural landscape in India. Right now the overhead in the retail space is too high to make the operation sustainable, and Drishtee wants to figure out a way to create a sustainable model here.
So the project is essentially - to research options, run field studies, make recommendations and then run a pilot. All in the span of 5 months.
It doesn't sound too complicated, but I have no clue what I'm talking about. This Friday I go to the district office in Mathura, to participate in the "block manager" training and then on Saturday I get a glimpse of what it is like for an executive to spend a day in the field going from one rural retail point to the next. I've been warned it's going to be a long and rough day. Stay tuned...
Sunday, January 11, 2009
Crazy coincidence
Just moved in to my place today in GK1 (R block), and interestingly enough my 3rd roommate, who I have yet to meet, is also going to be working at Drishtee. Lauren's going to be working in the health vertical and I believe she's from Boston. The entire Drishtee office is 70 people here in Delhi and me and Lauren pick the same apartment in a city of 11 million people. What are the odds? Now I'll have someone to car pool with.
Met Nakul from Drishtee today as well. I am excited to start. Looks like I will be going to Mathura in a few weeks to participate in some field training.
Delhi is a lot more spread out than Bombay, with much better roads. Delhi is gearing up for the Commonwealth games in 2010 and the Governments on a major drive to spruce up the city.
Random Delhi facts -
* Delhi is 5000 years old but the city we see was built in the 17th century by Mughal emperor Shah Jahan. It's earliest name was Indrapastha, capital of the Pandavas in the Mahabharata.
* The first war of independence started in 1857 in Delhi.
* Literacy rate is 81%, with 87% for males and 74% for women.
* There are 30,000 stray cows in the city.
Met Nakul from Drishtee today as well. I am excited to start. Looks like I will be going to Mathura in a few weeks to participate in some field training.
Delhi is a lot more spread out than Bombay, with much better roads. Delhi is gearing up for the Commonwealth games in 2010 and the Governments on a major drive to spruce up the city.
Random Delhi facts -
* Delhi is 5000 years old but the city we see was built in the 17th century by Mughal emperor Shah Jahan. It's earliest name was Indrapastha, capital of the Pandavas in the Mahabharata.
* The first war of independence started in 1857 in Delhi.
* Literacy rate is 81%, with 87% for males and 74% for women.
* There are 30,000 stray cows in the city.
Friday, January 9, 2009
Found a place!
First - thank you to everyone who helped/offered to help me find a place in Delhi.
I will be living in GK1 (close to M block market) in South Delhi and the place is unfurnished. It's a 3 bedroom place, and I have 2 other flatmates. Andy is from the UK and has been in Delhi for the past 3-4 years or so, the other is a girl who I don't know much about. Since I fly in tomorrow I'm assuming I'll meet the crew this weekend.
Since there is no furniture, Andy has generously offered me his old small bed, but he thinks I'll probably want to get my own bed when I get there.
My next challenge - finding a second hand car. Suggestions anyone?
PS: I just enabled importing my blog posts to facebook so now I can spam everyone on my network with my blog posts (thanks Yaron).
I will be living in GK1 (close to M block market) in South Delhi and the place is unfurnished. It's a 3 bedroom place, and I have 2 other flatmates. Andy is from the UK and has been in Delhi for the past 3-4 years or so, the other is a girl who I don't know much about. Since I fly in tomorrow I'm assuming I'll meet the crew this weekend.
Since there is no furniture, Andy has generously offered me his old small bed, but he thinks I'll probably want to get my own bed when I get there.
My next challenge - finding a second hand car. Suggestions anyone?
PS: I just enabled importing my blog posts to facebook so now I can spam everyone on my network with my blog posts (thanks Yaron).
Tuesday, January 6, 2009
Tribulations of finding a place in Delhi
My first challenge - find housing.
No one likes doing deals over the phone. Not sure why. I have 4 leads at this point ranging from 10K to 17K a month, but no one wants to commit. To some extent this makes sense, I would want to meet a potential roommate before they move in as well.
At this point Drishtee is putting me up at a guest house for a couple of days. I'm just going to have to find something in those 2 days, and if it comes unfurnished then I'll also have to find a bed. Good luck to me
No one likes doing deals over the phone. Not sure why. I have 4 leads at this point ranging from 10K to 17K a month, but no one wants to commit. To some extent this makes sense, I would want to meet a potential roommate before they move in as well.
At this point Drishtee is putting me up at a guest house for a couple of days. I'm just going to have to find something in those 2 days, and if it comes unfurnished then I'll also have to find a bed. Good luck to me
Friday, January 2, 2009
Bombay security
Bombay is different after 26/11. Most notable is the security presence. At some places it looks like they might be gearing up for war (VT train station has police behind sand bag bunkers).
Hotel security is like walking into an airport. Bags go through scanners, cell phones are examined, dogs sniff your cars when you drive up. But at 1 am at night, things feel a bit lax. Me and friends walked through and even though the gate beeped, they didn't scan us for anything else. But we couldn't accompany our friends to their room after 10. Strict rules that only guests can go to rooms after 10. Not sure what the purpose is, but I think everyone here has just accepted the need for such security.
They have tons of police check points on roads at night. Supposedly looking for "evil doers" but really all it does is create traffic snarls. The one positive externality is that they catch drunk drivers. This year they caught 800+ drunk drivers in Bombay on new years eve (last year the number was 230). It's so effective that nowadays no one goes out at night without a driver, because they don't want to deal with the cops after a glass of beer.
Also went to Leo's my second day in Bombay. It was nice to see the place PACKED (with desi's and foreigners). I hadn't realized how close it is to the big police station at Regal (and I'm talking police headquarters). Embarrassing that they could cause so much havoc so close to law enforcement. One glass pane at Leo's still has bullet holes. Here's a pic (took it with my cell so a bit blurry)
Hotel security is like walking into an airport. Bags go through scanners, cell phones are examined, dogs sniff your cars when you drive up. But at 1 am at night, things feel a bit lax. Me and friends walked through and even though the gate beeped, they didn't scan us for anything else. But we couldn't accompany our friends to their room after 10. Strict rules that only guests can go to rooms after 10. Not sure what the purpose is, but I think everyone here has just accepted the need for such security.
They have tons of police check points on roads at night. Supposedly looking for "evil doers" but really all it does is create traffic snarls. The one positive externality is that they catch drunk drivers. This year they caught 800+ drunk drivers in Bombay on new years eve (last year the number was 230). It's so effective that nowadays no one goes out at night without a driver, because they don't want to deal with the cops after a glass of beer.
Also went to Leo's my second day in Bombay. It was nice to see the place PACKED (with desi's and foreigners). I hadn't realized how close it is to the big police station at Regal (and I'm talking police headquarters). Embarrassing that they could cause so much havoc so close to law enforcement. One glass pane at Leo's still has bullet holes. Here's a pic (took it with my cell so a bit blurry)
NYTimes op ed by Gurcharan Das
The Next World Order
Since India Unbound I have been a big fan of Gurcharan Das. This article is not very different from things he has talked about before, but he puts the Mumbai terror attacks in an interesting perspective relative to China.
What are your thoughts on the question he poses in his article -
"Lee Kwan Yew, the former prime minister of Singapore, raised an important question: Why does the rest of the world view China’s rise as a threat but India’s as a wonderful success story?"
Since India Unbound I have been a big fan of Gurcharan Das. This article is not very different from things he has talked about before, but he puts the Mumbai terror attacks in an interesting perspective relative to China.
What are your thoughts on the question he poses in his article -
"Lee Kwan Yew, the former prime minister of Singapore, raised an important question: Why does the rest of the world view China’s rise as a threat but India’s as a wonderful success story?"
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