Of late, one is clearly witnessing B2B e-commerce pick up the growth momentum with rapid adoption of the digital paradigm by manufacturers and wholesalers. Buyers and sellers from across the world are increasingly transacting goods and services with ease over digital platforms, anytime, anywhere.
The market potential is big and according to industry reports it is expected that the B2B e-commerce market will be twice the size of the B2C online market by 2020. No wonder, the sector has seen a number of successful entrepreneurial ventures in recent times and investors too have reciprocated with high interest levels in the sector. Meet Moglix– a digital marketplace specializing in B2B commerce of industrial products such as electrical equipment, fasteners, lighting & luminaries, tapes, adhesives & sealants and power &safety tools and more. SMEpost.com caught up with Rahul Garg, Founder and CEO, Moglix. Here are excerpts of the exclusive conversation.
Q: We understand that B2B market is much bigger than B2C. Why according to you is the Indian e-commerce landscape been dominated by B2C companies?
A: While B2B market size is certainly bigger than that of B2C, the former is much more complex in nature. The differentiating recipe for success in B2C is primarily marketing and pricing as the decision to buy is more of an impulsive one. One can actually make a splash into this space through product & consumer promotion. Hence the entry barrier is low and so is the heightened competition. Globally the B2B commerce is evolving post the B2C maturity primarily as the risk of timely delivery, quality etc. are heightened in the B2B space. Example: while you are ok to have a shirt delivered with 1-day delay that delay for B2B can mean a plant shut-down. India we expect B2B to significantly change the landscape in the next 5 years – as the country lacks organized distribution and therefore online shall be the 1st place for organized distribution to evolve.
Q: How did the idea of Moglix take birth? Tell us something about your business model and your growth story so far.
A: Moglix.com is an Asia-based e-commerce company specializing in B2B procurement of industrial products such as MRO, Fasteners, and Industrial Electricals. In order to cater to these requirements, Moglix has partnered with manufacturers and distributors across these categories and working with several large manufacturing companies to completely transform the Business buying. Moglix’s end-to-end procurement marketplace is being built to provide product discovery, price negotiation, logistics, and payment capabilities. Moglix’steam is extremely passionate about the initiatives of GOI viz. ‘Make in India’ and ‘Digital India’. We are focused on bringing technology and manufacturing together to drive transparency, efficiency and scale for the companies both within India and also enabling them to increase exports.
Q: How do you see MSMEs align itself with platforms like Moglix?
A: Moglix currently specializes in B2B procurement of maintenance, repair and overhaul of industrial productsand is partnering with manufacturers and distributors across these categories in India, China and other Asian countries. There are more than 50 million SMEs in India who are predominantly local/regional market focused because of lack of technology, financial muscle and marketability. Through Moglix platform, SMEs will be able to leverage efficient supply chain model &promote their manufacturing capabilitiesin India as well as overseas.
Q: How has Moglix been enabling supply chain efficiencies in business purchasing? What are the product categories that it is currently servicing?
A: Moglix currently focuses on Business and Industry Supplies which include Electricals,Lighting, Hardware and Tools broadly referred as Engineering Goods. Some of the brands that already sell their products via Moglix include Havell’s, Larsen and Toubro, C&S Electric, Anchor, Bajaj, Unbrako, Caparo, Ambika and Taparia. Moglix is positioning itself as one stop enterprise solution provider for the entire consumable requirements of industries as well as institutional customers. This helps us bring in operational scale which improves demand-supply mapping and the supply chain efficiency.
Q: Is there any specific focus on any SME cluster by Moglix?
A: Our focus is on SMEs in manufacturing space because we believe that is where India has missed the opportunity to China in last 2 decades. If India has to command the global trade as was the case during independence then manufacturing has to be the torch bearer. This requires SMEs to move fast and adapt technology to scale both on sales and their internal procurement.
Q: Which countries is Moglix currently servicing? What are your future plans?
A: We are present in India and China. We are continuously building a stronger supply chain and sales engine for the b2b commerce to happen.
Q: Do you have any plans to raise finance for Moglix further after Ratan Tata’s recent investment?
A: No comments.
Q: Given NDA government’s focus on the SME Sector, how do you see the SME sector furthering the growth & development of Indian economy?
A: Indian SME sector creates ~100 Mn jobs and contribute 40% to the national GDP; hence an important sector for any government to miss out on. Any significant contribution from this sector to the industrial production or foreign trade has the potential to impact the per capita income of India. Also, because it is one the prominent employment generators, it has got the cascading effect on the overall economy to improve education, infrastructure and quality of life.
Q: How is Moglix currently reaching out to Indian SMEs?
A: We are reaching out to the SMEs through marketing of our platform across media as well as liaisoning with various trade bodies.
Q: How do you plan to go about building brand Moglix amongst Indian MSMEs?
A: We are currently focusing on building a strong supply chain with domain knowledge of the industry. This helps us understanding the real ground issues and how technology can help to de-bottleneck those problems. We strongly believe that if we can resolve the fundamental issues plaguing the sector and deliver on our promise, then Moglix brand will be built around that trust and commitment.