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The Economic Times,
Dinesh Agarwal, Vikas Agarwal and Brijesh Agarwal stand vindicated for sticking to what they do best: become a neutral marketplace for small and medium enterprises, says Debasish Roy
IndiaMART is not on the lines of SAP, Commerce One or eBay; neither in terms of business model nor in terms of revenues. Last business fiscal, the company clocked Rs 28 crore turnover. So why doesn’t it diversify and introduce new products? The answer to that is also the USP of the company and a deliberate choice of the CEO, Dinesh Agarwal.
“We are very comfortable with the position of a monopoly in the space for B2B business and we don’t want to change into anything else?” he says.
Does he face pressure within the company to become something else? “Everyday,” he laments, “business meetings within the company throw up innumerable suggestions for changing the business model or just diversifying it into things as inane as email provider.”
It is clearly a raw nerve with the otherwise collected personality of this man. This company obviously believes in what it is doing and knows how to handle the business need. “We grew to the figures that we are right now, 50 per cent, in the last three years. Slowly business is catching up and we are being vindicated in the stand we have taken.”
IndiaMART has consciously not taken up a B2C attitude. Therefore, they do not charge per transaction on the net. The business model is just about creating an online marketplace which has 10 million buyers around the world. The buyer of an online space on IndiaMART.com will get banners proclaiming his presence on the site and as well as on other sites and trade exhibitions.
This ensures that the trader who buys space continues to conduct his business from all the enquiries that he gets from his sub-portal in IndiaMART.com and IndiaMART Intermesh does not concern itself with any of such business.
The site uses Oracle, the most powerful of all database technologies. “We are too database intensive a company not to use Oracle. We tried hundreds of other things but in the end we had to get down to Oracle.”
How is this company heavily database intensive? Well, the various industry based portals that they have within IndiaMART are just different views of the same database that is there at the backend of the organization.
The other sub-portals refer to areas such as sports goods, chemicals, engineering goods, medical equipment etc. All of them throw up more than seven thousand companies offering to sell their goods through IndiaMART.com
Is this the reason why IndiaMART succeeded during the software bust? It would seem so. While other companies tried to charge per transaction (Commerce One India run by Sanjeev Nanda of the BMW Murder case fame in one example) IndiaMART stuck to its model of charging for a relationship with their company and no more.
How many hits took place owing to that relationship could be monitored but IndiaMART chose not to exploit that figure directly but still charging a one time fee for a subportal on their portal.