IndiaMART.com’s founder and CEO remains bulish on the SME market, and with good reason
A leading online B2B marketplace, IndiaMART.com is as much about innovation as it is about exploring market opportunities. A medium that brings suppliers and buyers on a platform, the 15-years-old company has 900 employees and 29 offices all over India. Belonging to a business family, Dinesh Agarwal, the founder of IndiaMART came to India after a stint in the US, where he worked with HCL, The entrrpreneurial bug struck and he discovered how companies lacked internet presence and set up his company InterMesh Systems in 1996. Company databases came next, and those companies that were designed by Agarwal’s InterMesh got more visibility, As the directory grew, SMEs approached the website for finding business. Excrepts from an interview from an interview with Agarwal on how the space is set to grow and the challenges the SME sector faces:
Indiamart has been working in the SME space for several years. What changes have you seen in the sector since the 1990s?
IndiaMART.com was born in 1996 and building a robust SME eco-system in the contry. SMEs continue to face challenges cush as inadequate financing facilities and poor infrastructur, among others. They also lacked due recognition of their monumental work. But with time, SMEs have evolved in terms of adoption of new technology, Today, they are more open to the idea of embracing the internet than before and are willing to look for new avenues that can help their business grow. They are also looking to expend their presence into global markets.
IndiaMART brings buyers and sellers together, especially in the SME space. How did you zero in on this lacuna in the market?
We always felt that SMEs have a lot to offer to the Indian economy. We noticed that suppliers found it difficult to reach out to buyers and required investment of time and money, not to forget geographical distance. IndiaMART.com came into being with the purpose of bridging this gap. We provided a common platrorm to SMEs where they could easily find buyers irrespective of the market or location and conduct business time-efficiently and cost-effectively.
Does a body like Indiamart make supply chain management easier to maintain?
IndiaMART.com has provided SMEs with a unique business platform, which is India’s largest business-to-business marketplace helping suppliers connect with buyers and vicevers. The company has an extensive supplier verificatiion process that enables buyers to trade with confidence with suppliers. We also offer services to buyers to find reliable suppliers and competive quotes for almost anything. The assistance is also extended to suppliers so that they can list their trade offers on the portal for buyers looking for similar product/service quickly and easily.
What are the challenges in the market?
We have always handheld small business to help them understand the benefits that the onlinc medium offers. When we ventured into the market, we were aware of the benefits of internet technology and an online industry meant educating and creating awareness of the benefits of internet technology and an online B2B marketplace. Today, we have a huge base of SMEs who have placed their trust in us.
Even though we have crossed a major hurdle and a large base of SMEs have successfully migrated to the online medium, there still remains a large untapped SME market. These SMEs must see online services as an effective means to connect with their relevant business partners across the globe.
IndiaMART is an online medium. Does that come in the way for people seeking help from this particular channel because they may not a way with the computer and/for the internet?
Internet was widely viewed as “technology for a few” when we commeneed operations. There were only 500 internet subscribes in the country at that time.
We have been spending qualiey time and resources in reaching out to SMEs and educating them on how internet and B2B marketplace can help them explore hidden markets and multiply growth prospects cost-effectively. We have participated in over 260 trade shows in India and overseas and organized conferences and seminars with trade bodies. Today, we have more than one million registered members on IndiaMART.com.
As someone who has been in the sector for nearly two decades now, what do you think are the main challenges for the SME sector?
Despite their huge contribution to the economy, SMEs continue to face several obstacles which hamper their growth prospects. These include:
Finance: SMEs mostly depend on banks and financial institutions for availablity of credit, which charge a high rate of intrest – a major convern in this sector:
Technology: Internet has revolutionized business operations across industires but SMEs have to actively adobt technology for seamless business operations and to explore hidden markets.
Marketing support: Reaching out to global buyers and suppliers in less time and less cost are challenges.
Desired human resources: Limited human resources are another bottleneck. As they have limited budgets, they unable to hire professional agencies and skilled IT professional agencies and skilled IT personnel.
Overseas comptition: Led by globalisation and liberalisation, small business owners face intense competition from their global counterparts.