In the part 1 of this interview with Samir Kazi, we learnt how he started his whirlwind journey from a call center employee to setting up a successful online selling business. The story so far has been of courage, learning from mistakes and a great appetite for success.
In this second part of this interview, we quiz Samir about how he sees the future of GadgetBucket and Indian e-commerce. Don’t miss the advice to new sellers who will come into the industry in the future.
Gurpreet Singh (GS): Often, we see that when it comes to an individual online seller, he works with four or five assistants the old-fashioned way. But you seem to have consciously adopted a more professional approach and built a highly-efficient team of 25 people. How did you go about doing that?
Samir Kazi (SK): Again, our call centre experience has helped us do the right things. Firstly, there is focus on manpower utilization, a concept we picked up from the call center. Secondly, discipline is the key. We have worked in different companies and understood the culture of the companies. So, when we started, we decided we would run the company in a professional way. Even if it is a small company, the processes will be defined so that things get done in a disciplined manner. Most of our team is from the call centres. We have worked with them and know their work ethics. We even pay them higher salaries. I don’t think any individual online seller in India pays as much as us. We respect their talents and know the benefits that can be accrued from this team.
We adopt a “We” approach to team building. It’s not about the boss and employee, it’s about what we do collectively as a team. We try and lead by example as far as possible. We try to nurture a sense of ownership in the employees because then they start working for the company and know that if the company grows, they will grow. We have transparent and egalitarian HR policies and the employees are made aware of it.
GS: The infusion of capital is deemed necessary in e-commerce to achieve scale and lot of companies turn to venture capitalists. How have you managed to grow so fast without infusing external capital?
SK: The bigger companies stock big inventories. When you stock, your operating costs go up, space costs increase and most importantly your inventories depreciate over time. These are the reasons why companies need additional capital.
We work on a ”Rolling Inventory” model. One of the biggest advantages of e-commerce is that the inventory is virtual. Once a buyer places an order, we procure it and ship it in no time. In this too, we have classified the products in two buckets.
1. Fast-Moving Products: We stock these. We try to dispatch the orders on the same day so the customers get it at the earliest. Speed is of the essence in e-commerce.
2. Slow-moving products: As far as the slow-moving products are concerned, we procure them after an order has been placed.
GS: How do you manage price fluctuations in the rolling inventory?
SK: Sometimes, we face this problem. But it’s a rare problem. Once in a while we have to bear the losses but we revise the price of the product as soon as possible. Out of the 5,000 products that we sell every month, if this affects only a couple of products and we can easily ignore it.
The future of e-commerce in India
GS: Which is the best e-commerce portal in India today? Both from a customer as well as a seller experience point of view.
SK: eBay.in is by far the best. It has been around for over 8 years and knows the markets, the buyers and the trends. The most important fact about eBay.in is that it follows a ‘Customer First’ approach, which I think is the right way to go in the long run. Some sellers might argue otherwise, but I believe that until you don’t ensure a customer is fully satisfied, he won’t believe in your website and your net promoter score won’t increase. One satisfied customer can bring in ten more customers. But one dissatisfied can give your website a bad review and drive away 100 other customers.
Another practice that I feel might spoil the marketplace is the practice adopted by some VC-funded websites of passing on the incentives and benefits to the customers. In the long-term, I don’t think it is beneficial for the e-commerce business. Once the buyer gets used to buying cheap products, he won’t look at the expensive ones. What will these websites do when they run out of VC funding? India is a price sensitive market.
GS: You have laid a solid foundation for your business. What do you think are the challenges in front you for the future?
SK: The biggest challenge is sourcing. I want to have the maximum number of SKUs. I want to build a team that can handle many SKUs. Managing SKUs is a big task because the more the number of SKUs the more the chances of a particular product being out of stock or the price has been revised. These things need to be monitored on a real-time basis. Also, I don’t think sales growth should not be problem if I offer the best price.
GS: In the coming years, do you see yourself stocking products in different marketplaces as well as your website or only your website?
SK: My dream is to build my website and ensure that maximum business comes from there. Currently, I don’t have the funds or the resources to be able to invest, promote and advertise my website. Until I don’t have the wherewithal to do so, I will continue listing in other marketplaces.
GS: Since you started, have you seen any improvement in the allied e-commerce services like logistics, payment etc.?
SK: Every marketplace has its own way of doing things. If I talk about eBay.in, there have been no issues or delays in payment and remittance cycles. Shipping times have improved from 5- 7 days to prompt next day or two-day deliveries. As far as the logistics are concerned, eBay has started a new service called PowerShip. The shipping and delivery are done quickly and the remittance is smooth and easy. There are some issues with some other logistic partners regarding charges and weights but they should get sorted out soon.
GS: Any other particular turning points where you have felt you shouldn’t be doing this business? Like the eBay account suspension incident.
SK: None whatsoever! Sometimes we make losses on some deals or products but we take immediate corrective action. My team has been instructed to point out the problems at once. In between, there was a problem where one of the products would be damaged in transit. We looked into the matter, identified the problem and we changed the packaging – corrugated boxes, thermocol boxes and bubble wrap. We incurred some additional expenses but the damages came down from 30% to 3%.
GS: How do you think the Indian online seller community shaping up? How is it different from mature markets like the US or the UK?
SK: E-commerce is in its nascent stages in India. It will take some time for the sellers to mature and learn to utilize the knowledge and resources effectively. There is a need for a forum where all the sellers can share their problems and best practices and benefit from each others’ experiences.
GS: What advice would you give to a newbie who wants to start internet selling?
SK: The only advice I will give is that there is no additional training required. E-commerce is a self-learning module. Learn quickly and learn well. There are no boundaries to growth in this business.
GS: So, background, finance, education, availability etc. none of these matter?
SK: Nope! All you have to do is get started.
Aap Ki Kahani – IOS is the platform for online sellers, by online sellers. In the months to come, we will feature inspirational stories of Indian online sellers who have pushed the boundaries, redefined the meaning of success and led the way for the industry.
Express your views in the comments section below and write to us if you have any inspiring stories.