To remind you once again am neither a J L Nehru nor a Lord Chesterfield to write this letter but as a CEO of a small brick and mortar company I think am qualified to comment about this particular subject. Before going for your summer intern you asked me an interesting question of the position of E-commerce in India. That day I avoided my answer. In the corporate circles it is often told that "to keep silence is a crime...". So here comes my answer. As usually it is not crisp and sweet but a bit lengthy and bitter.
Few years back my partner and me attended a PNC meeting for an order. It was a big one and with that we are neither in a position to accept other orders nor we are sure about the execution of the same within that time frame. Added to that the margin was also not good because it was a big order. What they say “even we loose and odds also we loose”. So I was a bit scary. The meeting was at our client's board room which was lavishly decorated. On the wall of the room I came across a ship painting with a quote on it. "A ship in the harbor is safe but that's not what ships are built for."
I have not even asked my partner's opinion and taken the MOU and affixed my signature showing their MD their painting on the wall. He commented affixing his signature "Srinivas - business is all about taking risks". Working in Vajra for more than twelve years do I accept it now? No - in my perception "business is all about taking decisions." I used to joke with my team mates during their annual increments that "money neither can be created nor destroyed but it only changes places and forms".
So these two statements are my answer to the position of E commerce in India. It is all about taking risks / decisions and not getting worried about money what one is going to get at the end of the day. As simple as that? If not you guys answer and convince me in a different way.
Some time back I was talking about the Roman God Janus with his two faces one looking into the future and another one into the past. In my view for running any conventional business - one should be a Janus looking into past and future for the top line and bottom lines. But for a E com biz one should be a "Brahma" with all four faces facing NEWS - not North, East, West and South but Net sales, Earnings, Welfare of Promoters / VCs and finally and most importantly Supply Chain Management.
Please go through the following two articles -
http://www.businessinsider.in/Jabong-is-losi…/…/47185686.cms
http://trak.in/…/flipkart-amazon-snapdeal-revenues-losses-…/
It was clear that many e com companies in the world (other than 3 -4 if am right) are not making money as of now but are going to get in future. May be that is true with the calculations as on today. But you might have learnt that all economic theories revolve around a Latin phrase "Ceteris Paribus" - i.e. all other things remaining equal. In these days of instability we have to substitute the phrase "mutatis mutandis" and then calculate the above future predictions. Don't you think it is further complexly complicated with other riders acting on these future predictions? So try to calculate the much complicated equation from your side.
Affectionately – Your Old Man.
All titles and trade names belong to the respective owners and suitably acknowledged and all views expressed are my personal.
