Archive for the ‘Business’ Category

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My Take on Tata Nano

January 13, 2008

No No, this isn’t another post to talk about the launch of Tata’s 1 lakh car or about its features or Specs. Theres load of information over the internet regarding this. This post is about why or who should buy a Nano? Or should one buy Nano ? Lets compare Nano with Maruti 800 to see where it stands. Maruti has higher engine capacity at 796cc compared to Nano’s 673cc.But Nano is smaller compared to Maruti 800 yet has larger space inside comparatively. Thats a great achievement. Thats because the engine in Nano is fitted at the back similar to an auto. Parking should be much easier now and so should be finding spaces to park.In terms of fuel mileage there is not much difference. Tata’s claim that Nano will give 20 km per litre and maruti gives around 21 Km per litre. But a lot of difference lies in the price. Maruti 800’s base model is priced at 1.94 lakhs + taxes and Nano’s base model is priced at 1 lakh. That means people can buy 2 Nano instead of 1 Maruti 🙂 And thats exactly what has happened. Lot of them have postponed their decision to buy a car waiting for Nano. And most of them are planning to buy more than one car. Tatas have created a revolution by launching such a low cost car. This has posed a tough competition for others in the industry. Given the traffic condition in each metro, people find there is no use of buying high-end vehicles and SUV’s. You will never get to drive at such fast speeds because of traffic and a signal placed at every arm’s length. My manager is planning to sell his Ford Fusion and get a Nano if its a hit. And why not? given that his family comprises of just 4 people Nano will serve that purpose. My point is this car is a steal especially for those married coupled who have a baby. We know that driving bike with baby in hand is risky. Such couples get stranded in their houses as they hesitate to take the baby along in the bike. They will be yearning for Nano. A typical family in a metro comprises of 2 adults and a child. Given they stay in metro, Nano should be very much affordable. A typical family living in a tier-2 cities say (ex:coimbatore) will comprises of 4 adults and a child. Nano too can fit them all. Working women too would go for Nano. Those who use public transport will find this affordable provided they have been given attractive EMIs to pay off auto loans. And those who use scooty/honda/pleasure will go for Nano as it is much safer to ride a 4-wheeler than a 2-wheeler (for themselves ofcourse). And not to forget the Cab Drivers. These where the people who waited for tata nano much more than any other. To ferry employees of MNCs from office to home and home to office,Nano would be the best-fit. But there is a small problem. When Nano starts be used as a cab, people will hesitate to buy it. Remember what happened to Tata Indica. Tata would be better off if it has different color variants so that cabies go for white color and other buyers go for colors like metallic-grey. I mean any color that signifies great style and finishing. They might come with a pink variant to attract women buyers too.
What could jeopardize their plans ? Frequent maintenance needed for the vehicle and poor after sale service. Maruti is just so good at this. The Traffic. Just imagine if so many cars get on roads in cities like bangalore and hyderabad. Driving would become a nightmare. Car’s engine is good enough to pull load of 4 Adults. Given the roads in hyderabad where there are very hilly, there remains concerns whether Nano can climb such hilly roads with 4 people in it and say AC is on ? How much is the ground clearance ? safety concerns for the driver incase the car crashes headon. Is there a diesel variant ?
If Nano fares well in each of this parameter then they have revolutionized the auto industry. But that said, Tatas have done an excellent job. Making a promise of launching a 1-lakh car inspite of none in the industry believing in it and keeping up the promise is no mean feat.Kudos to Tata and their team behind this project.

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Power of web will democratise the system

December 13, 2007

This post is just to make you realize the power of web. How can one leverage web to communicate his thoughts and thereby fight effectively against the system. The system could be any entity: political, non-political, business organizations or any individual. This post is all about how we can take better decisions and learn from each other mistakes. Web as a medium fosters faster communication at a wider audience with less transmission loss. For Example, the rating of a new movie is known instantly . People have the liberty to judge a movie without needing to visit the theatre. IMDB – Internet Movie Database has the ratings for all the movies. It also includes reviews written by movie-goers. Thanks to the evolution of web from 1.0 to 2.0 . Web 1.0 was all about displaying static content. Web 2.0 is all about of social networking. It defines how group of people communicate to take informed decision and share information for each other’s benefit

I will quote few instances where i used social networking to make informed decision. The objective of this post is to make you embrace the power of web2.0 for the betterment of society. In March 2006 I had planned to buy a bike. In this age you are spoiled for choices. To choose one that best fits you is a tough proposition. I bumped on a website called mouthshut.com . This site has rating of all the products on earth – you name and it is there. You can find the reviews posted by users of the product. And you can also rate the reviews posted by other users. You can build a network of trusted users and set aside the untrusty ones. You can add products to your wishlist and can receive notifications whenever any user adds a review of that product. And now that is really cool. By the way you can find my review of indiaplaza.in at here . When it comes to rating restaurants, i look upto burrp.com – A social networking site built to specifically rate restaurants, hotels in your city. Such sites makes business organizations to be on their toes. They are aware that any mistake they make has a lot of repercussions. Corporates are infact using the same medium to attract customers too. Mouthshut has introduced a new feature called Corporate blog through which corporates can get first hand info about how customers feel about their product. Social networking is going to redefine how we buy and how companies sell their products. I ll definitely encourage you to be a part of this redefinning process.

Another such instance of my brushes with web2.0 is the creation of this blog. One of the reason why i decided to blog was to share information to a wider audience who can benefit from it. And with this post i have started my initial albeit small baby steps towards that goal [:)]

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Rumblings about indian business

October 30, 2007

Hmm .. Good news . Mukesh Ambani declared as the world’s richest person beating Software Czar Bill gates. Thats a real good news. Thanks to the Indian Stock markets, they have been scaling new heights creating a lot of wealth on their way. But more than this, it also signifies a BRAND NEW INDIA. India traditionally referred as a poor developing country has prouduced the richest person. (Well its still a developing country and so is mexico to which carlos slim – one of top 5 richest person belongs). This is the changing face of india and has made the world to wake up and take note of it. Mukesh Ambani’s three group companies namely Reliance Industries, Reliance Petroleum and Reliance Industrial Infrastructure have businesses that span over petroleum, chemicals, polyester, retail, textile and infrastructure have largely participated in the current bull rally propelling his networth to $63.2 Billion(Courtesy : Economic times ). But this post is not about signifying the fact that an Indian- Mukesh Ambani has become the world’s richest person but about another 1st generation entrepreneur whos been creating waves in the Retail industry. Yep you might have guessed it by now. Its Kishore Biyani – Retail King of india. I believe in calling him the next ambani of india. His Flagship company Pantaloon has been doing pretty well. But thats not it. Hes rightly positioned to capitalise the retail boom thats sweeping indian economy whereas other players like reliance retail, Bharati walmart are yet to make significant presence in the retail industry.

I happen to have a close watch on this man and what he is upto and in the process have become a great fan of him. Reading his book – It happened in india only reinforces my respect and admiration for him. He has been successful in creating retail formats for a whole-lot of General merchandised products. His Big Bazaar is the defacto shop people go to buy any item. It houses all the items a person would need it, at a reasonable price offering (with freebies and discount) and expected quality. He has been successful in scaling up this business by opening number of stores, creating logistics to transport bulk items at low operational costs and maintaing a profit margin albeit selling it at a price less than his competitor.He has replicated the same model in different industries like fashion clothings, Sun glasses, Watches, Furniture, Food, Books, Electronics, Home,Health and jewellary. Pantaloon caters to selling fashionable clothing to people of all ages. Brand factory is targeted to the brand-concious youth. ‘ALL’, a company serving a niche market of fat people (They call it as 40+ size). Top 10 – another company serving a niche market for people who keep up with latest fashion trends. Fashion station – another player selling fashionable clothing to mass market. Note it that all the companies i was talking here are engaged in selling clothing. we will move out to his other business example furniture. Kishore biyani has been successful in creating Furniture mart – a market player attempting to sell furniture to mass market and Collection i – another market player in furniture targeting high end customers who are concious about trendiest furniture designs available in market . i refer to them as class market.

Kishore biyani has struck gold by selling products targetting them for two different markets – Mass and Class. Be it furniture, Fashion. Home or Electronics. The names that he has chosen for his companies have a lot of connotation.Any company targeting the mass market ends with bazaar or mart Ex, Big Bazaar, Furniture Mart etc and any company marketing products has classy names namely Collection i, Top 10, Central etc. I really admire this aspect of him a lot.

I would really suggest you to visit his other line of business here . although i m no expert in finance or MBA nor have i gone through his P&L statements, i can see that his group of companies (Future Group) has been making excellent sales. I myself shop/buy at any one of his group companies – Big Bazaar, Central, Pantaloon, Brand Factory. And I must say i have been satisfied with product quality and price. And no matter what time of day you reach his shop, its always been crowded.I m suprised at the amount of marketing his companies spend. Its huge. His company is on its way to create the wealthiest brand in india. Given his success rate in booting up new ventures i can see this man creating a big name for himself in the retail industry. And thats one of the reason why i believe that he could be the next ambani.

That said some of the richest person alive are not from the IT/Software industry except for Bill gates. Does that mean the software industry is not suited for those whom dream to become the richest person in the world. Time to ponder ????