L’Entrepreneur
June 2013
Contents Editor’s Note
3
President’s Note
5
E– Commerce : Gold Mine for Indian Entrepreneurs ?
7
The Sinking Ship : BPO Sector
12
Young Entrepreneurs : Changing The Face of India
16
Effect of Chinese SMES on the Indian Sector
20
The Importance of Looking good : Reviewing the Booming Beauty Care Industry
2
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June 2013
EDITOR’S NOTE
Hello Friends,
Welcome Batch 2013-15 to the great IBS Hyderabad campus! All of you enter the campus with twinkling eyes and gleaming hopes. But, believe me, all your hopes and expectations are going to be true as you progress and come closer to the finishing point of your sojourn in this campus. As a fresher, I too had the same experience of stepping into a completely new environment, with lots of questions and doubts pondering my mind. Standing at this point, I realize how transformed I am. Thanks to IBS!! The campus life at IBS, Hyderabad is an experience of a lifetime which has to be lived in to know it. It teaches us the way of life. On one end it teaches us to fight for survival, the very next end it gives us invaluable friends and astounding confidence to face the challenge which the world throws upon us. In short, this is one stop which teaches you “Life”. The warmth and admiration for the Alma mater make a high tide during the alumni meet while the farewell party for the seniors unleashes a euphoria of emotions; yes, that very feeling which makes the campus a lively and creative place. These two years are going to be the most joyous roller costar ride of your life. Sure, there are going to be many uphill tasks which will put your wits to test and many moments which are going to make you nostalgic about later. Therefore I request you all to make the most effective use of your time and energy at this campus. This 100 acre campus is bustling with activities in such a way that you will find yourself engrossed in one or the other. There is room for everyone - be it sports, literature, dance, arts, theatre or music and there is a space for everyone. There are around 30 official clubs which caters to your varied interests. Every student is allowed to pursue his or her interests and make his or her contribution. The campus life focuses not only on academics but on all round development which makes you highly competitive for future. There will be lectures, surprise tests, quizzes and exams, and every recipe has the indispensible ingredient- “Management”.
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Before putting down my pen, let me finally wish you the best for your future endeavors. These two years will be the stepping stone to a successful life that awaits you and blessed are you that the voyage begins through this
‘golden temple’ of wisdom. Welcome to IBS
Hyderabad!! Neha Agarwal (Editor)
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PRESIDENT’S NOTE
Dear Readers,
I extend my warm welcome to all on behalf of the newly recruited Maçon team. The entire year seems to have gone by in a jiffy. It feels just like yesterday when my colleagues and I were going through the rigors of the recruitment process of Maçon. All of us hoped to be a part of this esteemed club. It has been a wonderful journey till now. All of us have had the privilege to work under the guidance of some very fine people. Their mentorship and support has imbibed in us the confidence of taking the club forward. The year started with an introduction class by our very own mentor, Prof. Jojo Mathew George, where we were introduced to “business plan making”. Apart from the usual activities of organizing events and holding guest lectures, we also started events such as ME Gang and The Entrepreneurship India 2012 (E-Week). ME Gang was started to enlighten the club members as well as other budding entrepreneurs about the business opportunities in the various fields in today’s growing economy. The E-Week was one of the biggest challenges of our last academic year. It was a vision of our seniors that they entrusted us with. All the club members put in their heart and soul to make this event successful. These efforts paid off when Hon. Minister of New and Renewable Energy, Dr. Farooq Abdullah, graced the Valedictory event of the E-week. The year, which was full of challenges, ended on a high note with Maçon winning the Best Student Body for the fourth year in a row. With the onset of the new academic year, all of us are filled with new hope and overflowing with innovative ideas for the club. We would be taking our seniors’ legacy forward and further develop on what they had started. IBS Hyderabad is now getting its own incubation centre, where help will be provided to all the budding entrepreneurs in mentoring them as individuals and in polishing their business plans. Also we are currently in talks in extending our ties with entrepreneurship cells of other IBS colleges to achieve more exposure and increase our network within IBS fraternity. My team and I are also eagerly awaiting the arrival of a new batch of creative and aspiring entrepreneurs that are willing to form an integral part of leading the club to new heights.
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Before signing off, I would like to thank our seniors once again for guiding us and instilling within us the confidence to continue the legacy of Maçon. On behalf of the entire team, we wish them all the best for their future endeavors. Shradha Aima (President)
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June 2013
E-COMMERCE : GOLD MINE FOR INDIAN ENTREPRENEURS ?
BY VANDIT DHOLAKIA
Indians have started to make their presence
The investments are showing some returns as
felt on the Web. Not only on social media
the customers have opted for online shopping
platforms but also on the E-Commerce
rather than visiting the market place. The
portals. Out of 121 million Indians, about 10
customers are able to view all the options
million have availed the service to buy goods
available on their screens & customize it
& services online. The eye blinking scenario
according to their choice. But, there is still
is that the number of Indians using Internet &
noteworthy customer base which strongly
E-commerce is increasing at a rapid pace
believes in physical experience of shopping
each year. Major products & services availed
and are reluctant towards online shopping but
by Indians via E-Commerce are Electronics, Travel Ticket Booking, Movies Ticket Booking, Apparels etc. There lies a big chance for a smart businessman to pounce on these business opportunities. Young Indian Entrepreneurs have plunged & can still jump in the E-commerce industry
these
which promises to provide success in the
towards online shopping owing to the trust &
long run. FlipKart is the major player with
customization enrooted by these e-commerce
approximately 25,000 orders per day having
firms.
the logistic facilities across 27 cities in India. Snap Deal, Myntra, Fashion&You are also making their way into the market with potential customer target base. E-commerce start-ups are knocking the online customer’s browsers very frequently & the best thing is that Indian customers have started to trust these firms & started online shopping on a regular basis.
7
customers
are
gradually
turning
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June 2013
According to industry experts, the entry
shopping i.e. Buying as well as Selling. The
barriers in the industry are very low. But, one
customer base on e-commerce is increasing
of the major concerns for the players of this
day by day with the firms also providing
industry is that there is a huge & quick
secure transactions. In India, e-Commerce
investment of technology & money whereas
has the opportunity to flourish from the base
returns are meager over a period of time. Lot
level with the improving infrastructure &
of money is locked up in the industry and
communication facilities. After its wide
until these businesses starts to exit & provide
acceptance from Tier I cities, Tier II & III
return to their
cities have a huge potential market that is
investors, the
untapped & the tendency of youngsters to
picture
will
buy products online has increased. E-
to
commerce firms need to change their
shaky.
approach towards their target customers &
This industry
provide safe & secure experience. The
is surely for
service needs to be more adaptive towards
the
the customers by identifying their needs &
continue look
brave
hearted
&
banking upon it.
trend identifiers. E-commerce contributes to 8-10% of the total revenue in retail business & is increasing rapidly on annual basis. This is the reason why the venture capitalists have been
ambitious
by
funding
these
E-
commerce start-ups, as each promises to shine & attract huge customer base. Indian market always has those charismatic opportunities for the aspiring players. India possesses highest youth power across the globe & most of them have a sound knowledge of technology. More & more youngsters
are
turning
towards
online
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If you are planning to launch an e-commerce
look
start-up then this is the best time as the
operational efficiency because smoother the
industry has lot of players & huge customer
operations
potential.
more business & retain more customers in
Entrepreneurs
need
to
be
possessing strong knowledge of Indian E-
forward
to
set
high
targets
of
better are the chances of getting
this fierce competition.
commerce sector as it is considered risky.
The startups also need to be creative & cost
One should be able to predict trends &
conscious to attract the customers to their
visualize every possible scenario that can
ventures because wavered spending on the
arise in the market while acquiring the
marketing & promotion of the firm on online
willingness to adapt to these rapid changing times. Efficient Supply Chain & Logistics is the key to E-Commerce apart from the technology as these aspects will provide better customer experience & draw them to
media can be troublesome.
The entrepreneurs need to build a system that
use their service quite often.
can successfully decode the need & want of the customer choices while they surf, through
Supply
Chain
&
Logistics
is
their intelligence applications on their portal
highly
to buy products. Niche market can be one of
dependent on the strong grip over the local
the key areas to be served & is highly
contacts across various cities. They should
untapped
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where
the
entrepreneurs
can
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June 2013
Cash On Delivery model started by FlipKart
important aspect in today’s marketing
was a huge success in India as initially
world
Indians lacked the trust to pay online. 50-
retention & loyalty for these firms. Firms
60% of the online shoppers have benefitted
must specially focus on it by also
from this service.
providing maintenance through the parent
which
decides
the
customer
company. The increase in smart phones can be a good opportunity to provide shopping experience through smart phone applications
which
has
not
evolved
strongly. After sales, service is a very important aspect in today’s marketing world
which
decides
the
customer
retention & loyalty for these firms. Firms must specially focus on it by also providing maintenance through the parent Online Transaction through Net Banking &
company. The increase in smart phones
Credit/Debit Card needs to be secure to
can be a good opportunity to provide
create the environment of trust in the minds
shopping experience through smart phone
of
applications
the
aspiring
online
shoppers.
innovate to target new customers to bring
decides the customer retention & loyalty
knowledge of marketing, operations & understand
evolved
aspect in today’s marketing world which
market. The Entrepreneurs must have sound better
not
After sales, service is a very important
into notice their presence in the flooded
to
has
strongly.
Entrepreneurs need to identify these trends &
technology
which
for these firms. Firms must specially focus
the
on it by also providing maintenance
complexity of e-commerce market. The team
through the parent company. The increase
is a better option & it must be a blend of all
in smart phones can be a good opportunity
these skills as it is not possible for an
to provide shopping experience through
individual to possess all these skills with
smart phone applications which has not
same accuracy. After sales, service is a very
evolved strongly. This type of trend
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June 2013
very important aspect in today’s marketing
The Indian E-commerce Industry race would
world which decides the customer retention
be very exciting for the customers as
& loyalty for these firms. Firms must
innovations in goods & services in online
specially focus on it by also providing
shopping will be a huge benefit.
maintenance through the parent company.
The increase in smart phones can be a good
It
opportunity to provide shopping experience
runner in this race in the coming years. Time
identification can serve as a competitive
will
advantage to increase the customer base &
E-commerce
Entrepreneurs or the bubble will burst.
recently quoted “Indian Talent + Information Tomorrow.”
only justify whether
Industry proves to be a Gold Mine for Indian
provide better experience. Narendra Modi India
the entrepreneurs
operations & marketing will be the front
not evolved strongly. This type of trend
=
for sure that
possessing skilled knowledge of technology,
through smart phone applications which has
Technology
is
This
statement very truly holds as the youth is aware of the growth in technology & optimize its use for the benefit of himself & society along with business.
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June 2013
THE SINKING SHIP : BPO SECTOR
BY SREENY VALLABH It was in the not so late 1990’s and the early
jobs in this booming sector and promising
2000’s; Indian students were caught with a
package, graduates just flocked into the
technical
industry.
fever
called
Engineering.
Delhi,
Mumbai.
Pune
and
Considered to be one of the toughest courses
Bangalore became the hub of BPO sector. A
in human history, engineering was revered to
number
a godly stature. A promising career awaited
mushroomed up as business was expanding
everyone who took up engineering as their
overseas. Many youngsters travelled miles in
field of expertise. The much anticipated
order to reach the job as a monthly salary of
boom was attributed to the consultancy
Rs. 10,000 was much more compared to any
sector and especially the BPO sector.
other job. After paying rent for food and
of
BPO’s
and
call
centre
accommodation, people were able to save and send a reasonable sum of money to their h o m e . Bangalore became IT
city
India
the of with
youngsters splurging on their income
With the government of India opening its
on food and
gate for the world with its globalization and
cinema. The
liberalization policies, India stood in its
economic
shimmering best. Economy boomed initially
boom
and income kept flowing. People got
was
short lived and very soon the disillusioned
respectable jobs with packages that were
youngsters realized the truth. With recession
dreamt off.
crippling the developed world in 2008, the
In the early 2000, the BPO sector began to
industry witnessed what no one was prepared
expand at a thundering rate. With guaranteed
for. People lost jobs in batches of 300-400
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June 2013
sought job at a call centre or a BPO was getting transformed to something much more technical. India was losing the sheen in the BPO zone. Easily it could be said that the BPO industry was dying a slow death. While in 2004-05, this sector contributed 40% of an industry’s revenue with a high profit margin, in 2009-10 it came down to a mere 15% of the total revenue. Many companies scaled down their voice business by 60%. The business was getting shifted to countries like
The major reason for losing out business is
Philippines, Malaysia and China. The call
the language gap which India faces. In order
centre was shifting its focus to “non-voice”
to meet client requirements of west, the
sectors which involved high analytics and
knowledge of English alone can’t help,
cloud computing. The industry calls it a
accent plays in the main role. Despite the
transformation phase for the betterment, but
months of training offered, the heavy Indian
the job prospects for thousands of youngsters
accent is unacceptable to many clients.
lies in darkness.
Countries like Malaysia and Philippines on the other hand have a cultural history with
According to Mohandass Pai, Director of
US and becoming the prime destinations for
Human resources at Infosys Technologies, in
call centres and BPO even when they are
the last five years, India had lost close to one
slightly costlier for US. Where an employee
million jobs to Philippines. For a sector
in India gets around Rs. 18000 per month,
which employs close to 2 million directly
the same employee may get around 15%
and 7 millions indirectly, losing the business
higher compared to his Indian counterpart.
was a serious blow. The growth of IT-BPO
This gets to around 25% at the managerial
sector came down to 6% in 2009-10,
level and even 50% at the senior most
although it has recovered to 11% in last year,
management level.
even then it does not come close to the 30% in the pre Lehman Bros. collapse.
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June 2013
According to Ganesh Natarajan, CEO of
the slowing down of hiring process, but
Zensar Technologies, India lost close to
stresses that the government should support
75,000 jobs to Philippines. Philippines is in
the industry by providing premium quality
many ways a better choice for the west as it
infrastructure and providing loans at cheaper
is culturally close to west, with lower costs,
rates.
high quality telecommunications better pool of
work
force
and
English
Industry professionals suggest that this is in
speaking
the best interests of the BPO industry as the
proficiency. Pradeep Udhas, the head of IT at
business is getting close to the clients and in
KPMG group says that the rising wage
turn saving up on cost and providing quality
inflation, poor quality of talent pool and poor
service to the clients. Also many clients like
infrastructure has led to the downfall of the
to have non voice work like accounting and
BPO sector.
analytics to be done, hence voice based work too follows in. Thus, Philippines makes the best out of it all. One another factor affecting the industry is the high attrition rate which is as high as
Vodafone had recently shifted its base from Mumbai to Kingston in Australia. Around 30 Indian BPO companies including Genpact, Zensar,
TCS
headquarters
BPO at
had
set
Philippines.
up
their
Industry
professional deny to admit the loss of jobs,
30% which results in higher training costs.
while some do accept in private. On the other end, Nasscom president Som Mittal states
Infosys states that 2.5% of its revenue are
that jobs have been added on in the last one
spent on training alone. The attrition has
year during the slowdown. He admits the
more social factors than compensation
poor quality and infrastructure play a role in
factors alone. Around 42% of the employed
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June 2013
family. Finally when the husband gets
so that specialized work could be taken up
transferred for better prospects, the weak
and serviced efficiently.
partner, in this case women sacrifice their
Whether the above measures help save the
jobs. As a result many BPO’s employ young
dying sector is the next big question.
people in the age bracket of 25-30 years who stick to an organization merely for a year or so. With all the hullabaloo around the industry, there exists a silver lining too. Domestic
voice based industry have started picking up.
Insurance, Mutual funds and telecom sector have clients who need to be serviced in the vernacular languages. These call centres employ young people at Rs. 8000-9000 and may go up to Rs. 15000. With a mature work customer
focused
industry,
domain
experience and an efficient work force. The industry is also hiring domain expert lawyers, chartered accountants and doctors,
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June 2013
YOUNG ENTREPRENEURS : CHANGING THE FACE OF INDIA
BY NEHA AGARWAL
sooner.
These
young
entrepreneurs,
brimming with energy, are go-getters and are moving one step closer to a successful life. Today, in this modern era, when India is in a rapid process of development, more and more young Indian “Though the road’s been rocky, it sure feels
entrepreneurs
are
good to me.” is an epic quote by the freedom
emerging in
the
singer - Bob Marley. In the age where
market.
all
youngsters could have simply did the usual
started
things like high school, college, hangout
India’s first Prime
joints, video games or ride bikes, they went
M i n i s t e r
ahead and took the road less travelled. Not
Jawaharlal
worrying about the tough journey they would
wanted to tailor the
have to go through, they went ahead and
Indian economy after the Soviet Union’s
founded companies, gave seminars, wrote
socialistic economic structure. He strongly
books, and became aspiring figures for all
believed that the state should control every
aspiring entrepreneurs irrespective of their
aspect of the Indian economy. His idea was
age.
to issue licenses to a worthy few. Although executed
on age. But, one gets surprised to see some
plan
proved
to
be
light. But today, the market has been very
and know how to make them a reality. They
promising and encouraging to our young
use their creativity and hard work to make bringing
his
businessmen were not seen in a favorable
Our Young Entrepreneurs have great ideas
thereby
Nehru
counterproductive. Capital was scarce, and
youngsters making it big as entrepreneurs.
happen,
when
his intentions were good, the way he
This proves that Entrepreneurship has no bar
things
It
entrepreneurs especially in the areas of
new
technology, health care, education, rural
concepts and products to the market.
marketing and social services.
Probably, they have learnt their lessons
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June 2013
for most entrepreneurs, greatly distinguishing
market he or she is about to enter into. An
it from other western democracies.
organized approach is always more trusted because the investors will feel confident about investing in someone who knows every aspect of the venture he is undertaking. Apparently, a large number of young entrepreneurs have been successful and have made something out of nothing. But there are some who have left a mark on our mind. These people have not only moved one step
A country where almost 50% of the
closer to the life of a successful entrepreneur,
population is below 35 years old, India has a
but also earned a global recognition for
large working class. An essential process
themselves in the process. Some of the
every young Indian entrepreneur has to go
startups which caught my attention were
through is the interview with investors. Most
RedBus.in,
startups have to go through many meetings
Application Firm ‘Go Dimensions’ and
and interviews before they can actually find
Greenway Grameen Infra.
an investor who is willing to invest in their
Rockstah
Media,
Mobile
Neha Juneja, from Greenway Grameen Infra, a Mumbai based startup, recently hogged the limelight when her company won the 2012 Intel Global Challenge at Haas School of
idea. For the investor to be convinced, the most important thing one should do is to study the
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June 2013
Her company has developed Greenway Smart Stove which is a patent-pending cook stove designed as a modern replacement for traditional mud Chulhas. What is unusual about this cook stove is that it is biomassbased which increases fuel efficiency and targets consumers in rural areas. He was also awarded Entrepreneur of the Year Award under IT, ITES Category by ET Now and the BITSAA 30 under-30 award. The CEO is also selected as a high-impact Endeavour
Entrepreneur
and
TiE
Entrepreneur. redBus was amongst Forbes top five startups to watch in 2010 and was
The single-burner, high efficiency cook stove
ranked first amongst the fastest growing
uses 65% less fuel and produces 80% less
companies in India in a survey done by All
smoke than traditional chulhas. In late 2011,
World Network. Also, it was awarded India’s
the company won The BusinessWorld Young
best internet start-up, 2010, by IMAI.
Entrepreneur Award. Thinking about India’s largest bus ticketing
Standing up to the thought and achieving a
company, the one that comes first is
milestone in this Smartphone era, school
redBus.in. The mastermind behind redBus is
going
Phanindra Sama or ‘Phani’. He is the co-
Kumaran and Shravan Kumaran launched
founder and CEO of this bus ticketing
their mobile application firm Go Dimensions.
company. He is the CEO of the Bangalore-
At age 10, Sanjay is one of the youngest
based Pilani Soft Labs Pvt. Ltd., a company
CEOs in the world, while his elder brother
that was set up by 3 friends who studied in
Shravan holds the position of the President of
BITS, Pilani. Phani was chosen as a global
the company at a mere age of 12. The startup
shaper 2011 for the World Economic Forum.
floated up in the app market during
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brothers
from
Chennai,
Sanjay
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June 2013
Rockstah Media has gone on to become very
its first gaming application ‘Catch me Cop’ registered over 2000 downloads within just two weeks of the launch.
successful with a full fledged team of developers, designers and market strategists and caters to clients all over the globe.
Sanjay and Shravan study in class 6 and 8 at a school in Chennai and are said to have
After reading about people who have attained
immense understanding about mobile app
so much at such a young, a sense of
development, its market and the allied
optimism prevails. People are open to new
technology. With
$10
from
his
parents,
ideas when the old ones are plainly
Farrhad
malfunctioning. We're more likely than usual
Acidwalla joined the entrepreneurial ranks at
to question our bad habits and inherited
age 13, when he decided to build an online
assumptions when circumstances shake us
community devoted to aviation and aero-
out of our comfort zone. When the
modeling. Several months later, he sold the
preordained social and education destinies
community to a fan for $1,200.
our young people anticipated are denied
Four years later, he put $400, from the sale
them, it should be an opportunity to
of his online community, into Rockstah
remember what we too often forget: under-
Media, now an international, award-winning
21s are not just prospective employees or
agency focusing on branding, marketing and
students, they are entrepreneurs too. But
web development in Maharashtra, India.
booming business cultures in emerging
Despite only just turning 18 in November
economies seem to be much better at
last year, Farrhad has more than meets the
celebrating and encouraging youthful energy
eye for the average 18 year old.
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June 2013
EFFECT OF CHINESE SMES ON THE INDIAN SECTOR BY KARTIK SETH
current production value is almost Rs 816,000 crore. It contributes to around 40% of industrial production & exports. It manufactures more than 8,000 diverse products, ranging from low-tech items to technologically-advanced products. The SSI
"A sharp decline in SME units is creating job losses in the sector affecting over 8-10 lakh people. Even the owners of SMEs are indebted to bankers and moneylenders due to continued loss of business and capital," revealed
the
Associated
Chambers
sector targets both domestic as well global
of
markets. SSIs sector is recognized as the
Commerce and Industry of India (Assocham)
engine of growth, accounting for about 70%
survey Monday.
of employment and contributes a significant
These are the common news that one hears
amount for the growth of GDP. Globally,
everyday about the sad state of Indian SME
99.7 per cent of all enterprises in the world
sector , The huge importance of SMEs in any
are SMEs and the balance 0.3 per cent are
economy cannot be neglected they are the
large-scale enterprises. By contrast, the SSI
backbone of any economy and they are the
sector in India accounts for 95 per cent of all
major driving force in an economy. SSI
industrial units.
(Small scale industries) is one of the
As of now we must have understood the
important segments of the Indian economy,
importance of SMEs in Indian economy, but
contributing about 7 per cent to the Indian
the important question is whether the Indian
GDP and providing employment to over 28
government is giving the SMEs their desired
million people. The Indian SME segment
due, we all know that on paper the Indian
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June 2013
government is giving the SMEs their desired
guns), balloons and colours this Holi, leaving
due, We all know that on paper the Indian government has done a lot for Indian SMEs , there are lot of policies, dedicated ministries , many promotion boards. In short government has designed an excellent strategy on board for SMEs but do these actually work. And the answer is a big no. The Chinese invasion of India’s economy is no hidden fact, The speed by which Chinese
jobless about one million people in small and medium
enterprises
(SMEs)
in
India,
according to the Assocham survey. The Assocham surveyed about 1,000 colour manufacturers and shopkeepers in Allahabad, Agra, Hathras, Mathura, Vrindavan, Delhi and the National Capital Region (NCR), Kanpur,
Lucknow
and
Patna
between
January and February that nearly 1,000 SME units have shut down in the last two to three have
taken
over
India’s
economy
is
years owing to the rise in imports from
magnificent. It is not a proud thing for us
China. Manufacturers were forced to stop
they have literally killed the Indian domestic
operations mainly in Allahabad, Brij Mandal
sector , the prices at which they are selling
(Agra, Hathras, Mathura and Vrindavan),
their products is unmatched, the production
Delhi, Kanpur, Lucknow and Patna.
efficiency they have, the kind of innovation
According
they are carrying with every product is a
manufacturers, the invasion by Chinese
thing to envy for Indian industry.
products has been threatening their daily
to
several
shopkeepers
and
earnings.
Recently the festival of colures “Holi” has
The Holi colours and accessories industry is
passed. Markets in northern India were been
growing at a compounded rate of 20
flooded with Chinese 'pichkaris' (water
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June 2013
some of the major problems the Indian SMEs are facing in today’s context. India is the hub of business opportunities, and slowly yet steadily, Chinese products like electronics, crackers, idols, apparels, etc. are dominating
similar Indian products.
Whether it is SMEs (Small and Medium Enterprises) or cottage industries, they are These reports are shocking to read , this is
not able to provide a stiff competition to the
not the case with this particular industry.
cost effective offers provided by the Chinese.
This is a case with every other industry in
Due to these imports of Chinese products,
India, One question that strikes the mind is
most Indian cottage industries have closed
that is whether the Indian government is
down, and the future of the existing ones
sleeping, why is Indian government not
looks very weak.
doing
Indian
The Chinese have entered the market in a
Industries from the Chinese assault. They can
very systematic and planned way, the
impose import restrictions on the products
marketing strategies they have followed and
that can be easily manufactured in India to
the type of innovation they have carried in
protect the domestic industries.
their products have outpaced the Indian
The government has to take strict actions in
domestic sector.
order to promote and protect the small and
As we can see the huge power of China’s
medium enterprises of India, they have to
SMEs in World, China’s SMEs are ruling the
give an equal fighting ground to fight with
World economy , If countries like India
Chinese
multiple
wants to protect themselves from Chinese
problems surfacing Indian SMEs like limited
invasion they have to take effective steps in
access to financial resources, inefficiencies in
promoting and guiding Indian SMEs towards
the logistics and distribution in home market,
growth, they have to prepare a climate of
transport
payment
Innovation and growth in order to provide
regulatory
stiff competition to China’s market. The
framework, exchange rate system. These are
government has to implement the policies on
anything
collection
to
invasion,
and
protect
there
insurance
methods,
the
are
cost,
adverse
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L’Entrepreneur
June 2013
THE IMPORTANCE OF LOOKING GOOD – REVIEWING THE BOOMING BEAUTY CARE INDUSTRY
BY SREENY VALLABH The paradigms of life have completely
Botox, exotic body wraps to complete
changed today. A morning stroll in the
slimming solutions.
nearby neighborhood took me by real surprise; there were 8 beauty parlours in a radius of just 1 km of my house, in which two came up recently. It was not just this area which has this unusually high number of parlours, a simple stroll thorough any residential colony in Delhi, ’Sector’ in Noida or ‘salai’ in Chennai will prove that beauty business is booming.
Beauty training is in demand too. A new generation of women are becoming (men are still in minorities) make-up artists, nail art technicians, massage therapists, hair stylists and beauticians. Are all these women going to get the much preferred job? The beauty industry is moving ahead with a tremendous pace. A recent FICCI report suggests that the industry is worth 230-245
The velocity with which the beauty industry
billion, which is growing at a rate of 20-25%
is mushrooming is tremendous and makes us
annually. The major players in this industry
think of its future possibilities.
include Lakme, VLCC, new entrants like
Not only the residential areas alone, moving
Naturals and many thousands of beauty
across the more commercial hubs and
parlours and spas. The actual number of
parlours
‘salon-cum-spas’,
salon and spas are hard to come by but in the
‘image enhancement centres’ and beauty
early 2000, a research conducted at Pune
clinics, offering everything from painless
suggested that there were around 61000
morph
into
Brazilian waxes to laser hair remover to
23
L’Entrepreneur
June 2013
parlours and spas in the cities and towns in
their major students covered post graduates,
total, which catered to a million customers.
home
makers,
professionals
and
even
software engineers.
The above statement proves that the beauty industry is a promising job provider which has much better prospects for the feminine gender. Moreover, the beauty training centers are transforming the helpless women to a self confident,
independent
and
empowered
woman. A research conducted on women running small businesses like bag making, beauty parlors suggested that women enjoyed control over the economy and also liked to
The poor could afford the training only if
exercise their power in decision making. The
they are sponsored from some society,
paper
is
agencies or NGO’s. For e.g., recently a
empowerment in true sense” which was titled
backward class welfare society had launched
in
ti t l ed
a first ever kind beauty parlour in the
“Entrepreneurship and Empowerment from
backward regions of West Bengal. A total of
Pune city” which got featured at an
25 new graduates were offered jobs here. The
international press conference in Singapore
success of such a parlour would help them
last year.
kick start new projects in other parts of the
was a
apparently
rep o rt
fro m
titled
“That
Pune
country. Similarly the government of West
The beauty training is very costly and a few
Bengal had inaugurated a parlour in a tribal
days basic workshop would cost more than
area. Self help groups for women and
Rs 5000. A complete training which includes grooming,
cosmetology,
hair
care
Anganwadi workers are given training to
and
equip women and make then self dependant.
makeup would cost more than Rs. 20000 and continues for a duration of 9 months or
The question however is, how competent will
more. The beauty training is unaffordable for
women be? Are they really empowered?
the poor and general class. In a recent chat
Does this mean they will be able to start on
with an owner of a beauty clinic revealed that
their own? Unfortunately many well-known
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L’Entrepreneur
June 2013
personas in this field think otherwise. The
Andhra bank, Bank of India, and Central
schemes provided by government to provide
Bank of India offer various schemes to help
subsidized training to poor women hinders the
growth
of
industry
rather
than
progressing. The training provided are not adequate and the trainees need to relearn the basics from other institutes by paying a hefty price. Professional artists stress that, there is no regulating body to inspect the courses offered by the training centres. Many well known
centres
tie
up
with
foreign
universities and offer courses which are not
the backward women.
at all relevant in the present premises. This
The issue however is, the loans are approved
is the sole reason that even housekeeping
without any guarantee from the borrower. At
staffs are opening up salons and spas. This
the time of applying for loan a girl may be
has given a huge dent to the industry as
single. Lately she gets married and this loan
people are very much aware of beauty
is a write off. Many times the loans are
products and are well aware of the pros and
applied by the father of the girls. Many
cons. They ask for professional beauticians
trainees often do not know to run the
and even go to the extent of fixing
business. Many of the families got rescued
appointments with a specific beautician.
because of the schemes. Some girls approach
Such is the demand for the right person. Professional
institutes
stress
upon
co-operative societies and payback on Rs.100
a
basis daily. Such schemes have provided a
governing body to regulate and oversee this
means of life to many downtrodden families.
industry.
Business is business and has to be run on a
The major reason for the parlours cropping
savvy basis. Professional clinics reveal that
up so easily is because of the government
many
schemes and promotion of small scale
times
only
the
owner
is
a
professionally trained person and assists
businesses. Any nationalized banks such as
other trainees. These result in better job
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L’Entrepreneur
June 2013
Students say that there are voluntary courses
industry becomes a professional makeup
offered by universities on beauty care and
artist for celebrities or becomes an employee
beauty techniques. Professionals from such
of brands like MAC and Lancome.
universities have a fallback option because of
The day is not far when botox and Brazilian
their degree but the poor ones do not have
wax will become an FMCG product.
that luxury. Still they are making ends meet and who knows one day they may also open up a salon cum spa. The north east effect also plays a major factor. The pleasant people from the north east are found in every spa and clinic. They
get trained at some professional beauty clinics and later join local parlours and become professionals. They say the exposure adds a lot to their experience and makes them economically sound. The pay and perks for a professional beautician goes up to Rs 40,000. Some become experts and stylists which further adds on to the career. A specialist in this
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L’Entrepreneur
June 2013
The Editorial Team of L’Entrepreneur :
Kartik Seth, Neha Agarwal Sreeny Vallabh, Shristi Gupta
Special thanks to Vandit Dholakia for his Contribution to the magazine
Disclaimer : The views and opinions expressed in the articles are those of the authors and do not necessarily reflect the official policies or views of L’Entrepreneur, Maçon or IBS Hyderabad. While reasonable care is taken to ensure that the articles and other information are upto date and accurate at the time of publication, L’Entrepreneur takes no responsibility for any outcome or decisions based on the content presented herein.
No part of this magazine or its contents may be copied, stored or published, in any form or format without the prior permission of Maçon 27