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Disrupting the packaging market - The Noel D'Cunha Sunday Column

26 August 2017

Bizongo is an online B2B marketplace. Its business model hopes to empower efficiency for small and medium businesses in India.

Nothing new there. Businesses are often faced by the problem of sourcing the right products, managing multiple vendors and orders, keeping a track of all the purchases. “This eventually results in a lot of inefficiency in their supply chain. It is, therefore, essential to understand unique problems of buyers,” says Aniket Deb, one of the three former IITians who started Bizongo. Ankit Tomar and Sachin Agarwal are the other two.

In this Sunday Column, Aniket Deb shares the Bizongo journey.

team1 Management team of Bizongo: Top row (from left to right) - Hersh, Ankur, Aseem, Gulshan, Arjita, Vijit, Shashank, Shalmali; Bottom row - Sachin, Aniket and Ankit

How - and why - did you get into print?
Packaging as an industry is ubiquitous, used by every small medium enterprise across the table; packaging as a whole has been growing at a phenomenal rate of 15% CAGR. With over a million possible SKUs and a highly fragmented supply side consisting of over 30,000 vendors procurement of the ‘right’ packaging turns out to be a tedious task in the end. We saw a lot of potential for disruption in this industry. Print being an essential part of any packaging manufacturing process was an obvious industry for us to target along the way. 

Did you start Bizongo alone then?
Bizongo was founded by three alumni of IIT Bombay and IIT Delhi in 2015 with the realisation that B2B trade across companies mainly happen offline and is a very tedious process. Our leadership team consists of alums of companies like Microsoft, ITC, Gravitas, Paypal, Housing.com, Snapdeal.com

Did all of you put money in?
We had initially bootstrapped for the first few months. But we were soon able to raise a round from angel investors.

By the sound of it, you simply took the VC model, raised capital and expanded it across more brands and super brands. Right?
At the core of Bizongo’s business model is a technology stack built to empower efficiency for small and medium scale businesses centred in India. Businesses are often faced by the problem of sourcing the right products, managing multiple vendors and orders, keeping a track of all the purchases; all of which eventually result in a lot of inefficiency in their supply chain. Being a B2B marketplace, it is essential for us to understand unique problems of our buyers. Hence, it is not a one solution fits all model. But there are common themes that exist around packaging procurement across different brands. We are building scalable solutions for these problems. 

Your early days were from hired spaces and a lean-mean team. How did you convince the big boys that you are here to stay?
From very early on, we had a very collaborative approach. The big players saw value in us building a complete procurement experience: from design to development to procurement. We are building intelligent data-driven systems to utilise excess capacity of manufacturers, to identifying their best capabilities. Our team works closely with the sellers for deliveries, quality check, product development, logistics and payment. Our seller dashboard gives them complete overlook of all their trades with us which brings in a lot of transparency. This kind of an approach is very new to the sector and hence big players have been engaging with us.

3,500 customers. How do you manage them?
We have built technology to bring efficiency into business purchases. Our technology products ensure that right from vendor selection, customisation, issuing purchase orders, tracking shipments, availing credit everything happens through our platform in a very streamlined fashion. On our flagship product: procure plus platform, a business can build their own personalised catalogue, get complete analytics to reduce expenses, manage invoices, purchase orders (Pos) and multiple shipment records online to easily maintain data digitally.

Who was your first customer? Was it tough?
Amusingly enough, our first customer was a person located out of Delhi who had ordered garbage bags from our platform for his mom and pop store. But yes, getting first 100 customers was a big challenge for us because what we were trying to do was completely unheard of in the market. Procuring packaging online was not an idea many people were comfortable with. But as we gained traction on the web and offline and due to our credible services more and more people started trusting us with their requirements. Although this is just a start, we have a long way to go in our journey.

What is your method to recruit for staff?
We believe that people are at the core of any company. Hence, we follow a rigorous hiring procedure. We first test them on the skills required for the role and then gauge if they are fit for the culture that we are building at Bizongo. CULT (collaboration, upscale, leadership and transparency) stands for our values. We look out for these values in each and every candidate.

One of the problems with packaging is, it is easy getting the work, but what if you botch up in production? How do you manage?
We follow the model of contract manufacturing with manufacturers, which helps us get a control on the supply side.

What kind of workflow do you follow from order to factory production to delivery?
The organisation is divided into departments. Marketing and sales department helps us to generate more and more demand on the platform. The packaging design lab looks after the development of the packaging materials. Our seller relation team then steps in to get the requirement fulfilled. Our technology helps us to determine the right seller depending on factors like localised supply, capabilities of sellers, history of the seller with Bizongo. We have quality check executives for some of our contract manufacturers and premium sellers’ facilities to ensure quality. The produced material is then transported by the supply chain team of Bizongo which ensures tracking for every order and timely delivery. Our platform is also integrated with services to provide credit to buyers and sellers.

How big was the business back then?
When we started we were doing orders worth Rs 20,000 on the platform in the first month.

Printing is still very labour intensive plus it has modernised kit. How do you grasp the vocabulary for the nuts and bolts, machinery and process?
Yes truly, it is a huge industry with intricate processes and specialised machinery. We are learning with every passing day. We also have folks from the packaging industry in-house as well as advisors who are helping us in the journey.

Must it have been a steep learning curve?
Absolutely. It has been a great learning so far for all of us in the team.

You mentioned you had an IIT / IDC background, prior to Bizongo, what were you doing before you joined?
I was in Housing.com before starting Bizongo, Sachin was at Gravitas and Ankit was at Microsoft.

You said you took your young team and gave them experience and training across the whole business – that was everyone from account handlers to production staff. So what was your favourite bit of your apprenticeship?
Back in 2015, when we started this company, we had hired five interns for business development who were in their fourth year of undergrad. Currently, all five of them have developed deep expertise in individual product categories and are heading their own category divisions. Seeing these people scale up has been my personal favourite. 

Which is your favourite production process - and why?Making intricate designs for the perfect unboxing experiences.

How old is your team?
We have folks as young as 22 years to 50 years of age working here. But yes, it’s a young team, and the average age of the team would be 27-28 years.

Do you generally develop your own people then?
Yes, we believe that there is a lot of potential in our people which can only be manifested if trained and groomed properly. We would always be a lean team and depend more on our people scaling up.

What are the packaging products you focus on?
Our main focus categories are food packaging, packing and shipping, packaging bags, bottles and caps, material handling and warehousing materials.

The industry looks at printing as a commodity. Is that part of the secret of your success; treating print as big business and not a commodity, not a craft?
True, but that is only a part of it. The bigger problem is fragmented and disorganised nature of the market. We are able to map capability of the seller to produce right quality of product and deliver timely to bring efficiency into the whole process.

Does that also mean that you look at customers differently too?
Yes, since our customers belong to different sectors, have a different scale of operations, hence they have a different set of problems, which makes it necessary for us to understand their requirement in great depth.

How does it work with you when you work with clients like Xiaomi, Myntra, Flipkart, Bigbasket, Delhivery? Do you look for customers that fit what you do, rather than looking to see how you can fit in with your customers?
We engage with the clients to first gauge the impact Bizongo can have on the client. We conduct thorough visits to their warehouses; understand their end-to-end supply chain. If it’s a packaging design project, we delve deep into what the brand stands for before developing the project.

Is there any customer you have said no to?
Yes, the focus is essential for us at this stage.

Technology moves on in a three- to five-year cycle. Will you invest in it at some point in time?
Yes. We will be investing a lot in pre-production processes like sample making, proofing and post-production processes like testing, quality checking which is currently lacking in the ecosystem.

Your team deploys digital admirably. Is digital print something that you’re looking at?
Yes in future.

Who is your dream customer?
Unilever and Apple.

What about the next stage of growth, is there a new generation of Bizongos waiting in the wings?
Of course. We are in our growth phase, constantly adding more capabilities within the team.

We are in an industry where profit almost seems to be a dirty word – does making good returns cause you problems with customers?
In our model, the economy of scale, packaging innovation and procurement technology drives profitability.

How do you see the market in India?
Packaging as an industry is ubiquitous, used by every small medium enterprise across the table; packaging as a whole has been growing at a phenomenal rate of 15% CAGR. So things look extremely bright.

How do you get the data from the e-Commerce majors? Do they mention how an insert into a package for a product or service is more relevant than a specific box size?  Do they share that with you?
Yes. For instance, we are doing a project with one of the biggest e-commerce companies for fully automating the optimisation of the size of the courier bag depending on the size of the products going inside it.

Is there anyone you admire in the industry, who inspires you?
There are several enterprising players, but among the ones we have met, as a team, we admire Parksons a lot.

Last question, what’s the most important lesson you’ve learned from your vendor?
Quality is the value proposition for any long-term benefit.

team2
Team Bizongo

 

 

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