Rajchandra Agencies has been one of the leading distribution houses in Mumbai, catering to Smartphones, Mobile accessories, telecom sector and FMCG products
During an exclusive interaction with Mr Mukesh Gupta, Partner at Rajchandra Agencies talks in detail about the manifold steps undertaken by the company to create a strong threshold in the distribution market and road ahead.
What are the changing trends in the distribution business in India?
Since the last two years due to the sudden rise of Covid-19 pandemic, there has been a drastic change in distribution business.
Distribution is a bridge for OEMs vs the partners, so there was a need to make sure that the partners come together. However, during the pandemic IT fraternity and cloud-based services had a booming business and thus electronic distribution of products came into the picture. This called for a set standard which never existed before.
We expect the distribution business to consolidate in the very near future because of the existing wafer-thin margins in the distribution business & expected decline in gross revenues.
Although it was difficult for all, yet we have managed to meet the needs of our Brands so as to sustain in the market and create a strong foothold in the market amidst the competition.
What are the key focus areas of the business model which helps to push sales?
The distribution segment also has witnessed the emergence of AI, Cloud computing and IOT, which enables a variety of industries. However, Rajchandra has focused on smartphones, mobile accessories, telecom sector and FMCG business
As a strategic policy decision, we have ensured to be in all the three main Distribution business product categories which include Smartphone, FMCG & Telecom (Prepaid Mobility). Hence, following our core business policy decision of varied business categories, we are partners for Airtel Prepaid, ITC & Vivo
By adopting such a strategy, we have ensured that the verticals don’t correlate and overlap too. This helps in the growth of all the companies as well.
We have undertaken adequate steps to make business resilient and we have effectively seen immense opportunities.
Explain the business model incorporated for collaboration with the brands?
Success in the distribution business is dependent on a few core factors like ensuring increased market coverage, targeted promotion, right market information, offering advantageous financials, and many more.
We at Rajchandra thrive on these aspects and have kept these parameters in our business model.
What opportunities do you see in the smartphone market in the long run?
The growing interest in the Smartphone space is an indicator of the great market opportunity. Mobile phones have become the primary screen for every single individual. Smartphones are increasing their market share due to falling handset prices, affordable fixed data plans and evolving users.
Since the rise in smartphones will create a huge demand for Mobile Software, it will be beneficial to the distribution business as well. The App Store has already fueled the imagination of marketers and created business opportunities by redefining the mobile world. Already all the leading Internet brands are available as mobile apps.
The expected launch of 5G services by the year end will definitely boost the overall Telecom Industry & other related industries. Hence, we see a lot of opportunities in the market of smartphones & IOT
What steps should the government take according to you to boost the distribution business in India?
The distribution business is the core of every consumer product industry. Traditionally the distribution industry has contributed a lot to the overall economy & has given huge employment too. The government has taken the first step by including the sector in MSME and thus giving more exposure & boost to the distribution industry. More such steps are needed to protect the interests of the Trade envisaging the intense competition from the existing & forthcoming “BIG Players” in the B2B industry. This is a major concern for the industry which will surely dent the Distribution Industry, the Retail Trade & thus impacting overall employment opportunities.
Taking the road ahead, what are the growth aspects that you would cater to in the next 5 year/ Future growth ahead.
At Rajchandra, we would like to navigate our business models towards growth. We would also like to explore new business opportunities & markets as there has been a steady decline in the gross margins over the last few years and a significant increase in the overhead costs. We plan to become one of the leaders in the distribution business in India by instilling growth, constant innovation and rationalizing our resources.
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