Short Story
38-year-old Manav is a wholesaler trader from Mumbai who manufactures and supplies men's trousers and cottonwear. He is married, has two kids, and lives with his parents. His business is highly focussed on product quality and he wouldn’t like to compromise on it since that’s his main competitive advantage. His business goal is to set foot in various cities across the country and to increase his annual turnover to 10 cr. by generating more sales.
Business
- Manav’s company manufactures menswear. It is a wholesale firm that produces and supplies trousers and cotton wear.
- He is not a part of any trader’s association but is soon going to join Dadar association for wholesalers. He believes that it is a good way to network with other wholesalers and also helps to solve disputes between buyers and sellers of the same association or another.
A: What were you doing before this?
M: I was pursuing my graduation before getting into business. Since I am from the marwari community, going to work or sitting at the shop was instilled within us from the very beginning. We were not allowed to sit idle. If my college dispersed at around 12 p.m., I had to come and sit at the shop after. The partners in the previous business liked me so much, they were ready to sponsor my education as long as I joined them after. But, I wanted to expand, which they were not ready for. Their company was only into men’s jeans. I was the one who added on formal and cotton wear. That is how I started my own independent company.A: Have you tried to find/market business online?
M: No, there are no such plans at the moment. As of now, the only plan is to expand the business and have a greater market presence in the wholesale segment. The online route is still some time away because I am the only one handling this business. And my focus is somewhere else. I do want to go online but I can’t divide my attention, nor can I trust anyone else with the business because I am used to my ways of working here. So, you can say we will go online once the business is more established.A: How did you get the idea to start the business? How old were you then?
M: If you want me to be honest, I wanted to pursue my dream of being a CA. I even cleared the first level of the course (IPCC). But, my father was not that well off to support my dream. My brother’s partners promised my father to support me till I finish my studies, to ultimately join the business. I never really wanted to do a business as such till I actually got into it and found myself being sound at it.
Finance & Banking
- Manav’s major monthly expenses include factory workers’ wages which are paid weekly, staff salaries, electricity bills, office rent, and travel bills.
- He visits the bank once or twice a month. In case there is an emergency, his father goes to the bank.
A: What is your general mode of making payments?
M: I only work with payments through cheques. Only very rarely does someone ask for payments in cash, when there is no other option.A: How many payments are made through cash/credit?
M: There is nothing fixed when it comes to these payments. Generally, in this business, everyone that I deal with prefers paying through cheques or online banking modes. There is maybe a 1% chance that a customer might request to make payments through cash/credit. Even then, we find ways to accept the amount as long as they are willing to give it.A: Are QR codes/UPI used anywhere in your business?
M: This is very rare, actually. It is only because our ticket sizes are quite high. But, we do plan to venture into the retail business, from where I do expect payments being made or accepted through these modes. Otherwise, the nature of the business only allows us to use cheques or online banking the preferred mode of transaction.
Loans
- Manav compares loan interest rates before taking a loan. He believes that even though online lenders have higher interest rates to offer, there will be a day when there will be no loan obligation.
- He borrows money from friends and family during certain times of the year when he needs some money to sustain. Otherwise, he feels the need to borrow money in June/July to fulfil his targets for Diwali, as it takes 60 days to get a finished product.
A: Where did you use this money in your business?
M: As I mentioned earlier, we used this borrowing to purchase stock because we were planning to expand at that point. I understood that the rotation of the stock would be slow initially and I had to pump in more money for it to take off. I ventured into these loans because I did not want to keep increasing the limit of my CC account.A: Does your money ever get stuck in stagnant inventory? Do you take a loan to get through cashless times?
M: Yes, it is very common for the inventory to take time to roll. During those times, yes, I do feel the need to take a small loan for the running of the business, but I have never ventured into one. Also, there aren’t any lenders that do give a small ticket loan. We generally wait it out for the payments to get released.A: Have you faced any issues while associating with a lender?
M; No, not really. I have never faced any inconvenience. Honestly, I had a good experience with FlexiLoans. They kept me updated about my loan and repayment details. Even if we do have any queries, we make it a point to reach out to the party in concern, so that there is enough clarity.
Customers
- Manav tries to find 5–7 fixed customers in every mandi in each city across a particular state.
- Usually, he takes 15–20 days to deliver orders to his customers. This number increases to 35–40 days during the main season.
A: Do you have any major customers?
M: Initially, we used to just operate out of Maharashtra only. But now, the business supplies goods to other states too. So, every city has a market or a mandi. We reach out to a middleman/agent, who is the intermediary between the buyer and seller. He ensures us about the payments and orders. We try to find 5–7 fixed customers in every mandi in each city across a particular state. As we fix our roots in one mandi, we move on to the next one.A: How do you select your mandis?
M: Over the years of doing business, you tend to make enough contacts to aid you for the same. When we set foot into a new mandi, we go through a local agent, who knows the market well and can assure us some business. Then, you also get links in these mandis to nearby cities and their markets. This is how we keep working forward and expanding. At the end of the day, the entire business is based on trust. Even we do our own research about these markets, but only someone who knows these markets in and out can give us a truer picture.A: Who are your major customers?
M: Initially, I started out of Mumbai. But, now I just keep networking and finding links to other mandis and try to get business there. The only being that I have to only work through an agency/agent. I need a basic background check and someone who can assume the liability. The agency will make sure that the payment is made on time.
Employees
- Employees’ salaries range from 10,000 to 20,00 based on the work they are given or have the ability to perform.
- Manav prefers hiring unskilled labour for work like packing. But he prefers to hire experienced employees when it comes to handling accounts.
A: Do you face any challenges to retain your employees or do you have to motivate them to stay?
M: No, nothing like that actually happens. They know the work they have and also know that it won’t be too excruciating or challenging for them to accomplish it. It is basic and I think they are content too. It’s only the agents who need to be given incentives as such.A: Are your employees trained or untrained?
M: When it comes to work like packing, untrained employees are preferred as they can be moulded well. But when it comes to something like handling accounts, we prefer someone who has had prior experience in the same.
Vendors
- Manav has no tie-ups with vendors as in this market, the trends keep changing and so does the requirement. But, there are some vendors with whom he has had business relations for years now.
- Most of the orders are placed through WhatsApp or over a phone call. The manufacturer sends pictures of fabrics and Manav selects and follows up with a phone call.
A: Do your vendors accept payments through digital modes?
M: No, they don’t generally accept payments through these modes. But that us also because the orders that I place are very large and the transactions only take place through cheques or RTGS/NEFT.A: How do you generally find your vendors?
M: I don’t really go out looking for vendors as such. I am a part of certain groups on WhatsApp where other wholesalers and manufacturers are present. This helps me network and create links that help me grow my business.A: How do you keep track of your orders with your vendors?
M: All our work is done on a bill-to-bill basis. Every transaction and order placed/received is fed into a ledger we maintain here at the office.
Accounting & Taxation
- Manav uses Tally for accounting and billing purposes.
- He maintains books of inventory and constantly files all expenses even if they are too small.
A: How often do you file your GST? How do you do it?
M: We file our GST obligations on a monthly basis. The invoices are fed into the GST format provided by the government and mailed to my CA. He cross checks the amounts and files the returns.A: How frequently do you contact your CA?
M: Since the last two years, I have been in constant touch with my CA regarding my balance sheet or accounts in general. See, in this business, it has always been about expanding and increasing sales. Only now, I have gotten more aware about other things that keep the business afloat. He visits twice during audits only.
Tech Adoption
- He is a part of a business group on WhatsApp which helps him network. He also watches business videos on YouTube, but only if it is not too long.
- He visits the factory only once or twice a month. He uses communicates with his staff through WhatsApp or through video calls.
A: What apps do you use most frequently?
M: I barely use my phone much, other than making phone calls or using WhatsApp. But, I do indulge in apps like Facebook and YouTube. Also, I use a bank app to keep a tab on my transactions.A: How does the usage of mobile phone/computers help you with business?
M: See, literally all my work is done on the phone. From making phone calls to sending catalogs to placing/receiving orders, is all done through the mobile phone. And, computers help me with keeping an account of the finances using softwares like Tally.A: How frequently do you visit the factory?
M: I don’t actually visit the factory that much. Maybe, once or twice in a month. Since the introduction of WhatsApp or video calling facilities, communicating with my staff at the factory has become much easier and keeps me from being physically present at the factory.
Business Goals
- Manav feels that the USP of his business is that he doesn’t compromise on quality and give the end product a finish as good as any big brand with all the intricate detail.
- He wants to focus his business more on the lines of lower pricing, better quality, and increasing sales. He thinks that he will feel more rooted in the business and be an established player in the market if these are set in place.
A: If you had access to greater working capital, what part of the business would you focus on?
M: If I access to more funds, I would invest it in production and buying more stock so that the rolling of goods is smooth and I can cover more amount of market share.A: How do you see your business growing in the coming years?
M: The main aim is to set foot in various mandis across the country and I want my annual turnover to increase to 10 cr. by generating more sales.A: Is there anything you plan to change for the business?
M: Yes, what I basically want to do is provide my customers with the best quality product at a much lower price. Now, achieving that target has got to take some time, but we are persistent.
Credits:
- Interviewed and transcribed: Ansh Chawla, Flexiloans
- Analyzed and published for Medium: Geetika Shukla
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About the research
This documentation is a result of the in-person interview, along with the participants’ consent. The interviews might be conducted in their native languages and translated to English in the best possible way to reach a large audience.
Disclaimer: The identities of people and places in this documentation have been changed to honour the privacy of the participants.
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