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Flash Winners - a new e-commerce model for success


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If you look at the figures from the last couple of years, 50% of the e-commerce ventures that were launched have had to close their doors within 12 months. Today, 80% of the ventures are financially hanging on a thread and cannot hope to receive capital from VCs who have frozen their investments in the first rounds of these young start-ups.
In a globalised economic environment, entrepreneurs need to develop an intelligent vision of the world that surrounds them by making a clean break with the existing paradigms. That means building the e-commerce of the future for today's consumers.
Flash Winners unpacks the brave and dangerous world of e-commerce for the entrepreneur. With feet firmly on the ground, it also offers practical advice to enable e-commerce ventures to achieve that all-too-elusive-goal: PROFITABILITY!

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Flash Winners - a new e-commerce model for success

  1. 1. The Harsh Reality of E-commerce in India: a Model’s Failure
  2. 2. The Indian Entrepreneurial Dream ‘Those who have no imagination will have to settle for reality’ The story of the successful entrepreneur who starts with nothing and conquers the world feeds the Myth to be able to launch a company, get quickly funded with several millions without having generated even one dollar in revenue, sell the said company less than 3 years after and become rich. Unfortunately if you look at the figures from the last couple of years, 50% of the e-commerce ventures that were launched have had to close their doors within 12 months and today 80% of the ventures are financially hanging on a thread.
  3. 3. The Apprehension of Market Codes ‘Those who understand the past are better prepared to build the future’ Instead of basing your market study on the question ‘Is it a good idea to launch an e-commerce venture in India?’ you should focus on finding the answer to the only question that has an interest, ‘What are the needs of the market and how can I meet them effectively?’ The market is a collective thought that you must understand and apply to your daily activity. Understanding it, interpreting it and implementing it can have just one goal: making sure your business exists.
  4. 4. The Mutation of the Indian Consumer ‘To understand a system, one must get the most out of it’ The Indian society has reached a point in history where the supply of goods and services is higher than the demand in many fields. The concept of abundance of products makes it so that man surrounds himself inexorably with objects and in the end, he sees and swears by them, surrendering little by little his wish to become more functional. Do not trust the appearance, the Indian consumers are not becoming more westernised. They are becoming more and more modern and international, but they distinctly remain Indian. The Indian consumer is mutating whatever the consumer class he belongs to. It is not a transformation since he retains his cultural uniqueness. However, by intensifying the consumer society, he could lose his soul!
  5. 5. The Fair Perception of the Winning Product ‘We discern from the world only what we are prepared to perceive’ Winning Products While innovation is necessary, it should not be considered as sufficient The construction of a range of products around it is equally important Having a range of products, even more so if they are new, involves educating the consumer about the manner in which they have to use them The mean of distribution is simply capital especially in an unorganised market
  6. 6. Rethinking Inventory Management: A New and More Efficient Model
  7. 7. A New Strategy To Reach Profitability ‘We can no longer think differently because we have been perfectly conditioned to perceive things in a certain way’ The pitfalls which directly affect the profitability of an e- commerce inventory-led model The first issue is the inventory risk which weighs over he unsold products. Delivery services could also be a thorn in the entrepreneur’s side and free shipping remains something that batters the e- commerce’s cash flow The second profitability issue of the inventory-led model revolves around the marketing costs to sustain the e- commerce
  8. 8. A New Strategy To Reach Profitability ‘The difficulty lies not so much in developing new ideas as in escaping from old ones’ – John Maynard Keynes The Mass Distribution Model First you need to understand the structural relationship between the distributors and the suppliers based on the question – ‘How can I buy the products at the lowest price?’ This model of revenue is no longer based on margins but on the turnover of assets; the profitability being reached by the negotiation due to a high volumes of sales The profitability is based on the ‘Back Margin’ model which is the result of the negotiation between distributors and suppliers to generate new sources of revenue REBATES DISCOUNTS COMMERCIAL CO-OPERATION
  9. 9. How can I implement this Model on my E- commerce?
  10. 10. A New Format for E-Commerce ‘The strongest is never strong enough to be hegemonic. At the awakening of the weakest, a new balance of power is established’ BACK MARGINS REBATES DISCOUNTS COMMERCIAL CO-OPERATION Cannot be used at the beginning Cannot be used at the beginning Key of the model but cannot be used with a format ‘shop’
  11. 11. A New Format for E-Commerce ‘The most critical stone of your business is the foundation’ The new format which shall influence the negotiation between you and your suppliers on a more equitable level to generate new revenue is that of the SHOWROOM. This showroom format will allow you to bring up some services for your suppliers around 3 thematic – ‘Image – Distribution – Product Range’ To be efficient, this showroom must be a tool of predictable success!
  12. 12. The System as a Tool to Achieve the Model ‘To reach what is right, sometimes you must get rid of all the received ideas and build a new and more efficient System’ SYSTEM IMAGE PRODUCT RANGE DISTRIBUTION How are you doing to develop an image strategy? How will you highlight the new products? What will be your undeniable rigour to reassure your suppliers?
  13. 13. ‘What we do in life echoes in eternity’ - Marcus Aurelius In the coming years, more and more young entrepreneurs will try their luck on the e-commerce market and unfortunately, more and more failures will emerge from this development. Annihilation has taken over creation! The idea of this book is to try to stem this phenomenon of chaos that affects entrepreneurs and give a little hope in this futuristic model that is e-commerce in India.