Books, clothes and accessories, electronic gadgets, cosmetics, even groceries — shopping for all these online has become commonplace. But when did you last hear of someone who bought a chain-saw for over ₹50,000 and had it delivered at his factory’s doorstep with just a click of the mouse? Well, that’s the kind of buying customers of NowPurchase have been doing over the last few months.
Naman Shah, co-founder of the B2B industrial procurement platform, spent three years working for Freshmentors in the US and helping US-based valuation software start-up BizEquity expand into Asia.
In early 2016, planning to start his own venture, he returned to Kolkata. His cousin Aakash Shah, co-founder at NowPurchase, saw huge potential in a B2B procurement platform. Aakash says: “This stemmed from the pain points I had experienced in my over seven years in the manufacturing industry. We spent three-four months visiting factories, gathering data. Soon, we were convinced there was a gap in the market that NowPurchase could fill as a platform from where businesses could source their industrial needs.” Aakash provides NowPurchase with strategic inputs and advice.
Seamless experience
NowPurchase makes industrial purchases seamless and transparent for business owners. A curated e-commerce platform with customised purchase management software, reliable delivery and secure payment options, it works with over 150 suppliers and has fulfilled over 500 orders since going live early this year. The portal is focused on end-users, with manufacturers as key target buyers, including such clients as Century Ply, Skipper Pipes, Patton and over 100 SMEs.
Naman and Aakash come from the family that runs Nipha, a 60-year-old manufacturing and foundry business in Kolkata; it is now a strategic partner to NowPurchase.
On the NowPurchase team, Naman says: “We are a 10-member team, with many experienced e-commerce professionals who were earlier with firms such as Flipkart and Delhivery. The team has a few fresh graduates who bring great energy and a fresh perspective to our work.”
Brand collaborations
NowPurchase has bagged a few significant brand collaborations, including tie-ups with ACME Safetywear and ContiTech Hose Pipes. It is now an authorised online distributor for both these manufacturers, ensuring customers get a full range of genuine products, at the best prices. Brands view this as a new and innovative distribution and marketing channel for their products.
Asked if the venture needs to stock inventory, Naman says: “We currently work on a zero inventory model and ship directly from our supplier partners. We work with suppliers to maintain assigned inventory for fast-moving items while figuring out SKUs we might want to stock in the future.”
Ensuring quality and reliability for its customers is a key concern. Arnab, who joined NowPurchase following a two-year stint at Flipkart, explains: “We have over 100 registered suppliers, selected through a stringent process. We meet with the larger brands and they assign us suitable supplier partners across regions. If suppliers approach us directly, they must provide us with relevant documents to prove their authenticity — for example, a letter from the brand or a certificate."
This is important, says Naman, who believes B2B requires different solutions and careful vetting to ensure the buyer’s trust.
How does the venture tie in with the thrust to manufacture in India? “We are big supporters of the ‘Make in India’ vision and are proud to partner with high-quality Indian manufacturers,” says Naman. “These include ACME Safety, a key partner for the safety segment. Some of the products we supply through our suppliers are also imported from overseas through authorised distributors.”
Funding, revenue model
NowPurchase was started with the founders’ own funds. They plan to keep it bootstrapped for the next six months, while they strengthen the business model. Later, they hope to bring on board a strategic partner.
The company makes money through a healthy margin on every order in the form of a commission or buy/sell margin. It is completely free for the businesses signed up to use the platform; the purchase management dashboard automates their enquiry and generates a purchase order. Clients can also call, WhatsApp or mail their requirements.
GST impact
How has the GST rollout affected the business? The timing could not have been better, says Naman, adding: “GST is a huge boon to the B2B e-commerce industry. It makes inter-State transfer of goods seamless, with less regulation. It is now easier to find the right supply source anywhere in the country and get your goods shipped from there. It simplifies the tax structure with abolition of excise duty, a huge factor when making industrial purchases. We are happy to make the changes required in order to help millions of SMEs with their industrial purchases.”
Says one such customer, Rahul Patwari of Nagreeka Hydrocarbons: “It is a fantastic way of making purchases easy for a growing organisation. Great prices, excellent service and processes in place. It helps save our time, money and energy.”
Virtual purchase managers
Naman’s vision for NowPurchase is to widen the reach of such easy, transparent purchases. The company has built customised solutions, such as a purchase management dashboard for clients, dynamic bulk pricing and tie-ups with financial service firms for different credit and payment options.
Naman signs off saying: “Logistics is a big piece of the puzzle that we are continuously improving to ensure reliable and timely delivery. Bengal is a young start-up hub. There is a serious intent, both by the government and educational institutions, to introduce incubators, accelerators and funds to help ventures like NowPurchase. There is a strong SME community here, which is good for us as it means a big pool of potential clients.”