A failed business

Internet users in India is growing fast and so is the online business. There are a lot of startups out there who wanted to start one. As a society we need a lot more than what we have today and it s a good thing that people are coming out with several ideas .  But do we understand the issues in online retail business? Are we aware that creating a Ecommerce site is only a small part of the problem. 

In the year 1999, before the dotcom crash, we decided to launch our first online business. I wanted to share some of my experiences running this business.

By the end of 1990s the whole industry was buzzing with excitement on the prospects of dotcom and not having a dotcom business looked like plain foolishness. That is when we decides to launch our first online business. We had several brain- storming sessions to decide on what  problem that we wanted to solve. Several suggestions were made but we rejected almost all because none of them looked sound enough. Finally we  came across a problem that we know not many in the industry will come across because we were uniquely positioned.

At that time we were  working with several non resident Keralites. We were trying to build a network of NRKs as well as those who returned to Kerala after living elsewhere for a long time.  Though this was part of a non-profit activity, it gave us some unique insights into the problems that they faced. Most of them are away from their family and they do miss the celebrations back home like Onam, Vishu, Perunnal, Christmas, Easter, etc. They cannot take part in marriages, birthdays, and other family celebrations. Is there a way they can share their happiness with their family back home?  For example is there a way they could give a "Onapudava" to their family members even when they are away? Give a gift to wife on the wedding anniversary day? Give a gift to parents on their birthdays? They may not be able to attend a marriage but should show their happiness by sending a gift to the couples on the day of marriage.

So we decided that the NRKs should have a website where they could order gifts that will be delivered anywhere in Kerala. Will that solve their problem? No, we have to do something more than this to address the issue. On your father's birthday you want to send him some flowers.  It should be delivered in the early morning. It should be delivered with a greeting from the son. It should not be delivered by somebody from a courier agency, the delivery boy has no idea what he is delivering. It should delivered  by somebody who understand the relationship between the father and the son. So we decided that we should have our own delivery network throughout Kerala. Through our non-profit activity we were already connected with a lot of Keralites who were returned from Gulf. Most of them do not have an idea what to do next, so we decided to use them for this purpose. Who else is better to understand the pain of a non resident malayalee? We formed a network and trained them. One idea that came to us at that time is that the person who makes the delivery should take a photograph and this  can be send back to the Person who made the order. The mobile cameras are not that popular in 1999, so if this is not possible then we will alteast take a message from them.

This business failed after serving the NRK Community for almost five years. We decided to closedown because it turned out to be a very costly. The world was not yet ready for solving this issue. We need a lot more infrastructure to solve it. We understood this only because we tried to solve it by putting a lot of hard work and we learned a lot of lessons from it. There are several problems in ensuring the supply of quality products in time. This cannot be delayed, we need to make the delivery in time. For example the gifts send for marriages are delivered during marriage functions, not before that or not after that. Supply of goods are a big issue. For this to happen, the order has to come well ahead of the function. We need to locate quality supplier in the near by locality and ensure that he supply the goods in time.

For Onam and Christmas we faced another issue. How to predict the number of orders?  Usually there are a huge number of orders and how to ensure that all orders are delivered in the days of celebration?  More over in 1999 there was no cloud computing and the servers stopped working when more people were trying to order from the site. This again affected the predictability. In 1999 Ecommerce was still a young science.

I will continue the discussion in my next blog.