E-commerce players gearing up for Google's online shopping festival

Many online sites are gearing up for a surge in business with a fortnight of discounts during the ongoing Google-led online shopping festival followed by Black Friday and Cyber Monday next week. The affiliate sites are creating 'howto' guides for best deals in different categories, anticipating a four-fold rise in traffic and a similar jump in revenue.

Sites that offer price comparisons, couponing and best deals may come up on top by creating 'how-to' guides during the GOSF (Google Online Shopping Festival). Smaller e-commerce merchants also gain from the rising traffic, given that they offer niche products and comparable discounts.

Typically, GOSF aims to tap firsttime shoppers, which constituted a large chunk — nearly 30% — during the 2013 festival. "This year, we have five times the number of merchants against when we started GOSF in 2012. Though there are 250 million internet users, only 35 to 40 million users shop online. Our idea is to get more and more first-time shoppers to experience this," says Nitin Bawankule, industry director for e-commerce, local and classifieds at Google India.

"While Black Friday and Cyber Monday are not Indian phenomenon, we have created a GOSF section specifically on Desidime to help shoppers. Diwali and GOSF make up nearly 30% of our annual revenues and last year the traffic went up by 120% during GOSF. We will be adding 20 additional servers this year in anticipation of the volumes," says Mehul Jobanputra, CEO and co-founder of Desidime.

Given that 14 days of pre-GOSF which would showcase 14 different e-commerce players offering their best deals, affiliates will turn a channel for product discovery and collating updated deals. "Price wars are likely on key days and it is a big question whether the featured e-commerce players offer their best deals on the day they are featured or on days when their competitors are featured,leading to never-seenbefore discounts.

Given the technical interruptions last year and earlier this year for the shopping festivals, there is a better amount of preparedness," says Swati Bhargava, co-founder of cashback and coupon site Cash-Karo, which is expecting four times the traffic and three times the revenues during the GOSF days. The smaller e-commerce players reach out to a larger audience, expecting to benefit from the rising traffic. Last year, smaller players registered twice the traffic during GOSF.

"GOSF is a good platform for the smaller players who do not have the marketing muscle. The listing will be random and will rotate so as not to have any specific merchant's name on top. However, greater the number of categories the merchant offers, better the presence," says Bawankule.

Many smaller e-commerce players register a repeat customer base of up to 50% due to the exposure during the event. "During GOSF, there is a bump which remains. Many of our partners reported a 50% rise in repeat customers' post-GOSF and the festival benefits everyone in the ecosystem. The overall sales go up nearly three times.

The idea to launch a microsite is to help people search for best deals which are catalogued based on the brand or categories," says Sameer Parwani, CEO and founder of Coupondunia. The affiliate site started its dedicated microsite for GOSF on Monday. Incorporated in 2010, the couponing website was acquired by Times Internet earlier this year.

Digital media network Komli Media, which ran a series of deals and coupons ahead of the GOSF pre-party between November 17 and November 23, indicated better results for smaller players, given that the top e-commerce players will be holding on to their deals in anticipation of GOSF.

"The increase in transactions for the bigger players has gone up by 20 to 30% while smaller e-tailers have seen a jump of nearly four times the usual transactions over a period of two days," says Sandeep Balani, director, publisher development at Komli Media, which incentivised affiliates as part of its offer. </

Walmart India to offer e-commerce option in all stores The retail firm has cash-and-carry for its registered business members but they can order their merchandise online and have it delivered at their doorstep

Mumbai: Walmart India, the Indian arm of Wal-Mart Stores Inc., that has been testing out an e-commerce option for its wholesale business at two stores in Hyderabad and Lucknow is encouraged by its experience and will now extend this to all its stores across India.

Walmart India has a cash-and-carry business for its registered business members, largely small and mid-sized retailers. It is to these customers that it is offering an e-commerce option, where members can order their merchandise online and have it delivered at their doorstep. “The response has been very good (in the pilot in Lucknow and Hyderabad) and we are learning more about the members, what they need, and are fine-tuning the operations accordingly,” said Kris Iyer, president and chief executive officer, Walmart India, on the sidelines of the India Retail Forum in Mumbai.

“We are rolling it (the e-commerce option) out in the remaining 18 stores by January.” Walmart India plans to launch 50 new stores in the next five years, which will also have the online option, said Iyer, who is now looking to create mobile applications that can serve the company’s customers better. The company exited its joint venture with Bharti Enterprises Ltd in October last year.

That joint venture involved running a cash-and-carry business jointly and providing expertise and support to Bharti’s own front-end retail business. Indian law allows foreign retailers to invest up to 51% in supermarkets, but this policy, drafted in 2012 when the United Progressive Alliance (UPA) government was in power, is now only on paper, with the new National Democratic Alliance (NDA) government not in favour of it.

Trade minister Nirmala Sitharaman said recently that there are no applications from foreign retailers to this effect currently pending before the government. The only international retailer that has come to India under the new policy is Tesco Plc., which has formed a 50:50 joint venture with Tata group company Trent Ltd in March, named Trent Hypermarket Ltd, for operating Star Bazaar retail business in India. Foreign retailers are keen to do business in India, which has a retail market worth an estimated $554 billion, according to recent Crisil report. Only about 8% of this is accounted for by organized retail.

“Retail is a big opportunity in India and we are watching the space on the policy front,” said Iyer.

Online retail boom expected to boost e-commerce enablers Logistics firms, advertising platforms, mobile payment technology companies are being seen as safer and affordable investment bets by venture capital firms

Bangalore: India’s online retail boom is expected to boost e-commerce enablers such as logistics firms, advertising platforms and mobile payment technology companies, which are now being seen as safer and more affordable investment bets by venture capital firms.

For venture capital investors such as SAIF Partners, Seedfund and Peepul Capital, which either missed out on or avoided investing in e-commerce firms such as Flipkart India Pvt. Ltd and Snapdeal, these enablers offer an opportunity to indirectly tap the boom although they may never match the scale and valuations of online retailers.

Some of these e-commerce enablers are already receiving large cheques from investors and they are also seen as attractive acquisition targets for the likes of Flipkart and Jasper Infotech Pvt. Ltd, which runs Snapdeal, according to analysts.

E-commerce logistics firm SSN Logistics Pvt. Ltd, which runs its business under the brand Delhivery, said on Monday that it raised $35 million (around Rs.215 crore today), mostly from Multiples Alternate Asset Management; two days later, rival Ecomm Express Pvt. Ltd said it received Rs.100 crore in fresh capital from Peepul Capital.

Mobile advertising platform Vizury Interactive Solutions Pvt. Ltd, which helps e-commerce firms acquire customers by showing smartly placed product ads, raised $16 million in June. Last month, Flipkart bought a stake in NGPay, a mobile technology provider, after it decided to shut down its own payment gateway PayZippy. In July, product and price discovery website Reviews42 (rebranded as Zopper) received $5 million from Tiger Global Management.

According to investors, a few other e-commerce enablers including start-ups such as mobile wallet provider MobiKwik; and Browntape and Unicommerce that help third-party sellers and small businesses manage their online inventory as well as product discovery sites, are likely to raise funds over the next six months, though the cheque sizes are expected to be much smaller than those received by logistics firms.

“Many of these companies are laying the basic pipeline like logistics and payments for e-commerce companies. All these are fairly large opportunities,” said Mukul Arora, vice-president at SAIF Partners. “We have spent a lot of time on logistics companies and are looking at omni-channel enablers actively.”

A large part of the spending by online retailers translates into revenues for e-commerce enablers, and with billions being spent by Flipkart and Amazon, e-commerce enablers look attractive investments, said Abhishek Goyal, co-founder and president at Tracxn, which sells data on unlisted companies to investors.

“Now that the market for online retail is big enough and still growing exponentially, e-commerce enablers are catching the eye of investors, especially as we’re talking about billions being invested into e-commerce,” said Goyal, an early investor in Delhivery.

Flipkart said on 29 July that it raised $1 billion in fresh capital, and a day later Amazon.com Inc.’s chief executive officer (CEO) Jeff Bezos announced that the world’s largest online retailer would pump in as much as $2 billion into its India business.

Online retail sales are estimated to grow to $22 billion in five years from $3.1 billion, according to a November 2013 report by brokerage firm CLSA.

According to Goyal, advertising platforms, especially on the mobile, are likely to be the biggest gainers of the online retail boom, followed by logistics companies.

“Customer acquisition is key for e-commerce firms and they are willing to pay a lot of money to companies that help them get new customers. So Vizury seems to be in a good position. Of course, Google and Facebook will dominate this market, but there’s space for Vizury. Logistics providers will also benefit a lot, particularly as online retailers are looking to go deeper into smaller cities and towns, where they will need logistics providers,” Goyal said.

For instance, Delhivery expects sales of Rs.220 crore this year from Rs.62 crore last year as it adds more e-commerce clients and expands its operations to more than 250 cities, according to the company.

Ecom Express CEO T.A. Krishnan said the company hopes to deliver as many as 20 million packages this year against nearly five million last year.

Another sector catching the eye of investors is mobile payments.

As people increasingly use their mobile phones to buy things, safe and convenient mobile payment technologies are essential. Several payment gateways such as Paytm and PayU are planning to launch digital wallets and Flipkart’s investment in ngpay indicates that such companies are considered attractive investments by large-commerce firms as well as venture capitalists, experts said.

Paytm, a part of parent group One97, is in talks to raise another $100 million from new and existing investors, according to the company. Paytm’s investors include SAIF Partners, Intel Capital, SAP Ventures and Silicon Valley Bank. Apart from its payment technology, Paytm has also started a mobile marketplace to compete with Flipkart, Amazon and others.

“Payment is one of the biggest enablers for e-commerce to happen. With commerce now happening on phone, whether shopping for goods, travel, food, consumers want an easy and friction-less option, and hence mobile wallets adoption is increasing,” said Bipin Preet Singh, founder and CEO of One Mobikwik Systems Pvt. Ltd, which runs MobiKwik.

MobiKwik, which is attracting significant investor interest, is expected to raise over $20 million in the next three months, it said. The company declined to name the investors. Singh said investor attitude has changed in the last six-eight months given that consumer acceptance and merchant adoption for mobile wallets has increased and also regulatory environment has eased slightly for mobile wallets in the country.

To be sure, as with e-commerce firms, consolidation, either through mergers and acquisitions or through closures, is inevitable among the e-commerce enablers, too. For instance, several e-commerce logistics providers such as Chhotu.in and Dialaservice.net folded in the last two years.

“This is an industry where scale and quality is important. Investors are investing in companies that they think can survive in a shake-out,” said Suraj Saharan, COO at Delhivery.

E-commerce trumps realty in investments In the past 10 months, investors have put in $8.5 billion in 381 deals; e-commerce accounts for 35% of them

E-commerce trumps realty in investments The money has been spread across 55 deals, even though a disproportionate amount has been invested in three firms—online retailers Flipkart and Snapdeal, and taxi services firm Ola.

Read more at: http://www.livemint.com/Industry/zUqiLcNSGAUgAY7SdrPtRM/Ecommerce-trumps-realty-in-investments.html?utm_source=copy

The money has been spread across 55 deals, even though a disproportionate amount has been invested in three firms—online retailers Flipkart and Snapdeal, and taxi services firm Ola.

Mumbai: Technology and e-commerce firms have overtaken traditional sectors like real estate, financial services and infrastructure in terms of rasing capital, this year.

In the past 10 months, investors have put in $8.5 billion across 381 deals in the country and e-commerce has contributed 35% of the total deal value at $2.96 billion, according to data available with consulting firm EY.

The money has been spread across 55 deals, even though a disproportionate amount has been invested in three firms—online retailers Flipkart and Snapdeal, and taxi services firm Ola. Real estate has been the second most active sector, raising $1.2 billion from private equity (PE) investors.

“E-commerce has seen more PE interest this year then any other sector, and not only from venture funds, but also from sovereign funds and some traditional growth private equity funds, as they see significant opportunity for e-commerce sector in India, particularly relative to the growth experienced in markets like China,” said Sanjeev Krishan, partner and leader, private equity and transaction services, at PricewaterhouseCoopers Pvt. Ltd, another consultancy.

Accel Partners, Blume Ventures and Sequoia Capital lead the table in terms of the maximum number of deals closed by them in the last 10 months, though in terms of capital allocation, investors like Warburg Pincus, Temasek Holdings Pvt. Ltd lead the charts.

Sequoia Capital declined to comment. Accel Partners did not reply to an e-mail sent on Monday.

“We continue to believe in private-label commerce, enablers like payments and logistics, unique marketplaces and even offline brands. That’s where the bulk of the volume of our investments are. It is likely to continue into 2015. The larger players will compete for market share and leadership and share of consumer wallet, and that means more capital towards marketing, customer satisfaction and infrastructure,” Karthik Reddy, managing partner with Blume Ventures, said.

Apart from these funds, Tiger Global Management Llc has also been among the more active investors this year. In an e-mail response, Tiger Global said it does not talk about its investment strategy with the media.

Interestingly, of the nearly $3 billion investment in e-commerce firms, 80% ($2.3 billion) has been invested in three firms—Flipkart, Snapdeal and Ola. All three have seen repeated rounds of capital-raising this year.

Flipkart has raised $1.2 billion from GIC, Tiger Global, Naspers, DST Global, Iconiq Capital and others this year.

Since 2009, the company has raised $1.7 billion through nine rounds of funding.

Snapdeal has raised $884 million in three rounds of financing this year. It counts Ratan Tata, chairman emiretus of Tata Sons Ltd, as one of its investors, apart from SoftBank Corp., BlackRock Inc., Tybourne Capital Management, Temasek Holdings, Premji Invest, Myriad Asset Management, IndoUS Venture Partners, Bessemer Venture Partners, Nexus Venture Partners, eBay Inc., Intel Capital and Saama Capital. The online supermarket has raised six rounds of capital since 2011.

Flipkart declined to comment. Snapdeal did not respond to an email sent on Monday.

Ola has raised $252 million from SoftBank, Tiger Global, Steadview Capital, Matrix India, and Sequoia Capital. Since 2013, it has concluded four rounds of fundraising.

“We are growing aggressively across cities and categories. This market needs considerable investment in terms of building the ecosystem as personal transportation is almost non-existent in most cities in India even now,” said Bhavish Aggarwal, the co-founder and chief executive officer of Ola, adding that they are not looking for more funding immediately.

Multiple round of funding for these firms have come with steadily rising valuations, say experts. “There have been a few transactions where valuations were stretched other than that all transactions have happened at par with global peers. Brazil and Russia are far more ahead in the curve than India when it comes to e-commerce space,” said Nitin Agrawal, director at Equirus Capital Pvt Ltd, an investment bank.

Valuations have risen because of an expectation that Internet commerce is set to take off in India, say fund managers. According to a November report by brokerage Motilal Oswal Financial Services Ltd, online sales account for just 0.3% of the $600 billion retail market in India.

“Some over-valuation seems prevalent, but once again, the bet is that India is on the cusp of the consumer Internet take-off and if it does get there in the next 5-7 years, these valuations will seem very very reasonable,” said Reddy.

“One has to understand that all Internet valuations are calculated from exit potential or growth potential in the next 2-3 years.”

GST to take care of many of e-commerce firms’ tax issues

GST to take care of many of e-commerce firms’ tax issues: IT minister Digital India has three components: creation of digital infrastructure, delivering services digitally and digital literacy, says Ravi Shankar Prasad

New Delhi: Ravi Shankar Prasad , who took charge as information technology (IT) and communications minister in May, has received plaudits for sustaining the momentum around Digital India, which aims to provide government services to citizens online and connect villages to high-speed Internet networks to improve governance. But many have been critical about his handling of the telecom sector over spectrum issues, taxation of the rapidly growing e-commerce sector and increasing censorship of the Internet, ostensibly over national security issues and to combat child pornography.

In an interview on Wednesday, Prasad, who is also a lawyer, was categorical that he would not comment on spectrum issues, but insisted that the government is keen to support e-commerce companies. Prasad believes the introduction of the goods and services tax (GST) will help resolve the taxation problems of e-commerce companies. He also spoke about how the new government is balancing freedom of expression and security concerns with Web filtering. Edited excerpts:

How is the Digital India initiative shaping up?

Digital India is designed to bridge the gap between rural and digital (urban) India. India’s growth in IT has been quite urban-centric. We have 900 million mobile connections. Urban is some 40%. Broadband connectivity is also good in major cities, okay in other cities, but there is scope for improvement. Basically, Digital India has three components. One, creation of digital infrastructure. Two, delivering services digitally. Three, digital literacy. Digital connectivity is the logical cue to India’s connectivity. Basically, we are going to connect the rural hinterland with a national optical fibre network. We will link...a total of 250,000 gram panchayats by April 2016. We also have many services available now, like e-district, SWAN (state-wide area network), etc. All these would get metamorphosed into a whole system.

Another issue is digital literacy. Two months ago, the Prime Minister inaugurated a programme in Ranchi under which people will be trained digitally in local languages for 10, 20, 30, 40 hours. For BPL (below poverty line), families will be taught free of charge. We have about 1.5 lakh CSCs (community service centres) in India. I intend to increase this number, because CSCs will become the centres of e-education, e-health, digital literacy and also e-commerce... I want to promote women service centres in a big way—women who are digitally trained. The biggest trophy of my life would be if I can have Dalit women and girls running CSCs in a maha Dalit village. My office and personal staff are already working on that.

I have also told my office to introduce guidelines whereby the establishment of a BPO (business process outsourcing firm) is duly incentivized in a mofussil town like Gorakhpur, Devariya, Sitamarhi, Ahmednagar or Kannur. I have given that mandate to them. For me, Digital India would be incomplete if BPOs are not present in mofussil towns of India.

So you are also talking about making villages smarter along with smarter cities...

Smart city is a defined concept. But for me, a digitally connected village would mean a digitally empowered and digitally literate village. Smartphones have second-largest consumption in India after the US. And no one teaches them. A granny who may not be literate knows what a missed call is. How can we leverage this technology? We see mobile not only as communication facilitator, but also as a device of empowerment.

What about chip manufacturing and electronic clusters?

The chief ministers (of some states) are very excited about electronic clusters too. The whole substance is that if a state government gives 50 acres (for e-clusters), we give Rs.50 crore. If you invest Rs.100, the government of India will give Rs.25. I just laid the foundation of these in Bhopal and Jabalpur. There was a lot of interest from states like Andhra Pradesh, Telangana, Odisha, Tamil Nadu and Rajasthan. We are also pushing the manufacturing of chips, and are in very advanced stages of preparation. I also went to Germany, South Korea; met LG, Samsung and others, and they are excited about India. Two issues emerged from my interaction with them. First, they are worried about China, as far as IP (intellectual property) security is concerned. And I said, India is a very robust democratic country. There is very effective rule of law. We have legal remedies. So I hope big players will come to India and my sense is that they are very keen as well.

Do you see enough private participation in India?

Cisco (chairman and chief executive officer John Chambers) came to meet me, Mark Zuckerberg (founder and CEO of Facebook Inc.) met me. Then Flipkart came… This evening (Wednesday) I had a meeting with the postal department as to how to leverage the postal department’s infinite infrastructure, nearly 1.5 lakh post offices, in the interest of e-commerce. Flipkart and Amazon are in touch with them. I have told them to modernize and to leverage their network in rural areas so that talents of the Indian artisans can be blended with the e-commerce.

I see a lot of role for private players in distribution. If we are able to ensure e-commerce, e-education and e-health ride on this, it will really change the landscape of India. Today, I had a meeting on e-commerce. (I was told that) we do e-commerce worth Rs.70,000 crore in India. The biggest contribution of e-commerce in India, as Sachin Bansal (co-founder) of Flipkart told me, is cash on delivery. It is something unique. As I have always said, in India, you will have rocket science and jugaad technology going side by side. Any policymaker must create an ecosystem so these can exist side by side. We want this cash on delivery, or jugaad, to exist with smart cards.

But if the government is serious about Digital India, how do you plan to solve the discrepancies in taxation that e-commerce companies are facing?

GST will take care of a lot of those issues. We are pushing GST in a very substantial and effective way. Secondly, a lot of these challenges will be answered by the pressure of consumers. Softbank (CEO Masayoshi Son) said there were five million drivers with Alibaba. Once we begin electronic manufacturing in India in a big way, we can give jobs to 20 million people. If e-commerce spreads in India in an effective way, we can give jobs to millions of people. Once this will become evident, then politicians will need to understand that this particular venture should not be caged by uncalled-for regulatory frameworks. GST will take care of this. There is no problem with healthy competition, but the quality of goods and services should be good.

Another issue is that while the Internet user base in India is projected to cross 300 million by December, government policies do not appear to be keeping pace with Internet growth. How do you plan to balance security concerns with data privacy and the right to expression?

The first thing is after 26 May (the day the new government was sworn in), India is a different country. As far as I am concerned, I am all for freedom of press, freedom of expression, from which flows the Internet. But let us not forget, Article 19(1)(a), the fundamental right to expression, is subject to Article 19(2), (the State may make a law imposing “reasonable restrictions” on the exercise of the right to freedom) that can be imposed for the sake of security or public order, etc.

So the constitutional right, which creates the right (to freedom of expression) also creates those conditions under which it can be exercised. But yes, free flow of thoughts must be encouraged.

While I say that, we cannot lose sight of the fact that India is facing a threat from terror. Many of these fringe or terrorist groups have been abusing technology in a very effective way. Therefore, in the case of national security issues, if there is a provision, it should be respected. But these powers should be exercised in the extreme of circumstances. As I have seen, if you have to block any particular website for communal hatred or terrorism, there is a whole mechanism—officers look into it, and finally, the IT secretary has to approve it. So there are whole mechanisms of safeguards available. I am very clear, otherwise, privacy issues of others should be respected. And it is a democracy; people have got the right to express their views, and they can express their views strongly as well as in a very critical manner.

But what about the increase in Web filtering?

The Web filtering part is a rather delicate issue. You have got the right to consider the freedom of expression. When people, children, mothers, come and complain about proliferation of pornographic material, that is because they seek accountability from me. These have been worked out. My instruction is that there should not be any abusive use of it. That’s the bottom of it.

But it is possible that Web filtering can spread to other areas. For instance, India has a central monitoring system that can effectively snoop on citizens...

I am willing to take it on the record, (that) this Web filtering, if at all it happens, will only be used in the extreme provocative situation like pornographic material.

What’s the status of the communication Bill? (The legislation seeks to repeal certain archaic telecom sector laws like the Indian Telegraph Act, 1885, while modifying others like the Cable TV Networks (Regulation) Act 1995 and IT Act (2000)?

I saw a presentation on that. I have asked people to work on it. It is not that straight or simple. The world over, we don’t have such a precedent. Even in most countries that are technologically more advanced, I see there are separate laws for IT, separate for media, etc. This is an issue which requires a more elaborate discussion.

What is your stance on the Loop Telecom issue? Will you have a relook at the merger and acquisition guidelines? (Bharti Airtel Ltd in November abandoned a bid to buy Loop Telecom after failing to secure regulatory approval for the acquisition.)

I will not like to reply on any particular issue, but I have already created a committee, headed by the telecom secretary along with other senior officers, to hear out all the stakeholders and whatever further improvement is required. Whatever we do, we will keep the consumers’ interest in mind and also ensure the growth of the telecom sector. And, if in that process, you need some guidelines to be revisited, we will work it out.

The India Post department aims to cash in on the growing demand for delivery and logistics in the e-commerce space

India Post ramps up operations to handle e-commerce services The department aims to cash in on the growing demand for delivery and logistics in the e-commerce space

India Post has about 1.55 lakh post offices, making it the world’s largest postal network.

New Delhi: India Post is re-inventing itself to cater to the burgeoning e-commerce services industry in the country by setting up data centres, arming the postman with hand-held devices and implementing softwares for facilities like cash on delivery (CoD).

The modernisation project is being supervised by an Inter Ministerial Steering Committee, which includes officials from finance ministry, department of electronics and information technology and other stakeholders, according to sources.

The aim is to cash in on the growing demand for delivery and logistics in the e-commerce space. India Post, with its huge network and experience in handling mail and parcels, is the best agency to provide pan-India delivery service, sources said.

According to market analysts, India’s e-tailing space is estimated to be worth over $6 billion with delivery and logistics comprising around 10-12%.

India Post has about 1.55 lakh post offices, making it the world’s largest postal network. On an average, a post office serves 21.21 sq km area and about 7,175 people.

The project is also looking at providing standard web- based integration system and an end-to-end tracking service for the e-commerce firms. This will also enable the department to undertake large consignments of goods and services.

India Post will also provide hand-held devices to about 15,000 postmen and other hardware in mail offices, with procurement expected to be completed by December 2015. These devices would enable connectivity in rural areas, they said. “Besides, softwares are being created for real time delivery data updation, money remittance systems for Cash on Delivery (CoD)/electronic generation and settlement of bills and interface with tracking systems of railways and airlines for complete visibility,” a source said.

India Post will also have multiple access channels like POS, portal, mobile site and call centre for information, complaint management and article booking.

“To roll out these services, the modernisation project has various initiatives to augment capacities like setting up of data and recovery centres, softwares for money remittances services, etc,” the source added.

A primary data centre has already been operationalised in Mumbai and work is on for a data recovery centre (to be set up in Mysore by December this year).

“Besides, software solutions for mail operations, money remittances (CoD), retail business, inventory management, finance & accounts is being worked on and this is likely to be rolled out by December next year,” sources said.

Communications and IT minister Ravi Shankar Prasad had said India Post with its rural, urban and semi-urban reach was best-suited to offer delivery services to e-commerce players.

Already, the West Bengal circle of the postal department has approached various industrial bodies with a plan to create an online marketplace for local traders.

HUL strengthens e-commerce efforts The firm is working with Kishore Biyani’s Big Bazaar and e-tailers like Amazon and Flipkart to sell its goods through their digital networks

As e-commerce gains scale in the country, India’s largest consumer packaged goods company by sales, Hindustan Unilever Ltd (HUL), is working with modern retailers like Kishore Biyani’s Big Bazaar and e-tailers like Amazon and Flipkart to sell its goods through their digital networks.

“Globally we recognize e-commerce as one of the big transformations taking place and therefore we know we have to create capabilities within our organization to be able to use e-commerce as an important channel,” said Harish Manwani, non-executive chairman of HUL, explaining that the company had put in place a dedicated team to build e-commerce capabilities.

It is adopting a strategy similar to the one it used about a decade ago when modern retail was a relatively new phenomenon in India, Manwani said.

Clothing, food and groceries, consumer durables, mobile phones and IT retailing form about 60% of the organized retail market. Organized retailers have a share of just 2.2% of the overall food and groceries market, said Ajay Srinivasan, director, Crisil Research.

Even in e-commerce, food and groceries retailing is, so far, not among the top five categories bought online. Still, food and beverage makers such as PepsiCo India Holdings Pvt. Ltd, Kellogg India Pvt. Ltd and HUL have started partnering with e-tailers.

“All large FMCG companies like HUL, Pepsi, Kellogg have started to look at digital advertising and selling online as their consumers are gravitating online in terms of seeking information first and subsequently also buying online,” said Vipul Parekh, co-founder, Bigbasket.com, an online groceries retailer that has a presence in Hyderabad, Bangalore and Mumbai and has raised Rs.270 crore in funding.

FMCG is short for fast-moving consumer goods, a category that encompasses packaged foods and household and personal care products.

Accel is likely to start making investments from its new fund before April.

Accel is likely to start making investments from its new fund before April.

Accel Partners India, which has backed companies such as Flipkart, Bookmyshow and TaxiForSure, is close to raising its fourth fund of roughly $250 million as the venture capital firm seeks to invest more in fast-growing e-commerce and technology start-ups, three people familiar with the matter said.

Accel is likely to start making investments from its new fund before April, the people said on condition of anonymity. Accel will invest in e-commerce, mobile technology and Saas (software as a service) start-ups from the fund, the people said.

“For its ongoing investments, Accel has started committing money which will come from its new fund. The old fund is exhausted. Only the paperwork is remaining for the new fund,” said one of the people cited above.

Accel declined to comment.

After a gap of two years, investors have been pouring money into Indian start-ups in 2014 mainly because of the rapid growth in e-commerce. The rapid sales growth of Flipkart and Snapdeal, the high valuations attached to e-commerce firms in general, and the resulting expectation of large exits either through a public offering or acquisitions have prompted the investor rush.

This change in sentiment toward Indian start-ups has helped some VCs and early stage investors such as Lightbox Ventures, Orios Partners and IDG Ventures to close new funds over the past few months.

Accel, too, is an early-stage investor and makes a majority of its new investments in the first two funding rounds in a start-up. For instance, in Flipkart, Accel hasn’t been pumping money on a so-called pro-rata basis; its stake in Flipkart is significantly lower than what it was in 2008, when it first funded the e-tailer.

A $250 million corpus is adequate for an early-stage investor such as Accel, analysts said.

“I would say $250 million is a good amount for an early-stage investor, especially for a country like India where deal sizes tend to be much lower than in the US,” said Mahendra Swarup, managing director and partner at Avigo Capital Partners and former head of Indian Private Equity and Venture Capital Association, an industry body. “An early-stage investor can potentially do more than 15-20 deals with that kind of money. So I’d say they are raising an appropriate amount especially because if you raise too much, it becomes very difficult to deliver good returns.”

Accel India has previously raised three funds totalling $235 million since it acquired the operations of Erasmic Venture Fund in 2008. Erasmic executives Subrata Mitra, Prashanth Prakash and Mahendran Balachandran joined Accel India then and are still partners at the firm. The firm raised its third fund of $155 million in late 2011. They added a fourth partner, Shekhar Kirani, in 2011.

Among Indian venture capital firms (VC) firms, Accel has made some of the smartest bets such as that on Flipkart, now valued at $7 billion; Myntra, which Flipkart acquired for more than $330 million in May; and Bookmyshow, valued over $170 million. Some of the firm’s other valuable investments include software provider Freshdesk and cab booking service TaxiForSure.

The VC firm’s US parent Accel Partners is one of the better known investors in Silicon Valley. Accel Partners was an early investor in Facebook and currently has stakes in fast-growing start-ups including Dropbox and Spotify. Accel Partners US raised two new venture funds totalling roughly $1.5 billion earlier this year.

VC firms such as Accel India and Sequoia Capital India can raise money much more easily than their local rivals due to strong demand among limited partners (LPs) for their US parent funds. LPs, which fund VC firms, are encouraged to invest first in non-US focused funds of firms such as Accel and Sequoia.

“Firms like Accel and Sequoia don’t have to struggle because of their US parentage. They take much lesser time in closing a fund than the local VCs. That’s a big advantage, as they can focus almost entirely on doing deals rather than having to spend too much time raising money for themselves,” Avigo’s Swarup said.

Rock, paper, scissors, er, e-commerce Though few in number, sales of fakes and comedy-inducing deliveries of stones and soaps can harm the image of online retailers

Whatever due diligence e-commerce firms may conduct, once they bring sellers on their sites, they don’t have much control over what is sold and delivered.

 It is a beautiful rock.

Fair, dotted with just about the right amount of colours to show off its geology; the magic that went into its creation when some bit of silicon, a bit of oxygen and the Earth’s crust came together. It sits pretty, gleaming in all its glory, its edges sharp and well-formed. Almost 6cm long, it is a bit bulky. About 2kg perhaps. But boy, if you were to pick it, it fits perfectly in your fist. As if God intended you to have it. And for a moment, just a fleeting moment, it tickles your imagination with the various uses it could be put to.

But then you wouldn’t want to do that. Because this rock is precious. Rs.24,399 to be exact.

It most certainly has travelled thousands of miles to get here—painfully bidding goodbye to its friends and family, facing the vagaries of nature and carefully avoiding any human detection. Humans, you know, with their machines and checks and billion dollar robust systems. But now that it has reached its destination, an address in New Delhi, neatly sealed and concealed in a package, with the solicitude of an e-commerce delivery, its buyer has freaked out.

Her first reaction: “Haaaw, what is this?”

On 27 October, at 11.53pm, the 29-year-old buyer, who spoke on condition of anonymity, placed an order for a Samsung Galaxy Note 3 Neo from flipkart.com.

On 1 November, at about 9.45am, the phone was delivered. Except that there was no phone when she opened the package. It was a rock.

It would be understating it a bit to say that she was shocked. A small family investigation ensued. She wasn’t around when the delivery happened, so who took the package? Her mother. Did the guy who delivered it look suspicious or something? Not really. All her mother recalls is that the guy was wearing a Flipkart T-shirt. He asked her to sign somewhere, she did and off he went. The buyer then reached out to Flipkart customer care and explained what had come to pass. A few apologies and reassurances later, a replacement was ordered. The rock and the package it had arrived in was stored.

What does Flipkart have to say? “With respect to this specific instance, we are investigating the issue and shipping a replacement in the meantime,” said a Flipkart spokesperson.

Now, this is not the first time that a rock has found its way into an e-commerce shipment.

According to online complaint forums, there are complaints about the services of e-commerce firms on a weekly basis.

In March 2013, a Flipkart customer received not one, but a pair of stones, after placing an order for an iPod. Then again, early in 2012, Flipkart had delivered a stone to a customer who had ordered a phone. On October 24 this year, a Snapdeal customer by the name of Laxminarayan Krishnamurthy received a bar of soap instead of the Samsung phone he’d ordered. After complaining on the social media site Facebook, he received a refund from Snapdeal after a week.

“In the said case, we deeply regret the mix up that inconvenienced our customer,” says a Snapdeal spokesperson. “We are investigating the origin of this issue and will get to the root of the cause to rectify this, so that it does not repeat itself in the future.”

To be sure, these instances are extremely rare at Flipkart and Snapdeal and in terms of numbers, these snafus are inconsequential. Flipkart delivered more than 5 million products in September and likely exceeded this number last month.

At Six Sigma levels of quality, a maximum of 17 errors can be made by someone delivering 5 million products. That means Flipkart, going by the evidence on hand, exceeds Six Sigma levels—not something to be sniffed at.

Yet, these snafus are part of a broader problem facing online retailers that is likely to become more troublesome as they add thousands of new sellers over time: ensuring that third-party merchants sell original, first-hand products.

Even globally, online retailers including Amazon, eBay and Alibaba struggle to entirely root out sales of fakes and second-hand products. A French court slapped eBay with a fine of €38.6 million in 2008 for selling fake LVMH bags and clothes. Practically all luxury goods brands have at some point complained of fakes being sold online.

Alibaba had to fire executives in 2011 after it found that these executives had granted special status to more than 2,000 sellers in earlier years, who later cheated customers. In this scandal, the Chinese company also paid more than $2 million to customers from its customer compensation fund, which was set up in 2009 to make amends with shoppers who receive fakes or are not delivered what they were promised.

Though few in number, sales of fakes and comedy-inducing deliveries of stones and soaps can harm the image of online retailers and spread distrust about them. These snafus tend to stick with customers and others who use social media to quickly condemn and criticize sites. For instance, Krishnamurthy’s complaint about getting a soap from Snapdeal was shared by nearly 20,000 people on Facebook.

Okay. Now, let’s get back to the rock. How did it get in there? Perhaps there is a clue in logistics. According to people familiar with the matter, this is how Flipkart’s warehousing works: the company receives lakhs of products at its warehouse from its third-party sellers, primarily WS Retail, distributors and others. These products are already packed and sealed. Flipkart then conducts a series of stringent checks based on the product’s description, height, weight and other similar features. Following these checks, products that pass the tests are moved to “storage” and shipped to customers whenever orders are placed.

The people cited above said that while Flipkart gets most of its orders right, a rogue distributor or seller can escape the company’s quality checks. More importantly, Flipkart doesn’t have supervision over products that are delivered from its sellers’ storage locations.

Now, as things stand today, a third-party merchant is, for lack of a better word, a third-party. The same rules that would apply to, say, a Flipkart, don’t apply to it. So for instance, a third-party merchant is free to procure his goods from just about anywhere: authorized distributor, non-authorized distributor and even the open market. There are no fixed standards, again, on warehousing and delivery. Let’s try and understand this from our rock example.

The seller from whom the buyer bought the rock goes by the name of Gizmogear. According to the seller’s description on flipkart.com, Gizmogear started operations in 2008 as a distribution partner for various mobile phones and IT products. The seller claims that it sells only ‘Genuine and Original products’. Gizmogear has a rating of 78% positive, based on 1,198 ratings.

All kosher, except once you glance over the feedback from some of the customers. On 29 October, Priya Nair wrote: “Please DO NOT purchase anything from this seller gizmogear. I ordered a Samsung Neo for 22,399/- IT TURNED OUT TO BE A SCAM. Pieces of tiles in it!!!”

On 27 October, Ravi Vanga wrote: “Please do not buy from this seller. I got the packet with outer flip kart packing ok but inside the cellphone box seal is open and phone is missing in the box.”

So, a quick question here: when and how does an e-commerce player wake up to realize that a third-party vendor has gone rogue? Companies don’t want to answer this in specifics.

The spokesperson from Flipkart says that before approving a seller, the company has a team that visits the location and conducts a quality check on their products. “Customers can leave reviews and ratings on our site for products and sellers,” says the spokesperson. “These ratings can help other customers make informed purchase decisions. If a seller gets multiple low ratings, then that affects their rank on our site as well.”

Does a seller get de-listed? Flipkart says yes.

A spokeswoman for Amazon India says that the company has metrics to record and measure the extent of the problem, thanks to its experience in other markets. “We also have in place a mystery shopping for these sellers on the platform who list, pack and ship products on their own and we scrub our platform periodically to test random sample products and take action on the sellers. There have been several instances of where sellers have been delisted or courier services changed or impacted,” she adds.

Now in theory, these checks should have spotted the exact moment when the rock chucked out the phone and took its place. Perhaps when it was neatly packed inside the Samsung Galaxy Note 3 box. Or when it was stored. Or when it was shipped. Of course, none of that ever happened.

All of this makes one thing clear: whatever due diligence e-commerce firms may conduct, once they bring sellers on their sites, they don’t have much control over what is sold and delivered. Any action they may take against rogue or inefficient sellers is post the event. This is the inherent challenge of being a marketplace.

Which is probably why the mystery of the rock and the soap remains unsolved. How did they get in there? The smart Bansals at Flipkart and Snapdeal—with their state-of-the-art technology and billions of dollars in investment—are at a loss for now. Well, if only rocks and soaps could speak!

SoftBank may lead fresh $100m funding round for Housing.com

SoftBank may lead fresh $100m funding round for Housing.com





Housing.com, one of the hottest startups to have come out of the IIT-Bombay campus, is close to raising $100 million in a fresh financing round led by Japan's SoftBank, people familiar with the matter told TOI. Existing investors -including New York-based hedge fund Falcon Edge Capital, Nexus Venture Partners and Helion Venture Partners, among others -may also participate in the new round, which would give Housing a leg-up over its competitors. SoftBank has held talks with several Indian startups as it intends to put billions of dollars behind internet companies in the country, a sector which is seeing heightened investor interest over the past year. Last month, SoftBank's founder and chairman Masayoshi Son, on his India visit, had told this newspaper that India is growing very quickly and, with the government's digital vision in place, they will find multiple opportunities for SoftBank to make in vestments in.
When contacted by TOI, Advitiya Sharma, co-founder, Housing, declined to comment, while SoftBank could not be re ached immediately for a comment. In October, the Mumbaibased realty portal had gotten on onboard Falcon Edge, Nirvana Venture Advisors, run by Amit Patni of the Patni family , and Russian tycoon Yuri Milner in his personal capacity , as reported first by TOI in its October 21 edition.
Housing, started by 12 IITBombay graduates, is a mapbased real estate portal that helps people rent, sell and buy houses. Seen as a disruptive house-hunting website because of its technology backbone and heavy focus on data and analytics, Housing competes with the likes of 99acres, Magicbricks, part of the Times Group which publishes this paper, and new-age startups like Bangalore-based Commonfloor.
SoftBank, Tiger may invest in Urban Ladder
Mumbai: Japan's SoftBank and Wall Street investor Tiger Global have held talks to pump in around $50-80 million in furniture e-tailer Urban Ladder which recently got a small investment from Ratan Tata, chairman emeritus, Tata Sons. Formal term sheets, a non-binding agreement between the company and the investors, however, have yet to come in, at least two people familiar with the deal told TOI.They did not want to be quoted as the fund-raise process is still ongoing. When contacted, Ashish Goel, co-founder, Urban Ladder, said he had no comments to offer on the development. Sources said Urban Ladder may be valued at around $200 million. SoftBank and Tiger Global could not be reached immediately for comments. Tata's investment in Urban Ladder, which was announced last week, came just four months after the Bangalore-based startup had raised $21 million.

Snapdeal logs onto rural India

Snapdeal logs onto rural India

New Delhi





Plans Kiosks In Slums, Villages To Tap New-Found Demand

Online retail is poised for a hyper jump into rural India. To go one up on archrival Flipkart, Snapdeal -one of the country's largest etailers -plans to tap 50 lakh low-income households in slums and villages across the country . These include places such as Dharavi (Mumbai), which is Asia's largest slum, Govindpuri, one of the biggest slums in Delhi, and villages in Gujarat, Rajasthan and Haryana, among many others. Snapdeal will launch around 5,000 e-commerce kiosks across 65 cities and 70,000 rural areas by the end of next year with the help of FINO PayTech, an Indian financial inclusion solutions company . These e-commerce centers will be manned by village-level entrepreneurs, have personal computers and tablets, and also serve as collection and delivery points of packages since most people living in these areas usually have no permanent addresses. Additionally, they will help consumers with zero internet connectivity to shop online. “I am going into this thinking that we will be able to reach 5-10 crore new consumers in the next three years,“ Kunal Bahl, co-founder and CEO of Snapdeal, told TOI. At present, Snapdeal has around 3 crore registered users. Interestingly, initial pilot runs by these kiosks have revealed that the average ticket size of purchases by rural consumers is not too far behind that of urban consumers. “It is Rs 1,400 compared to Rs 2,000 from urban areas,“ said Bahl.
Snapdeal will be offering a special assortment of utilitycum-aspirational products, such as speakers, juicers, solar lanterns, diner sets, cameras and mobile phones.These products will be curated on an exclusive page that will require login by a FINO agent, who would place an order, collect payment, receive and deliver to people who have no permanent address.
“This channel has great potential. For instance, we call people from Dharavi the HNIs (high net worth individual) of slums,“ said Rishi Gupta, executive director and COO of FINO PayTech.

Nazara backs gaming startup HashCube

GAME ON - Nazara backs gaming startup HashCube





Mobile game developer and publisher Nazara Technologies is leading the first round of institutional funding in mobile gaming startup HashCube, which counts Google India chief Rajan Anandan and former head of Yahoo India, Sharad Sharma, (through Indian Angel Network) as its early backers. Founded in 2009 by gaming enthusiasts Ramprasad Rajendran and Deepan Chakravarthy, Bangalore-based HashCube Technologies will be the first investment by WestBridge Capital-backed Nazara, which set up a Rs 10 crore fund to invest in gaming startups earlier this year. In June this year, blue chip Silicon Valley venture fund Sequoia Capi tal invested $15 million in Octro, a Delhi-based mobile gaming company. The first rush of venture money in mobile gaming came in the mid-2000s but investor interest waned after the economic crisis of 2007-08. The Rs 4.2 crore series ‘ A’ round of investment in HashCube will also see Perry LaForge, Ah Ventures and existing investors Indian Angel Network and Blume Ventures participate, signalling the renewed interest in the mobile gaming sector as smartphone penetration and mobile data usage grow rapidly in the country.
The Nazara Game Fund aims to support young mobile gaming startups which are yet to be spotted by financial investors. “The attempt is to help startups from the ideation to the VC stage; it’s our way of helping grow the ecosystem,” said Nitish Mittersain, CEO, Nazara Technologies, one of the pioneers in the Indian gaming space having started the company in 2000 after graduating from college. The startup fund size may go up to as much as Rs 100 crore as VCs have shown interest in backing the concept. Mittersain, however, did not elaborate on who the investors would be.
The Mumbai-based Nazara will work closely with HashCube, which has 3 million users, on its Quest mobile game series, the first of which was Sudoku Quest. Additionally, Nazara, which is present across Africa, Middle East and south east Asia, will deploy its distribution networks to market these games globally. With annual revenues of Rs 150 crore, Nazara claims to be clocking in consistent profits which has made it a potential target for strategic investors but Mittersain said for now the company was not evaluating any offers. “We are beefing up our senior management and may look to raise up to $50-75 million to grow the business,” he said. Nazara, which has a user base of 12 million, last raised capital in 2007 from WestBridge, it’s sole investor.
HashCube’s Chakravarthy said, “We are excited to work with Nazara Technologies not just as an investor, but as a strategic partner. Nazara’s expertise in developing and distributing games to a global audience will be a great asset for us.”

'Net user base growing fastest in India'

'Net user base growing fastest in India'





Internet Corporation for Assigned Names and Numbers (ICANN), a nonprofit organization that aims at ensuring a stable, secure and unified global internet, has recently appointed Samiran Gupta as its India head.Through its co-ordination and policy framing for the internet's naming system (domain name system -DNS), ICANN plays an important role in the expansion and evolution of the internet. The appointment comes at a time when the US is gearing up to turn its stewardship of the DNS into a multi-stakeholder community . Gupta shares his views on some key issues:
How do you see India's role in internet penetration, governance and domain names uptake?
We live in a fast-changing world, with the number of internet users increasing tenfold from 1999 to 2013. In 1995, less than 1% of the world population had an internet connection. Today, that number is around 40%.
The growth of internet users has been an explosive one. The one billionth internet user came online in 2005, the second billionth in 2010 and by the end of this year, we will reach the three-billion mark. In fact, it is very likely that these next billion users will mainly come from Asia where we already form almost 50% of the global internet population.
But India needs to catch up.
According to Internet Live Stats, as of July 2014, India had one of the lowest internet penetration rates with only 19% of its population online. However, it has the highest yearly growth rate and currently has the third largest number of internet users globally. The recently approved “Digital India” programme is timely and promises to transform the country into a connected knowledge economy.
What is IDN and what prompted ICANN to usher in IDNs? In your view, what does this mean for India and its internet users?
IDNs, or Internationalized Domain Names, include characters other than the letters of the English alphabet in Latin script, numbers and hyphen.
This means that users will be able to register domain names in local languages.
Earlier this year in August, India launched the IDN ‘dot bharat’ in Devanagari script covering eight languages. This is a huge step forward and, together with the “Digital India” programme, India looks set for the transformation into a connected knowledge economy. India also has this IDN approved by ICANN in Bengali, Gujarati, Gurmukhi, Tamil, Telugu and Urdu.
For a nation with so many languages, most of which are based on non-Latin scripts, IDNs can serve as a powerful tool for broadening India’s internet capacity and accelerate local content delivery and related services in India’s rural and remote areas.
In March this year, the US government announced that it will transition the stewardship of IANA functions. What does this mean?
On March 14, 2014, the US National Telecommunications and Information Administration (NTIA) announced its intention to transfer its stewardship of the Internet Assigned Numbers Authority (IANA) functions to the global multi-stakeholder community. It also requested that ICANN — which is the IANA functions operator and the global DNS coordinator — convene a multi-stakeholder process.
ICANN’s current contract with the NTIA expires in September 2015, and a transition proposal based on community consultation should ideally be presented to the NTIA several months prior to that date. Should a transition proposal not be presented or accepted before the contract expires, the NTIA may extend the IANA contract with ICANN as necessary. Shortly after the NTIA announcement, ICANN launched a multi-stakeholder process and several meetings for discussions have been held at which India has been a participant. As with other stakeholders, we welcome India’s participation.

How to plan for education expenses

How to plan for education expenses





I the Bollywood flick “Three Idiots“, the lead protagonist (Aamir Khan) talks about the education system in India and the pressure a child has from the parents and the ecosystem in which heshe lives.Right from birth, parents want their child to become a doctor, or a pilot, a police officer, an engineer, etc. No wonder this is the most important financial goal in almost every parent's life in India. So much so Raj Malhotra (Amitabh Bachhan) had to withdraw his entire PF money to support his son's higher education in another Hindi movie, “Baghban“ . As a caring parent you would always want your child to get the very best, especially education. When we meet most of the to-be parents or just havebeen parents, the top priority we find is to plan for the child's education. According to a 2011 ET Wealth study , a middle class family spends around Rs 54.75 lakh to raise a kid from cradle to college in a metro city , excluding higher education costs.
When Gaurav Mody and Urvi (names changed) visited us to plan for their one-month-old daughter Dia's education requirement, they were shocked to see the cost of education in today's terms as compared to what they have incurred for themselves. Today , the cost of education for the child starts right from the pre-nursery school and the inflation in education sector is more than 10% annually for the kind of school most parents want to send their kids too.We discussed the cost of Dia's education right from primary to higher education.
We have considered a diversified equity mutual fund for this purpose and an average return of 12% compounded annually . We also assumed that they need to withdraw every year the required amount to fund the respective fees for the year. The table suggests that we need to keep aside Rs 15,000 per month for the next 24 months, which is a total of Rs 43.2 lakh to fund the education goal Based on the table, it is clear that the total cost of education is a whopping Rs 1.6 crore in future value and the idea is to start a regular monthly investment right from today till Dia finishes post-graduation.





Start Saving For Child's Education Early





Not just higher studies & professional courses, schooling costs are rising rapidly too

There was a time when parents hardly planned in advance about how to meet the costs of their children's education, but saved some money for their wedding.Now, thanks mainly to the rising costs of education and competition, parents plan for their children's education. Till a few years ago, parents thought about meeting the costs of higher education. A new trend is emerging now. Financial planners advise new parents to start accumulating funds for meeting their children's education right from their primary school years (see case study by Gajendra Kothari).
According to Nikhil Kothari, director & chief financial planner, Etica Wealth Management, even at the primary level the cost of education is much higher than what it was just a few years ago, and so for parents it always helps to plan early and lessen the financial burden.
For example, a doctor in Navi Mumbai recently found that the entire cost that his father had to undertake for his five years of medical school is almost the same what he and his wife were paying for their five-year old child's one year of education at a good school in their neighbourhood. This is because the rate of inflation for educational costs is much higher than the consumer inflation rate that the government publishes every month, financial planners and advisers say. Compared to an average CPI rate of 7.6% per annum for the last 10 years, cost of education in India has increased by at least 10% per annum during the comparable period, they estimate. The holds true for wedding costs. With lifestyle factors and the need to show off prevalent even more in today's India, the cost escalation of weddings is probably even higher, they say.
So the question is how parents should approach to meet these costs.According to Kothari, they should start saving as early as possible, preferably soon after the child is born. “If you start early, per month you can save less and still meet your target corpus. In comparison more the delay, less bandwidth you have to meet the expenses for your child's education and wedding,“ Kothari said. Depending upon your future requirement and present income, either you yourself can set a target corpus and invest accordingly or seek professional help for a fee.
After you have set the target and put in the investments, the second important thing is to cover yourself adequately . “When you are planning for your child's education and marriage, usually the time horizon is 1520 years or more during which your life's risks would go up. So you should take sufficient cover so that in case anything happens to you, your child will at least be financially secured for his education,“ Kothari said.
The third important thing to include while putting in place a financial plan for child's education and wedding is to have a health cover for the family as a whole. “You should include the child in the health cover because during the initial years the child is more vulnerable to health issues,“ Kothari said.
Financial planners and advisers say that given the long tenure for which parents are required to save for these two purposes, it is advisable to use the systematic investment plan (SIP) route in equity mutual funds. “You are taking a view for 15,20,25 years. It's better to be in equities. Start when your child is born and keep a discipline,“ Kothari said. “Remember that even a delay by a few years can set you back substantially,“ he said.
On the issue of planning for the child's wedding, financial planners say that with families becoming more and more nuclear compared to the joint family structure earlier that took care of part of such expenses, parents need to think more seriously about that too. However, on the positive side, they also pointed out that with young people becoming more independent, increasingly they themselves are deciding on their own wedding and so this is coming out of the domain of the parents.

Burger King, eBay tie up for pre-launch orders

Burger King, eBay tie up for pre-launch orders





Unable to resist the temptation of India's sizzling online growth story , US fast-food giant Burger King has hopped onto the e-commerce bandwagon. The second-largest burger chain in the world (McDonald's is the largest) has partnered eBay India to launch its burgers online even before it has opened the doors of its first store in the country . Consumers will be able to pre-order Burger King's signature burger Whopper, one of the world's most popular five-inch diameter burgers, for a limited time period, which will coincide with the company's store launch. “We thought it's our best bet to reach as many people as possible during our pre-opening days. On our Facebook page, we saw a lot of Indian consumers posting pictures of the Whopper. So, we thought why not offer it online first,“ said Uma Talreja, chief marketing officer, Burger King India. Burger King's first store is slated to open in the national capital on November 9 followed by subsequent launches in Mumbai and 10 other locations. After pre-ordering the Whopper online for Rs 128, select consumers will be able to redeem their coupons at Burger King outlets. The marketing move by the American fast-food chain is the latest among companies offering exclusive pre-ordering online.
Earlier, it was just cell phone makers including Samsung, Motorola and Xiaomi, among others, which tasted immense success. But now, food and beverage brands are also not shying away from taking the online route to stoke pre-launch interest among consumers. In September, Coca-Cola launched its new diet drink Coke Zero online in partnership with Amazon India.
Latif Nathani, MD with eBay India, said that India's ecommerce space would see more such partnerships. “Indians are shifting to e-commerce seriously and even food and beverage companies see this as a major opportunity to reach as many people as possible in the least time. We expect more such deals in the near future,“ he said.

Mukesh gets added role in Flipkart rejig

Mukesh gets added role in Flipkart rejig





Flipkart announced a slew of top management changes on Monday at a time when the country's largest e-commerce player is fighting it out fiercely with Amazon and Snapdeal for a bigger share of the consumer's wallet. Myntra's co-founder Mukesh Bansal and Ankit Nagori, who currently heads Flipkart's marketplace vertical, will both be given additional responsibilities, according to an internal communication sent to Flipkart employees which was reviewed by TOI. Flipkart had acquired the fashion & lifestyle e-tailer Myntra in May this year after which Mukesh had been designated as head of fashion at Flipkart and was given a board seat at the Bangalore-based company. Post the reshuffle, Bansal will now head marketing and take charge of categories like computers and consumer electronics, while Nagori will add general merchandize and books to his existing portfolio.
A Flipkart spokesperson said, “Flipkart is a new age and agile company , and organizational changes are regular for us. Realigning roles and responsibilities help us keep pace with our aggressive growth and the dynamic environment we operate in.“
In the memorandum, Sa chin and Binny Bansal said that Tiger Global's Kalyan Krishnamurthy , who was the interim chief financial officer at Flipkart, will be moving back to the investor's Singapore office. Tiger Global has pumped in funds in the excess of $600 million in Flipkart, making the Wall Street investor by far its largest stakeholder. Krishnamurthy is the director of finance for Tiger's portfolio companies. Flipkart founders said in the internal email, “Kalyan joined us from Tiger Global in 2013, where he managed operations and finance of their global portfolio of companies. We were facing multiple challenges in the business and finance at that time and Kalyan was instrumental in fundamentally changing the business trajectory for us with his passion and drive.“
Additionally , Michael Adnani, VP of retail and head of strategic alliances, and Amitesh Jha, who heads electronics & computers, will both report to Mukesh, the memo said.