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INNOVATORS VS COVID 19

cemX: India’s first Cement Marketplace with an E-commerce Focal Point

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Ashutosh Kumar - Jha & Sourav Chakraborty cemX

We talked to Ashutosh Kumar – Jha & Sourav Chakraborty of cemX, India’s first online platform with offline extension stores where customers can cement of different brands available at the cheapest price. Here is what they said about it. 

First of all, how are you and your family doing in these COVID-19 times? 

Ashutosh Kumar – Jha: We are doing well and staying safe, thank you!

Tell us about you, your career, how you founded cemX.

Sourav Chakraborty: The idea of cemX incepted in the mind of Ashutosh in March 2019, when he saw the inconsistencies in the offline domain of the cement industry and on having a closer look, he realized that the offline supply chain of cement is fragmented, orthodox and unorganized, and it needs a change.

So, Ashutosh did the initial design thinking and did the beta testing in Sitamarhi, Bihar. Later on, I joined, and both of us started building the team at cemX and formed the companys board in October 2019.

Ashutosh Kumar – Jha, Co-Founder & CEO of cemX, holds a B. Tech degree in IT from WBUT, Diploma in Business Analytics, Economics & Financial Accounting from Harvard Business School Online. He has attended Innovation and Entrepreneurship programs at Shenzhen University, China, and Harvard University, USA. During his undergrad days, he ventured into setting up two distinct start-ups as well (Knockstarter & Jha Ventures). Currently, he is also pursuing a Master’s degree (ALM) in Management from Harvard University.

I am the Co-Founder & CBO of cemX and holds a B. Tech degree in ECE from WBUT, an MS in Electrical Engineering from Boston University, and an MSC in Management from Imperial College London, graduating in 2019. I have 3.5 years of full-time experience working for one of Europe’s premier EPC companies, Maire Tecnimont, in Italy. I also hold Chartered Manager certification from CMI, UK, Member of the Royal Institute of Navigation, UK, Chartered Engineer from IET, UK & IEI, India, and was elected a Fellow of the Royal Society for the encouragement of Arts, Commerce, and Manufacturing (FRSA).

How does cemX innovate? 

Ashutosh Kumar – Jha: The cement industry in India was formally established almost 12 decades back in 1904, with all its legacy establishments, logistics, and supply chain specifically designed to cater to a civilization that was untouched by digital and internet revolutions. With the advent of the newer 21st century, the cement industry strangely chose to continue with its conservative and orthodox mechanism of human supply chains for endpoint cement sales. This collusive human-middlemen approach, merged with the ever-growing demands of the Indian middle-class, has led to huge price-arbitraging at the retail points of sale.

cemX, India’s first cement e-commerce, is a B2B online procurement marketplace for cement, with an e-commerce focal point. It is an aggregator platform that facilitates a direct supply channel between the large dealerships of cement and the end consumers that may be a real estate company, builders, or small retailers lower down on the supply chain in the B2B domain while it also targets individual customers. The present Offline supply chain for various materials is fragmented, orthodox, and unorganized. Therefore, by taking the procurement process of cement online into the digital domain, we aim to achieve parity and transparency in cement pricing, thereby removing any arbitrage for offering economies of scale on cement pricing. Procuring cement online at the right price is helping companies, individuals, and retailers to avoid cost overruns to a very large extent. In the usual offline domain, no single cement retailer can sell a wide variety of brands, and it’s a heavily consolidated sector challenged with very strong new-entrant barriers without a huge capital investment.

The B2B domain is starkly differentiated from the B2C segments, as discounts don’t attract the former, but a better price with cash discounts on the bags purchased as that is only available to large dealers/wholesalers of individual brands. It is usually a volume game as the rate to buy 1000 bags of cement is way more economical than buying 50 bags of cement. As an e-commerce aggregator and facilitator, cemX sets itself as the only intermediary digital channel aiming at cost-effectiveness and savings for the BOP sections only in Tier-2 and Tier-3 cities of India.

To appropriately capitalize in the lending-driven cement procurement industry, cemX has partnered with India’s premier NBFC ZESTMONEY to launch a first-of-its-kind holistic approach for quick and affordable EMI options for their end customers. This is the first time a low-cost EMI credit option shall be offered to any Building Material customer to cope with the financing challenges of small and medium builders in Tier 2, Tier 3, and Tier 4 cities of India.

Currently operating in Kolkata, Sitamarhi in Eastern India, cemX has realized a revenue of over INR 1.2 crores (GMV) emerge as one of the foremost e-commerce start-ups from West Bengal. cemX witnessed a consistent monthly average growth of over 120% since January ’20 and a yearly sales turnover of over 3500%. It is selected in the Top10 Best Start-ups in West Bengal by CEOInsights, Top 25 new start-ups of India in 2020 by Timesnext group, Top 6 Con-tech companies in India by BUILT WORLD, Germany, and the Best Con-tech company of Asia by BUILD magazine, UK. Recently was selected in the Top 100 Start-ups of South Asia in 2020 by Lemon Ideas Innopreneurs 2020.

As an aggregator platform, cemX facilitates a direct supply channel between the large distributorships of cement and the end consumers that may be a real estate company, builders, sales all retailers lower down on the supply chain in the B2B domain while it also targets individual customers on the B2C side.

We ensure-

•                         Bringing different brands under one umbrella in a digital easy-to-use setup. Exclusive single-source online distributor minus the middlemen.

•                         Order from anywhere at best competitive price to market

•                         Provide a bargain-free and transparent market (centralized price system).

•                         Hassles and bargain-free cement deals disrupting the orthodox supply chain with demographic limitations.

•                         Help in cost-savings to contractors and end-users by allowing cement purchases at the lowest competitive price.

•                         Guaranteed revenue recovery in the e-commerce digital domain.

•                         Price Uniformity maintained to avoid arbitrage negotiations.

•                         Near-Zero Investment cement store/retailer.

•                         Faster and reliable Delivery.

•                         Cement procurement savings of at least 7.5% for the local businesses and the BOP sections of the Tier-2 and Tier-3 cities of India.

•                         Enabling a D2C platform to empower manufacturers to directly sell to their consumers.

•                           Consumers can buy, track and pay through a single channel at the best rate. They can also leverage cemX’s easy EMI options for their purchases

How the coronavirus pandemic affects your business, and how are you coping? Did you have to make difficult choices, and what are the lessons learned?

Sourav Chakraborty: We had to keep our operation on hiatus for 2 months, approximately when the lockdown was announced last year (2020). As we know, this domain is heavily lending and credit-based industry at the point of sale. One of the major issues we encountered while approaching small-scale builders and contractors was the incumbent credit-recycle approach to cement procurement as for which they were willing to pay a high retail price for the cement procurement. Hence to appropriately capitalize in the lending-driven cement procurement industry, last year, during the lockdown, cemX has partnered with India’s premier NBFC ZESTMONEY to launch a first-of-its-kind holistic approach for quick and affordable EMI options for their end customers. This is the first time a low-cost EMI credit option shall be offered to any Building Material customer to cope with the financing challenges of small and medium builders in Tier 2, Tier 3, and Tier 4 cities of India. The usual cart size varies from INR 5000 to INR 2,00,000 with a repayment period between 1, 2, 3, 6, 9, and 12 months respectively, at a 0.5% interest rate.

Later on, when we started our business operation again in the month of June 2020, our sales got skyrocketed, and currently operating in Kolkata, Sitamarhi in Eastern India, cemX has realized a revenue of over INR 1.2 crores (GMV) emerge as one of the foremost e-commerce start-ups from West Bengal. cemX witnessed a consistent monthly average growth of over 120% since January ’20 and a yearly sales turnover of over 3500%. It is selected in the Top10 Best Start-ups in West Bengal by CEOInsights, Top 25 new start-ups of India in 2020 by Timesnext group, Top 6 Con-tech companies in India by BUILT WORLD, Germany, and the Best Con-tech company of Asia by BUILD magazine, UK. Recently was selected in the Top 100 Start-ups of South Asia in 2020 by Lemon Ideas Innopreneurs 2020. 

What specific tools, software, and management skills are you using to navigate this crisis?

Ashutosh Kumar – Jha: The cement prices offered do not differ from common offline market prices available at the retailers, whereas we are leveraging towards a D2C approach disrupting the human supply chain, thereby guaranteeing the best rates. We are the first movers in this manufacturer-collusive cement procurement domain, where over the last couple of years, we are devising methods of disruption through an e-commerce business focal point. On the other hand, offline manufacturer-affiliated cement Dealers/retailers (our direct competitor) offer competitive prices but are low on convenience and are geographically restrained. Hence, by eradicating middlemen in the Supply Chain through Digital Presence-High Convenience-Best Rates, cemX is uniquely positioned to capture the targeted cement market in India, guaranteeing price uniformity.

Who are your competitors? And how do you plan to stay in the game?

Sourav Chakraborty: As an indirect competition, there are a few companies like BuildSupply, MaterialTree, Infra Market, etc. who operate with a digital convenience model; however, these existing platforms sell an entire gamut of building materials online acting as a match-making platform and do not focus on cement alone. The cement prices offered do not differ from common offline market prices available at the retailers, whereas we are leveraging towards a D2C approach disrupting the human supply chain, thereby guaranteeing the best rates. We are the first movers in this manufacturer-collusive cement procurement domain, where over the last couple of years, we are devising methods of disruption through an e-commerce business focal point. We anticipate big players like Udaan and alike too to make heavy inroads into this domain by 2025 considering the huge untapped opportunities prevalent; we would rather want to consider a Strategic Merger to become the exclusive cement supply channel for them.

Your final thoughts?

Ashutosh Kumar – Jha: By 2025, cemX aims to operate full-fledged in 50 cities across Eastern India (Odisha, NE, Bihar, UP, West Bengal), equal to approximately 12% of the geographical market, equivalent to a minimum of $5.9 million in revenues.

Your website?

https://www.cemx.in/

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