Karma Bhutia, CEO, Founder of iShippo in Conversation with LogiNext


Today we speak with a stalwart in the e-commerce market, a person who led his company, iShippo, to the glory of being rated as one of the top 5 e-commerce start-ups by TechNewsToday, USA. All this in the span of just one and half years. Today we speak with Karma Bhutia, Founder, CEO, Leader at iShippo. He has created his own niche in the constricted and cluttered e-commerce market by exclusively selling handicraft products on his company’s portal. Narendra Modi, Prime Minister of India, endorsed iShippo as an ideal representative of the government’s ‘Make in India’ initiative. Forbes covered iShippo as being India’s answer to Etsy. iShippo also tied up with the Textile Industry to help train artisans and weavers to direct their products through the online channel, so that they could enjoy maximum profits. This list seems endless, but the vision and dream is clear. Karma Bhutia intends to bring a revolution in the handicraft industry while providing quality, locally sourced, products to the customers. Let’s hear from the person himself.


LogiNext Team (LT): We are proud to welcome Mr. Karma Bhutia, as the latest trendsetter to feature in our ‘In Conversation with’ series.


Karma Bhutia (KB): Thank you, it’s a pleasure being here.


LT: Moving to our first question, how do you see the product delivery mechanism as a part of the consumer value proposition?


KB: The way I see it, quicker delivery time coupled with the rising emphasis ascribed to customer satisfaction would improve the customer experience and hence increase the retention rate. Retaining an existing customer is more profitable for a company than acquiring a new customer.


LT: Within the logistics setup of your business model, how do you manage sourcing your products, such as picking-up and delivering them to the distribution center, from the local merchants? Are there some special considerations, in terms of educating your clients, when it comes to grass-root level merchants?


KB: We work with partners with years of experience in dealing with sellers from all strata of our society. Our platform, if not anything, is a nursery for people starting a digital life. As a marketplace, we do not hold any inventory. We are acutely aware that logistics is one of the biggest issues every e-tailer is working to solve. As a policy, we keep engaging with our vendors and our partners to avoid miscommunication. We work collaboratively to calibrate appropriate expectations.


LT: What future technology trends do you think will impact the online buying behavior of the consumers? Will an effective supply chain mechanism improve customer retention?


KB: On the top of mind, I can think of three major trends that would have maximum effect on online buying behavior. The first is Artificial Intelligence and Robotics. These two things are the heart of Extreme Automation which would start percolating into every aspect of our society along with our businesses. You can already see auto-driven cars and drones as a reality. All this would specially impact the industries that use a lot of technology to operate. Simply put, automation would be the key to optimizing all business processes, especially logistics and supply chain.


Secondly, predictive analysis would be a big factor over the next decade. Big data analytics would be able to tell a customer’s likes and dislikes. It would, eventually, reach a start that we will start assigning purchasing decisions to predictive analysis.


Finally, in the future we will have SKY Warehouses like the one recently patented by Amazon, from which drones will provide the last mile delivery infrastructure. This will completely automate the supply chain without any human intervention. This, in turn, would reduce cost of warehousing, delivery and logistics. Until then, using an effective logistics management software can help improve customer retention. If companies provide a reasonably good buying experience at a cheaper cost, they would have the customer’s loyalty.


Recommended read: How does a drone optimize its routes?


LT: Are the e-commerce companies leveraging big data analytics in understanding the consumer buying patterns?


KB: Traditionally, in earlier businesses, analytics were provided only towards the end of the month, where management would sit down and try to figure out what was growing/hurting the business. The decision would be to continue doing the things that grows the business and shutdown what hurts the business. Today, businesses are swamped with data overload. There are number of analytics running in real-time informing the management about the health of the company with respect to sales, marketing, products, services, HR, etc.


Fortunately, technology has evolved simultaneously and this has led to the automation of alerts, notification, responses and critical actionable information. We’re also starting to see more advanced real time analytics, so we can see how customers react while on the site, improving how we make decisions on the spot. This will continue to get more pervasive in the future. Curation, personalization & hyper automation will be a big part of e-commerce moving forward.


LT: How do you think the new e-commerce start-ups should position themselves to compete with current online retail giants and claim their market share?


I’d like to believe that a disruptor to any industry is just 6 months behind. We’ve seen e-commerce companies making investments in developing their own distribution networks, owning the customer experience and bringing down costs. These investments will yield benefits as e-commerce companies leverage their larger customer base. Improved distribution system is expected to reduce the average turnaround time for delivering a product to 1–2 hours compared to the 4–5 days average we have today. Startups should use their smaller footprint to innovate faster and move up the value chain in terms of customer experience. Like I said disruptors are around the corner.


LT: How can you differentiate yourself from other competitors globally?


KB: As a marketplace, we carry hand-crafted products from handloom, fun jewelry, and cool accessories to creative home decor and kitchen items. Everything we carry is handmade and often one of a kind. We ensure our products are produced ethically are sourced sustainably. Our approach is to remain focused on delighting our customers, sellers and stakeholders by providing them an unparalleled experience.


LT: GST is all set to be implemented in 2017, do you think this will impact the E-commerce ecosystem? How?


KB: It will bring down the tax-rate, which will help companies just starting out. Start-ups need VAT registration from sales tax department. Currently, different states impose different fees. GST will bring uniformity in process and will help business to grow faster across multiple states. Implementation of GST will increase VAT limit from Rs 5 lakh to up to Rs 10 lakh, which benefits start-ups.


Start-ups spend time and resources to manage the various taxes at various points. GST will simplify the process by integrating all taxes, making the process of paying tax simpler. Reduction in logistics, storage and transportation cost along with time saved across states as efficiency increases. It would also reduce lead times for transportation of goods.


LT: Thank you for your wonderful insights. It was wonderful having you’re here with us.


KB: It was a pleasure.

Recommended Read: Saurabh Saxena, Founder & CEO, Holachef, In Conversation With LogiNext

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