How B2B marketplace ProcMart helps companies manage high tail-end spend
In an exclusive interaction, Anish Popli, founder and CEO of ProcMart talks about business growth, clients, expansion plans, idea behind ProcMart, solutions and the disruptions planned.
February 3, 2022: ProcMart is one of India’s largest online B2B marketplaces launched in 2015 to provide an ecosystem that connects a variety of stakeholders through an easy-to-use interface. Purchase order management, contract administration, master data management, e-catalog management, compliance tracking, sourcing support, market intelligence, contracting, tail spend management, KPI, and category management are amongst the key services offered by ProcMart.
Anish Popli is the chief executive officer & founder of ProcMart (Instant Procurement Services). He is an alumnus of NIT Trichy and worked with Bharat Heavy Electricals at project engineering management department for 4.5 years. He was involved in the implementation of ERP systems at BHEL and that’s where he came across technological solutions for procurement. He did an MBA degree in marketing and finance from IIM Lucknow and then joined Energo Engineering as head of business development. He wanted to start something of his own and ProcMart was his call of doing something that he wished to do and solve a real-life problem of unstructured procurement in the corporates.
In an exclusive interaction, he talks about business growth, clients, expansion plans, idea behind ProcMart, solutions and the disruptions planned.
How has the year 2021 been for the company in terms of business (major highlights and low points)? Please share figures like revenue, sales, growth over last year, GMV, and so on?
ProcMart saw a 2X high jump in revenue in the FY21. During the ongoing year, the company is maintaining its run and the frist two quarters of FY22 saw a jump of 2.5X over last year’s revenue. Almost 80 percent of ProcMart’s revenues were made through the sale of industrial equipment and supplies, while the remaining came from sales of office/IT supplies.
Expenses incurred in the procurement of industrial goods and other related stock in trade was the largest cost centre for ProcMart, making up 87.5 percent of annual costs. These expenses grew in line with sales. The company has managed to grow its scale of operations significantly during the last two years and expanded its employee base to harness growth. As a result, employee benefit payments have grown over 2X year-on-year.
We picked our markets carefully and have increased our presence to 6 new locations in the past 2 years.
ProcMart has been making a profit for the last 3 years and their financial numbers emphasized the fact that the growth can be hacked without burning money. Importantly, it’s one of the rare start-ups to grow 100 percent YoY without making losses. Profit of ProcMart has increased 3X YoY and the same is observed in the first 2 quarters of FY22.
Also read: ProcMart launches VMI App to assist clients in effectively manage inventory and avoid stock-outs
Who does your business typically cater to? Who are your clients?
Our clients mostly include Fortune 500 companies with high tail-end spend management as customers can get benefits from volume aggregations, domain expertise as well as demand and specification management. With the growing need for category specialists, we provide a wide network of services with an unbeatable combination of our in-depth knowledge, technology, customer base, and backend support facilities, to such organizations.
Our clientele includes corporates across FMCG, consumer durables, pharmaceuticals, automotive and oil & gas. To name a few we work with giants like Colgate, Nestle, Legrand, Avery Dennison, LG India, Harman, Samsung, Kelloggs, Cipla and PepsiCo, among others.
"Through vendor consolidation, the platform strives to engage with suppliers to create a procurement environment that is fully accessible and transparent."
What are the immediate and long-term expansion plans for ProcMart?
We’re currently operational across 11 cities in India and are working towards opening 10 new fully functional offices in the upcoming months. Thus, in the next two years we are expecting to have at least one office in every state of India. Also in the subsequent year, we have planned to open our international offices in Vietnam, Australia and Thailand. In the next two years,
ProcMart is expecting to have at least one office in every state of India.
We are all set to introduce white label products with the ProcMart brand for PPE categories by 2022. We are also expanding our product offerings and we will be including packaging and construction equipment in the next 3 years.
Tell us about your venture? What was the idea behind launching ProcMart?
I wanted to address the issue of high operational and logistics costs, unorganized supply systems, lack of quality assurance and monitoring in this industry. Furthermore, it was difficult for the companies to maintain a tab of multiple points of contact. Thus, with the team of diverse and talented people, we started with working on Google sheets initially and gradually grew strength to strength in this field and now we are spread across India and Malaysia with 11 operational offices along with our own cloud platform which supports and caters to all of our services.
We have created one of India’s biggest B2B marketplace which connects buyers and sellers through an easy-to-use application, enabling buyers to procure effectively and giving sellers huge opportunities to submit the bids and explore new opportunities. ProcMart primarily acts as an aggregator or service-based e-commerce platform that helps organizations to select the right procurement technology solutions in line with their business.
Through vendor consolidation, the platform strives to engage with suppliers to create a procurement environment that is fully accessible and transparent.
"I wanted to address the issue of high operational and logistics costs, unorganized supply systems, lack of quality assurance and monitoring in this industry."
How you are planning to disrupt the procurement and supply sector with your venture?
We plan to disrupt the procurement and supply chain sectors with the combination of expertise, technology, customer focus and support facilities. We aim to offer semi-customizable plans to maintain a healthy balance between customer satisfaction and scalability and some of the key solutions include:
• Vendor Consolidations: We collaborate with suppliers to build a procurement environment that is both comprehensible and accessible
• Unified Approaches: Consolidation of suppliers allow us to offer efficient and effective procurement solutions
• Digitized Procurement: It helps to analyse purchase methods, consumption models and supplier interactions with greater depth
• Easy Integrations: We simultaneously integrate with several softwares such as SAP ARIBA, E-Invoicing, E-way bills among others
• E-Cataloging & Inventory Solutions: It helps to improve product data reliability, updating and relevancy, as well as significant cost savings in data processing processes
"We aim to eradicate problems in the supply chain industry such as highly fragmented and unorganized data of suppliers."
What are your priorities in terms of the solutions provided?
Corporates need greater predictability, cost efficiency and agility to their procurement practice for indirect purchase. There are a lot of recurring issues that need to be looked upon while operating in this industry. We aim to eradicate problems in the supply chain industry such as highly fragmented and unorganized data of suppliers, tedious process of managing multiple suppliers, absence of centralized spend monitoring, Lack of visibility and multiple POCs across various locations.
Thus, ProcMart has helped businesses reduce inventory holding costs and improve cash flow without compromising part availability, optimizing re-order parameters such as safety stock and safety time with necessary confidence levels. We have improved supplier management and negotiations through enhanced understanding of supplier performance, simulating effects of changes in order parameters on supplier performance KPIs.
ProcMart has also increased visibility into critical uncertainties such as seasonality, uncertainty in arrivals, potential quality issues with suppliers, transportation bottlenecks, and production-line disruptions. We have successfully enhanced organizational efficiency through a shared view across various departments (e.g., material management, supplier management, logistics management), leading to an optimized inventory aligned with organizational goals.
We have also gained productivity of inventory analysts through automated recommendations based on new data and live integration with operational systems and have consistently applied offers to supplier orders.
Lastly, we have streamlined reporting for quarterly/annual reviews, and financial audits, minimizing total landed costs that include standard and expedited shipping costs resulting from reduced inventory in the supply chain.
Has Covid-19 impacted your business in any manner?
The pandemic came with its own challenges but we knew that we should go beyond our abilities and rise to these challenges. From gloves and PPE kits to other Covid associated products, we went the extra mile and offered our customers a bouquet of Covid associated products. We offered end-to-end procurement support to help people and organizations rise to the hurdles posed by the pandemic. Through this initiative, organizations were able to save over 30 percent of logistics and other indirect costs when it came to procuring PPEs. Additionally, we ramped up mask procurement by over 18 times and ensured that we were able to at least meet a portion of the demand required by the sector.