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Ecommerce in India is a growing phenomenon. With successful Indian eCommerce companies like Flipkart selling products across categories, other Indian online retailers have also found niche markets to capitalize on, such as Nirogam, an ayurvedic product eTailer.
One such niche eTailer is Kobster, an online “one stop shop” for the office supply needs of Indian corporates. By focusing on a specialty market that has seen, and is guaranteed to see, increasing demand in the upcoming years, Kobster has become one of India’s hot eCommerce startups. Customers include Freshdesk, inLogic, ArrayShield and many more. Chennai businesses constitute their first major focus.
With product categories ranging from quintessential office supplies to cleaning supplies, vending machines, furniture and customizable printed products, Kobster has positioned itself as the Staples of India.
Offering flexible payment options such as cash on delivery, net banking and 21 days of credit for corporations, Kobster accommodates all levels of customer needs. They even offer free shipping on certain purchases.
Behind Kobster
There are three musketeers, Vineet Neeraj, Karthik Ramaiah and Mohan Gayam, three college school chums from SRM University.
After knowing each other for over seven years and having worked together on college projects, Vineet, Karthik and Mohan Gayam launched Kobster. Each founder manages a different aspect of the business: Vineet watches over marketing and sales, Karthik manages the technical aspects along with customer support and Mohan strengthens their product catalogue, ensuring the best deals from suppliers.
Before launching in September of 2012, Karthik worked at Cognizant and Mohan at HCL Technologies. Vineet, on the other hand, is no stranger to the startup world. He launched his first startup, Yippie, providing event services, before switching to a product startup, ArrayShield, based out of Chennai.
Runway to Success
Barely nine months old, the company has been selected as one of the 27 companies for “Runway to Success,” an event sponsored by Luftansa and ET NOW, a reality TV program that recognizes startups with promising business plans.
With an annual growth rate of 15-20%, the Indian market for office supplies and services is an appealing niche. Vineet says:
A Google India Survey states that 71% of SMEs use the Internet to search for vendors and suppliers. So far India has witnessed the rise of B2C eCommerce. Now, we believe that the next boom will happen in B2B eCommerce and we are excited to be in this space.
In the next five years, the company plans on expanding from Chennai, where they are headquartered, to ten different cities in India. They also plan to strengthen their product categories by extending their offerings to different customer marketplaces such as hospitals and hotels.
The American office supplies behemoths are not present India. There are other startups in the market though, and the category is becoming quite popular among entrepreneurs.
Also, now that foreign retailers are coming to India, the future of foreign eCommerce investment in the Indian marketplace is poised for change.
Meanwhile, Kobster has an opportunity to build upon its early entry, create compelling technology with which to develop customer stickiness. Also, in a business that is inherently low-margin, commercially viable supplier relationships are critical. In India, logistics are still rather messy. Small startups have to handle complex supply chain and delivery issues, without the support of robust logistics companies.
By 2020, I suspect many of these issues will get sorted out and a set of successful eCommerce brands will establish themselves and Kobster is working hard to be one of those.
Aira Bongco
This is a great example of how a simple need (like that of office supplies) can be great business if you know how to market it right. Kobster did it by selling these things online. It really depends on trying. At the beginning, you’ll think that it will not work. But since there are a lot of Indians who are now buying online, this has just gotten easier.