B Swaminathan, Associate Editor catches up with Byju Pillai, President & CEO, Inflow Technologies , one of the few biggies in the Indian IT distribution. Byju discusses various aspects on how he want to see his company in the near future and the key trends of the IT industry that decides 2016. Excerpts.
B Swaminathan (Swami): What, according to you, are the key challenges a national distributor face in Indian market scenario
Byju Pillai (Byju)
- Distributors have a key role in ensuring that statutory obligations are taken care of as per the law of the land. With constant changes to various taxation related laws, Distributors need to be sure that they are constantly updated and are compliant
- Distributors also have a role in ensuring that not just their employees, but the entire eco-system (partners, vendors) understand the law of the land
- As the volume of business increases, managing credit expectations of the market at the same time ensuring that partners with genuine needs are supported
- Considering that any distributor would have a variety of vendors in terms of revenue – range could be as diversified as vendors with > USD 100Mn revenue and certain vendors with < USD 1Mn revenue, setting vendor expectations and delivering the same
- While man power cost in India is lower, all other key cost like finance cost, in-country freight cost, credit insurance cost are on higher – managing profitability at current margin levels
Swami:You have different business units within Inflow. Which is the easiest BU and the challenging BU within your organization?
Byju: Each BU has its own challenges.Largely it is around, spending time with vendor to understand and articulate their expectations, then build plans and put in a team to execute the same
Swami:There is an overall thought amongst both the vendor and channel fraternity that the national distributors should do something innovatively. How in Inflow, you are innovating a step ahead of a routine distributor.
Byju: We have an innovative vendor extension biz model wherein we pick and choose our value add offering based on the vendor need.Our ability to provide “Professional Services” is a big value add to both vendors and channel partners. There is a constant innovation with respect time credit management – here distributors need to balance between risk, their cash flow / working capital and need to support genuine partners / transactions.
Swami:In the current business scenario, the lines between the vendor and a customer are blurring, please let us know, what the regional distributors and customer-facing channel partners should evolve themselves to tackle the changing business climate?
Byju: Understanding customer needs, their budgets and then offer a solution that meets customer requirement.Be a consultant / trusted advisor to your customer.Build technical capabilities and invest on skill. People management – ability to retain talent and commit what you can and honor the commitments give.
Swami: What are the top 5 plans for inflow technologies in the next calendar year?
- Continue our current share in Networking, Information Security and AIDC & POS
- Grow faster than the industry and gain market share in Electronic Security (Surveillance) & Storage
- Focus and grow our Services offering to channels
- Increase geographical coverage to Tier 3 cities
- Improve efficiency and productivity through automation
Swami: Your take on the GST bill
Byju: We are looking forward to a quick roll out of GST in the country.We believe the additional 1% tax proposed to be levied on movement bog goods across states is not right as interstate trade will become more expensive & therefore difficult to manage for traders & consumers also will end up paying more for such goods. Keeping petroleum & alcohol outside the purview of this bill is also not correct. These two points go against the very principle concept of GST. Upon implementation, we expect that it would take 2 to 3 quarters to streamline operations.
Swami: What are the top 5 tech predictions in the IT channel industry in 2016
- Cloud numbers will keep rising.
- Analytics (Big Data) opportunities will start to be adopted by the channel
- Smartphone margins are expected to drop.
- Opportunities for channel because of HP & Symantec split & Dell-EMC merger.
- Information security & Wireless numbers will continue to be high growth areas.