Aims to bring automation to the ‘last mile’ in the pharma retail trade, targets to be in 12 states by the end of this fiscal
Viveka Roychowdhury – Mumbai
Bengaluru-based Tarnea Technologies will launch their SmartMile SaaS platform in Mumbai tomorrow, at a select gathering of retail chemists and stockists. The platform, which aims to bring automation to the ‘last mile’ and connecting the entire supply chain, was launched in 2013 and already has its presence in Andhra Pradesh, Karnataka, Telangana, Tamil Nadu, focussing first on Tier II and III towns and more recently in metros.
The company clocked a sales transaction value of around Rs 2.3 billion this June, according to Suresh Satyamurthy, Co Founder, Tarnea Technologies. There are plans to launch it in Delhi during Dussehra, with the product already in pilot runs with very select customers. The company has conducted recces in Rajasthan and Gujarat and aims to be in 12 states by the end of this fiscal. The company is in the process of short listing the next four states.
Backed by early investors like Venkatesh Kini, who is currently the President, Coca-Cola India & Southwest Asia, Deepak Mehrotra, ex-CEO, Micromax and Sanjay Purohit, Managing Director, Levi Strauss India, Tarnea’s platform has benefited from their experience of setting up reliable, transparent and scalable supply chains in India and in the APAC regions.
Though the SmartMile SaaS platform is designed to be used across sectors, the founders chose pharmaceuticals to make their first foray, because they saw a huge opportunity in the visibility and availability challenges facing the sector.
As Satyamurthy puts it, “No other industry in the world has 170,000 SKUs (stock keeping units). If you do a comparison between India and China, the latter has a much more compact pharma sector even though they are geographically six times larger. India’s pharma industry is very fragmented.” They also found that the receptivity of a chemist/ pharmacist to investing in and using such technology is much higher than a nukkad ka kirana walla.
The technology itself is very simple to use and does not require much training, according to Satyamurthy. The value proposition to their customer is very simple. Most chemists already have a computer in their shops but it is currently used solely for billing purposes. The sales pitch highlights that instead of using an older technology which is disconnected from yesterday’s supply chain, the SmartMile SaaS platform, which can run on tablets, mobile phones or even desktop systems, allows reliable inventory control. Thus, what is seen on the computer is on the shelves and this allows the chemist to service customers/ patients better, with no customer turned away due to lack of stock.
Tarnea’s SmartMile SaaS platform’s second value proposition is that it allows even small retailer/ chemists to service high value regular repeat customers better, by using the same tools that any mega retailer would use. For instance, he can register these select customers, offer a loyalty scheme, give him digital services like giving him access on his cell phone and keeping him continuously engaged. Such digital services are currently beyond the reach of individual chemists, points out Satyamurthy.
He reckons that most chemists take just 20-30 minutes to figure out how to use the technology and understand that it makes good business sense. He is firm that his sales teams do not need brochures or powerpoint presentations because they can simply “demo the product and let it speak for itself.” Tarnea sales team has more engineers and professionals with a background in the retail trade rather than in a sales role, according to Satyamurthy.
He does admit that they initially had to overcome a resistance towards automation itself as a large proportion, as much as 87 per cent of the market, does not use any automation. But according to him, this too is diminishing as the use of smartphones and other touch screen interface devices picked up. He recalls some cases, like that of a lady who is an eighth standard dropout and a 65-year old man who had never used a touch screen interface, who are both Tarnea users today. “People are no longer intimidated by technology, when it comes on a mobile phone or tablet with a touch screen interface, which is very intuitive,” he says.
The sales model is referral based, with most existing customers referring fresh ones. The company has just concluded a round of bridge funding and is not planning a Series A funding right now.