The Connoisseur

After establishing himself as a great reseller and retailer, Rajiv Gupta, Director, Enterprise Solutions, Sara Infoway is now all set to phase out retail and reap the benefits of consulting, finds Megha Banduni

Rajiv Gupta

Having been born and brought up in a big business family, Rajiv Gupta could have enjoyed his luxurious life by following his legacy business. But the determination to do something on his own made him launch his own company - Sara Infoway. 1998 was a year when IT industry was booming and Gupta thought it was the best time to start a business in IT. With a mere Rs 200, he established Sara Infoway and recorded a turnover of Rs 20 lakh in the same year. Its current turnover is Rs 10 crore and he is aiming for 30 per cent year-on-year growth.

Initially, the company catered only to the SoHo segment by selling products like PCs and peripherals. Today Sara Infoway is a leading provider in South India involved in comprehensive infrastructure assessment and consulting, implementation and migration, project and program management, security, and support services to various organisations.

The year 1999 was a turning point in Sara Infoway's success, when Gupta formed a partnership with HCL and took PCs to homes through retail activity. There was no looking back.

Today, reselling is the largest revenue generator business for Sara Infoway. 70 per cent of its business comes from reselling and 20 per cent from consulting; retailing contributes only 10 per cent.

The early days of struggle

A science graduate from Delhi University, Gupta came to Hyderabad in 1990 to start his career with Magna International. He started from production, and then moved into techno commercials, where he got a real feel of the user requirement. This was when he developed interest in marketing and thought of starting his own business.

The greatest challenge for Gupta was to understand product lines, customer requirements and various techniques to reach the masses. The strategy that he built was to identify a niche area and different methods to cater to that area effectively. From analysis he concluded that selling home PCs for the SOHO segment would do magic for the company. Considering this opportunity, he strategised door-to-door selling, followed by a number of road shows, schemes and promotional activities.

"From inception, our focus had been on providing solutions not products and that's the key to our success," says Gupta.

Sara Infoway has always been early adopters of technology. It was the first to have a completely wireless showroom.

The founder of retail in South

Gupta proudly says, "I was known as the founder of retail after we initiated a concept called 'Compaq on Wheels' in 1998, where I converted a Maruti van into a demo van." The concept won various awards.

In 2001, Sara Infoway opened a retail outlet called 'Red Planet' and became distributors for HCL. The focus was to ensure a lot of displays and demonstrations for all big brands. He also launched some schemes like Gizmos, where the showroom showcased technologies like wireless and Bluetooth for nearly one and a half month, and it was a huge success.

Another such marketing concept was 'Retailing in Retail', conducted for HCL Bean Stalk. The company bagged several awards as the best value added reseller in the SMB segment.

Sara Infoway started off very well, but realising that retail in India is not a sustainable business, Gupta consciously shifted his focus to consulting. In his words, "Every retailer appears to be doing well and accruing good profits but the fact is that their balance sheets are quite dreadful."

Retail phasing out

Gupta explains, "With players like Reliance and concepts like e-zone coming in, players like us will be left with a small per centage of business to do."

Gupta has done a lot of study and research on retail in India and after discussing it with various peer groups and industry watchers, he has come to a conclusion that organized retail will not be good news for channel community in India.

Now the company has shifted its focus completely to consulting. "I realised that SMB has a huge requirement for IT, but there is a big gap in what they want and what they are getting. They need better service and consultation," explains Gupta.

He has developed a concept called 'Aligning IT with business roles', where the company offers enterprise class yet cost-effective solutions for SMBs to implement IT effectively in their organisation. This is followed by a proper integration of solutions and training.

Gupta opines, "Consulting is like a tailor-made garment, where the product is made as per the customer requirement, unlike the readymade garment, where you have to fit your requirement to the product." In India, it's difficult to convince people to buy consulting. Even today they feel it should be free.

Gupta feels consulting has scope to grow. In his words, "In distribution/ selling business, I feel there is a restricted scope to grow. You can only grow in product lines but in consulting you enhance your knowledge every time you meet a new customer. Also, it's a niche area and your bottom line is greater and safer here."

Favorite management philosophy: Nothing is impossible Favorite Hobby: Learning through various methods Favorite book & Author: ‘Mind of the strategist’ by Kenichi Ohmae. Favorite cuisine: Anything vegetarian Favorite holiday destination: Anywhere, but only with my family Ambition in life: To build a business empire

Consulting and reselling to go hand-in-hand

So, will Sara Infoway phase out its re-selling business too? Gupta replies, "Reselling is also like consulting. It is not just about selling the products.

The approach that we use is more of consulting, where we guide the customers on what to buy, why, and how much, etc."

Reselling is the largest revenue generator for Sara Infoway. It has been focusing on products like computing, security and networking and now its major focus will be on mobility products/ solutions due to growing demand.

The company has partnered with more than 15 ISVs and solution providers to provide a range of solutions from small messaging system to connectivity to enterprise business applications like ERP, CRM, etc. The most recent focus is on taking up facility management for its customers.

Says Gupta, "The challenge in this business is that ISVs often don't understand the consulting business well. They don't think out of the box. Their focus is merely on selling their products. Providing them value adds for their products helps them think out of the box."

Fighting all hurdles

Success never comes with ease. Gupta narrates how hurdles that came on his way could have shattered him, but strong willpower and fighting spirit helped him lead from the front. Sara Infoway was accruing good profits and then came a crushing moment in Gupta's life. In 2001 he lost an arm in an accident. He was bedridden for 25 days.

He reminisces, "My business partner dumped me on the day of the accident itself. We lost lots of money because of fraud. But I knew very clearly that we had to go on, we had to fight. It's a war, we have to win it."

Success mantra

From his experience, Gupta advises, "Never feel ashamed in meeting your smallest customer even after you grow very big. This is how success will come to you automatically."

"My success mantra is always to focus on customers, be very open, frank and truthful with them," says Gupta.

"We ensure our bottom lines by focusing on solution based customers and enterprise solutions for SMB customers," he adds.

One of the key strategies to sustain bottom lines was to do upselling, which is selling more than what the customer has asked for. For instance, if customer wants product X, we offer him XX. His second strategy was to gain reference customers.

He believes in Mahatma Gandhi's philosophy that says 'A customer is a god in your premise' and his own philosophy is that one should think like a buyer and not like a seller.

"I have built 'delighted customers' in so many years and that's my strength," says Gupta. Currently, Sara Infoway has 14 customers in consulting. All of them are India clients and Gupta aspires to explore international customers too.

Sara's vital stats

Year of Establishment: 1998 Key vendors: Microsoft, HP Key customer segments: SMB Employee strength: 45

Win-win situation

Sara Infoway has bagged some big projects in consulting. One such was in November 2005, involving IT optimisation for a Rs 200 crore company. The project involved analysing their current IT infrastructure, business requirements, aligning business with IT and providing them with best practices. "We helped them in designing their complete IT infrastructure and I am glad to say that they are still using the same IT plan," says Gupta.

Another project in 2005 was evaluating a product for an American company that wanted to launch it in India. The project involved product analysis, preparing market feasibility report and designing market roadmap.

Currently Gupta is working on an infrastructure design project for a large Hyderabad based company. It's a five-year project that involves integration of data, voice, video connectivity, networking, etc.

Gupta feels that consulting is not an easy job. He ensures that his team update themselves daily on various technologies through product training, technology training, e-learning, reading, and surfing.

The current strength of his team is 45, which he plans to increase by 10 per cent to 20 per cent year-on-year.

The team is being divided into three segments-volume business, production solutions and project solutions. Also, they have a separate division for services like customer care, facility management, and training.

The road ahead

Consulting space has infinite scope and opportunity, feels Gupta and he is confident that his bottom lines in consulting will grow. He explains, "If you have health problems, you need to visit a doctor, if you have legal issues you see a lawyer and if you have an IT problem, you definitely need a consultant."

Sara Infoway has established itself in Hyderabad and now wants to focus on other regions as well. It will focus on the south of India first then spread across the nation.

Gupta's vision is to set up a Proof Of Concept (POC) lab for the customers where the company will take up projects for clients to see the benefits that accrue after implementation.