Tripura: By­pass Through Kolkata

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“Mar­gins and prof­itabil­ity is need of the hour. Af­ter oper­at­ing in Tripura for 10 years, I have re­al­ized that there can­not be any growth in one’s top line in this mar­ket; so its best to se­cure prof­its,” said Sid­darth Dey of Info So­lu­tion Sys­tems.

The lack of dis­trib­u­tors in six of the Seven Sis­ters is a well-known fact by now. As the chan­nel part­ners in five other states of the north-east wail about the lack of dis­trib­u­tors, the CST and road con­di­tions, Tripura opted for a very smart choice; chan­nel part­ners here be­gan sourc­ing most of their ma­te­ri­als from Kolkata in­stead of sourc­ing from Guwahati where they have to pay CST.

Sup­plies to Tripura mostly orig­i­nate from Kolkata where the dis­trib­u­tor (based in Kolkata) has to air the sup­ply rout­ing through Bangladesh while pay­ing an op­ti­mal courier fee for air. Be­sides, a re­gional dis­trib­u­tor get­ting the quo­ta­tion has a choice of rout­ing the same through roads in Bangladesh (tak­ing the Padma cross­ing to en­ter Tripura) and pay a nom­i­nal fee. Sup­plies over the air save a lit­tle less than 0.6% of the ap­prox­i­mate CST val­u­a­tion while the roads ac­count for about 0.87% CST valua- tion dif­fer­ence. Also, pro­vi­sions from Kolkata en­sure that Tripura is well sup­plied when­ever any con­sid­er­able de­mand arises and that the in­ven­tory is well main­tained.

How­ever, it is not an ‘all well’ sce­nario in the state. Only Redington has a sin­gle per­son­nel, with­out an of­fice, to col­lect or­ders, and no other dis­trib­u­tor even has a pres­ence in the state’s cap­i­tal, Agartala.

Presently, the state has 32 chan­nel part­ners with just 4 of them into sub-dis­tri­bu­tion. Af­ter As­sam, Tripura is the only other state in the north-east to have sub-dis­trib­u­tors, but each one of them has a very unim­pres­sive top line to share.

“Mar­gins and prof­itabil­ity is need of the hour. Af­ter oper­at­ing in Tripura for 10 years, I have re­al­ized that there can­not be any growth in one’s top line in this mar­ket; so its best to se­cure prof­its,” said Sid­darth Dey of Info So­lu­tion Sys­tems.

Com­ing to the mar­ket strength, growth in the state is neg­a­tive, with some prom­i­nent play­ers like First In­fotech and Sigma Sys­tems los­ing out on top line in the last fi­nan­cial year. Over the ver­ti­cals, like all other Sis­ters, re­tail oc­cu­pies the prime slot at 74%, fol­lowed by the ed­u­ca­tion ver­ti­cal at 17%. The rest is filled up by the state gov­ern­ment, SMBs and other mi­nor ver­ti­cals oper­at­ing in the state.

As an ex­cep­tion to most of the north-eastern states, the gov­ern­ment con­trib­utes a neg­li­gi­ble pro­por­tion to the chan­nels, as most of the projects are di­rectly catered by the prin­ci­pal com­pa­nies or their sales and ser­vice part­ners in Guwahati. State gov­ern­ment spends

` 71.26 crore (as in An­nual Bud­get 2012) over IT ten­ders, pro­cure­ment and main­te­nance, of which only ` 5.2 crore is routed into chan­nels.

In terms of val­u­a­tion, the mar­ket stands at ` 4.8 crore ev­ery month where the pe­riph­er­als seg­ment scores just ` 0.4 crore less than the lap­top rev­enue con­tri­bu­tion. From the brands per­spec­tive, HP main­tains its strong hold in the state fol­lowed by Dell and Asus.

“There has not been much of a change in the mar­ket mo­men­tum over the past four years. Things in the north-east move at a slow pace and Tripura is no ex­cep­tion. Trade and eth­i­cal is­sues do not hap­pen much here or are not rel­e­vant much to this mar­ket,” Dey added.

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