Small and mid-sized IT firms in Bengal focus on niche products

| Updated on: Apr 24, 2011

‘Lack of effective sales and marketing personnel, the inability to focus on a single niche product and lack of understanding about the market remain areas of concern for the emerging companies.'

They are few in numbers, yet they are the new and innovative faces of West Bengal's IT industry which is traditionally dominated by the offshore software development and business process outsourcing (BPOs) service providers.

An increasing number of small and mid-sized companies, mostly driven by young professionals, are focussing on niche products and services for both domestic as well as export markets.

According to data prepared by National Association of Software and Services Companies (Nasscom) amongst its 47 small and mid-sized member companies in West Bengal, almost 76 per cent of them are into offshore software development, 9 per cent into Internet marketing and SEO (Search Engine Optimization) services and the remaining in BPO.

Niche products

Mr Suparno Moitra, regional manager (East), Nasscom said: “The focus of some of the emerging mid-sized companies are on niche products. Concentrating on a single product or service will always be beneficial for them.”

Interestingly, his words find reflection in some of the small and mid-sized companies doing well in their respective fields.

Communet Infosystems Pvt Ltd, a three-year-old company, which is into digital kiosk making that recorded a turnover of around Rs 45 lakh in 2009-10, has closed the previous fiscal with a turnover of nearly Rs 2.5 crore – almost 600 per cent growth. It has a clientele like the West Bengal State Electricity Distribution Company Ltd and Indian Railways.

“We have seen tremendous growth in these years. Compared with our first year of operation we have grown 18 times,” Mr Bodhisattva Banerjee, Director, Communet, told Business Line .

Another company, Lexplosion Solutions Pvt Ltd – offering compliance management services – too has seen a three-fold growth in revenue during the last one year. From having an insignificant turnover in the initial years of 2007-08, the company has closed 2010 -11 with an expected revenue of Rs 3 crore.

“Initially the company was not well accepted. But opportunities in this field have grown during the past two to three years,” Mr Indraneil Choudhury, Chief Executive Officer, Lexplosion, said.

Similarly, IT Orbital Global Outsourcing, which is into digitisation and provides back-end support to publishers for e-books, is hoping to build on its 50 per cent growth in the coming years.

The company, which had insignificant revenues in its initial years of formation, has clocked revenues of nearly Rs 80 lakh and Rs 1.25 crore in 2009-10 and 2010-11. The company has been providing digitisation services from November 2008.

Loss of Focus

Industry sources, however, point out that in some cases lack of effective sales and marketing personnel, the inability to focus on a single niche product and lack of understanding about the market remain areas of concern for the emerging companies.

According to Mr Moitra, Nasscom does mentor a lot of companies to overcome the challenges. Moreover, Nasscom, which has been advocating companies to focus on niche products and services, will also organise focused programmes for the small and mid-sized companies.

Published on April 24, 2011

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