Emerging Entrepreneurs

Matching capacity demand and supply

Parimala S Rao | Updated on February 19, 2018

JAYESH DESAI, Founder, Shareeconomy

B2B platform Shareconomy offers MSMEs a variety of other services too

A chance meeting with Patanjali Ayurved founder Baba Ramdev triggered a transformational idea for Jayesh Desai. When the guru visited Surat for a yoga camp, Desai, Founder and Chairman of Rajhans (Desai-Jain) Group, took him to visit the group’s new chocolate plant. The Baba asked if he could produce milk chocolate for Patanjali using cow’s milk.

“There was no reason to say no, and I figured this could be an instance of one company using the spare capacity of another,” recalls Jayesh, adding that this led to the idea of Shareconomy, a group vertical.

Starting with a small edible oil factory in 1996, the Surat-based Rajhans (Desai-Jain) group is now a ₹6,500-crore business house with operations across realty, entertainment, confectionery, hospitality and textile sectors. In November 2015, it launched Shareconomy, a B2B e-commerce platform to bridge the big gap in availability of industrial capacity vis-à-vis demand for it by connecting capacity owners with capacity seekers.

“In a sector with high capital inflow, under-utilisation of facilities leads to losses, not only for an individual but for the nation as well,” explains Jayesh.

Value-added services

“As we progressed, enquiries from users showed that the platform need not be limited to capacity identification and match-making. We now help improve business operations across sectors by advising on company formation, financial and technical due diligence, product development and quality audit,” says Jayesh.

MSMEs are the target customers as many of them are unable to raise funds from the market to expand operations. MSMEs log on to the website and create an account, which is free of cost.

Shareconomy then provides them a list of capacities, from which they shortlist those that suit them. Capacity seekers/MSMEs, in turn, post their needs and find the best option from the capacity owners registered on the platform.

Benefits, safeguards

Jayesh explains: “If you look at the trend, manufacturing management for big companies is expensive; it’s easier to get it outsourced. Be it food, pharma, garment, apparels, consumer durables or automobile industry, everybody is opting for outsourcing.”

The advantages, he says, are that people can start without capital investment, they avoid building up overheads and they can save on logistics and inventory management by having plants at different locations.

Giving the example of snack products, he says: “One truck can accommodate only 3-5 tonnes of material. Transporting this quantity from Gujarat to, say, Delhi becomes unviable, so it makes sense to have the facility close to the market to avoid such costs.”

And though the connection may happen online between owner and seeker, the relationship doesn’t end with one interaction. Both parties spend substantial time defining the work contract, and it is vetted by quality assurance, financial and legal experts. Only then is the work awarded.

How come overseas clients are using such services? Is it cost-competitive for them to Make in India? Jayesh says the cost of skilled manpower in any developed nation is several times that in our country. This is why Baker Perkins UK shortlisted and approved a vendor in Pune to manufacture machinery components for them in India.

Alan Woodbridge, of Baker Perkins, says: “It saves time and helps us do business with peace of mind. This really is the best gateway for international industries to associate with Indian industries for healthy business objectives.”

Sachin Shinde, Precise Systems, says: “My company manufactures control panels, and we invested in a plant in Pune in 2011. It was more like a small-scale unit. But that changed as British-based food-processing equipment company Baker Perkins chose Precise Systems to make control panels and electronic enclosures. Baker Perkins found Precise Systems on Shareconomy. For now, one-third of the plant’s capacity is used by Baker Perkins. We may gradually go on to 100 per cent capacity allocation.”

Sectors, expansion

Shareconomy is present in dozens of segments with key potential in automobiles, engineering, apparel, food, pharma and electronics. Some of the companies it is associated with are: Chitale Dairy, Global Consumer Products, Baker Perkins UK, Top Gear, Ace Micromatic, Shakti Bhog and Ghodawat Consumer Products.

Shareconomy is operational in Pune, Mumbai, Delhi, Bengaluru, Surat and Hyderabad and is in the process of expanding across India. It plans to grow operations internationally in the US, the UK and Singapore.

Published on February 19, 2018

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