Towards efficiency in trading

By N. N. Sachitanand

BANGALORE, SEPT. 14. England at one time was characterised as a nation of shopkeepers. That description now befits India. But, despite being the most widespread entrepreneurial exercise, trading in this country remains inefficient due to lack of application of structured information systems. Most traders and retailers in this country seem to rely on ad hoc decisions based on pressure of circumstance or gut feeling, whether it be purchase, stocking, credit sales or financial management. The result is large inventories and considerable dead stocks, high receivables, poor customer service, needlessly high operational costs, weak links with suppliers and big write-offs.

In these days of stiff, global competition and flattened margins, trading enterprises need fast and easy access to accurate information, both internal and external. Businesses need up to date financial information, such as latest discounts offered by suppliers or credit-worthiness of buyers, to support new ways of competing. As fixed costs continue to rise, traditional methods of cost reduction are not enough. Capacities, such as storage space in warehouses, have to be optimised, which means knowing what to push out at what discounts and what to hold on to. Customer relationships are becoming a critical competitive differentiator and businesses need solutions for assigning costs and revenues directly to individual customers as well as to know which customer to favour to what extent.

Modern information technology can provide solutions for trading in the new economy. The West is awash with such IT solutions but they are more suitable for scales of operations several orders of magnitude higher than that of the average Indian trader. Nor can our average distributor afford the prices of Western IT solutions.

Now a small Bangalore-based business software developer, Maruthi- IT.com Ltd., has come up with an ERP package called BOS-2001 (Business Operations System 2001) which is attuned to the Indian environment, whether it be scale of operations, taxation systems or purses. It is intended as a total solution to distribution enterprises, trading houses, dealers, retailers and others with single or multiple products, locations and business units.

It has a core of powerful programmes for customising, finance and operations. The modules of BOS-2001 such as sales and distribution, materials planning, inventory management, warehouse management and financial accounting, are all integrated into a workflow of business events and processes across departments and functional areas. The taxation regime as well as other legal requirements, that differ from state to state, are also accomodated.

Although designed as an integrated system, the modules can be used individually and the application can be expanded in stages to meet the specific requirements of the business. BOS-2001 is a Client/Server (for the financial management module) and e-enabled (for the operations module) system and runs on Windows NT with Microsoft SQL database as back end and is quick and easy to install and does not involve high hardware costs.

The pricing structure for BOS-2001 - Rs. 2.50 lakhs for a 5-user licence - had been structured to suit the purse of an average Indian SME with an annual turnover of Rs. 3 to 4 crores, said Mr. P. S. V. Ananthanarayan, Managing Director of Maruthi-IT.com. The company has already landed three clients for the distribution management of their products: a medium scale foundry and two IT networking product companies. According to Mr. V. Anantharaman, Chairman of Maruthi-IT.com, the company is talking to potential partners in the U.K. and Europe for customising the package and marketing it in those regions.

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Section  : Business
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