Revolutionizing Supply Chain Through Technology - Insights from the Business Model of Moglix

Anagha S Anagha S
Sep 1, 2021 5 min read
Revolutionizing Supply Chain Through Technology - Insights from the Business Model of Moglix

By making B2B business for various industries easier than ever, Moglix has reigned in the supply chain industry since its launch in 2014. It is backed by Ratan Tata among others and has its headquarters in Singapore.

It is an e-commerce platform that focuses on manufacturing and supplying goods. They are the largest e-platform of its kind in India. Today, it has a very elaborate supply chain network that is spread across more than 16000 suppliers, which serves nearly 5000 small and medium-sized business enterprises.

They ensure that their customers have a very seamless experience during their industrial product procurement process. Apart from the B2B model they also provide B2C model services as well.

Moglix has launched Mogli Foundation, a philanthropic venture of the company the aim of which is to help improve Health, Environment, and Science via intellectual, physical and financial contribution. The launch of Mogli Foundation has been confirmed by Rahul Garg, Founder, and CEO of Moglix, in the latest press release dated August 5, 2021. This new initiative will likely impact 100M+ Indians.

They have significantly contributed to reducing the humongous task of supply and procurement into a piece of cake. They aim to de-risk the nuances of B2B supply chains and expand to more places in the future. The following are few characteristic features that are evident through the business model of Moglix.

Constant Expansion
Digitalisation
SaaS Nature
Competitors of Moglix
Revenue Stream of Moglix
Cost Structure of Moglix
FAQ

Constant Expansion

This E-commerce company helps businesses to procure industrial supplies pertaining to electrical, lighting, MRO (maintenance, repair, operations), cleaning and office stationery. They ensure that the customer has a very cordial experience.

Moglix constantly strives towards improving and expanding its business over the years. Recently Moglix has launched a warehouse in Nuvem, Goa which will augment its business with the local partners in Western India. It is a home for many industrial hubs like Panjim, Verna etc.

Apart from that its strategic position is also helpful for customers along the Bengaluru-Mumbai economic corridor. Similarly, Moglix has also expanded its reach to the northeastern region through its warehouse in Guwahati.

Now they will start their supply chain operations soon. Earlier in 2020, they had planned to partner with government agencies in the UK to enrich the PPE supply chain of the country.


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Digitalisation

Digitalisation has also changed the business model of Moglix for the good. It has replaced manual methods to ensure proper follow-ups of orders and on-time delivery.

As a part of this digitalisation, they have also devised a single-window approach that integrated the intricacies of procurement solutions in an efficient manner. It ensures better transparency and analytics which has revolutionised supply chain technology.

Now Moglix is expanding its reachability which is fastened significantly through the process of digitalisation.

SaaS Nature

Moglix is a company that is founded upon and driven by technology. Such forms of business are generally termed SaaS business. The biggest advantage that Moglix has due to its SaaS nature is its immediate access to an abundant global market.

They have made use of technology not only to deliver products and services but also to revolutionise their organisational structure. They were able to scale up their business in a phenomenal manner without altering their delivery charges. It has also helped the firm to have better control over their products, greater security and even more; excellent user experience.

Competitors of Moglix

Amidst companies that ventured into the field of industrial products supply chain, the following are the competitors of Moglix:

  • Zetwerk
  • Infra Market
  • Industrybuying
  • Zoro
  • Kobster
  • Udaan
  • Power2SME
  • Mytradebox

Revenue Stream of Moglix

A large part of Moglix’s revenue comes from operations. Another part of it is derived from the sale of industrial supplies. They have bridged the gap between the businesses that are caused due by fragmented manufacturing and supply chain sectors.

Amidst all the crises that the pandemic brought, Moglix ’s revenue increased by 74% in 2020 from INR 217 crore in 2019 to INR 318 crore in 2020. In 2020, their revenue from the sale of products is INR 368.38 crore. Their operations revenue went as high as INR 375.81 crore in 2020. Apart from that they also earn from the interests on fixed deposits and current investments.


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Cost Structure of Moglix

While the company’s revenue increased phenomenally in the last year, there was a spike in its expenses. In the financial year 2020, the expenses of Moglix shot up to INR 456 crore from INR 265 crore in 2019. This means that there was an increase of 72%.

The major expense that the company has to incur is that of the purchase of stock-in-trade. This value saw a rise of 63% in 2020 to reach INR 347.32 crore in 2020. Costs of other materials, salary expenses, employee benefit expenses, advertisements etc. are other major sources of expenditure for the startup.

Apart from that, depreciation of the value of Indian money, depletion and amortisation has further added to the company's expenses. Along with the revenue growth, their net loss also saw an increase from INR 48 crore in 2019 to INR 78 crore in 2020.

Conclusion

Moglix is one of the key players in the industry. It is estimated that the company will reach a valuation of $60 billion in the future. With the government opening doors for 100% FDI, the opportunities are limitless for Moglix.

With a vision to make use of the economic boom that India is going to witness as it gears up to be a $5 trillion economy by 2025, Moglix is all set to partner with all manufacturing and government agencies to deliver the best services.

The planning of the company leans towards the digitalisation of the B2B supply chains. They also aim towards expanding to newer areas like Europe, South East Asia etc. Their mode of development is an excellent example that explicates the importance of planning and envisioning a business.

FAQ

What is the revenue of Moglix?

The total revenue of Moglix was INR 378 Cr in 2020.

Who is the founder of Moglix?

Moglix was founded by Rahul Garg, who is a IIT Kanpur and ISB alumnus.

What is the valuation of Moglix?

Moglix has a valuation of $1 billion as of 2021.

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