MindTree launches customer-centric solutions for retail industry

The software solutions company is also ready to offer operating expenses based model for Indian retailers

Software solutions company MindTree Ltd, which has launched multi-channel software for retailers, has said it is ready to offer software solutions based on operating expenses model for Indian retailers. The new 24x7 software solution would cost around $1 million.

"We are aware of the spending capacity of Indian retailers so we are offering a lot of flexibility with our solutions. We are also looking to provide a demo solution to retail customers," said Babuji Abraham, vice president and head for retail industry group, MindTree.

The Indian retail industry, valued at about Rs400 billion, is likely to spend around Rs24 billion on retail technology service solutions, during the current financial year, according to industry analysts.

 
At present, many retailers are using technologies based on fixed monthly fees rather than buying the software or technology, rather than buying the technology as a one-time investment.

“Our solution will accelerate mobile shopping among Indian consumers. Smart phones have already grabbed the Indian market and through our technology, retailers can reach their target audience,” said Abraham.

The solution will help the retailers to reach out to specific target audiences by sending messages which contain specific product details and use appropriate marketing strategy. For example, if a retailer is running a promotional offer for teenagers in which you get a branded accessory free with a branded dress, the message will be sent to teenage female shoppers who are the perfect target audience for such offers.

The promotional massages sent to the customers will also have a uniform resource locator (URL) which will take the customers directly to the page where the details of the promotional offer is mentioned and even will identify the unique customer in any channel of purchase.  

 "Indian retailers are still not using such solutions because they are very costly and the domestic consumers are not yet into multi-channel buying," said Arun Gupta, group chief technology officer, Shoppers Stop Ltd.

Abraham said that besides offering a bouquet of multi-channel commerce solutions, MindTree also provides flexibility to retailers to opt for specific solutions based on the Internet or mobile module. This way the retailer can get the solution at lower cost compared with the complete bouquet, he added.

"Online shopping is slowly increasing in Indian middle class families and the solution will help retailers to manage their inventory better and at the same time satisfy online shoppers," said Abraham.
- Pallabika Ganguly [email protected]
 

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Gartner vs NASSCOM: A tale of two predictions
Gartner says that world IT spending (IT market size) will grow by 3.3% to $3.3 trillion in 2010. The market size given by Gartner is twice the market size given in the NASSCOM Strategic Report 2009. The report says that world IT market size is only $1.6 trillion. Gartner is an international IT consultant. NASSCOM represents the Indian association of IT companies. With real time data availability, why do these two organisations differ on this crucial statistic?  
 
Earlier, Gartner had said that IT spending could drop 6.9% but now it is likely to rebound in 2010. It also cautioned IT leaders not to be overly optimistic. It confirmed that the IT industry may return to growth in 2010 but it may not recoup the 2008 market size before 2012.
 
The hardware market could see decline of 16.5% to $317 billion in 2009 which will be recouped in 2011. Worldwide telecom spending worth $1.9 trillion could see 4% decline in 2009 and is likely to grow by 3.2% in 2010. IT services spending of $781 billion in 2009 could grow by 4.5% in 2010.
 
Server, PC and printer purchases have slowed down and it is expected that 1 million servers have had their replacement delayed by a year in 2009 and another 2 million servers could be delayed in the next year comprising 10% of the total installed server base.
 
NASSCOM’s break-up of $ 1.6 trillion comprised IT services ($557 billion), BPO ($115 billion), packaged software ($295 billion) and hardware ($594 billion).
Dhruv Rathi [email protected]   
 
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That sinking feeling
One of the best performing sectors in India’s growth revival is the cement sector. However, the industry is headed for overcapacity and prices are likely to come down. One immediate indication of this has surfaced in Andhra Pradesh (AP). Cement prices continue to remain low in AP since August 2009. Lack of demand and over-capacity has been responsible for this. While cement industry players expect demand to improve, analysts fear it may worsen over the long run.
 
Cement prices fell to Rs170 per bag in August 2009 from a peak of Rs235 per bag in April 2009 in AP. Cement prices continue to remain low at Rs170 per bag since August 2009. A cement industry official confirms that the cement prices for the present day are at a low of Rs170 per bag.
 
While industry sources believe the scenario is the result of low demand due to the floods in AP, it may well be the first indicators of oversupply.
 
In the next three months, analysts believe that prices may fall further in the other regions of India. “Prices are expected to fall not particularly in this region, but also in the remaining regions of India. The prices may fall steadily in the next three to six months,” said Amit Srivastava, research analyst, Karvy Stock Broking Ltd. “There could be a further correction in cement prices,” said R Gurumoorthy, executive director, corporate communications, Dalmia Cement (Bharat) Ltd.
 
In spite of low cement prices, the units in AP have been able to maintain profits due to low operating costs, analysts believe this might prove difficult for the remaining regions in India.“ Other regions are not in a position to reduce operating costs in a similar way as AP,” said Mr Srivastava.
 
Analysts believe the worst affected would be south India, as the fall in prices would be soon witnessed in the neighbouring states of  AP. “The excess supply from AP will be diverted to other regions like Tamil Nadu, Maharashtra, and Karnataka and later to the eastern parts. Thus, an excess supply is expected to occur in these regions.”
While the spokesperson for Dalmia Cement cites low demand and not over-capacity as the main reason for fall in prices, analysts look at it as a combined effect of both lack of demand and over-capacity.
 
“The reason for the fall in prices is not merely a lack in demand but also the overcapacity happening in that region. The prices will not fall so low only due to lack of demand, it is more due to the over-capacity. Even if they operate at 50% to 60% capacity utilisation there is an excess supply in the market,” added Mr Srivastava.
 
“Cement capacity in expected to grow by 8% to 10%. These capacities were planned on an expectation that demand will also grow. Current demand for cement has been driven by spending on IT projects and residential projects. For the capacity addition planned for 2010, the industry needs incremental demand over the existing construction activities in order that total cement demand grows at an expected 10% rate,” added the analyst.
 
Delayed public spending in the form of planned government infrastructure projects has also adversely affected the expected cement demand. “The main factor in the current fall in cement prices has been a delay in the offtake of public spending,” said Mr Gurumoorthy.
 
“There has not been sufficient demand in AP due to delay in expected government housing projects and IT projects. Later, the floods also acted as a spoilsport,” added Mr Srivastava.
 
All over India, 47.5 million tonnes (MT) of cement capacity is expected to be added in 2010 and 19.2MT by 2011. Out of this, the southern region is expected to add around 20MT in the year 2010. For the year 2011, the highest capacity addition of 7.8MT will happen in the eastern region
- Amritha Pillay ([email protected])
 
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