One of India’s largest online Business to Business marketplaces, ProcMart witnessed a 2x jump in revenue with Rs. 40 Crores in FY21, followed by a 2.5x jump in the first two-quarters of FY22. The Start-up is all set to achieve Rs. 100 Crores mark in FY22. ProcMart has been profitable for the past 3 years with profits increasing by 3X YoY. It is one of the rare start-ups to grow 100 percent YoY without recording any losses.
ProcMart's exponential growth can be attributed to the following factors:
- Almost 80 percent of ProcMart’s revenues were made through the sale of industrial equipment and supplies, while the remaining came from sales of office/IT supplies. Expenses incurred in the procurement of industrial goods and other related stock in trade were the largest cost centre for ProcMart, accounting for 87.5 percent of annual costs. These expenses grew in line with sales. The company has managed to grow its scale of operations significantly during the last two years and expanded its employee base to harness further growth. As a result, employee benefit payments have grown over 2X year-on-year. The company has expanded its presence into 6 new locations over the past 2 years.
- ProcMart focuses on the issues faced by big companies and conglomerates such as Colgate, Nestle, Legrand, Avery Dennison, LG India, Harman, Samsung, Kelloggs, Cipla and PepsiCo, among others, in the procurement of indirect materials. Typical indirect procurement costs in a company lie between 10-15% of the overall revenue. Even a small reduction in this cost can have a significant impact on numbers for these large manufacturing companies. ProcMart's model allows buyers to share requirements and RFQs through multiple channels of communication, including multiple integrations with SAP ARIBA, to integrate their system with its ERP for real-time information transfer and error reduction.
- Over 80% of B2B buyers prefer to purchase online. Nowadays, B2B buyers’ behavior is becoming more aligned to regular consumer behavior with a strong dependence on the internet, IT forums and search engines before relying on more personal engagements. The reason for the same is that pre-sales research has now become far easier and thus, businesses are opting for B2B e-commerce.
The year 2021 has proved that the importance of B2B e-commerce has increased more than ever. The sector saw valuations being doubled every 3-4 months and attracted investment rounds of more than $100 million. This is directly proportional to the fact that India has become a hot space for e-commerce activities with businesses heavily relying on B2B firms to avail products pan-India. Much like its B2C counterpart, the B2B ecosystem has also picked up with the online market trends. While the growth in business will continue to multiply in the coming years, about half a dozen players including ProcMart will emerge fast and occupy the top rung. They would particularly become popular among companies with over Rs100 crore turnover who would prefer sourcing from top vendors with seamless technology capabilities.
About ProcMart: ProcMart is one of India’s largest online Business to Business (B2B) marketplaces which provides supply chain solutions to empower businesses. The company’s mission is to provide an ecosystem that connects a variety of stakeholders through an easy-to-use interface, to meet demands across various levels of supply chain. Founded in 2015, ProcMart acts as an aggregator, assisting businesses in selecting the best procurement technology solutions for their needs.
