Introduction
Udaan is a B2B trade marketplace that is specially designed to empower, retailers, wholesalers, traders, and manufacturers using technology as a source. Udaan is run by Hiveloop Technology Pvt. Ltd and is a special initiative for small and medium businesses in India. The business model of Udaan involves its business plan, revenue model, Competitors, its SWOT Analysis, and many more.
The main idea was to connect wholesalers, traders, retailers and manufacturers on a single platform via a mobile app. The udaan app enables users to access to real insights into active trends and many other premium B2B trade features.
It has enabled small and medium business owners to use the power of technology to nurture and scale their businesses.
Business Plan
Udaan is a Business to business marketplace on which manufacturers and wholesalers can sell their products to retailers via an online platform or mobile app. The company provides logistics, secure payments, and technical support also.
They are the asset-light player based on their Business Model. They do not believe in owning assets and also are not planning to go asset-heavy as of now. It helps businesses discover customers, suppliers, and products across categories and connect them to get the best deal. The platform also facilitates secure payments and gives logistics support.
The company also offers accounting, order management and payment management solutions to merchants on their platform.
The retailers end up borrowing from local lenders who charge exorbitantly. Udaan intends to provide working capital(funds) to them at a reasonable rate.
So, apart from being a platform for retailers and wholesalers, it has also started underwriting loans for these small businesses. It has also received a non-banking financial company (NBFC) license to provide finances to SMEs.
Revenue model
Udaan’s wide variety of sales assets consist of revenue from Logistics offerings. A crucial asset of sales for Udaan is the shipping expenses it collects from the individuals for picking up items from the premises of the vendor and turning in the same to the buyer. There additionally are prices for amassing any cross back of income from the customers.
Udaan provides dealers registered at the platform, garage and warehousing offerings to allow them to ship items quicker to the customers. Sellers are charged a fee for such warehousing offerings. Fees from receivable control offerings consist of prices for amassing bills from customers in coins on behalf of the dealers or prices for accepting bills online on behalf of the vendor.
Commercial prices from promoting their product listings at the platform to make sure higher visibility among customers within the platform are also one of Udaan’s techniques. Udaan, through its NBFC arm, extends credit scores to traders and investors to assist them in meeting their operating capital requirements. Interest profits from such loans is a crucial supply of sales for the platform.
Udaan gives numerous different charge-based offerings to agencies registered on their platform. These consist of offerings like packaging and printing of labels on merchandise, the printing of invoices and returns control offerings. It offers electronics and client items at the market for commercial items, sparkling cease result and vegetables, workplace supply, style accessories, girls and men wear, Food and FMCG.
Udaan has been the combination of a marketplace, logistics, and lending.
These are the main pain points as well as opportunities for a B2B business online portal like Udaan. So, all the data about the revenue has been collected from anonymous but credible sources.
Udaan charges a percentage on sales as a commission which varies in different categories. Udaan also charges for the logistics in the form of delivery charges from the buyer which also varies according to the product and quantity.
They provide credit limit to the only verified buyer that too if is eligible for the limit.
At first, they will provide Rs. 10000/- credit with no interest charges then the credit limit will be increased to a maximum of Rs. 250000/-.
At the moment, Udaan doesn’t intend to make money through providing funds for working capital for its buyers so they do not charge any interest on the credit.
Competitors of Udaan
Top Competitors of Udaan are:
- ZoomTail: ZoomTail is seen as one of Udaan’s top competitors.
- Big trade
- Tradekosh
SWOT Analysis
Strengths
- Strong Foundation Team:- The founding members of the company already had the required knowledge and experience after working at Flipkart. Due to this, many other Flipkart employees also joined the startup, which helped them in increasing their efficiency and productivity. It enabled the engineers to work on their creativity, which is encouraged at Udaan.
- Big scale of customer base: The company now has about 150,000 vendors on its platform, with the number of downloads and website views rising every day.
- Innovative Idea:- The company emerged with a new idea of providing online services to retailers and wholesalers. It provided with a platform for B2B Commerce that can help them in effectively competing with the big retailers and the big branded stores and websites. This helped them to enlarge their customer base.
Weaknesses
- Unable to manage its Expenses: The expenditures of the company increases with increase in revenue amount but the hike in expenditure is more than the proportion of revenue
- Supply Chain Issues: The firm frequently has problems in finding prospective suppliers that can match the company’s criteria in various geographic locations while also delivering the goods on time.
- Requirement of Internet: Certain locations still cannot access the internet. These individuals remain impoverished, forming a barrier across all geographic areas.
Opportunities
- B2C: The company should develop a platform that deals B2C i.e. Business to Customers along with its current department. This will help in increasing the customer base and revenue sources of the organisation.
- Management Consulting: The company should consult a consultant. This will help the company to manage their resources in a better manner.
- Setting up of Outlets: The company currently trades through an online platform. It can be a great way to increase your customer base by investing in establishing offline outlets in different areas.
Threats
- Cost: The cost is a significant factor in a market where a firm must compete fiercely to stay afloat. Due to the huge number of costs invested in the process, the firm frequently has to sell its products and services at a greater price than the market, causing its consumers to switch to another company.
- Economic Factors: The company has invested a handsome amount of money as capital. A small change in economic factors can have a huge impact on the company.
- Decreasing Profits: The company though increasing its revenue each year is not able to boost the profits too. The profits are decreasing each year which is a major threat and needs a quick action. The corporation cannot increase profitability, posing a serious threat that requires immediate action.
Conclusion
Udaan is a B2B trade platform that brings manufacturers, traders, retailers, and wholesalers onto a single platform. The platform additionally allows steady bills and offers logistics support. The agency additionally gives accounting, order control and fee control answers to traders on their platform.
