The one week Entrepreneur

This monsoon I had taken 10 days off from work and decided to tour Coorg on my bicycle, less cycling and more of relaxing in Prakash’s home stay located at the middle of a 10 acer coffee estate. After cycling 90 km from Virajpet I reached Prakash’s house and rested for few hours post awesome breakfast. Even Prakash happened to be free and we started our discussion casually and ended up discussing the decline in coffee price due to pre monsoon showers. Being a coffee lover I always used to wonder what differentiated the taste of the coffee that is served in Café Coffee day, Barista and the ones prepared at home. I asked him if he knew how different were the quality of the coffee seeds grown in his land and that of the ones sold at coffee day. He promptly said that the altitude at which it is grown makes a difference and the seed grown in his estate were of the same quality but they use it for themselves where as he sells his seeds in the market and this gets mixed with other low quality seeds as the volume is pretty low and hence there is not a big difference between his seed and the rest. After working on the Raw material tracing project for 6 months the Supply chain track and trace fever had bitten me. I asked him why he cannot sell his seeds directly to companies than going through the market. His answer was very weird, he said that there is not a huge difference as end of the day he is least bothered about the end consumer and was happy with the amount he gets paid. I told him that if he was confident that his seeds were of a much higher quality he can brand it and up sell his seeds to the companies than selling it to the market along with the other low quality seeds but he seemed to be least interested to take the extra effort. This seemed to be a good project to keep my 10 day vacation occupied and my dream of starting my own company. I began writing the business case. The problem was simple; I wanted to know what was the quality of the coffee seed in the coffee I was consuming and as a consumer I was ready to pay extra to get that information as there were enough coffee lovers like me in the consumer market. To get that information I had to link the Supply Chain from the estate to the Retail and I would do this with the help of simple emails which would get the receiving and shipping information of the Estate owners, Manufacturers and the Company. My company which gathers data will take a small commission from the estate owners and the companies who want to brand their product if they think it had an edge over similar products in the market. This seemed pretty cool and one of its kinds. The first thing I did was to explain the model to Prakash the next morning and he was not interested as he was not a computer savvy or a strategic thinker. He was just a rich farmer with limited literacy. I decided to give few more shots and took reference of 5 similar estate owners by nagging Prakash and also a manager in a Company called Coorg Coffee works, Bopanna. I called Bopana in the morning asking if can meet today but he suggested we discuss on the call as he was busy and will be out of station from the day after for few days (I think it was a lie).  I explained him the entire model and he seemed to be interested with this idea and said he would get back to me once he talks to his boss by evening. I decided to visit the Estate owners in the mean time and my ride on the bicycle to these estates was wonderful but the meet with owners were depressing. They were worse than Prakash as they hardly understood what I was talking about and I had to explain them diagrammatically. They were never convinced with the model and did not want to pay for something which would not yield any immediate gain. The second day happened to be depressing but a great experience though Bopanna never got back. By evening I had given up on the idea and planed to ride till Waynad the next day. To my surprise Bopanna called me the next morning telling the director wanted to meet me to understand more on this regards, but after a week. It was a good sign and I was hyper excited. Now I had a week’s time to prepare and the only concern were these Estate owners who were not supportive. As I started worrying about it I started to get a clear picture, “why should the estate owner pay for something that is not of his interest (long term gain)”. The immediate solution was the estate owners will just provide the data and the companies will be paying me for my service and the companies could pay as they had a huge margin in branding. But will the estate owners provide the data was another big question. Now I started seeing this as a game theory problem and in this model it never had “Nash Equilibrium”, which means the Estate owners and manufacturers did not have any incentive in emailing me the information. Now my focus was shifted to this new problem which seemed to defy the theories of economics. Entire third day I was trying to understand the psychology of the suppliers at the bottom most level of the supply chain. Monetary benefit could be a good incentive for the suppliers to provide the shipping information but that is not solution. By the end of the day I could come up with a dozen solutions rite from providing free computers to the estate owners to email information till they are tied up with the company, hire unemployed youth’s to work closely with the estate owners and provide the information and pay the youth’s some premium based on the quality of data they provide, assist the manufacturing companies in inventory optimization.. etc and I knew it would be done only till they all got used to the new model. I was convinced with this idea and on the 4^th day I started asking few questions to Prakash and he did not seem to have any problem with the new model. I approached 3 more estate owners to ask them if they would be happy with the new model and they seemed to never have an issue. It was a perfect day and I was satisfied on investing my vacation on this project. On Day 5 I did 100 km cycling till Tibetan camp and I also all my pricing information was ready. I will be charging 20,000/year from each company and investing close to 10,000/ year to get the shipping information from supplier and manufacturer. I needed at least 10 companies and had to invest 4 hours per week on the data cleanup and customer support which would give enough time to focus on my work for GE. It was a perfect model and everything fell in place.  I decided to get back to Bangalore to keep the paper work ready and come back after 2 days to meet the director. I prepared the quotation, catalogs, presentations…etc. I even emailed the high level process and presentations to the director for him to be prepare for the meeting and called Bopanna to inform the same. I called Bopanna to confirm if the appointment for Thursday afternoon still holds good and he confirmed. In an hour I got a call from the Director Mr Bidappa and as this was unexpected I was a bit nervous. He sounded very calm and started asking questions regarding the process and how he would get benefited. I could answer most within my reach and just passed the ones that were related to the quality of the coffee seed and the varieties.. etc. The call went on for 30mins and he seemed to be interested as he said it is not of a great benefit now but there is a good chance of branding his coffee powder in future. He also had a few concerns like, I was doing this as a free lancer and did not have a registered company of my own, it would be the first implementation and he saw a huge chances of failure over a period of time, . .. etc. I had no answer for these and I had to shut up and he said he will think much about it and get back to me which meant I failed. I was a bit upset as the vacation and the hard work had gone in vain but it was a great experience and I was convinced that this was a great idea and would implement it someday. I met my friends over the weekend and got back to my usual life with GE from Monday.

Epilogue

More than implementation my interest was more inclined towards understanding the supplier psychology and tried similar projects whenever I got a chance to visit Ooty, Shimoga, Srigeri.. etc on Tea, Arca nut, Coconut..etc. I am planning to prepare a white paper on the same once I have sufficient data available.