Librarywala has always been perceived as a relief to bookworms. The portal currently provides books on a rental basis. We caught up with Hiten Turakhia, founder & director of Dharya Information Private Limited, company behind Librarywala.
Q1. Tell us something about the team behind this venture – Librarywala.com?
We are a four member founding team, everyone comes from a different background adding to the expertise in every area required for a startup like ours. Our skills sets required to make this venture successful -
- Hiten Dedhia brings to table a rich experience of strategy & operations consulting and knowledge of finance
- Hiten Turakhia brings over 7 years of experience in IT products and services marketing
- Dhairyasheel Pawar brings an experience of over a decade in starting and managing a software & networking company
- Shibanarayan Rath brings a global experience of supply chain management and project management
- To add to this everyone is an avid reader and have a strong thirst to make this world better.
Q2. You’ve done a lot of market survey on business viability, could you share some statistics about your internal study in terms of targeted audience and market opportunities?
In terms of our business survey we used to stand outside leading bookshops and libraries and ask people a small set of questions. The questions would be in regards to their reading habits, at what price they would feel comfortable to rent books and what were the problems they were facing with the local library near their houses. We also asked them about their monthly spending on books etc
All four of us used to do this for four days at one particular location and we did this for about six months, three to four hours a day. We collected a good amount of responses from our target audience.
We analyzed the collected answers within four to five months, then we changed a lot of things based on these reports for e.g. we came up with the “no late fee” option because most of the people had one common problem with the local libraries. It was the 14 day return or the late fee clause. We also came up with the ‘cash or cheque facility against delivery’ option because most of the people preferred to pay against delivery (a lot of people did not trust the online payment systems – online frauds etc)
Q3. Any number which you could share with regards to your sales figures, subscriber count etc?
I would like to take this opportunity to tell you about this extra ordinary journey that Librarywala has taken us through. We launched operations on 1st Aug 2007 in Mumbai and we were operationally breakeven in the first month of operations. With the good response in Mumbai we planned to open one in Bangalore so as to increase a revenue source as well as being the first to have presence in two cities. We launched operations in Bangalore on 19th Jan 2008 and achieved operational breakeven in the second month. With seven months of operations in both the cities we decided to open a satellite centre in Pune which we launched on 29th Sep 2008.
In the year 2007-2008 with eight months of operations we had 2200 active subscribers in Mumbai and the revenue generated was 22 Lakhs, with only two and a half months of operations in Bangalore we had around 250 active subscribers and the revenue figures were 2.2 lakhs. In the current year of operations librarywala.com has crossed the 75 lakh barrier in terms on revenue. We currently have around 5800 active subscribers and 15 corporate clients.
Q4. You are currently available in only 3 cities i.e Pune,Mumbai and Bangalore. Any expansion plan in other cities on the anvil?
Yes, indeed we do have plans to expand in multiple cities but before that we plan for a deeper penetration in the current markets. Some of the plans we are already working on are:
- Developing a mobile platform where members can order for books via SMS (no internet connection required).
- Adding value added services like providing regional books.
- Starting audio book services thereby also serving the visually challenged.
- Book donation – Go green – Help the underprivileged.
- Dial –a– Book service
- Up gradation of the website – Starting book forums, Blogs, Author chats etc.
- Planning to have presence in more than 10 cities in the next two years.
We will also look to open more satellite centers like Pune and also are reviewing the franchisee option for tier- iii cities.
Q5. You seem to be building your own delivery network, what is your strength?
We tried to tie up with courier services when we stared but it did not workout as books are of different sizes and weights, so the process was time consuming, inefficient and costly. We hired some delivery boys like the pizza companies and started training them, today we have more than 25 delivery boys across three cities and we deliver more than 525 books in Mumbai, 310 books in Bangalore & 150 books in Pune daily.
With the current setup we prepare around 300 parcels in one hour, we are looking at making some software changes and speed up the delivery process. Furthermore we will deliver up to 700 books daily in Mumbai in the coming months.
Q6. The price war seems to have started in DVD rental business due to entry of many players. What’s your views regarding the elasticity of pricing in your business (Book rental)?
- We were the first online circulating book library and we were very happy when one more player launched somewhat similar services, thereby vouching to our idea and boosting our confidence.
- India as a whole and each area (city / town) in particular is a big market and there is enough place for multiple players
- But competition will not worry us but will keep us on our toes to keep improving the service levels and always be one step ahead in the competition
- We not only want to be a transaction provider, but also an entire service and experience provider to all the entities related to reading
- In terms of the pricing, even if some player comes with a lower price it would not matter. It is the quality of service that will matter.
The major highlight of the interview is their ambitious plan to go franchise route which if done could spell major growth for their business. In future their current near monopoly position may also be thwarted by new competitors but would not hinder their growth for few years as the book-rental market is still at a very nascent stage.