43. Kadam Marketing Ltd: Graduating To Distribution

The last year was one of growth for Kadam Marketing. It grew its reseller network from 350 to 600. The most important landmark, however, was the appointment of Kadam as a regional distributor for Compaq. A task for which Kadam added five marketing professionals in its ranks.

"Tying up with Compaq has helped us move one step up the ladder," says Anil Sachdeva, CEO. Kadam now will distribute the entire range of Compaq products in the Northern region. "The brand pull is immense and the amount of business coming in is definitely greater than the efforts we have put in till now," says Sachdeva. But they don't plan to continue taking it easy.

Kadam is planning an aggressive marketing development exercise to establish its presence in the market as a regional distributor. "We plan to go to customers rather than the other way around," says Sachdeva enthusiastically. 

But sailing has not been entirely smooth. Like all in the industry, Kadam Marketing also had to face the brunt of thinning margins. And the problems seem to be compounded with the rise in the number of defaulting resellers. "To get the bad debts under control was a challenge," says

Sachdeva. 

A cause of serious concern for Sachdeva is the rising incidence of what he terms 'deal-based pricing'. "Many principals", he says, "pass on a special price to a reseller just because he picks up volumes that meet their targets." He further explained that this disrupted the entire price mechanism in the market. Those flushed with goods purchased at a higher rate are compelled to sell at a loss. 

All this coupled with the slowdown in the market seems to put undue pressure on the reseller. But Sachdeva looks at the current market situation quite differently. Says he, "The market in India, at least, is growing, at a slower rate though. The price points are under pressure and price realizations are going down." To tackle the problem headlong, Sachdeva is aggressively looking at retail and will expand beyond the realms of Delhi.