Reflections on 2012 – The Negatives!

So there were a lot of good things to look back on from 2012, but it wasn’t all rosy…

Suppliers

Whilst artisans have been great to work with I have also had my share of disappointments, such as the Moroccan supplier who took my upfront payment and failed to deliver a third of the goods. In India we have found a few gems (like the brass inlay work) but have had to work through many potential suppliers who may produce great stuff but have been unreliable to work with for various reasons, including doubling the cost to me when I tried to repeat order, or complaining that I am being unreasonable when I reject their badly damaged goods through insufficient packaging. We ensure that we select only high-quality products for Arastan, and therefore demand attention to detail and quality work from our suppliers, and many do not fit the grade!

Octroi

Thank You Couriers and Octroi Inspectors

Thank You Couriers and Octroi Inspectors

Apparently it is just a few places in Maharashtra and Ethiopia that still implement Octroi. Aside from the expense, the tortuous process to declare our goods, the inspections that don’t bother to repack our goods afterwards (result: one broken Rishtan platter) and the ridiculous process to claim refunds on goods unsold (currently looking like being 18 months wait), are serious reasons to not bother exhibiting in Mumbai. Not going to stop us though!

Couriers

Do reliable and efficient couriers exist? With direct theft, smashed goods from packages being thrown about, cash on delivery where they deliver the product and forget to collect the cash, and assured delivery dates rarely met, we’ve tried many companies and haven’t found one we’re happy with yet. (On the positive side, good old Speed Post has proved very reliable – most of the time!)

Funding

When we started Arastan we always knew that any profits would need to be reinvested, and to grow as we wanted (and to give Mike and I a reasonable income – albeit not comparative with what we use to earn) we would need external funding within our first couple of years of operations. I covered some pluses from this earlier but unfortunately there are a few minuses too. It’s a difficult balance when preparing business plans and pitches, and having calls or meetings with potential investors, takes away so much time which ideally should be spent working directly on the business. In particular I had to postpone trips to Burma and South West China because they ended up clashing with important meetings with people who are so busy that if you miss one chance you might not get another one! The feedback we received was great, but also frustrating:

“We love the idea, continue doing what you do and come back and talk to us in 2 years and we will be keen to invest then”

We were hoping to get some help for the next 2 years!

“This could be a nice 35 Cr [c $6.4m] company in 5 years but we are looking for 100 Cr [c $18.4m] opportunities so not of interest to us”

35 Crores doesn’t sound too bad? And that is without taking any international sales into account. Maybe we are biased!

“If you’d tried to get funding a year earlier you’d have had no problem but now investors are being more careful”

So we suffer because of the over-inflated projections from over-hyped e-commerce startups!

“You’d be more likely to get funded if you ask for more money”

Ok, can I have twice as much then please?

“This business is too dependent on the founders”

What startup isn’t?!

So the conclusion would seem to be that the only way to go is self funding with some help from friends, family and individuals who like what you do and want in on the growth story. So if you know someone we should be talking to please do let us know. Unique concept, great branding, exciting vision, passionate invested owners, good ethics and numbers that speak!

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  • Welcome to Arastan

    Arastan was an online store that curated rare and handpicked treasures from exotic bazaars along the ancient silk route. Unfortunately we ceased trading in early 2014.

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