Moglix provides a comprehensive digital marketplace for a wide range of industrial and maintenance, repair, and operations (MRO) items with the goal of revolutionising the supply chain and procurement processes for enterprises. The platform offers a wide range of items from different manufacturers to meet the demands of industries like manufacturing, construction, automotive, and more.
Rahul Garg established the Indian e-commerce platform Moglix in 2015 with the goal of offering business-to-business (B2B) solutions for procurement and industrial supplies. products likeMRO, fasteners, electrical, hardware, pneumatics, safety items, power tools, and office supplies are all sold on Moglix.com. In addition to providing supply chain solutions, online selling, and vendor management, Moglix is a business-to-business e-commerce company that specialises in the procurement of indirect materials, including MRO, fasteners, hardware, electrical, lighting, and safety shoes. Automotive, oil and gas, construction and infrastructure, pharmaceuticals, power, telecom, and hospitality are just a few of the industries it supports.
Facilitating smooth B2B transactions for industrial items is at the heart of Moglix’s business strategy. Through its platform, Moglix links suppliers, manufacturers, and companies, facilitating effective product buying and selling. By charging a commission or fee for enabling successful transactions on its platform, the business generates income through a transaction-based business model. Additionally, Moglix might make money by offering value-added services like supply chain optimisation, vendor finance, and bulk discounts.
Moglix has established itself as a major participant in the industrial procurement industry thanks to its dedication to improving procurement efficiency and offering a trustworthy and transparent marketplace. It was a pioneer in the digital transformation of B2B commerce in India.
How Moglix Makes Money?
How Moglix Makes Money?
Moglix combines various business concepts to generate revenue.
Generating Revenue through traded goods – Industrial goods such as power tools, hand tools, adhesives, safety and security, and electrical equipment are among Moglix’s main sources of revenue.
Generating Revenue through online sales commission – Moglix receives a commission from purchases made online
Generating Revenue through information technology services – Moglix gets revenue from support and IT services
Controlled expenses and a spike in other revenue allowed Moglix to cut its losses by 16% to INR 189 crore ($22.5 million) in FY24 from INR 225 crore ($26.8 million) in FY23, despite the scale growth being unchanged. It had an EBITDA margin of -1.5% and a ROCE margin of -4.82%.
Moglix SWOT Analysis
Strengthens
A robust web presence with an intuitive user experience
Numerous goods serving a range of industries
Cultivated connections with several manufacturers and suppliers
Pricing that is competitive and draws in enterprises
Weakness
Low brand awareness in comparison to more established rivals
Reliance on digital channels, which leaves it open to technological disruptions
Possible challenges in inventory control for a wide variety of products
Problems with customer service because of the large number of enquiries
Problems with customer service because of the large number of inquiries
Opportunities
Capitalise on increasing demand in the business-to-business market for e-commerce solutions.
Entry into foreign markets and areas experiencing rapid industrial development.
Possibility of expanding product offers to include more specialised goods.
Alliances and collaborations with other tech-driven businesses.
Threats
Fierce rivalry between new and old competitors.
Economic swings have an impact on purchasing power and the industrial supply chain.
Changes in regulations that affect internet sales methods.
Rapid advances in technology necessitate constant adaptability.
Conclusion
Despite obstacles like customer service requirements and brand recognition, Moglix has a strong foundation thanks to its supplier ties and technological strengths. Significant growth prospects are presented by the changing e-commerce scenario, especially in international markets and sustainable product offerings. However, with cybersecurity issues and challenges from intense competition looming big, vigilance is essential. Moglix may improve its market position and take advantage of new developments that will shape the industrial supply sector’s future by carefully utilising its strengths and navigating its flaws.
FAQ
How does Moglix make money?
Moglix makes money through the following methods:
Generating Revenue through traded goods
Generating Revenue through online sales commission
Generating Revenue through information technology services
Who is the CEO of Moglix?
Rahul Garg is the founder and CEO of Moglix.
What does Moglix company do?
Moglix is a B2B e-commerce platform specializing in industrial products, supply chain management, and procurement solutions.
The e-commerce market in India is expected to reach $350 billion by 2030.
On the other hand, mobile e-commerce sales are projected to exceed $710 billion in 2025.
Due to the pandemic, a lot more people have started buying products online.
All these stats show us that if you want your product to reach more hands you need to build your own online store.
Nowadays, it’s very easy to create your website using tools like Shopify, Wix, or WooCommerce.
Although to have a successful business you need to select the correct business model and delivery framework.
You also need to select the right website that matches your business requirements.
All these things can seem quite confusing.
Don’t worry!
In this article, I will explain to you all the popular and most used business models, delivery frameworks, and e-commerce websites with their pros and cons.
I will also give examples so you can understand each concept easily.
Freelancers can list their skills on a website like Upwork and mention what tasks they can accomplish, how much time they will take to do a task and what price they will charge.
Businesses can look for skilled service providers for their tasks on Upwork. They can pay these freelancers for a specific task and get their work done within a few days.
This is how the C2B business model works!
Another example of C2B can be a gamer who shares an affiliate link to a gaming console on his YouTube channel.
Consumers get the freedom to set their own prices and businesses get the opportunity to work with people with different backgrounds and expertise.
Consumer to Consumer (C2C)
Etsy- An Example of C2C Business Model
The rise of the internet and e-commerce gave birth to the C2C business model.
In this model, consumers sell products directly to other consumers using third-party websites like eBay, Etsy, Alibaba, and many more.
These websites make money by charging transaction or listing fees.
The e-commerce marketplaces like the ones mentioned above allow small-scale business owners to sell their products without the hefty upfront cost of setting up an online store.
If you decide to make a website that uses the C2C model you need to take care of quality control, payment handling, delivery, and resolve all the issues between the two parties.
You also need to make sure that both the buyer and seller don’t get cheated and get a good product and a fair price.
You also require advanced technology.
Many other companies have tried to use this business model but failed terribly due to an unstable business strategy.
We are not saying that you shouldn’t use this model.
But, if you want to operate on a C2C model you need to have a smart business strategy that satisfies your customers and generates profit for you.
Business to Government (B2G)
Senseware- An Example of a B2G Ecommerce Business Model
In the B2G model businesses sell their products or services to federal, state, or local government agencies.
An ammunition manufacturer building guns and missiles for the government is an example of a B2B model.
Let’s understand how this model works.
First, the government will submit a proposal (RFP) according to its project requirements and timeline
As an e-commerce business, you need to bid on these projects.
Since you are working with the government you need to deal with bureaucracies and the pace of the project is usually slow.
As you might have guessed, government agencies don’t use e-commerce sites to place orders.
Although a local government agency can go to an e-commerce site to place an order for a part required to complete a particular project.
In dropshipping you directly buy products from the suppliers and manufacturers who then ship the products directly to your customers.
Let’s say you decide to sell men’s wallets.
You find a supplier who sells you quality wallets for Rs 500 including the shipping costs.
You list all those wallets on your online store for Rs 900 with free shipping.
When someone places an order in your store you then place the order with the supplier at their wholesale price.
The supplier ships the product directly to your customers.
Here, you make a profit of Rs 400.
You are not dealing with the warehousing of the products nor do you have to focus on packaging and shipping and tracking the inventory.
You are only focusing on marketing and positioning the products.
Now, you may ask why don’t the customers directly buy from the supplier.
Good question!
Manufacturers and suppliers typically sell in bulk and they will mostly sell to businesses and not give wholesale prices to regular customers.
Another reason is that people buy products because of marketing, brand value, and customer service.
Since manufacturers don’t focus on the above things people would prefer buying from a drop shipper.
Pros of Dropshipping
Since you are not focusing on warehousing, packaging, and shipping there is a very low capital required.
You can sell and test a wide range of products.
You can set up your business anywhere with an internet connection.
Cons of Dropshipping
Since you are not paying for warehousing and inventory the profit margins are very less.
You have zero control over the supply chain.
If the customers receive damaged or lower quality products your business reputation will get damaged.
Since a very low capital is required there is fierce competition.
You will not build a brand because you are selling products of other companies. In the end, the product that they will purchase will have the logo of the other company.
There is very limited customization.
Subscription Service
In the subscription-based model, you regularly deliver products to your customers and get timely payments from them.
It was traditionally used to deliver newspapers and magazines.
But, now it is used in every other industry.
Instead of using it as a standalone delivery model, I will recommend you to integrate it with other delivery models.
There are 3 most common types of subscription services:
Replenishment subscription service
Here, you are selling essential consumable products like shaving cream and body moisturizer.
Curation subscription service
In this model, you are selling a collection of products based on individual customer needs and wants.
Examples of this can be sending beauty products or dresses based on your customer preferences.
Access subscription service
Customers buy memberships in this model.
Generally, businesses give hefty discounts on their memberships to get more people on board.
Selling organic healthy snacks is an example of this model.
Pros of Subscription Service
Customers repeatedly buy products that generate consistent income for you.
You can easily forecast how many sales and revenue you will generate.
Planning the inventory becomes easy.
You can build strong relationships with your customers.
Cons of Subscription Service
For many people signing up for a subscription is a huge commitment and that is why selling subscriptions is sometimes very hard.
You need to constantly innovate and provide quality products to your customers regularly. Even a small mistake can lead to the cancellation of the contract.
Wholesaling
In wholesaling, you sell products in bulk to other businesses or retailers at discounted prices.
It is mostly used in the B2B space but it can also be integrated with the B2C model.
Pros of Wholesaling
You don’t have to spend your time and money on marketing and advertising your products.
You get a fixed profit margin.
Cons of Wholesaling
You need a lot of capital.
You are responsible for warehousing, managing inventory and products, shipping, and tracking customer orders.
Private Labeling
In private labeling, you hire a third-party manufacturer to create your products.
The product idea is yours but, the making is done by someone else.
Once the products are made you can either tell the manufacturer to ship the products directly to the customer’s house or get the products in your warehouse and manage the supply chain yourself.
Selling cosmetics or personal care products like shampoo is a good example of private labeling.
Pros of Private Labeling
You can create your brand without having to invest in factories and inventory.
You don’t have to spend a lot of time and time on product development and can focus on marketing, branding, and customer service.
It is a great way to test your products in the market.
Cons of Private Labeling
You are entirely dependent on the manufacturer. So, if there is any kind of delay or if the third party creates a low-quality product you have to carry the losses.
Most of the privately labeled manufacturers have the minimum order requirement. This means that you need to purchase more than you need.
White Labeling
In white labeling, you are buying products from a third-party manufacturer and selling them under your own brand name and logo.
So, when customers buy the products they think that it has been manufactured by you.
Pros of White Labeling
Since you are not developing the product from scratch the initial investment cost is low.
White labeling allows you to jump on an ongoing trend.
Cons of White Labeling
Most of the white-labeled products are generic and there is a high chance that other businesses are also selling them. This means there is huge competition.
Since you are not manufacturing the product yourself you have zero control over the quality of the products.
In contrast to the single brand website, you have little control over the website and have to strictly follow the rules and regulations of the website.
If you break any of the policies you wouldn’t be allowed to sell on the site.
Since you are competing with dozens of sellers it would be difficult to rank for a particular product keyword.
If you are new to the e-commerce business you can start with the retail website since you don’t have to build the store from scratch.
You can also use it to test the demand for the product or operate both on a single-brand website and a retail website to get a wider reach.
The marketplace that operates on the C2C model allows consumers to sell their products to other users.
Rishabh Rathi
