Sandeep Manohar Naik, founder of Doctor’s Bazaar, shares his experience with YourStory
According to Sandeep, "An experience that really pushed me into starting my own venture was when I was running my family-owned medical devices business. We had partnered with a South African company and were representing them for a wound management device in South India. The product drastically reduced cost, pain, time, and infections in even the most severe burn cases. It was designed for the poorest of the poor and required practically no maintenance. When we showcased it to a hospital, we found that there was a company in India which was falsely representing the manufacturing company. They had given a very bad demo and quoted over 3X the price. The equipment was quoted at Rs 48 lakh against our quoted price of Rs 13 lakh. The hospital postponed the purchase because of affordability. They had a budget of Rs 50 lakh but one machine would not solve the problem. They needed at least four units to handle the patient flow. Being a government hospital, they also could not recover the cost from patients and had to make do with the grants/budget allocation from the government."
Buying that machine could have improved the lives of thousands of patients that year. Right from product discovery and engagement with the manufacturer to dealing with a validated distributor and being offered a fair price and ultimate order delivery and installation, the whole system seems broken in developing countries. There is almost a 10–15-year lag between products and technologies being made available in the developing world.
Most manufacturing companies are not willing to take the risk of launching into markets which are highly price-sensitive because they require extensive investments in sales, marketing, and distribution infrastructure to have some impact.
Having worked in the industry for seven years Sandeep had the perspective to attempt a solution for these gaps. Thus, he founded Doctor's Bazaar in February 2016 with Prashanth Prabhu and Vishal Naik. They are based out of Cochin and have an office in Bangalore.
So what does Doctor's Bazaar actually do?
They offer an enterprise solution which connects medical device companies with distributors and buyers from around the world. It allows the users to network, interact, and transact globally.
How did they go about addressing this opportunity?
Sandeep knew that the medical device industry is truly global, with developing countries importing almost 95 percent of their requirements from Western Europe, the US, and Japan. While the manufacturing nations have a growth of about 3 percent y-o-y, the growth rate in other regions was almost 18 percent y-o-y. The platform they built had to ensure global outreach and continuous engagement for the manufacturing companies with buyers from around the world.
They are creating a curated, industry-specific ecosystem of manufacturers, distributors, and buyers. It will ensure faster search, produce more relevant data, ensure transparency, reduce transaction time, and facilitate transactions by providing payment. Logistics and validation support to all the stakeholders are a part of the system as well.
Revenue growth and projection
Their subscription revenue is expected to touch $3 million in FY 2017–18. They will start the subscription cycle April 2017 onwards. Their other revenue streams include commission from sales on the platform and marketing/ad spend revenue. They expect the subscription revenue to grow to $25 million before flattening out based on the current pricing.
They are working on products which will bring non-platform-based revenue from transactions, at the same time enriching the range and selection of manufacturers available on the platform.
The medical device industry is a $375 billion industry. Of this, countries like the US, Western Europe, and Japan account for over 75 percent. The rest of the world accounts for the balance 25 percent. While the growth in developed countries is about 3–4 percent, the ROW market is growing at 18–20 percent. India accounts for about $7 billion or 1.87 percent of the global medical device industry.
They have identified three revenue streams
- Subscription model
- From transactions, and
- From marketing and ad spends
Current team size
They have opted for an outsourced model, so apart from the three founders, they have had team size in the IT department go up to 14.