CIOIN

Pertisth Mankotia

Head – IT, Sheela Foam

Executive summary

Sheela Foam - the company that owns the Sleepwell brand of mattresses - was having rough nights. All the discounting among the channel partners was hitting authorized dealers who were now unable to retain their margins because customers, being customers, went to the lowest seller. Thus, selling the brand was becoming difficult for authorized dealers.This led Sheela Foam to explore an IT-based solution to save its brand.

"Selling mattresses depends on referrals from customers and the dealer's word," says Rakesh Chahar, CEO, Sheela Foam. Since referrals from customers are not very high, the company had to depend on its dealers. "To make a dealer recommend Sleepwell, it is important that he retains a reasonable margin in selling the product," he points out. The company needed to enforce the MRP of its product. This is what led Sheela Foam to explore options in IT, and thus the project to control MOP (market operating price) was born. And the man responsible for its implementation was Pertisth Mankotia, head-IT, Sheela Foam.

"The most important challenge was to enable our dealers to retain their margins," says Mankotia. But, in addition, the IT team also had to track sales up to the customer level and build a customer database. This was the only way it could revive customer confidence in the brand. One of the things that stood in the way of the IT team was the fact that they had to manage with a home-grown ERP system, and this meant that they had to customize it themselves without much help from the vendor.

With the home grown ERP - which they call Greatplus - they have not only automated their entire production process right from procurement to production, but have also successfully integrated it with their external channel partners. Mankotia's team also decided to use a simple mechanism for data management: SMS. "This is the most simple and innovative way for controlling MOP and for tracking and maintaining stock at the location of the distributors and the dealers without spending too much," he says. "With each dispatch, an SMS is sent to the distributor about the material that is dispatched to him. All this is recorded by our ERP system," he says. The innovation of using SMS comes into play when the dealer makes a sale to an end customer. When the dealer sells a mattress to a customer, he uses his own mobile phone to SMS the product serial number along with the customer's mobile number to a number belonging to Sheela Foam.

"This SMS is fetched by our database, where the system checks the entire transaction. Within two minutes of the SMS being received, the system automatically informs the dealer and the customer, through SMS, about the 'Successful Guarantee Validation' and the MRP of the product," says Mankotia.

Sheela Foam spent about Rs 2 crore on Greatplus, and it went live in January 2007. Before the project, registering for a guarantee could take many months and the company paid approximately Rs 15 per guarantee registration. "Now, the guarantee is registered in just two minutes and we are spending only 40 paisa on the SMS," says Mankotia. This difference in cost has been passed on to the dealers, and naturally they are happy. The dealers are happy and Sheela Foam is pleased. But the IT team is more than glad. Mankotia says, "Discounting is the biggest problem in the consumer durable industry in India. No one has gone to this extent to control MOP. We have controlled sales through unauthorized dealers, stopped infiltration, controlled selling to non-dealers, controlled interdealer competition by giving heavy discounts, and also built a strong customer database for the future." Mankotia is also pleased to point out that "guarantee registration through SMS is an unique and innovative method that no one as per our knowledge has ever done in the country."