About Indian Tourism

As per the Travel and Tourism Competitiveness Report 2009 by

the World Economic Forum, India is ranked 11th in the Asia Pacific region and 62nd overall, moving up three places on the list of the world's attractive destinations. It is ranked the 14th best tourist destination for its natural resources and 24th for its cultural resources, with many World Heritage sites, both natural and cultural, rich fauna, and strong creative industries in the country. India also bagged 37th rank for its air transport network. The India travel and tourism industry ranked 5th in the long-term (10year) growth and is expected to be the second largest employer in the world by 2019. India has been ranked the best country brand for value-formoney in the Country Brand Index (CBI) survey conducted by Future Brand, a leading global brand consultancy. India also claimed the second place in CBIs best country brand for history, as well as appears among the top 5 in the best

Contribution to the economy

According to the Travel & Tourism Competitiveness Report 2009

brought out by the World Economic Forum, the contribution of travel and tourism to gross domestic product (GDP) is expected to be at 6.0 per cent (US$ 67.3 billion) in 2009 rising to US$ 187.3 billion by 2019. The report also states that real GDP growth for travel and tourism economy is expected to be 0.2 per cent in 2009 and to an average 7.7 per cent per annum over the coming 10 years. Export earnings from international visitors and tourism goods are expected to generate 6.0 per cent of total exports (almost US$ 16.9 billion) in 2009, growing (nominal terms) to US$ 51.4 billion in 2019. The travel and tourism sector which accounts for 6.4 per cent of total employment or 1 in every 15.6 jobs in 2009 is expected to generate 40,037,000 jobs i.e. 7.2 per cent of total employment or 1 in every 13.8 jobs by 2019. Real GDP growth for Travel & Tourism economy is expected to be 0.2 per cent in 2009 and to average 7.7 per cent per annum over the coming 10 years.

Government Initiative
The campaign Visit India Year 2009 was launched at the International

Tourism Exchange in Berlin, aimed to project India as an attractive destination for holidaymakers. The government joined hands with leading airlines, hoteliers, holiday resorts and tour operators, offering them a wide range of incentives and bonuses during the period between April and December, 2009. The airlines participating in the campaign, Air India, Jet Airways and Kingfisher Airlines are offering a companion free ticket for every ticket purchased for international and domestic flights. Connecting flights to the departing airports are included in the final travel costs. The Indian Travel Agents Association (IATO) is offering holiday-makers a free sightseeing tour in a city of their choice. Euromonitor International's Travel And Tourism in India report states that the Government of India increased spend on advertising campaigns (including for the campaigns Incredible India and Ahithi Devo Bhava Visitors are like God) to reinforce the rich variety of tourism in India. The Ministry promoted India as a safe tourist destination and has undertaken various measures, such as stepping up vigilance in key cities and at historically important tourist sites. It also deployed increased manpower and resources for improving security checks at key airports and railway stations.

Initiatives at State-level with involvement of Locals:

States are taking initiatives in teaming with locals to provide a flavor of their culture and traditions. Some of the initiatives are mentioned below:
HIMACHAL PRADESH - The Himachal govt has introduced a scheme

Himachal Pradesh Home Stay Scheme 2008 under which tourists are given the opportunity see the rural areas. GUJARAT Through the Vibrant Gujarat programme plans to actively market the tourism sector. MP The govt of MP is keen to initiate the development of an artificial beach in the state. The concept is based on Ocean Dome artificial beach in Japan. KERALA - Kerala has introduced innovative tourism initiatives. Two of its villages, Aranmula and Kumbalangi, are being promoted as tourist destinations in a big way as part of the Endogenous Tourism Project of United Nations Development Programme and Govt of India. RAJASTHAN - Rajasthan has a developed tourism infrastructure, with close to 6,000 hotel rooms spread over more than 150 hotels. AP AP has about 18 projects lined up under various categories such as temple circuit development and eco-tourism projects.

Tourist Circuits in India

CULTURE, HERITAGE AND ETHNO :TOURISM Chattisgarh, amongst other states

has identified and is developing ethnic villages. The private sector is also being encouragement for proper maintenance. ADVENTURE TOURISM Adventure sports such as water sports, trekking, rockclimbing, para-sailing and bungee-jumping are popular with the younger travelers and working executives.

 ECO TOURISM Indias forest, national parks and wildlife sanctuaries are

major attraction for a whole lot of tourist from around the world. AVIAN TOURISM Adding another dimension to the Kerala's backwater and health tourism is the avian tourism to attract birdwatchers from all over the world. MEDICAL TOURISM AND SPAS India has originated as one of the most important hubs for medical tourism. Many people from the developed countries come to India for the rejuvenation promised by yoga and ayurvedic message therapy as well as for high-end surgeries like cardiac bypass surgery or knee/hip replacement. HIGHWAY TOURISM - Besides catalyzing diversification of tourist traffic and revenue from the urban centers, planned development of highway tourism opens opportunities for enhancing local employment and uplifting rural economy through local feeder enterprises, which will find scope to grow in the vicinity of such highway tourist complexes. RAIL TOURISM The Indian Railways has introduces several new services to promote rail tourism luxury tourist trains, exclusive steam and hill charters, tour packages. CARAVAN TOURISM A new policy guideline to promote Caravan Tourism in India and facilitate the infrastructure required for the same would be announced. WELLNESS TOURISM - A new policy guideline for promoting Wellness Tourism in India would be announced. The policy would aim to leverage Indias potential in traditional systems of wellness and medicines like

Travelers analysis
2 % 2 % 2 % 2 % 2 % 2 % 2 2 % SE Asia W Asia W Europe Africa Australia C & S America E Asia E Europe N America S Asia
2 2 2 2 2 2 2 2 Num ber of Travellers (Mn)

Share of Outbound Travelers, 2006-2008

2 2 % 22%

Number of Outbound Indian Travelers 2 2

2 2 2222 22 22 2222 2 2 2 2 2 2 2 2

Foreign Tourist Arrivals

Estimates of foreign tourist arrivals (FTAs) and

foreign exchange earnings (FEE) are important indicators of the tourism sector. FEE in US$ terms during the month of November 2009 were US$ 1.2 billion as compared to US$ 1 billion in November 2008.

Tourist Visits in India

The number of domestic and foreign tourists has almost doubled in 2003 and 2008.

Indian Tourism Industry-Market Size

2 2 2

Market Size in Bn

2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 E
2 2 % 2 2 % 22 2 2% 22%

11

International Tourist Spends Domestic Tourist Spends

2 2 2 2 2 2 2 2 F

111

2 2 2 2 F

India GDP Growth

The most important growth is the robust economic growth that has been witnessed in the country. Indias GDP has been growing at the rate of 6% since the liberalization of economy in 1991 and has grown over 8% in the past few years. At 8% CAGR, Indias GDP would almost triple from US$ 1200 Bn to US$ 3500 Bn by 2023

Growth in GDP per Capita

Indias strong economic growth has caused the GDP per Capita to increase rapidly over the past 5 to 10 years. At current rate, the GDP per capita in 2013 would be double of what it was in 2003

Distribution of Households Across Income Brackets

More and more families are expected to leave the deprived or aspirers category and join Indias burgeoning middle class. By 2025, the Indian middle class is expected to constitute 46% of the Indian population. Subsequently, discretionary spends would be going up and this bodes

Share of LCCs In Airlines

2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2

2 2 % 2 2 %

% n i e r a h S

Fsc: Full Service Carriers LCC : Low Cost Carriers

The above graphs indicates the increasing share of LCC from 33% to 47% between 2006 and 2008. The advent of LCC has spurred domestic air travel to grow from 11 Mn travelers to 36 Mn travels in the last decade. Operational airports in the country have gone up from close to 40 airports in 2004 to 81 airports at present.

Air Travel in India

2 2 2 2 2 2
e l t T s i x A

2 2 .2 2 % 2 2 .2 2 % 2 .2 2 %
T otal Domestic International

2 2 2 2 2 11 11 -2 2 2 2 -2 2 2 2 -2 2 2 2 -2 2 2 2 -2 2 2 2 -2 2 2 2 -2 2 2 2 -2 2 2 2 -2 2 2 2 11 11 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2

Steps taken by Government to Promote Tourism in Country.

Airline tickets, tour package are all set to go

cheaper with 2% reduction in service tax State-run oil companies have slashed Aviation Turbine Fuel (ATF) prices by 7%, the 11th reduction since September last year. Airport Charges to be cut for a limited period by 50%. Removal of 8% excise duty on ATF. Reduce the charges which airport operator charges from the oil companies, leading to enhanced performance.

Indian Textile and Apparel Industry

Indian textile and apparel industry is one of the oldest and

most significant industries in the country and one of the largest in the world. Apart from China, no other country can match the size, spread, depth and competitiveness of the Indian textile and apparel industry. Today the industry contributes around 14% to industrial production in the country, 4% to the GDP, is estimated to directly employ apprx. 35 Mn people apart from the indirect employment in allied sectors, thus making it the second largest employer after agriculture. It accounts for about 15% to the countrys exports and is, in sum, an important economic engine for the nation. In the past 10 years, the industrys actions, government policies as well as market events have begun to converge, providing several growth opportunities for the sector

Current Size : Indian Textile and Apparel Indian Textile and Market Apparel Market US $ 62
Bn Domestic Market US$ 40 Bn Exports US$ 22 Bn

Textiles US$ 12 Bn

Clothing US$ 10 Bn

The present size of the Indian textile and apparel market is US$ 62 Bn of which 22 US$ Bn is exports while rest US$ 40 Bn is the domestic market. The Indian domestic textiles and apparel market is one of the fastest growing market in the world. It is expected to become one of the major consumption bases in near future. The textile industry plays a significant role in getting the foreign exchange reserves into the country as it contributes approx. 15% of

FDI in India : Current Scenario

Due

to Indias recent liberalization of its foreign investment regulations, the country has become one of the fastest growing destinations for FDI inflows. India offers many advantages to foreign investors like strong economic growth leading to increased buying power by the middle class, low wages, and an educated work force. Indias Special Economic Zones (SEZs) attract foreign investment by providing tax incentives, assistance with bureaucratic and administrative problems and access to reliable infrastructure. Indian economy is growing 6 % per annum since last 10 years. Even in times of recession / slowdown in most of the developed economies, India is expected to maintain this level of growth. From August 1991 to March 2009, India has attracted a total of US$ 106 Bn, of which approx. US$ 90 Bn was invested during Apr 00 to March 09. In textile and apparel sector, 100% FDI allowed under the automatic route. FDI sectors to the extent permitted under automatic route does not require approval either by Government of India or Reserve

Foreign Investment in Textile and Apparel Industry Vertically Integrated :

Cotton Other Natural Fibres MMF

Ginning
Small Players

Spinning

Extrusion
Small Players

Garment

Weaving / Knitting

Processing

Domestic Retail / Exports Buyers

Distribution Channel

Big players constitute mainly the composite units or garment exporters

Indian industry is amongst the very few in the world that is vertically integrated from raw material to finished products. ( from fiber to retail). Broad range of Products Indian Industry has over the years steadily diversified its raw material base t include man made fibers such as polyester, viscose, acrylic, polypropylene etc. Production Capacity : The capacity in spindles in the mill sector increased from 35.9 Mn in 2007 to 38.4 Mn in 2008. Fabrics: The Indian weaving and knitting has today includes products as

International Outlet Centers

Outlet Center Country Mall Size ( Mn Sq Ft.)

Chelsea Premium Outlets Atrium Furniture Mall Sungei Wang Plaza Bicester Village

US US Kuala Lumpur UK

0.2 0.3 1.2 -

An outlet Center offers discounted merchandise for slow moving items and non seasonal merchandise for various categories. Dominating categories include apparel & footwear, consumer durable, furniture, furnishings and electronics. This sort of concept, leveraging first- mover advantage, does not exist in India.

International Lifestyle Centers

Outlet Center Country Mall Size ( Mn Sq Ft.)

Deira City Center Ngee Ann City Suria KLCC Times Square Pacific Place

Dubai Singapore Kuala Lumpur Kuala Lumpur Hong Kong

1.2 2.0 1.4 3.5 0.7

A lifestyle center is essentially a premium shopping destination designed for the entire family. Lifestyle centers have emerged as the most successful way to differentiate and create space in the already established retail malls.

Healthcare Industry

The wave of change has swept across every industry, such

dynamism and corporatization has completely changed the face of the healthcare industry. Due to increased competition Healthcare Providers are unable to pass the burden onto patients in the same proportion. Since there is a rising demand and unprecedented growth of the sector, there is a growing need to come up with newer models to improve operational efficiency and make processes, infrastructure and out outlook to management more lean and specific.

The Ongoing Transformation in Hospitals

Documentati on Mode of Payment Public Relations Quality Hospital Financial Operations Human Customization Resources

Electronic Medical Records

Third Party

Marketing / CRM

Accreditat ion

Revenue Cycle Managem ent

Active Employee engagem ent

Personali zed Care

Changing Healthcare The Toyota Way

Changing market dynamics and customer attitudes are forcing companies to redefine their business models. While there is no standard formula to do the same, hospitals have improvised and developed their own USP models. Some innovative practices adopted by hospitals to reduce the costs and improve on the throughput:
A popular for-masses Indian hospital charges different

fees for diagnostic services at different times of the day. They have been able to increase patient volumes by differential pricing.
To streamline operations, use of Case Process Map

wherein the activities of all the staff involved in a procedure are mapped and time plotted allowing the variation to be studied and corrected.

Case Process Maps

Start Patient Entry Surgeon Assistant Machine Support OT Nurse

Patient Prep

Incisio Procedur End Closur Patient n e e Exit

Room Cleaning

Anesthesiologi st

Japanese Process Improvement Traid.

Eliminate Muda : Waste Reduction

Avoid Muri: Standardization

Minimize Mura: Promote Consistency

Muda: Waste Mura: Inconsistency

Muri: Randomness

Many hospitals are adopting the classic Japanese Process Improvement Traid as Shown. Activities such as reorganization, value mapping and best practices are designed to help implement these principles

Facility Planning: Role in Performance enhancement

In recent times patient expectations and demand for quality

healthcare facilities in India have undergone a transformational shift. In todays changing environment, as hospitals look to improve their performance, they should take into account various design parameters that can result in direct or indirect economic benefits. Some of the parameters that can lead to operational efficiencies and thereby, cost savings are:
Patient monitoring. Patient flow. Nurse travel distances . Standardization.

Facility Planning

Patient Monitoring Ideal Unit Configuration for Critical Care

Patient Arrival Registration Waiting

Nurse Travel Distances Layout of a Typical Patient Care Unit Nurse Travel Distances

Patient Flow Typical Patient Flow for Outpatient Services

OPD Consultation Billing Pharmacy Diagnostics

Customer Relationship Management

Customer Relationship Management (CRM) is a method for an

organization to track, maintain and organize a database of its current and prospective customers. In the healthcare sector, there is a wide difference between the customer and consumer. Hence there is a series of relationships that need to be nurtured and managed to enhance patient retention. CRM is increasingly applied in the healthcare industry in the following way:
CRM goes long way in building patient confidence and goodwill, and

hence it becomes a deciding factor for patient while choosing a hospital again. Hence customer service is one of the major drivers of repeat business. In a active CRM programme it is necessary to train every member of the hospital in providing quality care and service to the patient . It plays important role in retaining the patient. The cost of efforts undertaken to retain a customer is ten times lesser than that of acquiring a new one.

Application of CRM
Application of CRM
CRM has now evolved into a science which has been used very effectively and productively to enhance the efficiency of various sectors such as the banking industry.
Collection & Integration of Customer data

Multi-channel Integration

Customer Marketing Credit Cards, Insurance Schemes Customer Analysis

Customer Delight & Retention

Customer profitability, Propensity to busy, Attrition behaviors Analysis & Application Of this date to provide quality Service to customers

Customer Care

Hospital Revenue Cycle Management

Standard Revenue Cycle with Activity Analysis Front - end
Appointments Scheduling Registration Patient information collection Information verification Insurance validation Registration Computing the deductibles and co-payments Public health insurance program counselling Clinical documentation (used in the billing process and Communicated to third-party Payer)

Collection and recording of cash received Contractual allowances

Back-end
Follow up for outstanding payments/accounts receivable Denial management
Billing and collection Claims review, approval and denial along with insurance company

Core
Charge capture into Hospital information System (HIS) Diagnosis and procedure coding

Less than 10% of the Indians are estimated to be covered under some sort of health insurance. Most patients pay for their hospital expenses directly. Today in most hospitals in metro cities, over 50% of patients have some form of third-party reimbursement plan. Failure to realise this could seriously affect the working capital of a hospital. The hospital revenue cycle has 3 major components :
Front-end: From the time the patient comes in first contact with the hospital to registration. Core : Provision of actual healthcare services.

Electronic Medical Records

Advantages of EMR
Continuity in treatment Accessible at all times, Continually upgraded

Safe with Authorised viewership

Cost efficient

Vital information At vital times

Search and sorting Made easy

In India, barring a few Pvt. Hospitals, all record are maintained in physical form. For cross referral check or an opinion at second hospital, the patient has to go through the entire process of documentation and resting again adding to his financial distress. Electronic Media Records (EMRs) eliminate the burden of tedious paperwork occupying much of the physicians quality time. EMR serves as comprehensive database of the patients entire history, but they are also very userfriendly as they help to locate relevant data instantly when needed across multiple locations and point of times.

Case Study: An Indian 650-bed multi-specialty state-of-the-art hospital deployed an advanced web-based HIS.
Better inventory and medical package control. Rapid access to laboratory result. Improved continuity of medical records
Automated patient billing
With over 400,000 outpatient visits per year, the hospital reduced its outpatient processing time by 40% to increase patient throughoput..

Customisation

Pharmaceutical substitution

Flexibility

Speed

Security assurance Scalability and with control interoperability

Innovation @ Google

Google Maps Earth Medical Consultation online

Google Health Manage Health records

GH on iPhone Mobile phone health access

Google flu trends Digital Outbreak detection

Many companies like Google, have innovated and taken technology a step further by coming up with a whole range of medical technological applications such as predicting epidemic trends and also making healthcare advice available on cell phones

Impact of Warehousing
Technopak estimates that for most organisations, 6-8 locations will have mega warehouses with complex operations in the near future. Thus, modernization of key warehouses is strongly recommended on account of:
Large sizes, high through outputs and more complex

operations. Increasing level and variety of service required by customers, especially organised retailers. Increasing scarcity of skilled labor and real estate requiring vertical and mechanized warehouse.

Freight Savings Due to Case 1 : CST at 2% State Border Old Warehouse GST
1000 Kms Plant

Illustrative freight distance (and hence cost0 saving of 400 Kms for Cutomers1
Case 2 : GST State Border Old Warehouse

Customer 1

Customer 2

Plant

200 Kms

Customer 1 New Warehouse

Customer 2

In Case I, the source is State A (left) and the customer is in State B(right). Due to CST barriers, the customer can only be served from a warehouse in State B but by backtracking in the direction of the source. In Case2, after the introduction of GST, the network linkage is re-defined and the back tracking is saved substantially by serving the customer directly from the factory, or a warehouse on the way in State A itself. The freight distance saving translates directly

Impact on Service Level

The key fallout of GST aligned networks is fewer warehouses but this also has two implications on customer service:

Longer Lead-times to Customers: This would not be an issue as long as the network redesign exercise puts a minimum lead time/distance constraint while serving customers in the new network. Improved Assortment : Often SKUs needed by customers are not available at the ware house meant to serve them although they may be idling at another warehouse. The Key to improve service to customers is to undertake a professional scientific exercise as opposed to manual experience based methods that many firms have used for designing their

Our Methodology for GST Implementation Solutions Impact Analysis Model Warehouse New Network rollout
Audit of Current Setup. Future Scenario impact Engineering Design & Layout. Modernisation Change Management

Distribution Setup Design Network modeling based on MILP Programming. Minimise cost subject to service level & other constraints

Change Management Planning CST transition planning, Vendors. Employees, Systems & Processes

Impact of GST on the Supply Chain

GST Characteristic
Extended Central GST Chain

Impact on Supply Chain

Implication

At present, service tax on logistics services This will boost outsourcing in consumed during distribution and retail are not off- supply chains and provide greater settable against CENVAT impetus to 3PL's Extended Central GST chain will allow the offset in post manufacturing networks This will lower the cost of logistics outsourcing as the 10.3% service tax charged by logistics companies can be largely offset against the Central GST liability Affected Inventory Post GST, inventory will also carry Central GST & Organisations need to study GST's inter-state GST input credit, the tax rates may also final mechanisms and plan get changed for many products inventory transition very carefully for themselves, suppliers and Unless the GST rates go up for its product, the customers firms would be encouraged to minimise pre-GST inventory which has less input credits As the GST implementation date approaches closer, one could expect uncertainty and panic regarding pre-GST inventory as was seen during VAT introduction Subsuming Octroi & Entry Tax Octroi and entry tax are not in line with the spirit Organizations will be encouraged of GST although in some cases entry taxes are to locate warehouses and hubs in VATable entry tax and Octroi zones and Once these taxes are paid reverse flow of goods stock more inventory there becomes difficult, hence companies prefer postponed and uni-directional flow of goods across entry tax and Octroi borders Organisations will be encouraged to locate There are two possible scenarios through which Organizations can and should warehouses and hubs in entry tax and Octroi zones tax barriers would be removed: design their networks purely and stock more inventory there supply chain considerations and Scenario 1: CST rates would reduce to zero not tax considerations with no carry-over of input credit across states Scenario 2: Stock-Transfers are disallowed/taxed and inter-state sales are taxed with carry-over allowed In both cases, companies would no longer be required to have a warehouses in every state just

Details of the Tables mentioned in next slide

Table 1 : Suppose a firm currently does a stock transfer from State A

to State B, before selling in State B to avoid paying CST . It thus gets a margin to US$0.50 per unit and incurs local VAT only when it sells in State B to its distributor through its depot. The distributor charges a margin of US$ 0.14 per unit and charges the final price by adjusting the input credit ( Which is available since the sale from depot was intra-Stat). In this case, Price to Retailer = (Distributor landed cost + Distributor Margin Distributor Input Credit)* (1+VAT Rate). Table 2 : In todays 2% CST scenario, the firm incurs US$ 0.08/unit loss in margin. If it were to do a cross-border sale to the distributor, without going through transfer at the depot. The calculations are based on the premise that the US$/unit retailer margin, distributor and MRP are maintained at the same level. Table 3: If CST rates were to become zero then the firm can do cross border sale (at 0% rate) directly to the distributor without any loss of margin to itself, the distributor or the retailer and yet charge the same MRP to the consumer. Table 4: If CST is abolished and inter state sales or stock transfers are

Detailed Impact of Removed Tax Barriers on Cross-border Sales Table1: Current - Stock
Transfer Sale
Stock Transfer Sale Source Depot Distributor Retail Landed Margin Input VAT Price Cost Credit Before Tax 100.0 24.2 124.2 124.2 124.2 129.2 6.5 5.0 130.6 135.9 13.6 5.2 144.2 VAT CST Tax 0% 12% 12% 12% 0% 4% 4% 4% 5.0 5.2 5.8 5.0 0.3 0.5 5.8

(All figures except VAT and CST are in US$/unit) Net Tax Final Price

12.4 129.2 135.9 150.0

Table2: Current -2% CST Sale

Stock Transfer Sale Source Depot Distributor Retail Landed Margin Input VAT Price Cost Credit Before Tax 100.0 21.8 121.8 124.2 124.2 12.9.2 6.5 5.0 130.6 VAT CST Tax Net Tax Final Price

0% 4% 4%

2% 0% 0%

2.4 5.0 5.2

2.4 5.0 0.3 7.7

12.4 129.2 135.9

Commercial Impact of GST

Table3: GST-Zero CST Sale
Stock Transfer Sale Source Depot Distributor Retail Landed Margin Input VAT Price VAT Cost Credit Before Tax 100.0 24.2 124.2 0% 124.2 6.5 130.6 4% 135.9 13.6 5.2 144.2 4% CST Tax Net Tax Final Price 0% 0% 0% 5.2 5.8 5.2 0.5 5.8 124.2 135.9 150.0

Table4: GST - Inter State Sale Taxed with Offset Allowed

Stock Transfer Sale Source Depot Distributor Retail Landed Margin Input VAT Price VAT Cost Credit Before Tax 100.0 24.2 124.2 4% 129.2 6.5 5.0 130.6 4% 135.9 13.6 5.2 144.2 4% CST Tax Net Tax Final Price

5.2 5.8

5.0 0.3 0.5 5.8

129.2 135.9 150.0

Impact of GST on the Supply Chain

Evolution of Key Indirect Tax Reforms GST GST Introduction
2nd Level Reforms CST
Reduction

CENVAT MODVAT

Introductory Reforms Sales VAT

Network Re-engineering for GST

The move towards

fewer warehouses would require many Annual Turnover 24 Hrs 48 Hrs warehouses to (US$ Mn) combine, close and relocate. < 600 24 28 20 -24 Required capacity of many warehouses will 600 1500 22 26 18 - 22 undergo changes. With > 1500 20 24 16 - 20 fewer warehouses, the average size of the warehouse will go up. impacted by CST considerations. However, Hubs are not directly fewer & larger warehouses may make throughputs. Thus, the size and number of hubs could get affected. The linkages between factories-hubs-warehouses-customers for various products will get re-aligned.

Delivery Lead Time for 80% Urban Customers

Pros & Cons of Network Reengineering for GST

Clearly, the benefits outweigh the disadvantages. Besides providing a simpler and more manageable network, Technopak estimates between 5% to 10% net savings in logistics _ inventory carrying costs of an organisation through this exercise. Fewer warehouses would mean a straight saving on warehousing costs.
xed ts ced fi Redu using cos o h e W ar ry vento oot n i d r ce Redu e Square s r e ( inv ing law) plann d ie f i l Simp duced e and r use and nt e ho ware managem C&FA
times r lead e h ig H s tomer to Cus er ly high ib s s o P t cost freigh lly ia espec ry freight da secon

*Safety Inventory 1/Sqrt ( Number of Stocking Points)

The root that law states This inverse also means the safety stock requirement would also go down. that : Prime-facie, it would appear that some of these savings would be offset by the increased cost of freight.

Transforming the Business Landscape- Social Media Sites

The increase in penetration and usage of internet in

developing countries has led to the emergence of a new trend the growth of social media. People are now spending significant part of their internet time on social networking/ blogging sites. As the popularity of the medium, the nature of consumerbusiness relationship is getting redefined. The balance power is shifting towards the consumer with their voice becoming more powerful than marketers. Many companies , especially in the developed economies have recognized the value of consumer generated content and built their presence on social media, where the consumer is more active.

The Multiplier effect Usage Across Business Areas

Brand Awareness Product & Service Promotion Customer Service

People

Customer Understanding Promotion of Social Causes

Product Development Knowledge Sharing

Employment

Brand Building

According to Aberdeen Group 63% of the best-in-class companies surveyed across the world plan to increase their social media marketing budgets in 2009. In USA alone the social media spend is expected to increase from US$ 716 Mn to US$ 3113 Mn in 2013. In India around 82% of the top 500 marketers in India spend close to 5% of their total advertising budget online. 26% of this online spend is targeted towards development and maintenance of brand specific websites and another 13% goes

Obama Success through social media

Twitter 291000 followers

My space page 1.26 Mn friends

Facebook page 32000 active application users

You Tube 100m+ Vedio view, 164K Subscribers

Indian Cos on Social Media

Seeking Feedback - Titan Hiring New Talent E & Y Customers Support Kingfisher Airlines, PVR Cinemas

Brand Awareness Apollo Hospitals

Brand Promotion Tatas Nano

Brand Promotion - MTV India

The use of social media is now gaining popularity in India. Leading companies are leapfrogging in the social media space with their own social networking sites and spreading multiple legs across various social media platforms. Infosys, TCS, Rediff, HCL, Cleartrip, Fritolay and Naukri and India arms of MNCs like Microsoft, IBM, and Hindustan Unilever are few names that launched their social media presence with corporate blogging.

Successful Use of Social Media

Area Company Activity Undertaken Activity holding consumer interest through engagement ads on social networks - set up of an online game Impact The game was played more than 14,000 times during the 1 month campaign. Rise in page view by over 48,000 a week Increasing Brand Adobe Awareness

Product promotion

MTV Capitalizing on social media Over 40000 fans on facebook India to keep the show buzz alive - creation of an online and highly interactive model of the real game show Partnering with customers to contribute to, and integrated into, Dell's product development 12511 ideas contributed to community, with 86255 comments. 366 ideas implemented leading to launch of Latitute Laptop 60000 blog users, 17000 different blogs, 1 Mn page views per day on internal wikis.

Product Dell Development

Employee IBM Engagement

Multiple in-house versions of web 2.0 with the intention of brining employees, alumni,

Social Media Maturity Spectrum

Type of social media Initative Customer Reach Customer Engagement Customer Empowerment Customer Involvement Low Medium High

Impact

Establishing Presence

Building Connections

Building Relationship

Value Generated

Consideration

Sales

Loyalty

Maturity Index

Identify the Target Consumer : Examine the sociotechnographic profile of target customer. Set Objectives: Decide what the company wants to accomplish with social media and how the results would be measured. Make a Plan: Plan for how relationships with customers will change and build a strategy around changing relationship with customers. Adopt Technology: Pick the appropriate platforms, tools and

The Social Media Influencer Model

Its essential for a company to adopt a systematic approach towards social media- the mantra is Listen, Understand and Engage. Even before embarking on a social media journey, it is important for companies to explore the medium and listen to the company or brand specific conversations on the web understand what consumers are thinking and saying about their brand. They should identify and segment the consumers as shown in social

Evolution of shopping centers in the US

Phase 1 (1920-1950) Development Of shopping center Garden City Shopping Center

Retail Development

Development of Operational process

Regional Center

Phase 2 (1950-2000) Era of modern shopping mall

Customer Dissonance Theme / Festival Centers Cost Focus on Entertainment

Differentiation

Factory Outlets

Bigger Malls

Competition from discounters & super centers Lifestyle Centers Community Participation

Changing dynamics of retail Real-Estate business

Liquidity Crunch Organised retails Lower than Anticipated growth Uneven distribution Of mall space Showdown in consumer spending High Opr. costs Largely due to high rentals Poor Mall Management Commoditization of Mall space Shortfall in supply of mall Correction in rentals

Unsatisfactory performance of mall space

Growing trend towards revenue sharing

Retailers vacancy

Retailers lowering profitablity

Careful planning, Position & management of mall space yet to happen !

The Outlook for Indian retail looks quite promising in the near future and the current turmoil should be over in 2 to 3 quarters. The retail center of the future-whether it is enclosed or open-air, big or small, themed or general would also be designed to resemble a community, not just a place to shop and entertainment would emerged as vital component in the development of new malls.

Education Industry
The enrollment in higher education is currently at 17 Mn at a Gross Enrollment Ratio (GER) of 13%. Enrollment are projected to grow at a CAGR of 5.6%, reaching 22 Mn by the year 2013 and 29 Mn by the year 2018. As per these estimates, 12 Mn additional seats in the higher education would need to be created by the year 2018 as shown in the Exhibit 2. Total Current and Projected Growth in Higher Education Enrollment (Mn)
GER 21% GER 17% GER 13%

17

22 22

29

Enrollment in Higher Education

The cost per seat in a regular higher education institution is UD%$ 8300. Therefore, the total investment that India required for higher education alone would be US$100 Bn.

Total Current and Projected Growth in K-12 Enrollment Currently, the total number of
students enrolled in K-12 schools in the country is 317 Mn and expected to grow to 328 Mn by 2013 and further to 351 Mn by year 2018.
222 222
97

Total Current and Projected Growth in K-12 Enrollment (Mn)

97 10 0 80 Age Group

22 - 22

74 22 - 22 72 Clearly, India will need to add at least 34 Mn additional seats 2 - 22 222 14 15 17 in K-12 segment in the next 10 7 8 1 years to cater to the education 2 needs of its continuously 1111 2222 2222 growing population, as shown in the Exhibit 1. The cost per additional seat, at a conservative estimate is US$ 2400 (cost of land included at US$ 1 Mn per acre). This translates into a minimum investment requirement of US$ 80 Bn of investment over the nest 10 years to establish these 34 Mn seats.

222

Vocational Streams of Education

Parameters
Health & Beauty
No. of Students Capex- 1 Centre (US$) Cost Per Seat (US$) 1380 195,800 145 560 133,333 240

Counseling

English Speaking
1180 100,000 84

Cost per Seat Estimation in Few Vocational Streams of Education

The vocational education and training landscape of India is extremely underdeveloped. India currently has 5,500 industrial training institutes and 1,745 polytechnics as compared to 500,000 similar institutes in China. This infrastructure cater to only 2.5 Mn people annually. There are 175 trade training programs in India as compared to 1,500 in the USA. Clearly there is a pronounced skill gap in terms of both quality and quality in the country. As estimated 85-90 Mn people with vocational skills would be requited in various sectors between 2008-2013. According to industry sources, the split of people intake sector-wise over the next 5 years will be 44.8% from the service sector, 31.2% from agriculture and 12.6% from manufacturing. Cost per seat will very vary significantly in this segment depending on the location, scale, positioning of training service and investment by private players

Ayurveda Marvel
The world today has come to understand

Ayurveda as a wonderful system of herbal healing. During the last 3 decades, there has been a worldwide back to nature trend. There is a great interest in Ayurveda in many countries, prompting studies and scientific research to assess its worth.

Global and Domestic Market for There is an increasing demand for alternative medicines and herbal Ayurveda
products. . The growth rate of herbal beauty care business is at around 40%. India is one of the largest markets in the world for personal-care The growth of the Ayurvedic products service industries, like Ayurvedic center for Panchkarma, Dhara and Kairali massage, Ayurvedic skin and hair care, as well as Ayurvedic Spas due canto be to attract tourism the growing worldwide interest in these treatments. developed Both Ayurvedic products and services can enter the international market through the franchise system.

Coming of Spas
With concept of total well being

gaining ground spa treatment are becoming popular. Nowadays salons are being converted in today spas and offering both saloon and spa treatments. Ayurvedic treatment are ideal for Spa treatments. Shahnaz Husain group has tied up with the Hyakumata group of Japan and setup the worlds largest Ayurvedic health resort, based on the franchisee system, on the US island of Saipan, off the pacific coast. Today Ayurvedic beauty treatments have become an important component of cosmeseuticals. Extension of our franchise ventures branding are very much a part of our future plans.

The Road Ahead

According to the latest Tourism Satellite Accounting (TSA) research, released by the World Travel and Tourism Council (WTTC) and its strategic partner Oxford Economics in March 2009: The demand for travel and tourism in India is expected to grow by 8.2 per cent between 2010 and 2019 and will place India at the third position in the world. Indias travel and tourism sector is expected to be the second largest employer in the world, employing 40,037,000 by 2019. Capital investment in India's travel and tourism sector is expected to grow at 8.8 per cent between 2010 and 2019. The report forecasts India to get capital investment worth US$ 94.5 billion in the travel and tourism sector in 2019. India is projected to become the fifth fastest growing business travel destination from 2010-2019 with an estimated real growth rate of 7.6 per cent. Preparing for the 2010 Commonwealth Games in Delhi, the Tourism Ministry is exploring the provision of tented accommodation to tourists in Faridabad and Suraj kund in nearby Haryana.

THANK YOU