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Indiabulls Securities Ltd.
INDIABULLS GROUP
1%
Indiabulls Real Estate Indiabulls Financial Services Indiabulls Power
27% 44%
68%
Indiabulls Securities
28%
INDIABULLS GROUP
It is one of the pioneers in retail brokerage. It had its IPO in 2008. IBSL generates brokerage from the following services:
Online Equity trading accounts Online Currency trading accounts Sale of Indiabulls Real Estate products. Sale of loans of Indiabulls Financial Services.
Business Manager
Business Manager
Business Manager
Business Manager
Relationship Manager
Relationship Manager
Relationship Manager
Relationship Manager
STRENGTHS 1. 2. 3. 4. A powerful brand name and brand recognition Presence of a large sales force. Nationwide reach. A large client base. 1. 2. 3. 4. 5.
WEAKNESSES Lack of training amongst relationship managers. Lack of confidence of Indiabulls group in IBSL. Easily replicable processes. Presence of a large proportion of dormant clients. Inability to increase the currency client base.
OPPORTUNITIES 1. High growth of other B2C companies under the 1. Indiabulls umbrella. 2. Application for a banking license by Indiabulls group. 2.
THREATS Intense price based competition in the industry leading to depleting margins. Entry of banks in the industry which have simpler processes for the customer. 3. 4. Slowdown in the retail participation in the equity market. Lack of training amongst sales persons to sell products of other sister companies.
Indiabulls Real Estate Ltd. was listed in Dec. 2006. Its net worth has increased more than 5 times from Rs. 1233.61 Cr. to Rs. 6414.27 Cr. It has also witnessed a 148% increase in its gross profit in FY-11 compared to FY-10.
REGION Mumbai Delhi-NCR Chennai PORTFOLIO SIZE $7.5 billion $1 billion $0.510 billion
PART II
Questionnaire based research on the sales force to analyze the vendor controlled factors.
Project Objective
PART I: SHADOWING OF THE INDIABULLS SALESPERSONS It was decided by the management that the project shall be only focused on the sale of Indiabulls Real Estate products. The marketing of either Indiabulls Securities or Indiabulls Real Estate shall be out of scope for the project. The products analysis shall be out of scope for the project as the management does not have control over Indiabulls Real Estate. The analysis shall be limited to the Relationship Managers (RMs) of Indiabulls Securities only. There shall be no data (qualitative or quantitative) explicitly extracted from the clients as this may hurt the sales pitch. The entire sales process, from client acquisition to closing of sales, shall be in the scope of the project.
PART-II: QUESTIONNAIRE BASED RESEARCH ON THE SALES FORCE The research shall be focused only on the 22 RMs and BMs under the direct reporting of the Industry guide. The research shall focus on the sales related variables only and not include matters under the purview of the Human Resources department.
250 200 150 100 50 0 -50 -100 -150 Sales Turnover Net Profit Mar Dec Mar Jun Sep Sep Dec Mar Jun Sep Mar Jun Sep Dec Mar '07 '07 '08 '08 '08 '08 '08 '09 '09 '09 '10 '10 '10 '10 '11
Margin
0.5 0.4 0.3 0.2 Margin 0.1 0 -0.1 -0.2 Mar Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar '07 '07 '08 '08 '08 '08 '09 '09 '09 '09 '10 '10 '10 '10 '11
The margins of the retail brokerage industry has been severely depleted due to increased competition. Emergence of Non banking institutions has created a severe disadvantage for non banking retail brokers like IBSL. Competition if mostly on two factors: Brokerage fee & Customer service. Though, the customer involvement has reduced with time. Further, the trading volumes have reduced in equity.
On July, 2010: IBSL was reported to have 129 branches Over the last quarter: it has reduced to
52 branches.
129 branches
52 branches
As a result, the management has decided to augment its income by brokering products of its sister companies. The leads are to be generated from the current equity client base.
ISURUS Consultancy framework for Sales effectiveness analysis was adopted. Owing to the limited scope of the management as well as the project, the focus was only on the vendor controlled factors.
Methodology
1. The RMs of the organization was to be shadowed to observe the entire sales process. 2. Qualitative data was to be obtained during the shadowing phase. 3. A questionnaire was to be drafted to quantify the observed issues relating to sales effectiveness. 4. Based on the data obtained, a set of recommendations were to be given to the management for implementation. 5. The recommendations were implemented as a pilot study to measure their impact
Methodology
Shadowing:
Overall 68 sales meetings were shadowed over the 8 weeks The entire process right from lead generation to client meetings was observed. Questionnaire: The questionnaire was prepared for the entire sales force (in scope) i.e. 18RMs and 4 BMs. Finally, 18 responses were obtained,
Methodology
ANALYSIS
Training
I have good knowledge about all the Indiabulls Real Estate products.
0% 0% 6%
44%
50%
Knowledge
I am able to provide all the information that a client asks for while Im selling real estate.
0% 0% 12% 35% Strongly Agree Agree Neutral Disagree Strongly Disagree
53%
Knowledge
24%
35%
35%
Company Support
Company Support
Indiabulls Securities Ltd. provides limited training to its relationship managers. (sometimes as low as 1 hour!) This is done to keep its induction costs low owing to the industry attrition rate of 40%. There is NO training given for real estate products. RMs have to use the Indiabulls Real Estate Ltd. website for information about its products. Most RMs cited the lack of training as a reason for their poor conversion.
Training
The management was itself unclear about the products that were available for selling to IBSL. The portfolio was constantly revised amidst poor communication The IBREL website was the sole source of information regarding the products.
Product knowledge
Leads are exhaustively generated from the existing equity client database. The calling was done randomly and without any classificatory logic. Lead generation ratios were observed to be as low as 6.5%
RMs were engaged from 9 am to 3:30 pm in stoke broking on working days. Hence, they generated leads from 3:30 pm to 5 pm. These leads were addressed only on Saturdays (and very rarely on Sundays). This was observed to be a hampering factor in the sales process as the buying intent was seen to reduce with time.
Responsiveness
Based on the study, the following recommendations were made: Classification of the client database on the basis of address to qualify the deals. Introduction of a training program in association with IBREL for the RMs. Preparation of a uniform brochure/manual for the RMs containing information about all the Indiabulls Real Estate products. Motivation in terms of higher incentives needs to be given for proper channelization of hard work. Encourage your sales staff to up-sell. Give your customers the inside scoop. Impart Don't Wait attitude. Scheduling meetings with the generated leads on a daily basis.
Recommendation
The following measures were implemented in the sales force to measure the impact: 1. Basic training about the products was given. 2. Meeting with the generated leads was implemented on a daily basis. 3. Lead generation was subjected to focus on certain localities only. 4. An EMI chart was given to all the RMs w.r.t. the home loans. This study was done on all 22 RMs.
Pilot study
Sales lead generation increased from ~6.5% to 40%! (in 2 weeks time)
Impact