The Start-up Guide for 2015
Start-ups are taking the nation ahead with new concepts and innovations. We have done a crystal ball gazing for you to understand which sectors you can start in, where to find the money and how to expand your business.
A Course Syllabus for Start-ups
Come April 2015 and aspiring entrepreneurs will not have to queue outside government offices for approvals. The Narendra Modi government is planning to move towards online medium for the approval of permits required by business owners. This will take into account more than 200 permits required from various central and state government departments.
As per a UN report, while the global economy is expected to grow marginally by 3.1 per cent next year, India is likely to grow by 5.9 per cent, recording the second highest increase among the world’s large economies. Nirmala Sitharaman, Minister of State (Independent Charge) for Commerce & Industry, has said, “In 2009, the Free Trade Agreement (FTA) on goods was signed (with ASEAN), and because of that and through that, the trade between ASEAN and India has been reaching about $80 billion level. We hope by 2015, it will touch $100 billion and get doubled by 2022. So there is a lot of work, there is a lot of scope.”
India, with its population of 1.3 billion people, an increasingly affluent middle class, an activist new business friendly government, and a revived appetite for investment, is again an ideal market for internationally ambitious companies to do business. Many large global multinational organisations have long been active and successful in India.
Who’ll Get the Money in 2015?
This New Year, Entrepreneur brings to you a fresh perspective on raising money and the businesses that are expected to attract investors.
According to advisory and accounting firm Grant Thornton, the amount of PE investment, which came into the system, increased to $2,726 million in 2014 from $725 million in 2013. With more people starting businesses, alternative financing methods are gaining momentum. Crowd-funding and online credit marketplaces are becoming popular.
Manufacturing: Domestic Production Makes a Comeback
The government is also committed to bring transparency in its policies across sectors for the ease of doing business and making the work environment more conducive. This will promote private sector investments in diverse sectors and make Prime Minister Narendra Modi’s call to “Make in India” a reality. These sentiments were expressed by the Government Secretaries during a panel discussion on the theme ‘Make in India: What does it take to Make in India?’ on the eve of FICCI’s 87th Annual General Meeting.
Amitabh Kant, Secretary, Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, says that manufacturing is the key for pushing up the economic growth. The government is focusing on the ease of doing business by the opening of FDI and work is in progress to roll out GST and bring about reforms in labour laws and the land acquisition Act. However, he says, legacy issues are there and that need to be addressed. He says that the government is focusing on reducing paper work, simplifying processes and looking at integrating all platforms online.
On e-commerce, Kant says that India allows B2B commerce, the way China does. India, he adds, is encouraging young B2B entrepreneurs to flourish and the government is promoting the B2B model in e-commerce by allowing 100 per cent FDI.
Gauri Kumar, Secretary, the Ministry of Labour and Employment, says that the Centre is now working closely with the state governments to bring about convergence. “We have put a single law for MSMEs to make it simple,” she said.
E-commerce: A Booming Sector
Gartner says that Indian e-commerce market will reach $6 billion in 2015, which is a 70 per cent jump from 2014 numbers.
According to new research conducted by Zinnov on behalf of Google, India has over 48 million SMEs, of which eight to 10 million can grow quickly by advertising online.
India has over 250 million Internet users and is set to overtake the US in 2015 by reaching 350 million Internet users, indicating the potential.
The Rise of Big Data & Internet of Things
Big data represents the transformation of the IT industry and a vast pool of opportunities for entrepreneurs. Big data is changing business everywhere.
Big data is expected to be a market worth $1 billion in India by 2015, growing at a CAGR of 83 per cent since 2012, according to a Nasscom report.
The IoT trend will dramatically increase the number of network connected entities. Devices that contain sensors, control or intelligence will increasingly become network connected. Internet Protocol version 6 (IPv6) will gain wider adoption, as will management technologies that are required to manage network-connected nodes. The IoT will benefit everyone, from enterprises to municipal councils, but it is the value of information and knowledge that will see new players introduced and new business models emerge during 2015.
Franchising: A Route to Success
Here’s a list of fastest growing sectors where the franchise model will be a hit in 2015.
Education: This recession-proof sector has offered myriad opportunities ranging from pre-school to tutoring centres. As confirmed by India Ratings, “The Indian education sector’s market size is likely to increase to Rs 602,410 crore ($109.84 billion) by FY15 due to the expected strong demand for quality education.”
Food & Beverages: From QSR to fine-dine, the F&B sector has been the one where branding has played a major role. Interestingly, the casual dining formats along with QSR together account for 74 per cent of the chain market, cafes make up 12 per cent while fine dining places are reserved for families with lesser per cent of the F&B market.
Healthcare: From gym centres to diagnostic labs and consumers love to be fit have been driving the growth of this sector. The healthcare sector is growing at 15 per cent CAGR and grew from $45 billion in 2008 to $78.6 billion in 2012 and is expected to touch $158.2 billion by 2017, according to a report by Equentis Capital.
Retail: From footwear to apparel, the retail sector is on an upbeat mode with a good number of national and international players. The retail industry as a whole right now is in the growth phase, and for the next three years, the annual growth rate is going to be about 35-40 per cent.