Professional Documents
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Archies: The Way Indians Greet
Archies: The Way Indians Greet
Submitted by:
Submitted to : Ruchi 09BS0001965
Prof. Rajeev Kumar Swati Anand 09BS000
INTRODUCTION
• Archies was the brainchild of Delhi-based Anil Moolchandani.
• Started by buying and selling quality posters.
• Visited South East Asia and got inspired by the way gift and cards shop
operated there.
• Incorporated the concept in Delhi at Kamla Nagar in 1987.
• It was an immediate success among the teenagers.
• Anil along with his brother established Archies Greetings &Gifts Pvt. Ltd.
• In 1995, they came up with IPO which was 4.5 times oversubscribed.
Archies different business
• GREETING CARDS
• Contributes 69% of business with 15% growth.
• Strategic tie ups with : American Greeting Corporation, Gibson Greeting,
Portal Publication, Kingsley of UK and Kel Geddes of New Zealand.
• Cads are also sold under Help Age Brand.
• 1st to start cads in Indian regional language.
• GIFT ITEMS
• Became operational in 1994 and accounts for 15% of business, growing at
30%.
• This includes photo albums, frames, stuff toys, clocks sunglasses,
perfumes and deodorants etc.
CONTD…
• STATIONARY PRODUCT
• Contributed 16% to the revenues.
• All the products manufactured in-house.
• Products comprised of autographed books, diary, calendar, posters etc.
• Growth rate is 10 – 15%.
REASONS FOR NOT SUSTAINING THE
PROFITABLITY IN 2000-01.
GIFT: Consumers could purchase gifts and get them delivered at their
doorstep. Min value of each purchase was Rs 250 and Rs25 as
delivery charges.
Archies tied up with courier companies- Blue Dart and Elbee.
Novel concepts like e-crackers that enabled surfers to burst ‘pollution free’
crackers.
Even though the number of e-greetings sent through the site touched 54 million ,
Archies discovered that the company gained no monetary benefit.
They invested Rs 20 million in the online subsidiary but made just Rs 2 million
from
e- commerce as creating and hosting one card cost them around Rs. 6000.
Advantages:
Archies could push its entire range of products into the retail channel.
C&F agents cut costs significantly while the distributor margin was 25-30%, the
C&F Margin was only 12%.
Disadvantages:
In addition, Archies had to pay higher interest on working capital and had to
write off expenses incurred on an ERP initiative also contributed to the decline in
performance.
Though Archies planned to take retail space on lease, it had to invest heavily in
real state.
THREAT FROM COMPETITION:
ITC entry into the greeting cards business
Importing high-end gifts like crystal, soft toys, Feng Shui items is the latest trend.
Outsourcing certain gift articles such as posters, mugs and key chains which it had
Manufactured till now.
VISION: 100 VISION 2000 STORES which will contribute at least 40% to sales and
the Balance 20% will come from distributors .