Redbus Javed

8/2/2019 Redbus Javed

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CASE STUDY ON RED BUSONLINE TICKET BOOKING

SYSTEM

Presented To : Presented By :Prof. Rajveer Singh Javed Akhtar

Faculty IMS Ghaziabad BM-010066

IMS GHAZIABAD LALQUAN


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Introduction:

Started in August(18th) 2006

CEO: Phanindra Sama(Phani)

Industry: Online Bus Ticketing

7000 operators with 10,000 routes and with aninventory of 5,00,000 tickets covering more than2500 cities over an expansion of 16 states

Profitable since December 2009

5000-6000 own travel agents making 75000 point ofsales for Redbus

20% sales growth on monthly basis

$30 million Turnover currently


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Idea Generation for Redbus

Centralized the ticketing system

Inventory management system for Operators

No aggregation of Bus Tickets like Global

Distribution System which is prominent in RailTicket and Airlines Ticket Booking

Much dependency on the Travel Agents who domanual bookings in the buses of few operators

Very little transparency regarding availability andfares of buses

India 4th largest user of Internet(81 million) after

China, America and Japan


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Process in Building of Redbus

The Redbus Founders Joined EAP (EntrepreneurAcceleration Programme offered by TiE

Redbus was among one of the three ideas

selected out of 300 ideas for mentoring

Due to this various Venture Capitalistsapproached Redbus

Kiran Nag (VP-SVB Indian advisors),AshokYerneni and Sanjay Anandaram appointedmentors in July 2006

They selected Redbus due to Teams Passion

and potential of this fragmented market


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At initial stage they divided their work

Market survey

Identifying customer Preferences

Gathering Market Data Spread awareness through pamphlets, personal

visits and visiting cards

Introduced and Convinced the Operators abouttheir service

Cont


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Contd

Studied Books for web Development andprogramming for core knowledge about theirbusiness

They didn

t hired a web developer taking into theconsideration the nature of business and threats

Finally started with just one operator


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Problems Faced :

Non-IT Background of the founders

Wait for operators for hours

While receiving calls, harassed and abusedseveral times

No Bank was ready to provide payment gatewayportal

Operators were still relying more on traditionalway of ticket distribution

Lack of internet knowledge among operator and

agents


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Industry And Competition

1970s-1980s Growth Phase

US $ 3Billion Industry, 2000 private Busoperators, 20000 buses of long route(Contract carriages)

Income has increased and Road conditions haveimproved resulting into growth in AC coaches(like- Volvo, Mercedes)

Expecting growth of 40% in next 10 years

40% air tickets and 30% Rail tickets sold online

Online moved to7% to 25% while Traditional

agencies from 32% to 10% market share


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Fund Raising:

Seedfund invested US$ 500,000 and by this,Bharti Jacob became a member of Redbus boardWhich was Spent in one and a half years due toRedbus robust growth

In 2008, it went for another round of funding of$700,000 from Inventus Capital, Helion andSeedfund in which redbus raised $2.5 mn

This was utilised for establishing offices in citieslike Hydrabad, Delhi,Pune,, chennai andAhmedabad


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Revenue Model

Average sales of 5000 tickets Daily

Commision is 10%

Home Delivery in 10 cities on a premium of $0.5

Sales Break up :

Booking Online: 60%

Call centres:30% (7 call centres with 20-25employees in each)

Partner channel:9%

Mobile:1%


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Reason Behind Success:

Innovation

Operational Efficiencies

Excellent Customer service

Adequate usage of IT

Division of Labor

Good Mentorship

Dedication

Untapped and Fragmented necessity driven Market

Simple Business model with good work Ethics


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Cont

Aggregration capabilities

Win-win situation for all three:Operators, Agentsand Redbus

Portal transparency which built trust

Honesty and ethics

Cost Efficiency


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Conclusion

With innovative approach and rightimplementation of technology accompanied withhard labour has brought success to Redbus.


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THANK YOU

Documents

Redbus Javed