What does Brick2Wall do? How do you stand out in the space?
Brick2Wall is a value engineering firm that creates value for stakeholders in value chains plagued by fragmentation, traditional operating models and information asymmetry. Nearly 5 years ago, we chose the construction material value chain for its complexity, economic relevance and affinity with the founders’ 50+ years family association. With the help of engineering, data analytics, and technology, we worked to reduce operational and financial inefficiencies prevalent in the value chain.
In construction, steel purchases account for the largest wallet share in an infrastructure project. Another issue adding to the expense and the inefficiencies is that steel manufacturers are highly fragmented and traditionally operated.
Today, we help infrastructure contractors save cost and time on steel purchase and help steel manufacturers increase business. The result is a $100mn enterprise, generated with little under $1mn capital investment. Some further notable factors are:
*Saving of up to 15% in procurement costs for infra contractors
*Doubled top-line for manufacturers
*Higher fleet utilisation for logistics partners engaged in the supply chain
*Disciplined business growth observed by financiers in the industry.
We are further extending our scope to other products in the construction material
industry through horizontal and vertical penetration.
Brick2Wall is one of the few startups that optimizes material procurement costs for buyers by bringing about manufacturer brand discovery and optimizing purchase quantity via customised products.
For manufacturers, Brick2Wall is the only loyal channel partner that hand-holds them in setting up steady-parallel D2C business lines, while assuming comprehensive supply chain responsibilities, spanning from standardizing mill operations, logistics, working capital and value engineering. This helps manufacturers observe higher asset utilization, brand elevation and profit maximization. Manufacturers like to view Brick2Wall as an integral division of their organization.
How has the construction material supply chain evolved over the years? How has Brick2Wall grown with it?
While the construction industry is unorganised in nature, it plays a vital role in the economic development of the country, leading to urbanisation, industrialization, and overall economic development. Sustainable and efficient supply chain management is essential for the delivery of successful projects. However, SCM in the construction material industry is still evolving as compared to the others, and needs development. Due to the fragmented nature of the construction material industry, the integration of efficient SCM practices has been far from accomplished.
We have moved across consumer segments, innovating business models for maximum impact in the fragmented, unorganised construction material supply chain.
Catching on to the construction wave in India, the last decade also witnessed a mushroom growth of regional manufacturers, most struggling to establish strong D2C presence; a segment that offers steady business volume and elevates utilisation KPIs.
Rising fuel costs and time pressures on execution have proven long-distance transits to be inefficient, encouraging procurement teams to identify trustworthy local material sources across India. Having committed partnerships with multiple regional manufacturers across India, Brick2Wall opens the opportunity to procure customized, ready-to-use products and achieve just-in-time deliveries. Our multimodal, pan-India logistics network further helps design cost and time efficient logistics solutions with real-time tracking abilities.
How has technology helped in elevating the fragmented construction market/supply chain?
Fragmentation as well as poor communication cripple coordination among stakeholders in the construction material supply chain. Erroneous data transfer leads to late and/or wrong delivery of material, resulting in delayed project execution and cost overruns. Government data suggests that close to 60% of projects are plagued by such inefficiencies. Timely and correct information assists supply chain managers to make procurement decisions on when and how much to buy, and where to buy from. It also greatly improves procurement precision, inventory control, higher labor productivity, securing finance and keeping track of goods in transit.
With the help of modern technology, Brick2Wall provides symmetrical seamless real-time information to infrastructure firms in terms of material prices and availability in a region, thus facilitating informed and faster decision making and optimising procurement. Leveraging technology with engineering, Brick2Wall recommends customised product solutions, helping firms save on procured quantity as well.
Why is good SCM so important in the infrastructure market?
Infrastructure firms are on a perpetual quest to optimise procurement costs and to timely execute projects. A typical construction project assumes a 15% margin, realised typically over a tenure ranging from 9 to 24 months. Material cost fluctuations, procurement delays, and wastage can significantly impact project viability and hence timely completion. For a sector that contributes nearly 4% to the Indian GDP and is a leading employer of the Indian work force, a good SCM model is pivotal to observe successful conclusion of projects and witness sustained interests in the sector.
Traditional distribution channels lack the capability to extend engineering solutions to optimise quantity and often function as stockists or financiers. Infrastructure firms’ limited trust on select steel brands (mostly the leading 5) further reduces the supplier base, leaving limited room for price optimization. Concentrated steel production and demand pressure often disturb manufacturers’ commitment to deliver timely. Infrastructure firms, by virtue of their milestone-based cash flows and leveraged balance sheets are often seen craving for short-term working capital support as well.
Cost-effectiveness and cost control are by-products of swifter supply chain execution and better management of resources, as well as inventory. This in turn creates overall operational efficiency. Employability ultimately gets a push as an outcome, as there is capacity for recruiting more skilled workers. This factor has a direct correlation with a nation’s growth. Reflecting back on these aspects of supply chain management, it is clear how good SCM is crucial not only for the infrastructure sector, but for the overall economy as well.
How has technology and digital integration opened the gateway to green construction and greater sustainability?
Digitalising the supply chain ecosystem promotes efficiency in multiple ways, which in turn encourages sustainability.
For instance, having visibility of delivery lead time, one can plan near Just-In-Time purchases and avoid over-stocking. Further, the ability to customise products by leveraging technology and digital solutions, enables projects to avoid waste. This prevents wastage at sites, which has its various negative implications in terms of material disposal and material return.
Similarly, having correct information on nearby sources to procure material also helps reduce carbon footprint. Having a large number of intermediaries in the supply chain not only causes financial and time inefficiencies but may also potentially pollute the environment due to the number of stops and re-routing before reaching the destination.
By deploying technology and digitalisation, Brick2Wall has opened the gates to source material from the nearest supplier at a lower cost, thus reducing logistics as well as environmental costs. Similarly, leveraging technology can help determine the exact amount of material that is actually required for the project in question, and hence minimise or even eliminate wastages. Brick2Wall is working to solve these very problems prevalent in the ecosystem today, thus promoting sustainable operations and paving the way for green construction.
With the recent conversations around some unaccounted activities in the sector, what are your comments on transparency in the sector and what are you doing to promote the same?
Due to the highly fragmented and unorganised nature of the industry, the construction material supply chain often offers gateways to unaccounted, unethical conduct. With its 50+ years of family business’ experience in the construction material industry, Brick2Wall understands these gateways thoroughly and aims to bring in a systemic change. To this end, Brick2Wall has adopted a two-pronged strategy towards its ethical and moral obligations: Proactiveness and Accountability.
We educate and assist channel partners to remain updated with statutory laws of the land. Also provide periodic material, accounting and statutory reconciliations with partners, bringing necessary transparency for all stakeholders to be on the same page. Any observed discrepancy is assigned the “highest priority” in our resolutions log-book.
Brick2Wall adopts a zero tolerance to deviation on statutory laws of the land and holds people accountable for any lapses. Wherever required, we partner with local and/or national enforcement agencies to ensure that the laws of the land are duly followed, the people are held accountable for their actions, and the interests of the stakeholders are protected.
