Moneycontrol
Last Updated : Mar 14, 2016 04:04 PM IST | Source: CNBC-TV18

Trringo.com to be based on dual biz model: M&M

In an interview with CNBC-TV18, Rajesh Jejurikar, President and CEO of Mahindra's Farm Equipment said that M&M plans to invest above Rs 10 crore in this start-up.

Mahindra and Mahindra (M&M) on Monday charged in to the agricultural equipment renatal services business with the launch of its application, Trringo.

In an interview with CNBC-TV18, Rajesh Jejurikar, President and CEO of Mahindra's Farm Equipment said that M&M plans to invest above Rs 10 crore in this start-up.

He further said that Trringo will operate on a franchise and aggregator based business model.

Below is the interview transcript of Rajesh Jejurikar with CNBC-TV18.

Q: How much have you invested in this start-up?

A: This is going to be a new start-up, a new company. While I am not going to be able to give you the exact number, it is going to be in double digit crore which is upward of Rs 10 crore.

The initial investment will all be done by M&M and over a period of time, we may -- as we stabilise the business model -- look at bringing in partners or private equity.

Q: You are basically look at two business models, the primary one being a franchise based model and the other one being an aggregator based model. Can you help us understand the nuances of both and also help us understand the profit sharing ratio between the franchise's and M&M. We want o understand as to how M&M seeks to benefit from this model as well.

A: The franchise model is one where, Trringo which is the brand will appoint franchise's and franchise's will have hubs under them. The idea is to be as close to market and have new products which are either tractors or implements owned by the franchise where the franchise buys them.

The relationship between the company Trringo and the franchise is one of a fixed fee plus a variable commission.

The transaction between the farmer and the franchise is a spate transaction not connected with the company. So, what this company gets back is a fixed fee, almost like a royalty model and a variable commission on usage of the product.

Q: Under the aggregator model?

A: In the aggregator model also we will rotate through franchise. So, while we will do the aggregation using our apps but the revenue streams will go through the franchise.
First Published on Mar 14, 2016 04:04 pm
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