Exim Academy

Trade Receivable Discount System (TReDS) - R R Padmanabhan, Director - Exim Academy Cash is the lifeblood of any business.  However, profitable the company is, unless the cash cycle is regular, the operations of the company gets hit.  The cash burden is acute for MSME units. It is jocularly said that unit size and cash burden is in inverse proportion always.  Big units have the wherewithal to reach out to sources to tap money. Besides, they employ skilled finance professionals to manage their cash flows.  But MSME does not have such luxury. The normal sources of funds of MSME are: a) Internal Generation b) Bank borrowings c) Savings of the proprietor d) Loans from friends and relatives  e) Chit funds Many times, when all the above sources are exhausted, the entrepreneur has nowhere to go to meet his fixed expenses.  The expenses have time lines to be met, whereas the accruals do not.  In spite of the MSME Act that prescribes a fixed time limit for paym...

Theory of Constraints  - R R Padmanabhan, Director - Exim Academy The society has both haves and have-nots.  I used to wonder at the success stories of rich and famous.  Most of them have poor or modest backgrounds.  They persist and succeed.  But their wards of second or perhaps third generation do not show that much promise and fall wayside.  What made the first generation succeed? And what caused the downfall of second and subsequent generations?  Of course there are exceptions to the latter question.  There are notable business families even in the Indian context as a perfect example for sustained existence at the top level.  In this article I ponder these questions and provide my perspective.   The first question: what is the reason for the spectacular success of the first generation almost from rags to riches style.  Is there any single reason that can be attributed to the success?  Yes of course.  One simple word ...

  Suez Traffic Jam, the alternative options   The Suez Canal crisis that hit the international trade like a thunderstorm and held its hold for more then 3 weeks still continue to be in limelight in the discussion of the international public.   This time it is not for the containers held on both sides of divide but for the compensation sought by the Suez Canal authority against the liner management.   It is not only phenomenal but also perhaps highest in the maritime history.   Few questions that pop up now and then in everyone’s mind these days. If the international transit is so fragile as having to depend one single source, what are we going to do about it?   Are there not other alternatives available for the international business?   If available, are they sustainable in terms of cost and time?   In the past 20 years or so, world community is coming together in terms of business in spite of nationalism rearing its ugly head now and then...

  India Mauritius Comprehensive Economic  Cooperation (CECA) Agreement - R R Padmanabhan Courtesy: GOI Website India and Mauritius share a lot in common in terms of social, cultural and economy.  Both of them were colonies of British.  In fact, many indentured laborers from India went Mauritius to work in the sugar fields.  They were mostly from UP, Bihar, W Bengal and Tamil Nadu.  Even though they were far away from mainland India, still these people continue to practice Indian cultural belief system. The CECA has to be viewed in this background.  The close cultural links now permeates to economic links too.  While India will no doubt be huge market for Mauritius products and services, Mauritius will be a springboard for African and European markets for Indian products and services. Mauritius It is one of the most prosperous nations of the African continent behind South Africa and Egypt. The per capita income of Mauritius is US$ is 12740. The off...

Warehousing – The next boom sector in investment and employment     - R R Padmanabhan, MBA, BL, FCILT. Director Exim Academy, Chennai. I ordered a football for my grandson through Amazon. I was promised delivery within 4 days. The same order anywhere in Europe would have been fulfilled within 6 hours! That is the logistics efficiency in India. In India, it is estimated the overall logistics cost is about 14% of GDP, which is quite substantial whereas in advanced countries it is less than 8%. That is why, you have a product like football ordered online within 6 hours in Europe.  The Logistics value chain consists of three parts, transportation, warehousing and administration. Unless all three parts work in tandem, efficiency in logistics is not possible. The prevalent online shopping pattern denotes that there has been change in people’s buying habits. Many would like to shop at the convenience of their homes. The presence of variety, discounts and returns policy has ...

  SUPPLY CHAIN – A POST PANDEMIC MUSING The Business sector has gone through a peculiar phenomenon through the last 8 months globally. The pandemic, without a precedent has hit every walk of life   and created a complete Industrial Disturbance ; right from BIG Industrial houses to small time MSME s. Literally, the breakout of Covid-19 virus has made the world coming to a standstill. But this was not the reality ; the supply chain around the globe has not come to a grinding halt, hence the requisites like healthcare, food etc. were reaching the end users. The regular practice of business is bringing down expenses, increasing sales which eventually brings higher margins for the smooth running. Here certain practices have already been redefined and Supply Chain is the major among them. We all know managing a supply chain is the effective Materials Administration or in other words, managing Supplies, Process and Delivery. The post covid scenario was through strategic sourcin...

Inco Terms 2020 I always used to wonder at the prosperity of tiny island state, Singapore.  The state is prosperous despite all the odds against it.  The birth of this state as an independent nation itself was seen as curse bestowed upon it.  The place was part of Malaya but Malaya did not want to have Singapore with it, for it considered the place as a burden on the Malaya’s economy.  Literally, the place had nothing to grow to feed its people, heavily dependent on its neighbours like Malaya, Indonesia and Thailand.  No cultivable land, no industries worth mentioning – but in spite of these handicaps, the place was strategically located in one of busiest in sea-lanes of the word.  That was the only advantage!  This advantage could only be used in International trade. Despite all these, place has become a state by itself by empowering its people with skill and knowledge.  Now, the place is a thriving economy engaging mainly in entrepot trade. If y...