I've been on a whirlwind trip to India the last two weeks, including overnight visits to villages in Karnataka and UP. hence my tardy blog this week.  I am spending my time hiring our sales and marketing staff and loving that we have different products in the field. 

My biggest headache at the moment is high import duties.  Despite our focus on rural customers and providing access to improved lighting, the duty structure is such that on average we will be levied at between 31-33%.  This is tremendously high considering that the majority of the 'competition' coming in from China has arranged a variety of schemes to avoid duties.  The most prevalent are:
   
-  under invoicing - we have seen boxes with maximum retail price 6Rs (15 cents) on the outside carton, instead of the actual                 250-400Rs.  These lights then get taxed on this much lower amount
-  overpacking the cartons = we have seen in the factories where cartons are printed that say 10 items, and where 100 units
            will actually be packed inside.  Duties are levied on the 10 items only.
-  mis-classification under a lower duty category
-  straight bribery (of course all of these schemes require complicity)
-  importing overland across porous borders, especially on the Myanmar and Nepalese borders

Nevertheless, the reality is we at d.light have a zero-tolerance for corruption of any sort.  I am realizing more and more that all the little tricks people play will never pay off in the long run.  I am starting to hear stories of companies that made a killing in the short term, but were later assessed back taxes on items with exhorbitant interest rates and subsequently forced out of business.  Other companies have had all of their inventory seized, as well as distributors inventory.  And the biggest risk is that none of the honest and organized business sector will do business with organizations that aren't transparent.

Interestingly there was an article in an Indian newspaper which asked Delhi-ites why they bought grey and black market goods.  Several people responded that they preferred to buy the goods much less expensively, and with the savings they could send their children to better schools, pay for an inverter or generator, repair their car, etc.  Conversely, they said if they bought expensive goods and the government received the money, then they would only see 10% of that in the form of better schools, electricity, and roads. I'm sure this is true in some cases and less so in others.

Thanks for all your comments!  I have never blogged before and it really helps to know people are reading.  I've connected with quite a few of you which is wonderful.  Please don't hesitate to give me any feedback and suggestions - I love positive and negative input!

A real challenge for me right now is prioritizing my time and transitioning from the purely 'product development' side of the company to the marketing and distribution side.  I am in charge of setting up our sales and marketing offices as well as coordinating new product design.  To do so I need (and WANT) to be oversees full-time, as close to our customers as possible.  It is pretty emotionally draining and stressful preparing to move to another country and set up an office there right when all the pressure of selling our first units and building customer pull is happening.  But this is what I signed up for, love, and it is totally energizing at the same time.

My main concerns at this point are :
    1) how to hire the right people.  The way I see it, the first 2-3 people we hire in each country are absolutely crucial and will really set the stage and tone for success.  I'm looking for YOU, and will find you - that one in a million person who wants to work with me to build a massive business in India and impact millions and millions of peoples lives.

    2)  how to market our products  :  India and Africa are a million times different from US marketing.  I realy need to understand the complexity of Indian marketing and consequently the 'educational system' we will use to inform our customers on the d.light value proposition.  For example, when I was in Hyderabad last I went into a roadside store or kirana and asked if they had any lights.  They whipped out a bunch of grey market chinese emergency lanterns and started regaling me with facts, "long lasting sir", 'higher quality", "the green band on this box signifies better quality battery, feel the weight", and my favorite, "this one is 200% brighter."  I asked for the later and the box said in big bold letters 200% brighter - to which I asked the shop keeper, 'than what."

The point is that the shopkeepers had internalized the packaging and were using it to sell to their customers.  There was no training or advertising and the customers were almost completely dependent on the shopkeepers for input as to which products were better than others.  In many cases, customers just ask for a light, or a candle, or a battery, and the shopkeepers pick the ones they want to sell based on margins and volumes. 

Does this mean that d.light needs to educate shopkeepers about our products more than customers?  Or are we really trying to sell to the early adopters and start the famous Indian word-of-mouth chain going? What do those early adopters care about?

anyway - if anybody has any good books I should read, videos to watch, or people to call to better understand marketing, I am spending a lot of my time on these issues now.  How to stand out as quality and value in a sea of competition?   Thats what I'm learning about everyday.