February 28, 2024

General trade

Business / /

General trade is the older of the two models, and was established before India opened its markets to organized retailing. Modern trade, on the other hand, is a purely urban phenomenon that grew in popularity between the 1990s and early 2000s, when many corporates and first-generation entrepreneurs entered the retail business. What is General Trade? General trade is a traditional form of trading that includes local standalone stores, roadside stalls, and kiosks that do not have a huge infrastructure and are run by entrepreneurs as opposed to investors or shareholders. Kirana stores in India, Sari-Sari stores in the Philippines, and Mom & Pop shops in the USA are examples of local standalone stores covered by the general trade channel. The most important distinction of general trade from all other types of trade, however, is the fact that sales reps are responsible for taking orders from store owners. As a result, sales reps play a very important role in identifying opportunities, onboarding, and sustaining relations with general store owners.  Advantages of General Trade for Brands Deeper penetration whereby brands are able to reach consumers who live in areas such as older and traditional neighbourhoods, remote villages, and in tier 3 and tier 4 cities where modern stores are not prevalent. As general stores are closer to residential areas than their modern counterparts, they enable consumers to easily buy products without having to travel a long distance. Brands have a strong affinity for stores who have a captive consumer base as it significantly increases chances of offtake. General stores focus on developing interpersonal relationships between store owners and consumers that are mutually beneficial. When store owners comprehend the preferences of consumers, sometimes on a personal level, it helps grow familiarity between retailer and consumer. Also, such understanding pushes store owners to tailor their secondary trade orders in accordance with consumer needs. This readily available consumer loyalty is what brands count on when partnering with general stores. Brands will always look to access as much of the economic strata of consumers as possible. Carrying out distribution via general trade gives them the opportunity to do so; products at general stores are usually non-premium and therefore, may not be as extravagantly priced as in modern stores. Alongside this, bargaining is also a common practice at general stores, making it even more economically feasible for low to middle income consumers to buy your products. Challenges of General Trade Restricted purchasing ability – General stores have a limited budget and prefer buying in smaller batches that don’t always meet the expectations of brands. This sometimes limits the range and definitely limits the amount of items in a general store. This limitation stems from the fact that general stores don’t see as large a cash inflow from business transactions as modern stores do.  Space constraints – General stores that are handed down from generation to generation usually continue business operations within the same space. A space that may be, from lack of funds or foresight, quite limited. This results in both a poorly lit store and compact shelf space for displaying products making it challenging to keep point of sale equipment or materials like a visi-cooler. As a brand, you may find that kind of a setup challenging unless you have a reliable visual merchandising app to document and flag store issues accurately. Pushing new products is hard – Small-time retailers of general stores store a small number of products due to limited buying ability. Persuading them to buy more from your brand is therefore a significant challenge. The consequence of such an approach is that general stores run out of products faster, necessitating frequent deliveries. More frequency means the cost of delivery goes up, making these businesses untenable at times.  Lack of foresight and market insights – Some general store owners don’t have the resources to carry out extensive market research before investing in a product. As such, this leads to poor purchase decisions that bring low returns and debt issues. Environmental hazard: General trade stores, with their sheer number, involve the movement of a large number of goods across huge distances, leading to a huge carbon footprint and pollution. This can directly cause deforestation and increased waste production. A sales enablement tool that also provides the most optimised delivery routes with visibility for both brand and retailer can ensure unhindered and optimised deliveries, reducing carbon emissions. What is Modern Trade? Modern trade is the antithesis of general trade in that it operates on a much bigger scale and infrastructure, with a national or a global presence. All orders placed in modern trade are placed on the company level where specialised teams are responsible for orders or the retail HQ sends the order request to the brand HQ. There is no involvement of sales reps in the ordering process and they are mostly limited to ensuring product availability and visibility at the stores, footfall conversion and capturing feedback, etc.  Advantages of Modern Trade for Brands Stronger infrastructure that allows for huge scalability for brands. Direct negotiation between brand and retail chain eliminates the role of sales reps, making the process booth streamlined and efficient. Brands get access to the entire network of stores under a retail corporation without having to go and visit each and every store. This means that your products will reach more stores with a single agreement, translating to less effort and more store space.  Higher revenue per retail outlet as modern stores are more spacious to accommodate more of your products and have generally better visual merchandising opportunities because of the space. As such, consumers buy more from a huge variety of products, resulting in generally excellent sales.  The ability to sell premium products targeted towards the higher economic strata of consumers. As opposed to general stores, brands with high-priced, premium products find a better footing in modern stores to sell their products. Bigger pack sizes in modern trade owing to the fact that more high-income consumers are likely to visit and buy from modern

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Mutation of Property in Telangana

Government Schemes / /

The mutation is a process of transferring of title ownership name in records of the revenue department for a property. Mutation (transfer of title) is to be done when the property is transferred from one owner to another. By mutating the particular property, the new owner can get the property records on his name. Importance of Property Mutation Property mutation is a mandatory process in all legal transactions involving the property. As stated above, by mutating the property, the new owner gets the revenue records on his name. Once the property is mutated, such details will be updated in the revenue records maintained by civic bodies like Municipalities, Panchayat or Municipal Corporations. In Telangana, Greater Hyderabad Municipal Corporation (GHMC) is doing the process of mutation. Mutation document is necessary for fixing the property tax payment liabilities Mutation property is necessary to prove the ownership of a particular land For selling a property, the landowner has to submit mutation certificate to the buyer for verification If a property is jointly owned, then the mutation certificate will be in the name of all the co-owners. Documents Required Documents required for Property Mutation in Telangana are below: Notice of transfer under Section 208 of GHMC Act, duly signed by both the Vendor and Vendee Attested copies of property documents and link documents Encumbrance Certificate (Latest document to be furnished) Non-Judicial Stamp paper for Rs.20 for each copy of the document Undertaking on Notarized Affidavit cum indemnity bond on Rs.50 stamp paper Tax Payment receipt In the case of Will- In addition to all the above documents, the following documents are also necessary for land mutation: Death Certificate Succession Certificate Legal Heir Certificate Mutation Fee Mutation fee is to be paid at the time of property registration. Concerned Sub-Registrars of Registration & Stamps Department will collect this fee and share this transaction details to the respective Municipalities or Municipal Corporations (ULBs). Rates of mutation fees to be paid at the time of the registration are given here. The Mutation fee is to be paid through Demand Draft (DD) in favor of the Commissioner, GHMC. Market Value of Land The applicant can check the market value of land by visiting the Telangana Registration and Stamps Department. Step 1: Select the option non-agriculture rates or Agriculture rates. Step 2: Select district name from the drop-down menu. The applicant must select the Mandal and village name for getting the market value of land in Telangana. Step 3: Click on the submit button to get details. Time Frame In the case where both buyer and seller made an application for mutation, it will be done within 14 days If the seller or buyer applied for mutation certificate, it would take 45 days to complete the process of mutation Telangana Property Registration Process Step 1: At the time of property registration, submit an application for mutation along with the relevant document to the concerned Registration & Stamps Department. Step 2: As mentioned above a Demand Draft for mutation fee to be submitted at the time of property registration. Step 3: During the property registration process, the Registration Department will collect all property related data and the transaction details for mutation. Step 4: Property and transaction details will be shared with respective GHMC circle office through online. Step 5: The applicant will receive an SMS with a mutation application number when the mutation request is processed. Step 6:  The unique mutation number also has another purpose like tracking application status and downloading the certificate. Step 7: The concerned Revenue officer of the ULB will initiate the process of mutation as per rules and procedure. Verification of the premises before a change of name physically Verification of existing property tax as per Bench Mark rate. In case of any under-assessment, there will be a revision of the property tax as per rules. Step 8: Revenue officer will circulate the e-file to the Deputy Commissioner for approval. Step 9: The Deputy Commissioners, will approve the mutation, subject to payment of all property tax dues. The ULB’s website and CDMA web portal would upload the digitally signed mutation certificate. The applicant can download the certificate, after receiving the SMS regarding approval status. Check Status of Application Step 1: Go to Commissioner & Director of Municipal Administration (C&DMA) web portal. Step 2: Select Registration and Mutation data dashboard option from the menu. SRO Mutations Abstract report will appear. Step 3: Click on district name. SRO PT VLT Abstract ULB wise report will appear. Step 4: The applicant can check the status of the application by selecting any one of the options such as application number, issued, in process, rejected within 15 days. Step 5: Select the request number from the list; the applicant can view the status along with all information related to a particular property. Step 6: The applicant can also search for the status by selecting the ULB name from the drop-down menu and enter the request number. Click on check status button. Download Mutation Certificate The applicant can download the Mutation Certificate through CDMA Web Portal using the Unique Mutation Application request number.Select ULB name from the drop-down menu and enter request number. Click on download mutation certificate. The applicant can get the certificate. After mutation, the new owner of the property has to pay all taxes in his name at the respective village office Commissioner & Director of Municipal Administration. Using assessment Number  (10 Digit PTI Number), the new owner can pay property tax online in Telangana. FAQs What is property mutation? Property mutation is the process of updating the records in the revenue department to reflect the current ownership of a property. It is essential to record any changes in ownership due to sale, inheritance, or any other transaction. Who is responsible for initiating the mutation process? The responsibility for initiating the mutation process usually lies with the new property owner or the legal heirs in case of inheritance. The process is typically initiated at the local municipal or revenue office. Why is property mutation necessary? Property mutation is necessary to establish legal ownership of the property and for tax assessment purposes. It ensures

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First Board Meeting of Company Post Incorporation

Companies Act 2013 / /

a lot many companies are getting incorporated quite successfully with different objectives in the form of public, private, or any other thing as per the provisions of the Companies Act, 2013. After the incorporation of the company, certain compliances have to be done by the company like conducting the very first Board Meeting within a time frame of 30 days, and along with it, there are many such general agenda items for the first board meeting of company post-incorporation. Over the years, the process of incorporating a company has been made simpler, which encourages full compliance by the companies. The management should be fully aware of the post-incorporation compliance to avoid any penalties or punishments. The Companies Act 2013 is a stringent act and leaves no room for any mistakes. “Ignorantia juris non excusat” means “ignorance of law is not an excuse”. This is a legal maxim which goes on to say that one cannot escape liability on the pretext of unawareness of the law. Thus the directors and shareholders will have to be aware of the legal compliance involved post-incorporation of the company. Following are the significant actions which need to be taken post company incorporation: First meeting: As per Section 173(1), of The Companies Act 2013, the company shall hold a meeting of the Board of Directors in less than 30 days from the date of its incorporation. Directors are permitted to attend the meeting either in person or through video conferencing. Bank account: Companies need to have a bank account even before approaching the authorities for company incorporation. Since the company is an artificial entity, the transactions cannot be done in the name of any natural person. Official address: As per Section 12(1), a company shall have a registered office within 30 days from the date of incorporation. This address shall be used to receive all official communication from the various authorities. The company shall inform the same to the registrar within 30 days from the date of incorporation. It’s all in the name: Every company shall be required to affix its name at all places from where it carries on its business operations. It shall be displayed in the language which is generally used in the locality. Additionally, the company has to get a seal with its name engraved on it, letterheads with appropriate information and printed negotiable instruments. Auditor: According to Section 139(1), the first auditor shall be appointed by the Board of Directors (BOD), except for a government company, within 30 days from the time the company is registered. Failing which, the members shall appoint the auditor within 90 days at an extraordinary general meeting. The term of the first auditor shall be until the conclusion of the first annual general meeting. Interest disclosure: At the first board meeting, every director shall disclose his interest in any company/firm/body corporate/association of individuals as outlined in section 184(1) of the Companies Act 2013. Any changes in the disclosures shall be intimated to the board in its first meeting held during each financial year. An independent director, if any, must give a declaration that he meets the criteria of independence during the first board meeting as a director. Statutory registers: The company shall be required to maintain statutory registers at the registered office of the company. The same shall be maintained in the prescribed form failing, which the company will be subject to penalties. Share certificate: The share certificate shall be issued to a shareholder within 60 days from the date of incorporation. In case of additional shares being allotted, the time period is taken as 60 days from the date of allotment. Books of Accounts: As per section 128, every company shall maintain proper books of accounts which shall represent an accurate and fair view of the state of affairs of the company. The double entry system shall be followed, and the accounting is done on an accrual basis. Commencement of business certificate: Within 180 days, the company shall obtain a certificate of commencement of business. There is a requirement to file a disclosure made by the directors of the company stating that every subscriber has paid the amount due on the shares. Conducting the First Board Meeting The first board meeting has to be held within 30 days of incorporation. The notice issued to the director must specifically mention that it is the first Board Meeting of the company. Every officer has to give this particular notice of the board meeting and if any office fails to do so then he/she will be fined with a penalty of Rs. 25,000. Thus, it is important to conduct the first Board Meeting on time.  General Agendas for First Boarding Meeting of Company Post Incorporation According to Section 173(1) of the Companies Act, 2013, every company shall conduct the first meeting of the Board of Directors within 30 days from the date of its incorporation. Every company has to follow Secretarial Standard-1 along with the provisions of the Companies Act, 2013 for conducting Board Meetings. Following are the transactions that should take place for the first Board Meeting of the company post-incorporation:- Election of the Chairman of that particular meeting. Appointment of Chairman of Board of Directors. Noting of certificate of incorporation of the company. Noting of Memorandum of Association and Articles of Association of the company. Noting of first Directors of the company through consent sent by the company’s directors. Adopting the common seal of the company. Appointing the first Auditors of the company. Appointing Company Secretary, if needed. Producing a copy of the notice of the registered office of the company. Opening a bank account. Allotment of shares agreed to be taken by the subscribers to the MOA. Approving the statement of preliminary expenses. Adoption of preliminary contracts. Purchase of books and registers by the Directors to the Secretary. Authorization for Board for taking loans, if required. Authorization for Board for making investments, if required. Decision regarding the date, time, and place for the next Board Meeting of the Company. Note of disclosure of the interests of Directors.

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Registration of Multi-State Co-operative Society

Government Schemes / /

The Multi-State Cooperative Societies Act (MSCS Act) is legislation which provides a regulatory mechanism for cooperative societies. The Act applies to cooperative societies which conduct operations in multiple states. The Act mentions the procedure to register a multi-state cooperative society and the contents which should be available in the bye-laws of a cooperative society. The Act also specifies the other regulatory guidelines which should be followed by all cooperative societies registered under the Act. Registration under the MSCS Act is voluntary. However, the Act mentions the grounds under which registration becomes necessary. Cooperative societies are listed under list II of the seventh schedule to the Indian Constitution. Hence, cooperative societies fall under the category of a state subject. As a result, the state governments have the right to form laws governing cooperative societies. The state governments formulate laws for cooperative societies depending upon the circumstances unique to each state. Thus, the MSCS Act is a legal framework which applies in addition to the cooperative society laws passed by the various states. The advantage of registering under the MSCS Act is similar to the benefits acquired by registering a company. A registered multi-state cooperative society has the privileges of limited liability, separate legal identity, and the ability of members to transfer their membership. Government-owned companies are allowed to subscribe for membership in a registered multi-state cooperative society. Contribution of capital by the government enhances the credit-worthiness of the cooperative society. Objectives of the MSCS Act To encourage the public to form cooperative societies voluntarily To provide a legal platform which allows cooperative societies to function as democratic institutions To enable the members of cooperative societies to promote their social and economic betterment To provide functional autonomy for matters connected with governance and administration of cooperative societies To facilitate the achievement of the common economic interest for which the cooperative society was formed To serve the interests of the Below Poverty Line (BPL) category of citizens and empowering them to derive economic benefit through the principle of self-help and mutual help To establish a framework for the provision of monetary support to the members during times of financial distress To formulate and implement guidelines for the formation of cooperative societies among agriculturists, artisans and individuals having limited means to sell the products manufactured Circumstances for Mandatory Registration Registration of cooperative societies is not mandatory under the MSCS Act. Registration is required only under the following circumstances: When there is a need to hold property and enter into contracts in the name of the society When there is a need to initiate and defend suits and other legal proceedings in the name of the society When the members of the cooperative society are residing in more than one state When there is a need to advance loans exceeding five thousand rupees to the members of the society without sanction from the registrar When there is a need to advance loan to another cooperative society after obtaining permission from the registrar When there is a need to obtain loans from banks by pledging property in its name When the members of the cooperative society who are residing in a particular state exceeds fifty When another cooperative society is proposed to be enrolled as a member of a cooperative society Conditions for Registration The cooperative society should serve the interests of the public in more than one state The bye-laws of the cooperative society should lay down the process of bringing about social and economic upliftment of the members The cooperative society should have at least fifty members for each of the states for which registration is requested The bye-laws of the cooperative society should not be in contravention of the provisions of the MSCS Act The cooperative society should pursue the goal of mutual help and cooperation among the members as the primary justification for its existence Contents of Bye-Laws The bye-laws of a cooperative society are the provisions which define its roles and functions. The bye-laws are agreed upon by the members at the time of forming the society. Once the bye-laws are registered, any change can be made only after obtaining the approval of the registrar. The MSCS Act provides the guidelines on the contents which should be available in the bye-laws. The contents should include the following: The states in which the cooperative society is conducting its operations The scope of business and objectives of the cooperative society The services which the cooperative society is providing to its members The eligibility criteria and procedure which should be followed for obtaining membership in the cooperative society, and also for cancellation and transfer of membership The rights and obligations among the members towards each other and also towards the cooperative society The maximum amount of capital which a member is eligible to subscribe The sources from which the cooperative society is eligible to raise funds and the purposes towards which the funds can be applied The officers who are authorised to sign documents and enter into agreements on behalf of the cooperative society The powers and functions of the promoter of the cooperative society The provisions relating to the appointment and removal of auditors The nomination procedures which should be followed in case of death of a member The provisions granting authority to the cooperative society to levy penalty from members Procedure for Registration The list of members classified state-wise, along with the name, address and date of birth of each member (The registration will be allowed if there are at least fifty members for every state.) Copies of Aadhar Card and PAN Card for all members, attested by the promoter of the society The list of states in which the society is currently conducting operations and the states in which the cooperative society plans to conduct its operations in the future (For the first two years from the date of registration, the society is allowed to conduct operations in two states only.) Certified copies of the resolution passed by the society for the appointment of the promoter A

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Annual run rate (ARR) 

Business / /

Revenue run rate, or sales run rate, is a financial metric that projects current revenue in a given period over a future period of time to give businesses a baseline understanding of future earnings. Companies can use weekly, monthly, or quarterly revenue data to extrapolate their annual income and inform strategic planning. Why you should track your revenue run rate Easily estimate your annual recurring revenue – You can use run rate (while accounting for other SaaS metric base rates) to quickly predict your company’s annual recurring revenue (ARR). Helps investors quickly estimate your growth and top line – Your revenue run rate helps you place growth in context by comparing previous run rates to the current run rate.  Offers a starting point for capacity planning – You can use the revenue run rate to predict your company’s ARR as explained above. Your predicted ARR can then be used to plan the capacity you will need to achieve your revenue goals and fulfill customer expectations. Simplifies continuous planning – Run rate is easy to calculate regularly, making it a very useful metric for a SaaS company’s continuous planning efforts. Using the revenue run rate to measure how growth affects revenue forecasts can help you adjust your business plans and revenue goals on a rolling basis. How to calculate the revenue run rate Revenue Run Rate = Total Revenue during the most current Time Period * the number of those Time Periods in one year Example of a revenue run rate calculation You can calculate revenue run rate using different time periods, including weeks, months, and quarters. Here’s a simple example of calculating a company’s revenue run rate using two different periods:  the calculations using different time periods produced different results. This is because the revenue run rate is heavily influenced by any revenue trends during the base period used for the calculation. Generally, the longer the time period, the more those trends tend to smooth out. How Revenue Run Rate and Annual Recurring Revenue (ARR) Are Different Since the revenue run rate is an annualized revenue projection, it is often confused with the annual recurring revenue (ARR). But they are different metrics. The annual recurring revenue (ARR) is the total annual contract value (ACV) of subscriptions in a SaaS business. In other words, it only accounts for revenue you can reasonably assume due to customer contracts. ARR is more commonly used than revenue run rate since it is a more stable predictor of revenue. However, ARR can’t show the complete picture of your revenue since it excludes one-time purchases and fees. So it is usually only used by companies with a subscription model.Businesses often use ARR to show growth rate over time by comparing each year’s recurring revenue.   What It Is Why Use It Business Type Revenue Run Rate Annual revenue based bookings from subscription sales. Projecting future revenue for non-annual contracts or non-subscription revenue streams. Any business and business model can use the revenue run rate metric. Annual Recurring Revenue Annual revenue based bookings from subscription sales. Gauging the top-line health of the business and forecasting revenue. ARR only applies to SaaS businesses due to subscription models. Drawbacks to using the revenue run rate The revenue run rate isn’t always the most accurate metric for revenue forecasting because it’s based solely on historical data. Some of the drawbacks that make revenue run rate risky to use are that it:   Does not account for seasonality – Monthly and quarterly sales revenue can differ greatly when measured during the high season compared to the low season. Revenue run rate calculations for the same company will vary depending on the time of year in which they are made. Does not account for churn – Churn occurs when customers do not renew subscriptions. Churn rates will reduce your ARR should more customers stop using your services compared to those who sign up. The revenue run rate assumes growth will be constant, which could result in major discrepancies between the run rate and actual revenue captured. Can present unrealistic numbers in tough economic conditions – Revenue run rate cannot anticipate major economic shifts in a turbulent business climate. If sales drop due to an external factor like a recession, the run rate won’t account for that. Assumes capacity remains the same – Run rate assumes your capacity will remain the same. However, you might remodel your capacity based on metrics like the Q factor. Revenue run rates are based on revenue data that is current at the time they are calculated and cannot account for changes not yet made at that time.  Does not account for one-time revenue windfalls –  A significant one-time sale during the period you use to calculate the revenue run rate will skew projections for the entire year resulting in a result that is artificially inflated and thus inaccurate.    Does not account for new business ARR – Your company may be about to introduce a new product or service that will boost sales and revenue. The revenue run rate can’t account for this future increase and its predictions may fall short of real revenue growth. When to use the revenue run rate When you’re trying to secure funding for a new company – If you haven’t been in business long enough to use alternative metrics, and given the market is stable, the revenue run rate can offer investors a quick picture of your growth prospects. When you are changing strategies – When switching growth strategies, you can use the revenue run rate as a benchmark to gauge whether your changes are working and whether your new plan is feasible. For example, if you’ve restructured your sales team and you see an increase in your revenue run rate, you can be fairly certain your strategy is working to boost your revenue.‍ When you want to provide quick insights to your sales and GTM teams – Run rate is an easy metric that sales and GTM teams can use to assess whether their efforts are in line to meet their revenue quotas and targets. FAQs What is the run rate of a company? Revenue run rate is a method used

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