Building India’s Blue Nile: CaratLane CEO Mithun Sacheti (Part 3)

Sramana: How did you go about developing your diamond aggregation pipeline? Did you primarily rely on your family’s history and contacts?

Mithun Sacheti: Aggregating diamond suppliers in India alone was not enough. We needed to be everywhere. We had to go deep and get inventory from Hong Kong, Israel, New York, Antwerp, and Bombay. Those were the biggest trading centers around the world, so if we were going to really be a player we had to be in all of those areas. Antwerp was the last one that we addressed because there were a lot of logistic issues there. Even today Antwerp is our single biggest challenge.

We had to visit every one of these locations, explain our business model, and convince them to work with us. The American guys understood us very quickly because they knew Blue Nile. The immediately asked us if we were going to be the Indian Blue Nile, and we told them we certainly hoped so. Their problem was that if they had Indian inventory, there was a slight problem because that was the pipeline that I was buying from anyway. There were a set of challenges like that everywhere we went.

We had to spend a lot of time talking about how to plan diamond inventory and how to plan real-time inventory. In many cases we provided them with tools to help them manage their real-time inventory.

Sramana: Did you have to make minimum business commitments?

Mithun Sacheti: We did make those commitments when it came to vendors we really valued and whom we really wanted in our system.

Sramana: How much of this did you need to have in place in 2008 when you launched?

Mithun Sacheti: We had 40,000 items in place when we launched. We had our solitaires in place. We did not have very many mounts in place at that time. Jewelry was not in place because we were very focused on the solitaire aspect of the business.

Sramana: Were you just selling solitaires and not the settings?

Mithun Sacheti: We did not have the level of settings we wanted simply because we focused so much on the solitaire inventory. We may have had 20 mounts for people to choose from, whereas today we have 200 or more.

Sramana: You went to market with a minimal viable business option, which is a great starting point.

Mithun Sacheti: Starting in the market is definitely better than sitting at home. We had already spent 14 months getting this started. There is a lot that goes into the back end. There are some very large, rigid vendors that require us to follow their guidelines. We had to adjust to work under their system. They key to our entire operation was to reach the cutters. We went very deep after that market. Our goal was to aggregate from levels that were so close to the cutters we could expect them to not have IT solutions.

This segment is part 3 in the series : Building India's Blue Nile: CaratLane CEO Mithun Sacheti
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