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Building at The Intersection of B2B Supply Chain and Fintech in Bangladesh: A Conversation with Irfan Rafique, Founder and CEO, SupplyLine

Our guest today is Irfan Rafique, Founder and CEO of SupplyLine, a tech startup operating in the $174 billion consumer goods supply chain market in Bangladesh. Prior to starting SupplyLine, he worked at Unilever Bangladesh and omnichannel ecommerce startup Deligram. Irfan combines rich domain expertise with a passion for leveraging technology to solve complex distribution challenges. 

In this insightful conversation, we explore SupplyLine's origin, its innovative approach to streamlining retail distribution, SupplyLine's asset-light model, its innovative invoice financing solutions, Irfan's lessons from building a startup in an enormous but underserved market, and a lot more. Please enjoy this excellent conversation with Irfan Rafique.

Future Startup: Please briefly tell us about yourself and your journey to what you are doing. 

Irfan Rafique: My journey began with a deep passion for solving logistical challenges in supply chain management. With a background in business and distribution as an early career choice and a keen interest in technology, I saw an opportunity to leverage innovative solutions to streamline processes and improve efficiency in the retail distribution industry.

During my time at Unilever, I gained invaluable experience in the distribution industry, which inspired my passion for finding ways to optimize supply chains, reduce costs, and improve customer satisfaction. Following my time at Unilever, I ventured into the omnichannel e-commerce space as a founder, an experience that provided me a unique perspective on the challenges and opportunities of integrating physical and digital distribution channels.

I eventually embarked on a journey to create SupplyLine, a platform that aims to revolutionize how businesses manage their supply chains, driven by the desire to make a meaningful impact in the sector. By combining cutting-edge technology with industry expertise, at SupplyLine we empower organizations to optimize their operations, reduce costs, and enhance overall performance.

Future Startup: How did you come up with the idea and get started? 

Irfan Rafique: SupplyLine came from my deep interest in simplifying distribution. I noticed that everybody in the industry is building their own networks to serve the same retailers. It's like Airline companies trying to build their own airports, or taxi companies trying to build their own roads. It made no sense in terms of unit economics and optimum basket size and that’s where SupplyLine comes in.

We see SupplyLine as a distribution optimization and financial tool that can be used by both retailers and lenders to open new pathways for their business. Be it via stocking the right amount of goods by the retailer, or the use of our credit scoring algorithm by our partner banks to extend invoice credits against those goods, SupplyLine aims to become the trade marketing and invoice financing CRM.

Future Startup: What problem is SupplyLine trying to solve? What is the scale of the problem?

Irfan Rafique: SupplyLine is addressing the inefficiencies and challenges within the $174 billion consumer goods market in Bangladesh, which is poised to become the world's 11th largest market with a steady 6.5% GDP growth. This market, larger than Germany, the UK, or France, is currently served by 2 million mom-and-pop stores, and is our total addressable market.

Despite the vast potential, less than 0.05% of this market has been tapped into by B2B marketplaces. SupplyLine offers a streamlined, efficient platform that connects suppliers and retailers, eliminating traditional distribution operators' slow and obstacle-ridden processes.

Our competitors are trying to disrupt the old distribution model, but their approach often results in slow growth and numerous hurdles. In contrast, SupplyLine is positioned to capture the first 10% of this market through an asset-light approach, leveraging technology and innovation to drive rapid and sustainable growth. By addressing the inefficiencies in supply chain management, we are transforming the way businesses operate and unlocking significant value within this burgeoning industry.

Future Startup: Tell us about the launch story. 

Irfan Rafique: It all started with a simple idea and a WhatsApp group where we tried to experiment and see if there is even a demand for something similar. We recognized a need within the market, and took the first step by creating a small web app to address it. From there, we listened closely to our users' feedback and iterated our product, constantly refining and enhancing its features and functionality. Each iteration brought us closer to our vision of a comprehensive, user-friendly platform for supply chain management.

As our user base grew and our understanding of the market deepened, we expanded our operations into a full-scale tech operation. 

Today, SupplyLine represents the culmination of years of experience and countless iterations of our product. Our current solution is the most mature version yet, incorporating the insights and lessons learned from our journey in the industry. But everytime things go wrong, we remember that once upon a time, this used to be a WhatsApp group and things were fine even back then!

Future Startup: What went into building the initial operation/first version of the platform/product/services? 

Irfan Rafique: Typically what goes on in a startup—a hunger for building something great! It was 2020, COVID was in full effect and there was no funding whatsoever from foreign VC’s, and we thought now is the best time to build something that solves the key issues that distribution houses were facing across the country amid the lockdowns!

Future Startup: How did you put together initial investment and other resources to get started?

Irfan Rafique: Our initial angel investor is a key industry insider, and is considered to be a thought leader in the distribution and trade marketing industry. We raised our first ticket from him, which helped us to build a working MVP and a fantastic team that already had years of experience in the industry. 

This eventually helped us get into the Accelerating Asia program, and we did not have to look back since then. 

Future Startup: Tell us about a few major challenges you faced in the early days. 

Irfan Rafique: COVID and lockdowns made it extremely difficult to raise funds and get anything ambitious done. Like many startups, we faced resource constraints in the early days. We had to be resourceful and make the most of what we had, often relying on lean development practices and bootstrapping to stretch our limited budget as far as possible. But it also made us stronger. 

On the other hand, convincing retailers to adopt a new platform for their regular procurement of key SKU’s was a major challenge, both in terms of trust, adoption of digital solutions, and awareness as a whole. 

Retail businesses are usually accustomed to traditional methods and are hesitant to embrace change. We had to work hard to demonstrate the value proposition of SupplyLine and overcome skepticism within the market in the early days. 

Future Startup: Tell us about a few major strategic decisions/activities that have helped grow the business in the early days

Irfan Rafique: One of the key strategic decisions that helped our growth was adopting an asset-light business model. 

By leveraging existing infrastructure and technology, we minimized capital expenditures and operational costs, allowing us to scale more efficiently with lower overhead.

Another critical decision was to refrain from extending invoice credits from our own books. Instead, we focused on facilitating transactions between suppliers and retailers without taking on the financial risk of offering credit terms ourselves. This allowed us to avoid potential cash flow issues and maintain a healthy financial position, enabling us to scale with minimal burn. 

On the other hand, this also proved that we had developed a successful credit rating model that was trusted by large banking partners. 

Forming strategic partnerships with key players in the retail ecosystem was also instrumental in expanding our reach and capabilities. 

By collaborating with suppliers, retailers, logistics providers, and other stakeholders directly, we were able to offer a more comprehensive and integrated solution, unlocking additional value for our users.

Future Startup: Please tell us about SupplyLine's business model. What is your product, and who are your customers? 

Irfan Rafique: SupplyLine offers a user-friendly online platform where retailers can browse a wide selection of products, place orders directly with suppliers, and manage their inventory in real-time. 

Suppliers, on the other hand, can showcase their products, receive orders from retailers, track shipments, and manage their supply chain operations more effectively. 

On the other hand, Banks and NBFIs can use our credit rating data to extend loans against each purchase to eligible retailers. 

Future Startup: How does SupplyLine earn money and what are some of your biggest cost centers? 

Irfan Rafique: Simply put, we deliver products to retailers and make a margin out of that. 

On the invoice financing front, we act as banking facilitators and earn a margin out of that too.

Future Startup: How does your distribution and marketing work? 

Irfan Rafique: As I explained above, we are an extremely asset-light company. We work with multiple partners for our distribution and have our own micro-fulfillment centers. 

On marketing, we are hyperlocal and believe in activation and retailer-specific outreach in our geographies. This gives us the best return on our costs and helps us get the best out of our infrastructure.

Future Startup: What are your operational pillars? How big is the team? How is the company structured? What does your culture look like?

Irfan Rafique: We are a highly customer-centric organization. Our retailers are the key to our whole operation. We believe in being hyper-agile, and technological innovation is our main target.

In terms of structure, we are a very flat organization with empowered executives and no mid-managers. 

We are currently a team of 40+ people and growing. Our team promotes an N+1 methodology when structuring our work making sure that the end-user of anything we build or work on is directly in touch with their counterpart working on that.

Future Startup: Tell us about the major challenges of SupplyLine today. 

Irfan Rafique: Simply put: raising funds, scaling to larger geographies, and finding enough time to sleep. 

Future Startup: Tell us about SupplyLine's future plans: short-term priorities and long-term vision.

Irfan Rafique: Technology in supply chain management is rapidly evolving, with advancements such as AI, blockchain, and IoT, transforming traditional processes. 

Keeping up with these technological changes and integrating them into SupplyLine's platform is our largest short-term target. This is while we scale to serving thousands of more retailers per month, and extend our invoice financing solutions to them.

In the long term, we aim to build Bangladesh’s retail operating system.

Future Startup: 3 mistakes that you would like other founders to avoid. 

Irfan Rafique: 

  • Don’t try to perfect your technology first. The solution is more important.
  • Traction is more important than validation and awards.
  • Good service for a simple product trumps fancy products any day.

Future Startup: Tell us about how you stay productive as a founder. 

Irfan Rafique: 

  • ToDo Lists
  • Timeboxing
  • Trusting your team-mates to get things done. A productive team is more important than our need for micro-management to feel personally validated.

Future Startup: 5 books you would like to recommend to our readers. 

Irfan Rafique: 

  • Forrest Gump
  • Art of War
  • The monk who sold his Ferrari
  • High Growth Handbook
  • The Almanack Of Naval Ravikant

Future Startup: 3 lessons you have learned as a founder. 

Irfan Rafique: 

  • Avoid jargon. If you can’t explain it to a Rickshaw puller, it's not much of a solution.
  • An MVP can even be a really good pitch. Doesn’t need to be fully usable when you are pitching.
  • Half the people speaking about building AI solutions and replacing everyone with a chatbot don’t really understand how a neural network works in reality.

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