Intuit, a company with an exclusive SME focus is looking to make further inroads into the market with its financial accounting product QuickBooks
By Mehak Chawla
Although SMEs might still be away from advanced IT applications, one thing that is certainly amongst their top priorities is streamlining their financial processes. That is primarily the area Intuit is banking upon for its growth.
Intuit, a company that globally is focused only on the SMB market is looking to make an impact through its low cost financial management product, QuickBooks. The company also recently came out with its report on the barriers to technology that micro, small and medium enterprises (MSME) of India are dealing with. The prime objective of the report that was supported by Ministry of Micro, Small and Medium Enterprises, was to understand why the tech adoption in SME’s not progressing at the rate that industry and policy makers are expecting and what are the barriers that SMEs are facing.
According to Nikhil Arora, Vice President and Managing Director, Intuit India, SMEs can be broadly branched off in three categories- the non-adopters, the aspirers and the users of technology. The non -adopters are traditionally brick and mortar or family run businesses who are not evaluating or feeling the need for any technology. The aspirers are moderate adopters of Excel or a bit of Tally. The users are the new progressive businesses who are very conscious of RoI that technology can yield.
“We found that RoI was the biggest deciding factor for technology across the board, especially in the context of fast pace of technology. Second biggest factor was more access to credit, payment plans that vendors offer, and government subsidies. The third important factor was around skills development and lack of resources,” said Arora while elaborating on the challenges that SMEs faced while buying technology.
With these market dynamics in the background, Intuit launched QuickBooks, an accounting software for SMEs. “What we have learnt from our customer experience is that if the awareness of the value proposition of the product is established then the barriers diminish,” he opined.
The product
QuickBooks is basically a financial accounting software, that works online and helps an SME streamline its accounts in an easy and affordable manner. Intuit has launched QuickBooks in over 150 countries in the past few months. The India launch took place about 6 months ago, prior to which the product was in its beta version.
Talking about the SaaS model that is gaining ground with the SME’s Arora said, “What we have figured it that the boundaries between SaaS, hosted model and Cloud are more in our mind, as technology providers, rather than in the users’ minds. For them it is about their workflow and RoI. As long as the job gets done and they are assured of the safety of their data they don’t bother about the technical aspects.”
Explaining their model for QuickBooks he added that essentially their product is about “Anytime, anywhere access to finances like an overview of dashboards, in a snapshot kind of manner.”
Though it is still early days for QuickBooks in India, the country is generating the maximum numbers of users amongst the new countries Intuit has ventured into (outside the core of US, UK, Canada). In terms of monthly adds, QuickBooks is seeing more than 20% user additions coming in every month from India.
“Worldwide we have over 1.3 million users for QuickBooks. We also have a QuickBooks desktop which is not here in India, but that includes over 4.5 million users,” disclosed Arora.
India localisation
With its target areas being exclusively the SME’s Intuit’s aim is to make 1 in 4 SMEs use Intuit’s product in the next 5-7 years. That is why, Intuit has laid huge emphasis on the ‘First impression” of the product. “We want to let the product talk. We have a ‘First Use Policy which focuses on quick installation and ease of use. These things we put a lot of emphasis on,” said Arora. He added that QuickBooks can be installed and is ready to use in 30 minutes.
Intuit is also working on making the product device agnostic. “It is the workflow of the customer that is important and it is our job, as tech providers, to enable its smooth functioning across devices. For instance, some of our products are available on both mobile and online. In India, QuickBooks is still a totally online product, but we have a mobile offering in other countries.”
Arora felt that it is still early days for mobility in India. It is only being used for basic stuff like checking balance, status etc, but not exactly for transacting. But, eventually it is likely to become a hybrid of web and mobile. “The question increasingly is becoming how many devices can a person handle and we are trying to make that handling simpler,” he said. Arora revealed that according to customer feedback, QuickBooks was saving them 2-4 hours a week in time.
Today, in India there are about two million SMEs who are broadband users but Cloud usability is low. “So, we believe that the time is right from a technology adoption point of view because this is a product driven adoption rather than a marketing driven adoption,” mentioned Arora.
Arora agreed that there were a lot of connectivity challenges in the country, with only SMEs in tier one and two cities having some access to broadband. However, he was optimistic that the future is going to belong to online products. To counter the connectivity challenge as of now, Intuit is also exploring an offline version of the product where one can use the product even without connectivity and it will automatically update itself as and when the device is connected again.
To add to the localisation flavor, Intuit is also leveraging the power of many domestic application developers. “We have an Intuit partner platform where we let third party developers develop apps around our products. We feel they can customise much better than we can,” he said.
Indian ambitions
Citing that Intuit looks at SMEs in a holistic way encompassing both urban and rural SMEs, Arora explained that there are some 10 million urban SMEs who have some sort of access to computer with 2 million of them being broadband users.
“When you look at an urban SME there are three main pain points- how to grow business, streamline payments and manage finances. QuickBooks is right now in the third bucket of finance management, but over a period of time we want to help SMEs with their payment processes as well as their business growth.”
Intuit already has these products in the US and over a period of time is looking to get them locally made here or get a hybrid version. They are already practicing this model with their product txtWeb, an Internet to mobile messaging service. “We have something called txtWeb in India which is a mobile based application with over 2 million users, all of it being developed through third parties- students, engineers etc.,” revealed Arora.
Intuit considers a farmer as a rural SME. It is to cater to this segment that they came out with their product Fasal, which informs a farmer about the going rate of his crop and the mandi which is offering the best rate. “We have 1.1 million farmers using this product,” said Arora.
The segments that Intuit is looking to target with QuickBooks are ad agencies, marketing companies and service groups that have extensive invoicing needs. “We are finding that 60-70% of our customers are, as of now, from tier 1 towns. We have lately been seeing trends from wholesalers and retailers. We are also seeing good interest from accountants- which we did not exactly expect because of Tally being so prominent,” commented Arora.
Intuit is also looking at building language capabilities and doing different experiments around it to enhance the scope of the product.
As far as the pricing goes, QuickBooks is available in two versions- basic and the advanced one. “When we price our products we see long term adoption rather than short term revenue. Our basic version is just Rs 4000 and advanced is Rs 6000. So, pricing doesn’t seem to be a barrier for us,” concluded Arora.
