Brick2Wall helps infrastructure contractors save up to 15% in procurement costs on steel purchase

- Nishant Garg

Co-Founder and CEO, Brick2Wall

Can you shed some light on Brick2Wall and its journey over the years?

Brick2Wall (B2W) is a value engineering firm that creates value for stakeholders in value chains plagued by fragmentation, traditional operating models and resulting information asymmetry. Nearly five years ago, the founders chose the construction material value chain, for its complexity and economic relevance. Ever since, the company has worked to reduce operational and financial inefficiencies in this value chain with the help of engineering, data analytics, and technology.

Leveraging the founder's 50+ years of family business association in the construction material ecosystem, Brick2Wall started with a marketplace to solve procurement challenges of retail consumers, offering one lakh+ SKUs, while solving for product discovery, price transparency and trust in quality. The critical mass from B2C success, attracted wholesale turnkey contractors/SME builders and marked the company's foray in the B2B space. Presently, Brick2Wall helps infrastructure contractors, which is one of the largest and fastest growing consumer segments of construction material, save up to 15% in procurement costs on steel purchase, by optimizing price through brand discovery and quantity via customized products.

Today, B2W is the trusted procurement partner of India's largest infrastructure firm, across its projects in India.

What are the major challenges in procurement of construction materials in the current market scenario? What kind of solutions does B2W offer to make materials procurement simple and efficient?

A typical construction assignment is tenured, depends on many stakeholders and typically operates at low double-digit margins. Construction materials constitute nearly 80% of the project's cost and thus for the project to remain viable, it is imperative to consistently procure efficiently, both in terms of value and timeliness of supplies, while also preserving quality and reliability of procured materials. The increasing volatility in construction materials prices and limited awareness or trust on available options, leads to suboptimal procurement prices. Further, there is knowledge asymmetry between the engineering team, which prepares the Bill-of-Quantities and the commercial team, which procures, leading to suboptimal procurement quantity.

Brick2Wall's advisory, using proprietary Product-with-Project match-making algorithms, along with a 'Seal of Confidence' on lesser-known brands, broadens the bouquet of brands/products. Intelligence on Price vs Delivery time reinforces the trust among procurement and project execution teams that help optimize procurement price and timeliness of supplies. The team works closely with on-site engineering teams to carefully analyze building designs and accordingly recommend customized products. Thus, we act as value engineering partners of commercial teams that help them optimize procured quantity. Having an in-depth understanding of the milestone-based payment of contractor invoices and thus the need for working capital to procure construction materials, B2W has also partnered with several financial institutions to help contractors secure necessary credit limits, either directly or via Brick2Wall's balance sheet.

The company also helps several small to mid tier brands often branded as 'Secondary' manufacturers, establish D2C B2B business. It enables these manufacturers - otherwise operating traditionally and often failing to showcase their world-class production facilities and quality raw material before business clients - with steady business volume and profit maximization opportunities.

What are the key advantages and benefits for customers using B2W platform?

Brick2Wall provides benefits not only to its customers (infrastructure firms) but also to other key stakeholders forming part of the construction material supply chain - material manufacturers, logistic partners and partner financiers.

With Brick2Wall's help, its customers have seen a 15% reduction in procurement and execution costs. By setting up parallel marketing and distribution lines for manufacturers, Brick2Wall aggregates committed business volumes for them. This has helped manufacturers optimize production schedules and increase asset utilization. At the same time, it has helped preserve manufacturers' capital for capacity enhancement by extending its financial solutions. With this, manufacturers have observed a 1.5x increase in asset utilization, with some even undertaking 2x capacity enhancement initiatives. The company has also observed a 1.5x rise in their logistic partners' asset utilization and its partner financiers have reported a 5x increase in credit lines.

What kind of business opportunities do you look forward to in the future and what are your expansion plans?

In the future, Brick2Wall hopes to deepen its customized product solutions and offer ready-to-use, prefabricated structures. Another exciting opportunity we see is supporting partner manufacturers with technical intelligence to produce better quality products, as well as participating in their procurement supply chains.

As for our expansion plans, we are currently in the advanced stages of establishing value creation propositions for two other construction material categories.

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