we want to bring this hardware at a very affordable price either we make lower margins when we make lower margins it is important for us to bring down costs and basically ensure that this cost remains low we dont do any major marketing like other brands do they spend a lot of money on advertising we have very low channel cost we sell online and whenever we sell offline we mainly sell through direct to retail mode we have a very leaner distribution network than many other brands and then we also reduce costs across the board by having this week on week structure what we are trying to ensure is that we dont have a two month inventory sitting in our books two months inventory is a huge working capital cost what most of the brands do is because they dont have a very efficient system of predicting the future needs of the clients when working capital cost is low everybody in the system can make a much higher roi because even if you make lower margins but because you are rotating the money much faster and the working capital is not stuck for a month or two but it is getting release every week the roi can be much higher even with lower margins it is also important that we sell each of these phones for long durations because what happens over a period of time the cost of component goes down and the price also goes down but maybe not in the same ratio thats exactly opposite of what many brands do a lot of brands would want to book a huge amount of marginal hardware and make very small margins profitable but small and it continues to grow over a period of time on top of it we make money from our softwareindia head xiaomi iimkolkata previous jobs jabong dink couple mckinsey company headstrong services claim to fame has built xiaomi into the third biggest smartphone brand in the online segment with almost zero ad spends who i want to be when i am 50 at 50 i would like to spend majority of my time trying to make a difference for the society i would like to be closely involved in few projects that can impact the life of common men in the country ideally something similar to what nandan nilekani is doing with aadhar upi and other projects success to me is people remembering you for your positive contribution even after you are gone about 15 years ago i got a chance to meet shiv khera author of book you can win he quoted ralph waldo emerson when you were born you were crying and everyone else was smiling live your life so at the end you are the one who is smiling and everyone else is crying this has really helped me define my definition of success i would like to be remembered for having made an impact