Let’s rebuild the Economy – Ourselves

After a self imposed exile at home in the garb of WFH for over 150 days, I finally stepped out of home and moved to Bangalore last month to join my “real office”. I also travelled to Kushal Nagar in Coorg where our company’s Headquarters and Plant are located for a review with my Management. All through my two weeks at Bangalore, I was pleasantly surprised and motivated how we are ourselves building back lost time, money and economy. For instance, we had full attendance at office and also ensured all of us wear face masks while seated. Every alternate chair in the Meeting room is left empty (so fewer persons and therefore the meetings end early too!). Usage of hand sanitisers, and most importantly washing hands frequently is encouraged to ensure this is rather a “habit formation” in the long run. Cleanliness is Godliness, someone said long ago and remains relevant all along. 

I travelled across two major parts of Tamil Nadu last week, to Coimbatore and Madurai to meet my team members, Distributors as well as for market visits. Same protocol, another precinct. Nothing changed. The hotels have accepted the new norm, so have Guests. Food is served outside the room as per WHO protocol and the guest must take it inside their rooms themselves. Buffet is off the menu and breakfast is served in the room. Works for all of us plus the added advantage of “NIL wastage” at the buffet counter. Limited and minimal contacts with other people around works to everyone’s favour after all. 

This week, my wife and I decided to travel by road to visit a few of our favourite temples to seek the blessings of our beloved gods. We departed on Tuesday morning even as the TN Govt. opened up the doors of all religious places in the state. We were not just surprised but also impressed with the steps taken by the Government and the penultimate cooperation by devotees. We witnessed this first hand not just at one but across some of the oldest and perhaps, otherwise most populous temples. For Ex., the Srirangam temple, the world’s largest temple complex witnesses at least 30,000 visitors on a regular day. However, now is a different story with less than 1% of that number of visitors being allowed everyday. Still, the devotees maintained strict social distancing and followed norms, while at the entry inside, temperature check has been made mandatory. Well, that’s not accurate, quip many. But then, do we have a choice of shutting down everything for some more time to come? 

We travelled around 1,100 kms over 5 days and stopped by at least a dozen restaurants. Almost everywhere, customers and patrons seem to be following self-discipline which is the key to combat this virus which apparently is here to stay for some more time to come. 

What was pleasant to see was that even in the smallest of Tier 3 villages, locals understand the reason to wear a mask and the reasoning not to touch others, walk in groups or sneeze in public. The awareness created all along by the Media and the Governments is impressive although there is a surge in unruly motoring skills in city roads as well as on Highways – especially 3-4 persons on a 2-Wheeler and most of them not wearing Helmets which goes unchecked by the authorities. Well, we gain a few brownies and lose some ourselves. Sad part of humankind.

Ultimately, to bring India back to it’s foot is the duty for each of her citizens and beyond a point, I believe the Government can do very little beyond disbursing loans and doling out subsidies. While the Central and State Governments are doing their best despite so much negativity around, I personally believe it is up to each one of us to pick up the broken, leftover pieces and push the economy upwards. If not anything, this is just another form of patriotism and duty to the nation. Needless to say, we need to ensure safety precautions for ourselves as well as to our surroundings. And for me, I filled up Diesel full tank today even as I entered my home garage, ready for the next drive. I pledge to do my bit. I have Miles to go, after all.

The Future of Retail

The writing was on the wall for a long time. Many old timers like me and thousands of retail enthusiasts in India and worldwide were eagerly waiting for the announcement. That the Reliance Group was a strong contender to buy out The Future Group lock, stock and barrel was a known fact. And that Amazon and Walmart were discussing the final nuances was also a known thing. And then, it happened finally. It Happened In India – on 29th August 2020, Reliance Retail and The Future Group formally announced in the media that the former had bought out the wholesale, retail and warehousing business of the latter in full. A red letter day for self made Entrepreneurs, groaned many on social media and in passive interactions. The man recovered his 30 year’s investment of time, quipped many others. A few former employees were seen sulking in public and private, some even wept at this outcome. At the end of the day, it’s a business that has changed hands, owners and course. Life moves on, so why fret, said many others. 

Kishore Biyani and his cousins started the traditional business of selling dress materials for men in Calcutta in the 80s. As a family driven business from the “Maheshwari” community of Marwaris, the family spread their work load. Each one of them had an important role to play – from sourcing to selling, accounting to managing working capital. They named the company “Pantaloon” as they were selling Pant lengths for making patloon, the Indian namesake for western clothing. When the family gathered pace with their wholesale business, was born an idea of retail models such that customers could grace the shop and buy. They opened their fancy big outlet at Gariahat, Calcutta in the late 90s. The shop was a runaway hit and also boasted “Green Card” – a loyalty platform. Yes, 1990s. With the stupendous success of the fashion format, the company decided to cater to the other essentials for the family – Roti, Kapda aur Makaan. Thus was born Big Bazaar on VIP Road, Kolkata in 2001. All along the Biyanis were shuttling between the city of joy and the city of dreams. With dreams unlimited. 

I joined the group in 2004 when the company ventured with Mall Retailing – Bangalore Central which opened it’s doors in May 2004 And has over 45 Malls to its credit till date all India. The company opened some format of retailing in every residential locality of India’s top 100 cities – from Gauhati to Madurai, Baroda to Bilaspur. At some point, the company was selling everything from a humble Rs. 10 samosa to the entire wardrobe for the house with accessories, furnishings, paraphernalia and everything in between. After the big slowdown of 2008, Kishore Ji in his inimitable style conceded at the 2009 India Retail Forum at Mumbai that the company wanted to be “everything to everyone” and failed miserably at it. As a person who only gathers learning and lessons from failures, he simply moved on to build a coveted “Pantaloon Fashion” business which he sold at a handsome profit to the Birlas. Once again, he painstakingly built other fashion retail brands including Cover Story and fBB alongside the equivalent of India’s very own Walmart – Big Bazaar. 

For every 10 customers who frowned at the business model of BB, 100 others became loyal patrons everyday of the multi-category retailer infamous for crazy deals and price-offs. During these last 20 years, there were several internal and external forces that wanted a slice of the Golden Sparrow – a pneumonic which the group added to it’s logo when the company’s name was changed to The Future Group – Sone Ki Chidiya tagged along with. When Reliance Retail was contemplating to enter the retail business in 2008, they had obviously explored a buy out. However, the company built it’s own fort with all it’s might. Amazon and Walmart made several attempts all these years to get a pie in the business but couldn’t lay siege in a big way. In turn, Bharti-Walmart ended up selling their retail business “Easy Day Stores” to the group several years back even as Carrefour bowed out of India with a single store in East Delhi which never took off. The group and it’s Founder were building a mighty retail company with several formats, several business models including a foray in to packaged FMCG with the “Tasty Treat” Brand which was an outcome of the private label business of the company through its grocery retail business. 

It’s all about timing, as they say in business and bourses. 

The Corona Crisis was a great opportunity for the Promoters to exit the business especially when the richest man of Asia was willing to write a cheque. This was not a hostile bid. Yes, there has been mounting pressure from Investors, bankers and share holders due the company’s debt levels. But a bailout, if needed was only favorable for the Biyanis. As they didn’t just sell grocery, household, electronics and fashion alone. Kishore Biyani was a Dream Merchant. He made millions of Indians to dream. To dream Big. To dream big about building scale and grow their businesses. For thousands of naysayers of the group’s way of running the business, lakhs of small time business persons grew their small ventures inspired by the self-styled and non-conformist serial Entrepreneur who tried to sell everything a consumer can consume, literally and figuratively including insurance and EMI-led credit to shop more at his 1,000s of stores. Some even went public or raised private investments. He strongly believed in a consumption led economy and Kept repeating that the Great Indian Consumption Story is yet to take off in a big way.

As a Retail professional, my second stint was with the group where I saw firsthand decision making of a slew of deals; how to take risks with determination and a cushion to fall; gather self motivation and courage to keep moving, no matter what. If one thing doesn’t work one way, try it another away. And a 100 other ways. It would eventually work, after all. It had to. Had I not moved to Bangalore on that Sankranthi day of 2004, much to the chagrin of my parents with 4 bags and a bagful of dreams, my professional career, a Retail dominated one at that wouldn’t have occurred, probably. I am ever grateful to the Leadership Team at the erstwhile Pantaloon group who guided me as a young man with a mere 2.5 years’ experience and of course my many interactions with Mr. Rakesh Biyani with whom I worked closely while setting up the Concessionaire Business at Bangalore Central. 

I personally see this as yet another lesson for budding as well as well settled Entrepreneurs  - to believe in oneself and keep moving with earnest efforts. If you do well, you will succeed. If you don’t do as well as you could have, yet have built something incredible, then there will always be someone to support you, invest in your dreams or perhaps buy them out. 

The Great Indian Retail story is yet to be fully told. I am glad I am a part of it.

A Retailer by Profession and Choice. Since 1997. 

WFH – Boon to Retailers & Brands

Many companies have advised their employees to plan WFH until end of this Calendar year. This means a good / happy news as well as a significant job loss for millions. That more people will lose lives and livelihood for the grave mistakes of themselves and the Governments across the world is a reality that we are staring at. However, the eternal optimist that I am, I can already see green shoots in certain segments of the consumer business. Some of you may recall that during my Webinar sessions in the months of April & May, I had referred to certain categories which is only bound to increase if not at least sustain its current business opportunity. Most of the daily household items have seen consistent growth even during the extended lockdown while Food related FMCG have shown tremendous growth. Categories such as Coffee, Tea, Sugar, Flours & Pulses have seen a spurt in sales for many brands while Retailers, albeit with a shortened operating time than before, are not complaining, thanks to consistent footfalls and increased bill values. 

However, what has taken many Retailers, Distributors and the entire supply chain by surprise is the huge surge in work-furniture for home and Electronics + Consumer Durables. We ourselves went shopping last week only to find that Godrej Interiors had completely run out of stock for 4 weeks, Home Town had absolutely no sight of when stocks would be replenished, over 40 customers merely waiting to enter Home Stop and hitherto B2B players such as Featherlite living up to the unprecedented opportunity and serving customers with their backend capabilities being spruced up. Traditional Furniture Retailers are not lagging behind either. Actually, I see many of the neighborhood shops doing brisk business with the highest demand for compact desktop / laptop chairs under Rs. 4,000 a piece followed by chairs that suit or double up for other purposes. I have also been hearing a few of my Architect-friends getting calls from their Business Clients to set-up / renovate their homes to be able to work. 

The other category which has been doing extremely brisk business is Cosnumer Durables, Home appliances and personal electronics. While Amazon & Flipkart haven’t resumed their deliveries fully across geographies, consumers are literally seen shuttling from one shop to another for want of peripherals such as computer mouse, headphones, Mobile Phones with 4GB RAM (to be able to take up Apps such as Skype & Zoom) under sub-Rs. 10,000 and most importantly, Laptops. I guess desktops as a category is passé – one, it occupies too much space and it’s immobile within the house as well as across users, which gives a push for laptops. 

In my own personal case, I had to wait for over 6 weeks to get myself a new MacBook Air, an upgrade after using the previous Air for 5 years. Thanks to good friends, I was able to lay my hands on one out of the two pieces that landed in Chennai after the recent lockdown. The folks at Apple India as well as Apple Retailers say with a grin that most models of MacBook / iPad are out of stock and there is no immediate visibility of their arrival into the stores.

With the State Governments finally budging for schools to conduct Online classes – the High Court of Tamil Nadu has especially allowed private Schools to collect 40% of the Annual Tuition Fee for the present academic year – Online Classes are getting more and more real. The state run “Kalvi Tv” in TN shall also showcase online lessons while every other State Government is looking at similar measures to ensure continuity of education. This further means more requirement of laptops, earphones and so on. That there is no shortage of Electricity at urban and semi-urban homes is a big advantage.

Smart Entrepreneurs, Individuals and Businesses have lapped up this opportunity. A second-degree associate of mine who was retrenched by his employer, a Hardware Engineer with 10+ years of experience has taken up direct sale of Laptops to Corporates making a neat 4-5% commission on the purchase value. He claims his income, although a temporary one is lesser than what he used to make in his previous job while he reconciles that he is unsure how long this would go on – his parallel entrepreneurship and the Corona lockdown. Whichever way, make hay while the sun shines is the way forward I guess. 

Meanwhile, traditional retailers in both these categories are indeed an aggrieved lot. For Example, the Founder of a family business which is in to Electronics for the past 2 decades has been adamant on downsizing his margins for want of volumes. He claims that this one-off discounting model on gadgets such as Iron boxes, Personal Shaving Equipment (for men) and other household items such as mixer grinders and refrigerators will hurt the business once the challenges are over, especially around Deepavali 2020. What he doesn’t realize is whether he would be operational until then, running 20+ stores across the state, employing over 300 people and a joint family of 4 siblings and their wards. 

In another instance, a proprietary furniture dealer near my home refused to entertain any sort of reduction on Chairs claiming that these items were already on high demand and that he sees no reasons why they should be sold at lower prices. That there are literally 100s of furniture shops around is something the gentleman should realize soon. Maybe, he wouldn’t. 

I am actually planning to write a book which would go by the name “Corona Millionaires” which could be release in 24 months or so. No, I am not referring to the likes of billionaire Shri. Mukesh Ambani and his ilk. I am referring to common people like you and me – who found this crisis as the biggest business opportunity of their lives. May be a Netflix original too. It could rake in more money than what many Entrepreneurs would make during this crisis.