Showing posts with label travel retail. Show all posts
Showing posts with label travel retail. Show all posts

20 February, 2023

The hype around Air India’s big buy

Much is being spoken, written and debated about the recent purchase of 470 aircrafts by Air India from Airbus and Boeing. So much so, that the US President made an official statement that this could create a million jobs for his countrymen. Many politicians thanked the Indian Prime Minister while so many questioned his role in this private affair between a buyer and a seller – why and how would the Governments on both sides have any role. Leaving all the controversies (if one exists!) aside, let us see the opportunity that we are sitting on. 

In the past 8 years or so, the present Government has reactivated over 70 airports. These are not new ones really, for they already existed. Barely. These were airstrips with an ATC Tower at best built before WW 2 by the British. The Union Government through its ambitious project to make the common man fly – Ude Desh ka Aam Nagarik (UDAN) was activated and many unused airports were operationalised. It is another thing altogether that our railway networks are choked and a small section of travellers do not mind paying a premium for air travel.


A view of the Udaipur Airport developed under UDAN


Altogether, the number of air passengers have grown from 37 mn pa in 2010 to 167 mn in 2019 (sans 4 days of the first lockdown!). The number halved for FY 2021, grew to 123 mn in 2022 and would be around 130 mn in the current FY. By 2027, we expect over 200 mn passengers to hit the sky in a year. To give it a perspective, over 2.2 mn (2 Crores) people took train journeys daily in 2019 of which an estimated 8% of them travel in airconditioned classes.


What excites me, as a (Travel) Retail Professional are the possibilities for retail at airports. To accommodate these new 470 aircrafts plus another equal number from all other incumbent airlines at the moment in India, we are expecting a blast in the skies. Don’t worry, it wouldn’t be so choked like our railway networks where one express train has to stop at times to let the other one travel. But the congestion at airports (runways) would be inevitable. 


IGI Airport, New Delhi


The new Terminal 3 built at New Delhi Airport a decade back is already choking during peak hours. Mumbai is building another new airport and the same is the case at Noida. Bangalore has commenced a new parallel runway last year and a brand new terminal T2 which will be fully activated by Q3 FY 2024. Goa has a brand new airport in the north while there is no confirmation of shutting down the existing one in the south of Panjim. 


Keeping aside the top 20 airports – 2 super metros, 4 metros and the top 16 cities in India – there would be 175+ operational Airports across the country by 2025. The bare minimum would be a daily passenger count of 1,000 pax/day while the maximum would be 30,000. The top 6 airports, by then would be handline 30,000 – 60,000 passengers per day! 


At the moment, the spend per passenger in Indian airports is abysmally low. Singapore’s Changi Airport recently announced their CY 2022 revenues from Travel Retail – USD 870 mn. That would be 38% of 2019 revenues, which means in 2019, it would have been USD 2.2 Bn pa. Dubai’s retail and F&B revenues pre-pandemic were a little over USD 2 Bn pa; Hong Kong, Paris CDG, Frankfurt and Zurich Airport, each had Travel Retail Revenues between USD 600 mn to USD 1 Bn pa. All this crashed due to Covid-19 but is slowly bouncing back.


New Integrated Terminal Building coming up at Chennai Airport

In India, Travel Retail has been a non-starter except at the top airports, especially those which were privatised. AAI continues to operate quite differently, in a manner that is neither exciting nor enticing for retailers to embrace the opportunity. However, change is inevitable and we see a huge improvement coming our way. By 2025, over 5 lakh people would be travelling through our Airports every day. Imagine the  potential retail opportunity that we are eyeing. And these are reasonably affluent passengers with disposable incomes. From a humble cup of tea or coffee to a beer / gourmet meal, F&B seems to be a larger pie than product retail at airports. I had written the reason for this in my previous post


Nevertheless, Air India’s purchase of 470 aircrafts is a boon for Indian Travel Retail. Happy to be back here in my new avatar in Travel Retail supporting the Trinity - Airports, Retail / F&B companies and the Consumers.

15 April, 2020

100 Days of Employment

It’s ironical that I am writing this article on my 100 days of Employment from home. So be it. Out of the 100 days, 25 have been Work from Home, a first of it’s kind in my 2 decades of being employed. The first day of my job and almost everyday thereafter have been on the shop floor, meeting, interacting and solving consumer challenges – from helping them to choose the right merchandise to closing a sale, somehow. But the last 25 days have been very different, thanks to Covid-19 Crisis and the ensuing lockdown. More on that later.


 

Mid-December 2019, I was lounging with my classmate who had come to India for a vacation. We were at Westminister, Crowne Plaza (though we still call it as Park Sheraton) which is our favourite hangout for the past 20 of the 24 years we have known each other since studying UG together. The Waiter who used to serve us way back then is now the F&B Manager of the Hotel, something that makes us feel happy that everyone around us has been growing. I received a call from an unknown number and the caller identified himself as an HR Consultant and spoke briefly about a Coffee brand. In the next 24 hours, my tickets were booked to Bangalore for a face-to face Interview with the Management and in the next 7 days, an Offer Letter was sent while I was on vacation at Jim Corbett National Park for Christmas holidays. Things moved very fast, to my own surprise but that’s how God’s grace has always been. He surprises us without even us realizing what He is up to. I joined the company on 3 Jan., on my Father's Birthday!

 

I completed 100 days recently at Levista Coffee as Vice President managing Sales, Marketing, Supply Chain, Logistics and everything in between. It has been a very short tenure yet, but a very fulfilling one. Be it setting up a Corporate Office from scratch (Furniture, Interiors, what not), to plan a detailed Business Plan for the next 24 months as I lead the company to greener pastures with a vision to accomplish 5% Market share of the Rs. 2,200 Crore Instant Coffee Market annually in India of which 80% is held between HUL and Nestle, who’s majority of business comes from Southern India. I have been fortunate to interact with executives and experts from the Indian Media Industry – small, big, large as well as meeting staff members along with prospective new recruits to join and grow the Sales & Marketing team meaningfully. Have also met and interacted with some very bright minds from the Indian Retail ecosystem who have been very supportive to a baby brand that we are, which is only 27 months young now.

 

After 100 days of this tenure, everything seems surreal. I was an Accidental Entrepreneur, thanks to a turn of events in the family way back in 2014. I was not prepared for running Retail Businesses or E-Commerce although Consulting was always on the cards. While all my entrepreneurial escapades went bust including a few Crores of personal savings between my wife and me, what has remained are memories and learnings. Something which I will cherish all my life and of course, am putting them to good use every day. Working for a retail company is very different than running one, for it’s easier to get paid than to pay employees. My hyperlocal ecommerce venture, which is incidentally the most utilized today during the N-Covid Crisis, where we delivered FMCG from nearby Retailers to Consumers was way ahead of time, perhaps. I received messages from a few friends over the last few days and even potential Investors who appreciated my forethought but was difficult to execute it then, due to lack of funds then.

 

Miles2Go Advisory Services, my Consulting firm worked with at least 50 Entrepreneurs on business ranging from Jewellery to Organic Bio-Manure, Agri-products to Idli-Sambar serving restaurant chains. Airports, Railways, Travel Retail Concepts were some of the areas where I worked in various consulting roles. This rich experience and exposure for over 60 months has helped me immensely as I wade my way through this complex maze of Retailing, yet again wearing a new hat (and new clothes!). I am learning every day; with a clean slate every morning – that I do not know anything about Retailing or the Retail Industry and that I get one more day to (unlearn) and learn from scratch.



I have Miles to Go. I have just begun.

10 April, 2019

Retailers and Jet Airways – Cross Learnings

I had just started flying frequently from Bangalore to Delhi for monthly meetings and the preferred choice those days was Jet Airways (9W). Their on-board service was perhaps the best in class (the only comparison was the erstwhile Indian Airlines) and a few years later, maybe Kingfisher. Even with the popularity of the red-dress stewards with mini-skirts that attracted millions of flyers (forget not those plastic Kingfisher branded earphones), the Corporate Traveller still preferred 9W. There were many reasons for this choice, despite their pricing being 7-9% higher than Kingfisher and almost 1.5 times of Indigo and Spicejet in the later years. 


The Jet Airways – Citibank co-branded Credit Card was a must have on our wallets in the later part of the Millennium. The card provided several intrinsic benefits – including Lounge access at Airports as well as shopping and dining benefits across the country. The 5 Tier membership on Jet Privilege, among India’s largest Loyalty Program was similar to the Snakes & Ladder game, that travellers had to cautiously fly a designated number of flights in a quarter to retain their Membership Tiers. And how can I forget the uncountable “upgrades” I have enjoyed on 9W from Economy to Business to even First Class! 

Move over Kingfisher, which many Corporate Travellers thought were more hype and publicity than 9W which had a very genuine care for travellers. Be it the highly curated gourmet food menu even on Economy Class, Coat hangers for Business Travellers and an overall, relaxed travel experience for toddlers to Senior Citizens, these were a few things that attracted passengers until a few years ago. Around a decade back, 9W acquired Sahara Airlines only to burn out too soon, even as the low-cost airlines were matching or lowering air fares what Sahara offered. And after the merger completed, 9W continued to be a premier airline, some even calling it elitist. It was common to see celebrities, cricketers, reputed Business Leaders and many more socially popular people on board 9W. Even without the selfie melees those days, it was nice interacting with such personalities often on board or at the 9W Lounges. 


As I write this piece, I just finished reading that SBI which is managing the debt ridden airline’s takeover has further tightened the norms for a possible suitor even as travel agent-turned India’s most respected Aviator and business tycoon Mr. Naresh Goyal resigned from the Board recently. I am able to already see similar comparisons between 9W (and to some extent Kingfisher as well) and Modern Retailers, for they both cater to similar consumer segments. I have hardly seen traditional Kirana stores go out of business, save for financial mismanagement or not keeping in tune with changing times. In some cases, the next-gen of these Kiranas despise to take over the business calling them traditional, boring and uninteresting. 

But we have seen the meteoric rise and abysmal fall of so many Retailers, Shopping Centres and Malls. If we see what’s in common with those who downed shutters or ones that don’t have the grease to keep them up – it’s all about financial prudence, business stability and focussing on the core. For example, 9W lowered its fare over time to compete with the likes of cost-efficient airlines like Go Air. Being an International Airline and also having a Government norm to fly to far off destinations including Tier 2 towns, the airline was making losses for every nautical mile it flew in some cases. Sounds similar to many of our Retailers selling at cost or lower, a few or more SKUs which they call “Loss Leaders” and what is expected to drive footfalls who will eventually end up buying high-margin products. How I wish this dream was fulfilled. 


Most recently, 9W removed complimentary meals on board for the first time in it’s illustrious history which made even the most hopeless 9W Fan and Corporate Traveller to start whining, writing a fitting Obit for the airline on social media. Instead of upping its value proposition, the airline took to removing services, akin to how Retailers cut down support staff or reduce/switch off air-conditioning in the Retail Stores and Malls to reduce operating costs. In-flight Retail, which is a proven big-billion business worldwide remains largely untapped as well.  All is not over for 9W, yet. I am quite confident that the airline will find a new suitor who will continue and also improve the brand’s legacy with passenger growth touching double digits the last few years. Also, the Government wouldn’t let another airline fail, for it impacts the image of the country at large. However, Retailers may not be that lucky. A private Retail Company is not of national importance, yet – the way Americans eulogised Walmart & Starbucks. We see store openings and closures commonly these days. Ask me about E-Commerce players losing money for every transaction – from selling mobile phones to a portion of Roti or Dosa – well, they all hope that consumers will get used to convenience. Well. 

21 March, 2019

Travel Retail at Regional Airports

I am seated at Madurai Airport and my Spicejet to Chennai is delayed by 55 mins. It’s a swanking new terminal built a few years ago when the local heavyweight MK Alagiri, (eldest son of Late M. Karunanidhi, the former Chief Minister of Tamil Nadu) was an MP in the UPA Cabinet. Being his hometown, he pushed for this infrastructure development a decade back when the DMK was a key ally of the UPA led Congress Government between 2004 - 14. That was when Bangalore & Hyderabad came up with new greenfield airports while Mumbai and Delhi had a massive makeover – all four now being run by private partners. While the UPA Government selectively upgraded regional airports, the present Modi Government led by BJP along with NDA allies has given a further push to unlock aviation opportunities at over 40 unused airports under the ambitions UDAN – Udega Desh ka Aam Nagrik (Common man will fly). 


The Prime Minister inaugurated the Gangtok Airport recently, unveiling a host of opportunities for tourism to the Eastern hill state of Sikkim (although excessive tourism is a bane for ecology, but I will save this for another article) along with numerous airports across India taking the tally of operational airports in India to 100. A further 50 airports are yet to take off even as many airlines have wound up operations at some of these airports due to various reasons – poor patronage by passengers cited to be the most favoured response even as I reckon that it is due to careless Business management by these operators who took up routes which they knew were unviable and continued to bleed operationally without building parallel commercial opportunities other than not marketing the cost of time to the locals to fly, rather than take up a rail or bus journey. Truejet has ceased operations to Salem while Air Deccan (yes, they were resurrected by Captain Gopinath) ceased operations in the East. And many such examples.  


I had to rush to Madurai on an urgent personal work and took a day trip by Air. After my work was over, I reached the Airport four hours in advance since I had a 2-hour Video Conference with a Client. I was dreading the thought of being seated in those most uncomfortable standard airport-seating. But to my own surprise, there was an oasis – a Lounge before Security hold area. It was prohibitively expensive for Rs. 900 per pax with unlimited time one can spend plus some food and snacks on the house. They wouldn’t accept Mastercard or Visa’s Complementary Lounge options either. But my call was more important, so I chose to pay and use. Didn’t realise how I spent the three-hour period at this well maintained Lounge with polite and courteous staff. Thankfully, I was the sole occupant all along so had the entire 20 seater Lounge for myself.


Took my boarding pass from the Kiosk and walked around and upstairs to be greeted by unexcited staff who were clueless why their “shops” existed what with not a single passenger glancing inside. I noticed local delicacies – Halwa and Milk Khova from neighbouring Tirunelveli and Srivilliputhur respectively. Once inside the waiting area, there were the usual food Kiosks savouring watery coffee, dip tea and oily snacks with sugary bakery stuff. Absolute gold mine of an opportunity to cater to the 3,000 plus passengers who fly off daily from the domestic terminals. Being sensitive Tier 2 cities like Madurai, it would make sense to engage passengers with affordable F&B and Retail options. Perhaps a Levis or Nike may not work, but Indian brands with a regional appeal could do well. 

Tourism development in India is usually seen as an activity to be undertaken by a particular Department of the Government. Worldwide, I have seen a cohesive collaboration between the Public and Governmental agencies to promote tourism – from Singapore to Switzerland, Bangkok to Berlin. It’s only in India that we compartmentalise the potential opportunities. There wasn’t a single poster or a visual that speaks about Enchanting Tamil Nadu which is the spiritual and cultural capital of India. At the Departure hold, passengers and visitors are already travelling back, so instead of promoting the city, why not promote the State? We would sell more Coffee, Tea & much more at neighbouring airports too!

15 January, 2019

Notes of a Frequent flyer



The biggest technology revolution Indian’s have encountered in the past 5 decades is the advent of the internet for daily use. From ordering Vegetables & Grocery, booking Travel tickets for Air, Train, Bus and Taxi rides on Ola & Uber and not to mention the flirtatious relationship we enjoy with Amazon, Flipkart, Snapdeal and others – India is the only country in the world which has the highest percentage of “Cash on Delivery” model – a method we have invented where the delivery boy collects cash after delivering the parcel from an E-Commerce company… be it mobile phones or an acrylic accessory which hides the back (and sometimes even the front of the Rs. 50,000 (about $700) worthy iPhone XR) or a simple Pizza that is delivered from the neighbourhood Pizza Hut. 

And this is where the first nightmare begins for the frequent Indian Traveler like me. Even as a harried (and hurried) passenger books his/her cab through a cab-hailing App such as the Wall St. funded Uber or the Indian discovery (and Japanese funded) Ola say around 4 am, the traveler realises she is low on Digital Money for paying the cabbie. So, she adds up a sizeable amount in to their wallet from a bank account or credit card and the transactions fails at the first instance. Why did it fail? While we have the highest number of mobile connections in the World, the number of towers is quite disproportionate to the usage. Isn’t there something called Broadband? Oh yes, we do, in fact India’s broadband rates are among the lowest in the world. Recently, our Honourable Prime Minister quipped at a Conference in Japan that India’s internet rates are lower than a cup of Coffee. Well, if he says so. But the internet is patchy most of the times and the promise of 100mbps speed by the Operator is applicable only when a single device is used – but a typical Indian household would have two mobile connections for the gent and the lady each, one each for their parents & kids, a couple of other devices such as iPads, Alexa and a Smart Tv and last but not the least, the live-in maid and the household’s car driver also are allowed to use the home Wifi because of the unlimited usage options offered by the Telecom providers.


And finally, the traveler completes her wallet transaction only to find that the cab prices have surged meanwhile due to peak demand - well, the Top 7 Airports in India including at Delhi, Mumbai, Chennai, Bangalore, Kolkata, Hyderabad and Kochi (in that order) which contribute to over 70% of India’s total air traffic have their peak capacity between 5am – 8am. So, finally she accepts a surged fare and curses how the Cab Companies funded by the Japanese, Chinese and American Investors have spoiled the market with freebies during off-peak hours and apply surge pricing which take away the incentives of using the App. The Cabbies in India, especially those who have joined the likes of Ola and Uber (and also food-hailing Apps such as Zomato, Swiggy & Uber Eats) have a new-found love for GPS – especially when it comes to delivering food or showing up a Taxi at the client’s place. India’s GPS is, well not so great obviously because 8 out of 10 times, these App users end up at the nearby street and call the user and sometimes even insist that the Customers come over there – either to board the cab or to collect their beloved Rotis and Pizzas. 

While the call happens between the Traveler and the Cabbie, one must be very cautious about the mood of the driver – so depending on their convenience, the user must agree to pay by wallet or cash. So, typically from around the 20th of the month, the cabbies reject trips which have a wallet payment since they need working capital and the Cab companies (despite funded in Billions of dollars) do not settle their payments on time. So, when a traveler says she is going to pay by Wallet, there is a high chance that the trip gets cancelled only to get allotted to another driver. By a stroke of luck, one could get the next cab arriving in 3 mins or 10 mins. Again, the cabbie who’s nearby would most probably prefer a cash payment and if the traveler refuses, the process repeats. This is a pattern, in fact. With most flights not allowing Free Cancellation or postponement, the traveler usually prefers not to cancel the next cab, because time is more precious than money. So, she finally settles for a cab with the payment option preferred by the Cabbie and heads to one of the Architectural wonders and marvels of the country – the multi-billion dollar funded “City Airport”.


It has always kept me wondering but hell yeah, why do almost all Airports in India except at Bangalore have only 3-4 entry gates when the influx of passengers during the morning and evening peaks are an estimated 20,000 – 30,000 spread over 3-4 hours? CISF – the National Agency entrusted with the protection of Airports among other prestigious Infrastructure projects are always in a situation where the supply is lower than demand. So, the waiting queue to simply enter the Airport Terminal could take between 5-12 mins on an average, depending on how quick the CISF guard is willing to skim through the paper (or digital ticket) and match it with the 5 acceptable identity Proof documents. Now, most of these identity docs for us in the late 30s, 40s and 50s who form the frequent traveler base, were perhaps made about a decade or two earlier, so the hardcopy doesn’t match the image with the  real one, despite the L’oreals and Gillette grooming accessories which Indians are embracing like no other. So, there is a 50% chance that the CISF guard takes a third look and compares the two images giving competition to the advanced AI techniques being practiced in many other developed countries. He gives a stern and final nod and allows the passenger to get inside the terminal. Oh, btw visitors are not allowed inside Terminal buildings in India. What started as a threat perception after 9/11 and 2008 London attacks has become a convenience excuse, thanks to the crumbling infrastructure in the public areas of the Terminal. So works well for the Airport Operator and the CISF indeed. 


All the four Private Airports have an excellent check-in process with kiosks that help travellers to skip the queue. However, most Frequent Traveler check-in before arriving to the Airport, which means the baggage Drop Queues are more crowded than those which have pax who haven’t checked-in. What an irony this is! Another 15 minutes later, the pax heads to the Infamous Indian Security Check. A decade back less than 8% of all air pax were women, but not the case today. The split is at least 80:20 today especially with more women travelling on work and leisure. Although the Frisking Queue for women is just one, perhaps two. Men have to wait endlessly and finally get their “trays” where they unload their offering from their laptop bags, backpacks and other fancy bags. It’s interesting to note what all a man carries - from multiple chargers to power banks, iPad, laptops (some carry coveted MacBooks as well), two mobile phones on an average and some even carry reams of papers (somewhat work related, although I wonder who keeps paper records anymore). The best part is how Men stand at the Security Frisking area - with hands raised and legs spread. It could be gory to hilarious to a security threat to the guards themselves with some pax standing as though they would pounce on the guards! Meanwhile, there is another senior guard who’s carefully skimming the Tv screens of the X-ray machines. 4 out of 10 bags (random average, but yeah) are identified for a total display of all the internal compartments of the bags even as the pax who is already late is sulking to get to the gate. 



Once at the Gate, a few pax try to board a flight which is for a different destination and realise it only when the staff at the Boarding Gate send them back saying they are still boarding pax for the previous flight. Many Indian Airports still have bus gates, mostly more of them than aerobridges, purely due to infrastructure costs as well as availability of remote parking bays. So, the pax now gets to a level below and waits to board the bus and finally reaches the aircraft. Once inside the craft, there is a wrestle for multiple rights; first comes the right to stowage - who gets to keep more and how close to where they are seated. Then comes the eternal right for arm space. Seasoned travelers like me always, almost always prefer an aisle row and seat number “C” so I get one arm space for granted and also I get to do some elbow space, such as writing articles like these. Last comes the right to alight - who gets out of the craft faster as though this will ensure who will get out of the airport itself. Because the bus ride to the terminal building is a sort of sight-seeing to showcase the marvellous infrastructure that the Government or the Private Operators have invested. While waiting for the baggage, one would wonder what was the topic the unloading guys must be discussing today - from Trump’s intentions on curbing sanctions to the latest celebrity gossip and more which eventually decides how soon (or late) your bag would arrive. After spending over 200-300 mins or more at two Airports, the passenger finally leaves the Terminal Building back to civilisation which looks very different altogether. 

On the way back to a catch a flight home, the frequent flyer heads to the Lounge and flashers his Mastercard or a Privilege Pass to get seated in a cushioned leather sofa and catch up on the latest cricket score. Some of them order a drink only to be forewarned by the waiter that they need to pay for this while the food is complimentary. After gulping one or two depending on how soon or later their flight would depart, the passenger continues to enjoy the hospitality while somewhere thanking the guy who took his application form for a Credit Card many moons back, so he gets this privilege. Those who aren’t blessed with such an offering loiter along the endless pathways which have numerous shopping and dining opportunities. From the latest Hidesign leather bags to Designer Neck Ties, from local delicacies like Sambar Vada to customised Pastas and Sushis, one could get almost everything inside an Airport that a typical restaurant serves in the top cities of India. It’s so heartening to see Travel Retail has come of age so much at Indian Airports over the years that many passengers prefer to shop here than in the city stores, thanks to deals on books and electronics as well as the personal space and staff attention they receive.


Having said that, most Airport Retail Stores, in my humble opinion aren’t investing even 25% interest or effort to cash in on the impending opportunities. Talk about CRM or customisation, Data Science or Business Intelligence, there is so much more to do. The staff are busy fiddling their mobile phones most of the times and even when the Customers (pax, in this case) show interest on products, they react very minimally. Of course there are a few exclusions and some of the staff do get interested in a dialogue with customers but frankly thats mutual. I have personally shopped quite a lot at the Airport stores. To show them that by building meaningful conversations with customers, one can actually “encourage customers to buy” than merely trying to “sell” a product or force them to “buy”. At Restaurants, food courts and Kiosks, the staff are more functional than vending machines with eye contacts hardly present or pitching to up-sell a thing or two. 


Even as the Frequent Flyer is on her / his way back home, the same process as in the morning repeats until finally one has taken the taxi back home. TSome of us start catching up sleep in the taxi and when we hit the sack, it’s close to midnight - most of us have been taught in our early days of professional employments to travel “first flight out, last flight in” and thus utilise the working day the most. Habits stay on.

27 November, 2018

Coming soon - 60,000 Retail Centres in India…

The Central Government announced on Sunday that it is planning to issue application forms for 60,000 Fuel stations across the Country to be operated through Dealers using the trade name of the Three Oil Marketing Companies (OMCs) Indian Oil, Bharat Petroleum and Hindustan Petroleum. There are already 62,000 (and counting) fuel stations across India which retail Petrol, Diesel and allied products while a bunch of them also retail CNG for commercial vehicles. About 10% of these stations are operated by private players such as Shell, Essar, etc. It is a remarkable feat that the world’s highest fuel retail station is in India at the Ladakh region of Jammu & Kashmir in the Himalayas which is a favourite among auto-enthusiasts. 



As in the past, prospective applicants need to apply online and pay an Ernest deposit to the OMCs which would be followed by a lucky draw. And those who win would be awarded the contracts and assistance provided by the respective agencies in setting up the outlets while those who didn’t qualify would be refunded their deposits. While this generous move by the BJP Government is seen as a positive measure since no such new contracts have been issued in the past four years, critics have dubbed this as a meaningless move with spiralling fuel costs and dwindling vehicle sales over the past two quarters this financial year and a mere public-pleasing stunt ahead of the upcoming National Elections in May 2019. So, the verdict is split. 

It costs a whopping Rs. 1.5 – Rs. 2 Crore to set up a Fuel Station spread over 5,000 sq. ft in the name and style of the OMCs while the cost is more than double for private players like Shell who have stricter norms towards the setting up of the outlets. The biggest challenge for setting up a Fuel Station has been land acquisition, especially on National & State Highways which have seen a 10-fold increase in vehicle traffic over the past decade, thanks to better roads, lower cost of acquiring personal vehicles and a generally heightened mood for vacations and road trips. 


Being an avid traveller and a terrific lover of road trips myself, starting with my beloved Hyundai Santro in 2005 till the new age Mahindra XUV500 (I upgraded to an Automatic from the previous Manual this March), I have personally seen how the entire ecosystem has evolved over the past 15 years or so. In fact, I plan my trips now, whether short or long depending on the wayside amenities that I could use, from rest rooms to coffee shops, meals to speciality snacks and of course the need for service centres, local vehicle mechanics and Authorised Service Centres, etc. The need for such pitstops vary when I travel solo or with family and of course based on the number of hours we travel at a stretch. 

My pet peeve on highway travel has been the lack of good quality toilets (well, good is a relative term, so!) and clean and hygienic food outlets which have somewhat been fulfilled at least across Tamil Nadu Highways which I frequent the most by road. While only a handful International and National Retailers such as Café Coffee Day, KFC, Mc Donalds and A2B have scratched the surface of the opportunity of Highway Travel Retail, there seems to be an enormous opportunity that lays ahead of us. I see these upcoming 60,000 new Fuel stations (many say only 1/3rd of all locations proposed actually turn up in reality) as nothing other than Retail Centres, where apart from filling Fuel, one can have various other retail offering from food outlets like cafes to speciality restaurants, shops selling snacks, fruits and condiments for the journey ahead and of course, wayside motels for a quick overnight stay for tired drivers and their families. 


Reliance Retail with their Fuel stations did come up with some of these models way back in 2006-07 but the whole effort slowly dwindled due to decentralisation of Fuel prices and today, they remain large parcels of land ready for an explosive growth. These fuel stations (and Retail Centres) could be beneficial not only for travellers but also for the nearby towns and villages, generating sustainable employment and entrepreneurial opportunities. 
I am writing this sitting in the back seat of a Bolero travelling on work and just stopped at a highway shack where I had a glass of Coffee. I see a new Retail Centre coming up closely (when I close my eyes).

20 March, 2018

Travel is an Incredible Opportunity

I have been travelling regularly on work for over a decade now. As a kid, my travel (mostly by bus & train) for outstation trips was limited to 2-3 times a year. My first business travel was in 2002 when I was called for an Interview by Shoppers Stop in Mumbai for the role of a Supervisor for their Chennai Store. I negotiated hard with the HR guy to get me a flight ticket although it was out of bounds by their policy. I flew Air India – a noon flight onward and a 2am flight for return since that was the lowest fare. Then I started flying across South India to expand the business of Benetton in 2005 with monthly visits to Delhi to our HO. The first visa on my passport was in 2006 and well, it was for Switzerland where I went to learn Travel Retail which I was implementing at Bangalore International Airport (BIAL). I flew to Singapore First Class onward and Business Class return for the first time, to speak at a conference on Indian Aviation in 2008 with my tickets being sponsored by the Organisers.  Travelled to 10 countries across Asia and Europe during my stint at BIAL. My domestic travel peaked during my stints at Café Coffee Day in 2009 where I set-up 140 cafes pan-India and thereafter at Royal Enfield Motorcycles in 2012 where I set-up 160 Dealerships across India.


Those days, I literally used to live out of a suitcase, travelling 3-4 days a week, more than 40 weeks a year. It was a lot of fun although tiring. But a sense of accomplishment looking at my professional achievements down the years. I have met many people at Airports – from childhood classmates to celebrities to politicians to academicians to Industrialists and a long list of personalities. I even travelled with a person of the third gender from Hyderabad to Bangalore once and trust me, it was some experience I would say.

Since 2014 my travel reduced to almost 10-15 days a year when I chose to become an Entrepreneur and started my offline Retail venture Smiling Baby in Chennai. I restarted my travel since 2017 when I began focusing on my Consulting Assignments. Interestingly, I have travelled over 45 weeks during the past 52 weeks, mostly by train since I prefer taking an overnight journey for distances less than 500 kms.


I have always travelled in a/c coaches this past year and mostly in the 2nd A/c Coaches since the bills are paid by my clients. I have always wondered why & how some people manage to fly Business or First Class and have done a lot of searches on this topic online. Empirical data suggests that those who fly in higher classes are more productive upon arrival in their destination cities. They get to sit comfortably, sleep on a flat bed, read a lot, get less distracted while working due to fewer passengers and hence are refreshed by the time they arrive in the next station. Indian Prime Minister Mr. Modi is a classic example – we have seen him fresh as an Apple just the day upon arrival even after trans-Atlantic flights!


I travelled on 1st a/c last night from Chennai to Madurai and this was so comfortable. Even in 2nd A/c, sometimes I get side upper or lower berths and I have seen my productivity nose-dive the next day. But the 1st a/c coaches are so comfortable. The berth is wider, fewer people, lesser banter and more comfortable a/c with a bigger pillow and nicer rugs. Trust me, the day after such comfortable travel is not just a more productive day but also a happier day, which boosts morale and work efficiencies. I travelled in 3rd A/c a week back and had a upper berth onward and lower berth up on return and it was not even just uncomfortable but very frustrating. The next two days were a nightmare.


This is not to demean the millions of people who travel in non-a/c coaches or other means of public transport. Travelling comfortably works best for me to increase my productivity and I believe, to each his own. Her own. Whichever mode, travel is a great opportunity to learn new things, meet new people and understand life better during the journeys. 

Convenience over Experience or Vice versa?

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