He quit his Rs. 300 per month job back in the 1980s with a dream. In 2008, he sits on a retail empire worth in excess of Rs. 600 Crore. Good Karma, he says, ensured that nothing or no one comes between him and his success. This month, we have the man who started his business for sheer survival sharing his entrepreneurial story.
What is the story of the entrepreneur behind Vishal Retail Ltd?
I was born and brought up in Calcutta. Before I started my entrepreneurial endeavor, I used to work as an Assistant Manager in a rolling shutter company in Calcutta with a salary of Rs 300 per month. I come from a very average middle-class family. For my family and me, money was required for basic survival. When I started my own business, it was mostly a battle for survival.
In early 1980’s, I noticed people slowly moving away from suiting-shirting to readymade garments. So, I basically just identified the readymade garment business as an opportunity that is not really tapped and holds huge potential. With that in mind, I started off with a 50 square feet store at Laal Bazaar Street in Calcutta, dealing in readymade garments. The store was not owned; I had taken it up on a long-term lease. Now, it spans in an approximately 18-19 lakh square feet area. I did not have any previous experience in the garment business, but I learnt everything gradually.
Back in those days, India was not growing at a fast pace in terms of capital, profitability, competition, etc. Then again, Calcutta was a very middle class city. When I started my garment business, I did not have much capital. I had to borrow money from some of my friends and neighbors. At that time, I pumped in about Rs 5,000-10,000 to begin with. When the store was up and running, the sales generated were also not really good.
My vision was to make it big. I would say, the gradual and successful scaling up happened because I was clear about my vision, the sincerity in my work, and the efforts I made. I found people to work with me quite easily, because I was willing to share my vision, dream and profit with them. In order to make my business grow, I started putting up big sales in Calcutta, which really clicked with the market. In 1994, I opened up my first big store in Calcutta. In 2001, I moved to Delhi where I started by opening a store in Rajouri Garden. The journey from how I started to where I am right now has been tough.
From a turnover of Rs. 146 crore in 2005 to Rs. 288 crore in 2006, and then to Rs. 602 crore in 2007… what vitamin is Vishal Retail on?
Yes, we have been growing at the rate of around 100 percent per annum. You can say there are multiple factors to this speedy growth. India is developing at a very fast pace, and the retail industry is booming. We have been aggressive in our efforts to make Vishal Retail really big. All of us have been sincere and hard working to make this happen.
Why did you choose to have your own manufacturing unit? Manufacturing as well as retailing, how does the combo work?
I always wanted to go into backward integration. The logic is fairly simple; we had a ready buyer in the form of Vishal Retail for that production unit. It benefits both the units as it compliments each other. Moreover, this takes away the dependability on other vendors. This way, we maximized our profits.
India has always been into manufacturing readymade garments. The combination of manufacturing and retailing is working really well for us. Take a look at our slogan. It says “From manufacturing to retail”. I always wanted to see goods flowing directly from the manufacturer to the consumers. With our manufacturing unit, we are doing just that.
Where or from whom did you get your early support?
My mom, Shanta Agarwal, supported me a great deal. She was always there for me. Other than that, I am a person with a very strong will. Whenever I want to do something, I tend to do it with extreme confidence.
What was your first big success? What is the one failure from which you learnt a lot?
It is difficult to place a finger on one single incident to say, 'this is the singular success,' because of which I am where I am today. I can always reminisce some of my milestones as success points. Like starting my first big store in Calcutta’s Dharamtala Street, opening my first store in Delhi’s Rajouri Garden, starting off of the big hyper market in Mathura Road, and so on.
As for the one big failure, you can say that one should not be overconfident about anything. At one point of time, some time in the year 1999-2000, I was overconfident about something, and that did not do very well. I did mention that I am a very confident person, so how do I differentiate between confidence and overconfidence? If you identify a spot at a height that you can reach by jumping and succeed in doing that; that is confidence. If you cannot see clearly what you want to achieve, and you overestimate the height that you can jump; that is overconfidence. I learnt to scale up step-by-step and started seeing my next steps as well.
In your early days, who or what were your biggest critics? How did you handle them?
If you do something that is against the normal and accepted way of doing things, every one seems to be skeptical and always suggest that you better be careful. This happened in my life too. I got to hear statements such as ‘you are too young to do this’, ‘you will fail miserably’, ‘you are moving at an extremely dangerous speed’, ‘do not open so many stores’, and more. However, I was always focused on what I wanted and had faith in what I was doing.
What is the biggest act of faith you received when starting up?
I have always believed in Karma. I think one should always have faith in Karma. If you do the right Karma, you will always succeed. No other person will come in between.
Today, being in the retail business calls for cut-throat competition. In this scenario, how do you acquire the market share, maintain it and grow?
It is all about getting your processes right. It should be smooth, and to implement these processes you need to get the right people. Not just that, you need to delegate authority and power to these people so that the implementing becomes easier. For procuring more market share, maintain it and make it grow, we keep our costs in control and provide good value to our customers. We are always more than 10 percent cheaper than the prevailing market price. We are always implementing new processes by which we try to bring the cost down, maintaining our supply chain, etc. Scale, cost control, right processes, dedicated employees, and many such factors help us achieve this.
How will the arrival of foreign retail brands affect you? How do you plan to handle it?
I think in most of the countries, the biggest retailer almost always tends to be the local retailer. We can always compete with them and give them tough competition at that. We all source from the same countries, such as China, Vietnam, etc. They source a lot of products from India too, where we have a very good base already. Technology is available for everyone today. It will take them three to four years to understand the Indian culture, taste, etc, By then we would be a big corporation in Indian retail industry.
What according to you is the next big change in the retail business?
Right now, I think organized retail occupies only 4-5 percentage of the actual potential. In my opinion, in the next five years this will increase up to 25 percent. That 20 percent jump can be looked at as one big change in the Indian retail industry.
What is your next big dream as an entrepreneur?
Vishal Retail is one of the top three among the Indian retail companies. With some giants like Bharti, Walmart, etc. starting operations in India, I need to still maintain my position in the top three. Overall, I want to be in the top 25 companies in the country. I am chasing that dream; let us see how much I will succeed in achieving that dream.
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