www.mynesthome.com – online retail venture of my better half :-)

home-sweet-home1

 

Home, the spot of earth supremely blest,
a dearer, sweeter spot than all the rest.
~Robert Montgomery

What is a home? A home is a space within four walls which has many connotations like an abode, a haven, a dwelling, a safe and secure cocoon and also a sound financial investment. There is nothing in the world as sweet as a home”. ‘East or West, home is the best’ as the saying goes. Home is the symbol of human togetherness- a place where all of us learn the first steps of life. For most people the very thought of home brings fond memories, nostalgic feeling and a gamut of emotions. Some say, “Home is not a place but a feeling”. For some ,” home is where the heart is “, while for some others it’s a place where you can relax and have a cup of coffee with Pablo Neruda and his verses for company.

A post on our facebook page www.facebook.com/mynesthome declares “ A home encourages day dreaming, protects the dreamer and allows one to dream in peace…..my home, my nest my dream machine !”

Another quote on the”mynesthome” Facebook page said, “Home is a place you grow up wanting to leave, and grow old wanting to get back to.”

As famous poet Payne has opined,

 Mid pleasures and palaces though we may roam,

Be it ever so humble, there’s no place like home.

While many people come back to their homes as a matter of habit and do not expect anything more than the comfort of home –cooked food and a soft pillow bed to rest their aches away, it is not unfair to say that a well- kept and stylish home is an unfulfilled dream for many of us. A large percentage of us would jump at the opportunity to add color and style to our homes at a reasonable budget without getting stuck in traffic jams or stepping in and out of shops spanning the length and breadth of the city!

A home is where your creativity can take wings and what better advisor and friend than www.mynesthome.com – the Ultimate Destination for all your home and Living needs. Whether you want to brighten up a dull nook of your house or revamp a whole room, you can do it at the click of a button.Our website offers a vista of products ranging from velvety kaleidoscopic cushions to balcony swings and other outdoor furniture to sturdy and stylish indoor furniture to kids furniture to kitchen essentials to bathroom towels and other styling accessories under one roof. Atwww.mynesthome.com you can shop for your needs while taking part in exciting quiz contests and writing witty captions on the Facebook page. People already love the site and have given feedback like” never seen such a good collection”. Says Neeraj Agarwal,”Seems like a nice collection they have…great shopping destination…” Vidushi Gupta says,” This will definitely be the best online shopping portal for our home. I’m dam sure… waiting 4 d same…”

The grand launch of the portal is being anticipated with bated breaths and eager fingers. Just as it is true that a home is not something that is made only of bricks and stones, it is also true that certain items in the house add to the warmth factor of the house and make everyone feel welcome and wanted. Household items sometimes substitute for or take on the role of family members. For e.g.: A child resting his head on a soft feather pillow listening to a bedtime story and mummy’s finger’s stroking his hair is assured of a good night’s sleep and wonderful sweet dreams .Similarly, your wife’s specialty cheese cake or gajar ka halwa will look even more tantalizing if it is served in a colorful Dessert plate .  Wouldn’t your morning cuppa energize you more if you had it on your balcony swing? At http://www.mynesthome .com what you want is what you see and what you see is what you get! So watch out for a grand launch to brighten up your New Year .

Log on to www.mynesthome.com and serenade into the world of home décor and living.

Swagatam!!

Six Men, Elephant and FDI in retail….

Watching the circus on TV  for the last two days since FDI in Retail has been announced I could not but help comoparing the situation to the famous parable of the elephant and six blind men. While each has its own opinion based on what part of the elephant they are holding ( like the opinions of our learned media,business men and politicians) , no one exactly knows what the animal ( in this case quite literally ! ) looks like. For someone like me who has worked closlely with the farmers as well as in retail for a long time the picture is quite clear. We are talking two different business models here : one is based on scale and the other is based on service and convenience. If you just look around : has a single mom and pop store closed down even when you have a number of so called organized big box retailers are all around them. Within a Km radius of my place in Bangalore I have a Big bazar super centre, a More Super centre and a number of Nilgiris, MK Retail,Reliance and others but I still order from the store next to my place or go and buy it from there for day to day needs : No ques therefore quick transaction or homedelivery that gets the store to your doorstep being my simple drivers.

For farmers there is absolutely no link between FDI and what they will get for the price of their produce. They sell to the mandis governed by APMC act today or just sell their produce to anyone that gives them a better price. On what basis are people debating that farmers will be adversly effected beats me completely.Typically in all economies with dominance of organized retail farmers realize 2/3 of the retail price of their produce vs. just 1/3 or lower in economies where such a mechanism does not exist.It’s quite simple if You know that at what price the retailer is going to sell what he buys from me and if all farmers know what price their produce sells in organized retail are they fools that they willl give it up to a Wal Mart just like that ?? It is this non transpareny that kills them today.When we are buying Onions at Rs50 a Kg the farmer is still getting just 5 Rs for it , so where does the Rs. 45 go ??No one knows or those who know are crying wolf wolf !! I don’t even want to go into the efficiencies in supply chain etc which will of course add a lot o value to consumers, producers and retailers alike. I have seen Wal Mart very closely and I know that it is one of the most hoenst, forthright and efficient companies in the world. What a lot of people say about Wal Mart is mostly out of ignorance or their own selfish interest. It’s a giant that competition is afraid of and fear always brings in insecurity.

Anyways you enjoy the poem and try to figure out which of the blind men is Politicians, Media, Businessmen, shopkeepers, farmers and general public :

It was six men of Indostan

To learning much inclined,

Who went to see the Elephant(Though all of them were blind),

That each by observation

Might satisfy his mind

And so these men of Indostan

Disputed loud and long,

Each in his own opinion

Exceeding stiff and strong,

Though each was partly in the right,

And all were in the wrong!

So oft in theologic wars,

The disputants, I ween,

Rail on in utter ignorance

Of what each other mean,

And prate about an Elephant

Not one of them has seen!

For the complete version click here : http://www.wordfocus.com/word-act-blindmen.html

Let’s first see the elephant and then we can talk about it.

Fortune at the top of the Pyramid…

A few months back I had a chance to meet up with a friend after a long long time.We decided to catch up somewhere convenient and since New Delhi can be a nightmare during peak hours I checked if my friend could make it to my hotel.”  I was parked at a 5 star courtesy my company but was it a good idea to pay through the neck for the drinks which would probably cost 5 times less at home.After all we just have to get sloshed.

My mind started racing at the options – ask my friend to buy a bottle on the way, go and fetch a bottle myself and ask for room service for the glasses and ice.I could probably afford soda from the mini bar.

As I checked the guest services folio I found something-  a gift coupon which announced that the hotel had a buy one get one policy for house guests during happy hours from 6-8 PM. So that’s half the price already and I get to show ff the  free thing as a smart move from a regular.Both of us drank like fish did not occur to me and the ‘free’ part will probably bring out the animal in us even more.Anyways there was hardly any time..

My phone rang.It was Ashwin my friend – the NRI venture capitalist.I directed  him to the hotel’s pub ” wellington”.

As soon as we were seated Ashwin waved to the steward and before the poor guy could offer any greetings he ordered – two Glenfiddich large please.we resumed our conversation thereafter which basically went around good old days…

The steward returned and I was surprised to see that he had just got two drinks.

” where are the free ones??” I asked.

” of I am so sorry sir.That offer is only for the weekdays and today it’s a saturday” He answered.

I picked up my drink  and put in a bunch of ice cubes eager to taste my favorite drink just the way I liked it.Ashwin did the same. We were bottle buddies.

We had a good time and after 4 – 5 large Glenfiddich’s when we could barely stand up we asked for the check.It was some 8 thousand rupees including the snacks.Both of us offered to pay and finally after a lot of argument I managed to snatch the folio from Ashwin and shoved my credit card in.At that point I did not even register what the bill amount was.I did not even want to show off or proove anything to my partner.We had grown up together and wouldn’t have cared if either one of us had bought over the hotel at that point in time.We went to the parking singing a Jagjit Singh loudly and promised to meet again soon.We knew “soon’ would be a couple of years.

Next morning when I woke up there was a nagging feeling apart from the hangover.I could nail it down to ‘why the hell did I spend so much money?When I could not get it off my mind I decided to analyse my behavior :

1.I had decided to host Ashwin at the hotel bar because I wanted to do it or because of the free drink offer ?

2.If I was sure so sure I could not afford 8000 bucks I should have let Ashwin pay. It was just a couple of hundred dollars for him after all.

3. Did I really bother that I had spend all that money.The fact was that even I was making enough to do this once in a while if not everyday.

4.Did I have a good time and was it worth ?

So what was it that was bothering me ?

As I recalled the events of last evening I got stuck with a line from the Ghazal we were singing last night :

हमने माना कि कुछ नहीं गालिब ,मुफ्त  हाथ आए  तो बुरा क्या है …

I know for sure that Ghalib is worthless, but what’s the harm if I can have him for free.

That was where my answer lay.I was feeling cheated !! No it was not the hotel but I was feeling cheated that something that was rightfully mine for free had been taken away by putting up technical barriers.How the hell it mattered if it was a Friday or a Saturday – I was entitled for a FREE drink which I did not get.I was lured into the trap by careful fine print.It was a privilege that was taken away unjustifiably.You don’t get to drink single malt at a five star for free all the time.It was foul play and nothing else.

Should I stay back till Monday and take revenge ?? I laughed at myself but a big lesson in pricing had been learnt :

1. Not having to pay up for a product or service is something etched deep inside our psyche.It is a measure of our “privilege Quotient” and our smartness.

2.While the service provider wants to get paid X , the customer wants to pay nothing for it.

3.Nothing is worthless as long as it is free.

4.We are as much gullible as our greed and we will see what we want to see not what we should see.

5.The “want” for freebies has nothing to do with our economic or social status.When it comes to paying as close to nothing as possible we are all the same.

6.There is no price for anything , only cost. You can sell anything for any price staring from zilch and taking it upwards with the customer’s aspiration or need.

These tenets do not simply follow the laws of supply and demand as has been proved by the sultan of Retail Sam Walton.He had mastered the art of creating exponential demand with the least drop in prices, keeping the supply angle out of picture for his customers.More than keeping the products at Wal Mart cheap, it is their ability to keep their customers feeling that they are cheaper everyday as compared to their competition that makes them the world’s largest and most successful retailer.

CK Prahlad proposed that there is a fortune at the bottom of the pyramid.In terms of increased accessibility due to a low cost of acquisition it might be true.A company can therefore make money by profiting not so much on per transaction basis but on a bulk of transactions which are undifferentiated , with the low cost of delivery and last mile.

I have been thinking – Is there a fortune at the top of the pyramid too ???

NREGA – Good politics Bad business

While the government is basking in the success of the NREGA (National rural emaployment Guarentee Scheme) and the opposition is crying fowl from the rooftops,the real  impact of this scheme on the economy is something no one seems to be bothered about.

Many years ago IBM computers was in the dumps and it had to do something drastic to turn around its dwindling fortunes.They had a huge workforce which they could neither fire right away nor could keep for always in its current form.Driven to the wall the team at IBM told its employees that we would like to retain everybody so long as they can prove themselves to be employable.This simply meant that there are no free lunches and whoever contributes can be a part of the party.This simple idea turned out to be one of the most important case studies in HR history as it brought back IBM computers from the brink of bankruptcy to the centre stage of IT revolution as we know it.

Professionals like us  have no issues with sharing our destiny with our less fortunate brethren but the only worry is that can we sustain it for long.If the dog starts biting the hand that feeds or in softer words if we cut the branch on which we are perched its going to be sad tale of foolhardy for all of us.On one hand the money is being ill spent and on the other the sources from which it came are being attacked at the same time.

http://www.indianexpress.com/news/in-opposition-camp-too-delays-mismanagement/259701/0

Lets look at some very compelling situations which I am putting here not for starting a debate but to sound a red alert for ‘fools’ who keep living in their own  paradise :

1.Today you go to any of the Industrial cities such as Ludhiana , Moradabad, Tirupur ,Kanpur,Cochin etc and there’s one thing you will find common on all factory gates – a sign declaring labour required for packing,polishing stiching,cutting,weaving and so on.So what’s new ? well there is no labour !

And where have they all gone ?? Nowhere.They have just not turned up.Who would bother to lead a harsh life of hard work when you can enjoy the fruits of someone else’s labor for free at home.A share has to be given away in bribes but that’s OK.I did not do anything do deserve it anyways.

2.NREGA may be a great scheme but its implementation is seriously flawed.Has the government come up with a white paper on how the country has benefited by keeping the nations working hands tied up to their place of origin.Displacement to urban centers could have been a problem but is this the right solution.What are the metrics applied and how the performance of the workers,supervisors and babus is being measured.NREGA is supposed to build check dams,community roads,wells etc but how have the parameters for achievement been set against the work being done by a private contracter.

3.In order to be ’employable’ by world markets our industry needs to be competitive.But we have floating exchange rates compared to China’s fixed ones,we have all kinds of industrial policies that hinder free flow of men and material,we have excise duty which encourages export of raw material and discourages export of finished goods,We have labor laws that were fit for the 1950’s but no one has bothered to change them,we have the lowest productivity of workers and highest cost of transport and duties.

4.India is touted to be on the growth path as more than 70% of its population is under 35 years of age and we have the largest pool of working population.But with schemes like NREGA we must question if the working hands are getting utilized optimally.Whats the differential when you have a skilled tailor work on a machine producing merchandise for exports vs. the same guy working in his village and digging a canal.

5.Those who earn much more that what NREGA offers and have skills which are far beyond will continue to rise on the economic path but what is the government doing to upgrade the skills of those who work for NREGA ??What about those who have under utilized skill sets.I am sure their numbers far exceed those of the few software engineers we keep talking about.

6.If the factories cannot produce goods for shortage of labour or become uncompetitive in world market place who will take the responsibility and how will the deficit in export earnings be made good.What are our options and what are we doing about mechanizing processes that are labor intensive.Is the government giving incentives to SSI’s and Exporters so they do not suffer due to lack of cheap labor which has been their competitive advantage for so long.

I am not predicting a doomsday scenario here but if you go to one of the centers of export excellence above you will be as aghast as I was when I saw half the units either closed already or on the verge of it.

When last season our supplier in Ludhiana told us that he can’t supply the goods due to shortage of labour we went to an importer and bought Chinese sweaters.I wonder what will hold the buyers in other countries to act any differently if we in India continue on this path of self destruction.

The Link below to NREGA website does not measure any of the stuff I have mentioned but interestingly shows the lowest levels of Funds utilization and sanctioned in states like Goa,Himanchal  and Uttarakhand which have done far better on the industrialization and improving quality of life for their people.

http://nrega.nic.in/netnrega/dologin/MPR_fin_rep_cmp.aspx?state_code=24&fin=2011-2012&Digest=9sBuBxgG+sPk1eZzpM7%2foA

Ranting the rural mantra

All of us have heard about the herd mentality but if you want to see a live demo you have to look at the Indian businesses.

A few years ago someone said ‘Retail’ and lo and behold ! Before you could blink an eyelid every company worth the name was trying to sell something or the other.Expatriates were summoned,consultants hired,large number of so called retail professionals were roped in and  larger number of stores were rolled out.

Just 3 years down the line  -you ask any CEO or manager who was till now going to chart a blazing path and they will tell you that they are cooling their heels by consolidating.The wait is for the ever elusive customer and the watch is strictly on the costs which are bleeding the other profitable group ventures.With every second retail “chain” going astray retail has suddenly become an abused four letter word.

I can hardly stop myself from getting amused when people talk about their business models,revenue streams and unique positioning.Feel like saying”oh yeah! I wonder why no other ass… ever thought about it.The problem is that the ideas are so great that they are beyond the customer .The poor guy who is just looking for some fresh veggies fails to register the traceability and sustainability aspects of the innovative supply chains.

This is how most of these SCM models are working :   Image132

Farm> Farmer>agent>wholesaler>Retailer

You may ask whats the big deal.I would say its a million dollar question.The only perceivable difference is that you would earlier have seen all Subzi wallahs in the Monda market now you can find a few managers too.

Anyways , coming back to the herd mentality.The buzz word as of the moment is rural.Anybody who is anybody has a rural strategy and a expansion plan in place.The tier 2 and tier 3 towns which were considered god forsaken lands have suddenly transformed into fiefdoms of milk and honey.The poor farmer who was hanging himself for not being able to pay his debts is no less than the Sultan of Brunei today! Let alone steal the wallet every manager worth his salt is ready to plunder the riches flowing in the hinterland through government schemes such as NREGA.After all the payment being made is in dollars yaar !

Hey what are you doing these days ?

Oh I am looking at the rural space.We are targeting Sec C and Sec D in Tier 4 towns.

Man ! you have gone really deep.

You bet.Our plans are even bigger.In the next wave we will cover the cattle too.

From Wall street to Wadala the rant is becoming louder – we will ,we will rob you…we will we will rob you….we will we will rob you.

Let us see how many come back beaten and bruised from this misadventure.

एक शेर नज़र है :

अभी कमसिन हैं ,नाज़ुक हैं अदाएं इनकी

उस पे मचले हैं कि हम खून ए ज़िगर देखेंगे

तो देखो भैया पर याद रख्नना कि ” बहुत कठिन है डगर पनघट की…..”

Traditional wholesale and Organized retail

In my earlier post I had suggested that Semi Organized Retail will succeed in India.To build upon the idea I am presenting another case below.

India is a uniquely different from the west if we consider the following factors :

1.While the Retail stores big and small have been there for almost a century now,Organized chain stores are a new phenomena to the Indian market

2.In the absence of pan Indian chain stores we had bazaars and whole sale and retail markets which catered to the needs and  lifestyle  of the Indian Public.By virtue of their long innings these have a place of prominence in the mind of the Indian shopper.Their value preposition too is quite clear and each bazaar caters to a different taste and wallet size.This is something that organized retail is struggling with at the moment.image118

3.While Labor is in short supply and is therefore costly in the west,its in abundance in the country of more than a billion people.This has shaped the Indian wholesale and Retail Market very very differently.

For cash and carry models I believe that they will not be successful unless they target institutional clients and offer door to door delivery.In India if you have cash ,you don’t carry someone else does it for you.Large number of house holds are still serviced by Deliver ‘boys’ across neighborhoods.This service is free of charge and many a times if you are a regular the bill value does not matter.

4.While there may appear to be very little method in the madness and chaos seems to be buzzword if you scratch a little deeper you will find  self aligning systems very similar to those found in primitive life forms.They may look like randomly moving around but a pattern emerges as soon as you put them under a scanner and start to study their behavior.

Go to any ‘Mandi'(wholesale market) and you will know what I mean.

They may not be carrying Laptops and have fancy accounting systems but they know their business well partly because that’s what they do 24X7 and partly because it has become a part of their DNA.

5.In Organized retail we work on SOP’s and MOU’s to forge  supplier and buyer agreements but in case of traditional retail these are handed over from generations to generations.The buyer and the supplier are not only business partners but they are friends who sometimes even marry their siblings into each others families.

It is very difficult to replicate that level of trust and understanding and the spirit of co creation.The MBA’s in organized retail learn about segmentation,customer focus and value creation but in the traditional whole sale business they KNOW that that’s the only way.Survival to them means continuously reinventing themselves keeping an eye on the pulse of the market.They get their information through informal channels but the actions that follow them are fast and practical.

6.On the other hand the Organized retail lacks many if not all of the above attributes.The systems and processes neatly laid down in SOP’s and charts and tables remain there and very few retailers have been able to drive them down in the organization.The team members are young and new to the trade so while they may not do it deliberately the understanding of the importance of each step of the business process is missing.

7.Organized Retail does offer to its customers a neat and clean ,friendly shopping environment and a certain level of trust of quality as most are backed by big corporates of multinationals.

Another aspect which is important here is that of customer service and window shopping which is a big Grey area as far as traditional retail is concerned.The salesmen are often rude and do not have the finesse to deal with different class of customers.The idea of being confronted and not being able to just ‘have a look around’ does not appeal to many customers especially women.

The point that I am trying to make is that in a way both these entities can not only co exist but they can partner together for creating a unique value for the customer.How ?

Traditional wholesale  can serve as the supply chain for modern retailers as they stock bulk quantities which can ordered as per the sales lift on the image116shelves.

For trial runs of new products this could be great idea as you do not have to commit yourself to quantities upfront.A organized retailer can continue buying from wholesalers as long as the quantities become so large and predictable that owning a production line is the best option to enhance and retain higher margins.

This model will work very well for new retailers with young and image117inexperienced buying teams as they can use the skill and expertise of wholesalers who have been in the market for decades.Their understanding of local taste and price points will be far more than someone who has just passes out of college.

In fact what I am suggesting is nothing new.Almost all big retailers in the developed economies depend heavily on importers for their business.The concept of category captains is akin to what I am proposing.

In India we do not have ‘importers’ and also the organized retail market is not so big to support such operators but that gap can easily be filled by wholesalers.Those who have been touted as the biggest adversaries by an ignorant media can in fact bring a lot of value on the table for themselves and for the customer too.

I have been experimenting with the above in my business and it as worked quite well so far.