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To its credit, Pantaloon Retail reported a 32% sales growth at Rs.5,924 crores for the eleven months ending May 2009, experts now say mainly on account of opening up of new stores and easy-on-the-pocket pricing policy. Toshniwal argues that Pantaloon is not meant to be positioned as a cheap brand and that the affordability factor is not the only reason for success of value formats like Big Bazaar, “Today, every retailer is offering economical pricing; so that doesn’t actually help to create a USP. We in the Future Group believe in giving the best quality with economical (rather than “cheapest”) price; this has been supported by our other marketing incentives.” Toshniwal has been key in introducing middle class targetted innovative schemes like “customers get 5 kg sugar free on purchases of Rs.1,500 and above!” This, and similar campaigns – some offering blankets too – helped Toshniwal boost up Big Bazaar’s sales by almost 30%!

During the upcoming festival season, the company does plan to roll out various price discount schemes to cash in on the increased propensity to spend. And here is where the role of logistics and supply chain becomes too critical. “It’s all about sourcing in bulk. Through our firm Future Logistics, we have been able to create a common platform from where we source all our merchandise for all our formats of business,” divulges Toshniwal. It is said that even the Birlas are looking at this format of leveraging from a common hub. But then, if everything seems to be uber cool, where’s the challenge?

Real estate! When it comes to the real estate industry, where the group has ventured in through Future Capital Real Estate, the group has not been successful to that extent. “That’s because our real estate business is not present everywhere and it’s a relatively new venture for us. Also, we have understood what people want, but it takes time to understand the concept of the real estate business,” reasons Toshniwal.

But that said, is enough said about business, as we also wish to find out Toshniwal’s views on leadership. The fact is that Toshniwal – whose passion is in understanding people – believes that there cannot be a stereotype model of leadership as it changes depending upon the situation and people you are dealing with. According to him, a true leader should be absolutely flexible and simple (“Try to be as much a people’s man and you will see a good leader will automatically come out of you”). But he does confess that however dynamic he might be, his regular jaunts between Delhi and Mumbai leave him very less time for his family. His passion (and wish now) is to spend more time with family and to indulge in sports. “I also pray, that we all have a good start for the next year,” comments Toshniwal with a future thought worth a million – or Rs.25,000 crores, as Future Group would say, as Toshniwal intends to make the group that big in three years from now. Mayur, our best wishes; we’ll be watching.

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Source : IIPM Editorial, 2010.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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The approach for consumers should be as usual. Do not kiss your festive inclinations goodbye. The show must go on.

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If all this talk about austerity by politicians has led to consumers feeling guilty, I would stick my neck out by saying that such guilt is unwarranted. It is not to be denied that there are many reasons that can make the consumers feel the pinch of going out for shopping.

One, the job of consumers is to consume and they do the economy a service by doing so; second, the inflationary spiral in essential items has extracted every ounce of austerity that resides in us already. And third, it is the festive season – and what would festivity be without people consuming, bustling food stalls, new clothes for the family and lights everywhere! That’s where the fun lies.

This season, I would exhort consumers to shed their austere cocoons – a product of inflation and examples set by politicians whose posterity is as fickle as the weathercock. Moreover, consumption is a national service. Look at what happened during Ganeshotsav this year – less idols were bought and those which were bought were cheap ones. Craftsmen were plunged into misery by such scrimping behaviour which was probably not an outcome of inflation but the swine flu. The same would happen if consumers reduce consumption and it is happening and at a very large scale.

To the rich I would say, “If you are inspired by the recent austere clouds surrounding you, give some of your money away so that consumption can be kept up as it is the lifeblood of the economy. For every rupee that you give away, the national consumption would rise. A basic law of economics is that the poor consume greater proportion of income than the rich. If you do not want to give any of your money away, then do not hoard it, but spend it. That it is the next best thing to charity. Your money on crackers, clothes and candles will ultimately find their way into a many a poor man’s stomach and light up their lives. Please do not behave like Uncle Scrooge in Christmas Carol.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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