IIPM Press Release: February 2013

Monday, February 11, 2013

RAHUL SHARMA, EXECUTIVE DIRECTOR, MICROMAX INDIA

Micromax founder and Executive Director Rahul Sharma in an interaction with Surbhi Chawla of B&E

B&E: Recently there were rumours that your dealers were not happy with you stating that there were no stocks. How have you sorted that out?
VJ: We have believed in growing prudently with our dealers and would do that. Most of the dealers that were there with us from the start continue to be with us but there is no wide spread dissatisfaction, although we have been out of stock from time to time. Yes, we have added new distributors and dealers from time to time, which was a natural progression for us. For example, we had only one dealer in MP when we started; but in this market, we are now number one and selling 1,12,000 units. There is also this dealer in Bihar who I remember wrote the first cheque to us for Rs.1,36,000 and now does a RTF of 4 crores as he realizes that cheque takes three days to clear. We have cautiously adopted this strategy to grow the entire ecosystem with us and that’s what we would continue to do.

B&E: How do you see competition in the segment?
VJ: I will think of competition only when I am not growing month on month. Another plus is that now we see a lot of Indian brands also fighting it out with the MNC’s so that’s also a good sign. I have utmost respect for Nokia; they are the leaders and have a wonderful portfolio and it isn’t that they are not competent. What we are seeing is the maturing of the market. A similar thing happened in the auto industry. Earlier we had just Maruti but with privatization, Hyundai and Tata Motors came in and slowly Maruti’s share has come down; but it continues to be the leader. Similarly Nokia will continue to be number one; only the difference between number one and two would become lesser & more legitimate.

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Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

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Friday, February 08, 2013

The company’s India operations

Global President and CEO, Domino’s Pizza,8 talks to b&e’s angshuman paul about the various peculiarities that personify the company’s India operations

B&E: Pizza Hut (from Yum! Brands) presumably has an edge over Domino’s with its sit & dine arrangements. During 2008, Domino’s also started paying heed to the sit & dine category. Was it the perceived threat from Pizza Hut that propelled Domino’s to enter this category after so many years?
Doyle: I can’t comment on any other players. I know our organization well and I can say that yes, in certain cities, we felt that we should have a sit & dine category; that was the reason we opened our restaurant. But we haven’t compromised and moved away from our home delivery competence and the 30 minutes delivery promise – and that’s the very reason you will see that our restaurants are not purely into sit & dine as these are all self service restaurants.

B&E: All your stores are franchised! Simply put, isn’t it difficult to manage so many franchised stores?
Doyle: No, not really. For half a century, we have been growing on the franchise model. The efforts of franchisees and team members have helped us to conquer very big markets. For, instance, consider our teams in India and Louisiana. These are two of the largest and best franchisee organizations in our system, and it’s appropriate that they are sharing in this distinction. Our franchisees will help us to achieve one goal and that is, we want to clip the ribbon on our 10,000th store within the first half of this decade.

B&E: The Indian QSR market has proved that economical pricing can do wonders for sales. McDonald’s has been thriving on this philosophy and has always resorted to ‘easy on the pocket pricing’. But in the case of Domino’s, we have seen that kind of philosophy only during the last two years. Haven’t you start too late?
Doyle: It was the popularity of the brand Domino’s that forced us to take the brand to a larger market [and therefore to economically price the products]. And then, even before we could come out with low priced pizzas, we had to do considerable changes to our supply chain and other such mechanisms so that we could give our consumers economical yet quality driven products. During the initial years, it was simply not possible for us to pursue such options.

B&E: United States is your biggest market. Which one is next? Can the Indian market ever become bigger than the United States market?
Doyle: After the United States market, United Kingdom should be our largest market and contributes close to 10% to our annual revenues. The UK and Mexico markets taken together have in total about 600 stores, while the next is Australia, which has 500. However, as I mentioned, India – and to a large extent Asia Pacific – is emerging as a big market for us now. In total, we have about 1,600 stores in A-Pac, which makes up 16% of our total stores. In some ways, Mexico is as price sensitive as India, and if we have been able to do well in Mexico, I am sure we can do the same in India too.

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Thursday, February 07, 2013

The Views

Abdul Basit, Spokesperson, Foreign Office, Pakistan

On resumption of talks
It is a welcome step. However we do not want photo-ops only. We met and both the parties articulated their positions. India links the talks with action taken in the Mumbai attack case, while we think that the composite dialogue must continue. In the run-up to Bhutan, foreign secretaries should have met but India unfortunately links this to Mumbai attacks trial. We are not against meeting. We would love to have the Indian foreign secretary here. However, if we meet to reiterate our position, then that would be a waste of time. We want these meetings to produce something concrete.

On Mumbai attacks trial
The trial is progressing. We have arrested seven accused. Our intelligence agencies did manage to fill the gap in evidence that was provided by India. The culprits will be brought to book. But to link it with talks is not done. India took more than a year to bring one terrorist to book. How can it expect us to do the same with seven accused in less time?

On terror camps
Lashkar-e-Tayyaba is a banned organisation. When you say dismantle the terror camps, what do you mean? I have been reading in Indian newspapers that there are umpteen terror camps. Where are they? Give us the proof. Can you kindly give us the coordinates so that we can act? Similarly, before the Mumbai attacks India was claiming that it had information that such and such attacks are being planned. We requested through the formal channel for information. But it never came. We are also battling terror. You had one Mumbai but we had many.

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Tuesday, February 05, 2013

A stem cell in need...

Being the pioneer in stem cell banking in India, LifeCell does have a head start. But these are early days in this industry and digging beyond the iceberg’s tip is going to be the real challenge by Virat Bahri

We rightly do not consider their banks or their auto companies as role models, but there are areas where we can learn from the American way of life and from their democracy. The manner in which they debated the morality of the use of human embryos (which would get destroyed in the process) for stem cell research is one instance (although it was amusing to see George Bush oppose the use of taxpayer’s dollars for destroying human embryos while using it in the wars in Iraq and Afghanistan!).

The scenario in India is quite different; where a debate on statehood is still far more likely to grab bigger headlines. Moreover, India is a market where health insurance itself has penetrated just about 3% of the market, so stem cell treatment looks even more distant. As far as morality of using embryos is concerned, we ourselves would sound like hypocrites even raising the issue; considering that around 7,50,000 abortions happen every year in India (UN figures), because they were girls.

Mayur Abhaya, ED, LifeCell International was never doubtful of the potential of this business when the company was set up in India in 2004 in technological collaboration with CRYO-CELL International Inc. The twin challenges that they faced instead were to create awareness in the Indian market and create acceptability in terms of pricing.

With a focus on embryonic stem cell banking, the company’s primary target audience is expectant parents from SEC A+, SEC A and SEC B categories. Initially, the company was constrained by availability of funds and therefore tried to reach out to customers through a B2B strategy (gynaecologists). Slowly, the company is targetting end customers through advertising, events, et al. Besides, the company is trying to improve penetration through EMI schemes et al. Tie ups are being done with players like Club Mahindra, Fitness One and Kaya Skin Clinic. The company has decided to position itself on the lifestyle plank to broaden its appeal.

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Monday, February 04, 2013

Nine years & counting

The company wrongly felt that KBC won’t work

Multi Screen Media (MSM, then known as Sony Entertainment Television) would hate to be reminded of its folly in year 2000. Sony Pictures Entertainment (the parent company of MSM) had the international rights of ‘Who wants to be a millionaire’, which was a blockbuster in US. MSM had the chance to buy the Indian rights for the show, but the channels’ steward Kunal Dasgupta (who resigned recently after a 14 year long stint) rejected it. This is what Dasgupta had to say later on, “Refusing Kaun Banega Crorepati (KBC) is the biggest mistake I have made. If I can, I will go back in time and change that decision.” Of course he can’t! Star Plus grabbed the opportunity and roped in Amitabh Bachchan to host the show. The show immediately clicked with the audience and became a rage. It recreated the old magic of the Doordarshan days when the entire family used to gather around the TV sets. Star built its programming around KBC and the channel was an undisputed number one for nine years. On the contrary, Sony kept slipping. In effort to correct its blunder MSM has bought the rights of KBC and it is planning to launch the show with a new host. Experts feel this move is not a smart one because KBC has lost its novelty factor.