Keeping customers at the heart of business

Vivek Limited, a leading consumer electronics and home appliances retail chain operates under the brands of – Viveks, Jainsons, AC Bazaar. BA Lakshmi Narayana Shetty, a devout follower of Swami Vivekananda, started this business concern in 1965 with an investment of Rs 10,000 on a 200-square foot outlet in Mylapore, to sell electrical fitting and folding chairs. The business was named Vivek & Co, after the great monk. 

Following the demise of the founder, his brother BA Kodandaraman Shetty took over the reins of the company. Credited with being a mastermind in retail, he increased the turnover of Rs 1.65 lakhs in the first year, to a stunning figure of Rs 28 crore by 1980. In its first 30 years, the company had set up three showrooms. From the mid-90s, the firm saw a spurt – with 50 more showrooms being added through acquisitions and expansions. The group’s turnover is presently estimated to have crossed Rs 500 crore. 

Excerpts from an interview: The growth of your company took place in a gradual, phased manner. How did that happen? When we wanted to expand in 1995, we knew it was time to move from a partnership to a limited company. The kind of growth we have experienced did not happen overnight. We do not have resources or money like the Ambanis or Tatas or Birlas. They are all yet to break even. We don’t have that kind of luxury. We need to see our company grow in every department – systems, logistics, supply chain management, human resources, training centres, everything has to grow simultaneously. It’s almost like how a homemaker prepares a dish in her kitchen. A pinch of salt, a dash of spice, but just in the right blend. Every company needs to be of a certain size to operate on a specific scale. That’s why our expansion took 30 years. We built three showrooms – Mylapore in 1965, Purusawalkam in 1969 and T Nagar in 1980. 

Now we can afford to dream of 30 showrooms in three years’ time. What’s your take on the online retail scene? If somebody can do a job in 24 hours, people want someone who can do it in 22. So, speed of placing an order and getting it delivered is of paramount value. The online market is a phenomenon you cannot ignore. Our roles are seeing an evolution, from being pure resellers to becoming exhibitors of sorts. People browse through their product of choice on their handheld devices and computers and come to our showroom for a look and feel of the product. 

Then, they go back online and place their orders. We serve a very crucial purpose. My first year turnover was Rs 1,02,000. Today we have TVs costing upwards of Rs 8 lakhs and refrigerators costing Rs 2 lakhs. India was once referred to as a nation of shopkeepers. We are not a nation, but more like a continent, considering the population and cultural variations across the length and breadth of this country. How has competition affected your business? When I started, my competitor operated out of the same street where I sold. 

Later my competitor was a neighbourhood away. Then my competitors grew in numbers, in the city, the state and in the country. Today, my competitors are multi-nationals operating on a global turf. From the street-corner shop to Walmart, Tesco, Carrefour and more, everybody is a competitor today and it’s only set to grow bigger. In the last one decade, shopping malls turned out to be one of the biggest competitors in terms of sales. More than 500 major malls populate the nation today. 

But back then, in Chennai all you had was Alsa Mall and Fountain Plaza in Egmore, or Spencer Plaza on Anna Salai, which was the first mall in the country. What is the state of Spencer’s today? What keeps your customers coming back? When McKinsey wanted to learn about retail in our country, they began analysing manufacturers, retailers and customers. And they published a report in which one of the articles was dedicated to Viveks. The headline was: More trusted than the brands it sells. We come from the Vaishya community, which is known for its all-round business acumen. Never in our history have we let down our customer. We have always enjoyed having a reputation of being a customer-friendly company. One of our core values is customer service and that hasn’t changed in all these years. Do global retailers like Walmart inspire you to take on newer segments? Walmart sells merchandise of all kinds. Viveks specialises purely in electronic goods and home appliances.

 If you go to Walmart, you will find a specialist ready to assist you in every single aisle under each category of product. There are ample signages to ensure you are not lost in 40-50,000 square foot spaces. You can go and pick anything easily, with or even without assistance. Of course, in India, even today customers need a very tactile, almost guided manner of shopping, with an attendant explaining the details of each product. We are not far from the day when we will have a US-like retail scenario, but it could take about five to ten years.