Monday, September 10, 2012

“Multi-brand Strategy works better in Asia”

Founded in 1983 by Jeremy Hackett and Ashley Lloyd-Jennings, Hackett, unlike the other bon ton brands of Europe, has been a late entrant in the international market. However, since 2005 Hackett has been continuously expanding globally so much so that today it operates from 77 stores in 16 countries across the globe. In an exclusive conversation with Angshuman Paul of B&E, Jeremy Hackett, The Founder and the man at the helm of affairs at Hackett explains why Europe still scores over Asia when it comes to market luxury goods...



B&E: As far as European countries are concerned, Hackett, like any other luxury brand, has been promoting events such as Aston Martin Racing, British Army Polo, International Polo, et al. But, when it comes to Asia, the brand still seems reluctant to such sponsorships. What’s the reason behind this divide?
Jeremy Hackett (JH): We have always believed in positioning the brand Hackett as a supporter of events central to the British sporting and social circuit. It’s because of this philosophy we have been sponsoring British sports such as Aston Martin Racing, British Army Polo, International Polo, The London Rowing Club, Beaujolais Run, et al. Though, in Asian nations like Singapore we believe there’s definitely a strong market for our products, the scope of enhancing our brand image through such sponsorships is really less. In fact, we don’t take up such sponsorships just for spreading awareness. It’s certainly much more than that.

B&E: From working in a tailor’s shop to creating a multinational premium chain of men’s haute couture, you have come a long way. So, what difference do you see when you compare the business model of a standalone store to a chain of stores that operates globally?
JH: I have even sold second-hand clothes and I can say that there’s a distinct business model for each of these formats of business. But then, the revenue-earnings model in all of them is the same which is based on the common concept of the consumer behaviour. For instance, when you are selling second-hand clothes or old stocks you have to keep the price of products high as buyers will bargain or ask for price discounts while purchasing these products. However, if you want to create a premium pricing for a luxury brand then you need to have a strong brand equity. Further, conditions across countries vary when it comes to setting price of your product.

B&E: While most of the luxury brands have diversified into various aspects of haute-couture for both men and women, Hackett has kept itself limited to menswear? What’s the logic behind this strategy? Do you plan to foray into other segments as well in the near future?
JH: You can say that we want to specialise. We want to be known as an expert in men’s dressing. Further, when it comes to diversification in the luxury industry, I think luxury brands, which have done phenomenally well, have also created a special range or sub-brands for each of the segment that they cater to. This is a retailing concept that works very well in European and US markets. But, in Asian nations like Japan, it’s more of extremely specialised services that work for a luxury brand and that’s where Hackett’s positioning is perfect.

B&E: Do you mean to say that a specialised model works well for the luxury brands in Asian markets? But then, in China, there are many luxury brands like Gucci which have been doing very well but they don’t believe in specialised or one category concept. So, what, according to you, is the ideal model for success in luxury business in Asian nations?
JH: In China and India the retail concept is emerging exactly in the way it started in European nations, particularly in China where gigantic retail stores are the order of the day, all thanks to the law that allows standalone stores of luxury brands in the country. But in this case, to fill up an exclusive brand outlet, the respective luxury brand needs to have an array of products in its portfolio. This I think is costlier and the company also takes a lot of time to reach break-even in this case. However, in Asian nations, it would always be better if you are a part of a multi-brand outlet and remain focused on your specialised area of luxury.

B&E: Among all the emerging markets across the globe, which have the maximum potential for your brand?
JH: Singapore, China and India are definitely very promising when it comes to the demand for our products. But still, I think it would be over-optimistic to expect that these nations will outdo Europe’s leading market in terms of turnover from luxury goods immediately. So, it’s really difficult, as of now, to say particularly which one has the maximum potential; but yes, Middle East have always remained a sure bet for Hackett.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
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Saturday, September 08, 2012

Each Plant nourishes many organisms; imagine the Eco-System with 20% of plant species gone...

“The Government is unaware of the ‘quantities’ being used by the pharmaceutical companies,” adds Dr. Acharya. “Forest department should be involved in the commercial process,” he suggests. Raw capitalisation like the recent ‘Vedanta’ intrusion is another sign of things to come. The village of Patalpur is one more reflection of the aftereffects of corporate evils. The naïve farmers and locals dance to the beats of flashy CD players as the industrialists successfully bribed/raided them off their botanic diversity. Acknowledging that industrialization is on a high, the micro-biologist adds, “though I’m not against it, I feel enough is not being done to sustain it strategically.”

Deforestation, especially in the tropical and sub-tropical regions of India, is another intimidating situation. Outside India too, close to 65% of endangered species lie in the tropics. Madagascar, which houses spectacular variety of biodiversity especially towards its tropical eastern coast, is infamous for the practice of ‘slash and burn’ cultivation. The process, which is carried out by cutting and burning forests to create plain fields for agriculture, is also guilty of contributing to the growing list of endangered species.

Natural reasons could also be responsible for some irreversible damage to the environment seen in the case of Kalahari plant. But little can be done against the force of nature. The humans, meanwhile, prepare for a mid-October conference in Nagoya, Japan where many countries are expected to converge. Dr. Acharya labels the participants “seminarists” while commenting that “every year summits are held for various issues without really implementing much.”

Indeed, policy-making is a major issue but let’s pray the Nagoya convention brings more ‘Hope’ than the much-hyped ‘Hopenhagen’.


Source : IIPM Editorial, 2012.
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Thursday, September 06, 2012

DR. WILFRIED AULBUR, MD & CEO, MERCEDEZ-BENZ INDIA

He’s the man who has been steering the Indian arm of Mercedes-Benz for the past five years. In an Exclusive with B&E, Dr. Wilfried Aulbur, CEO & MD, Mercedes-Benz shares where the company is heading

B&E: Mercedes-Benz is looking at entering tier I and tier II cities. How do you plan to go ahead with it?
WA: I don’t want to comment on investments. But as far as implementation is concerned, we basically have different formats for different cities. We typically start in a city with authorised service center which primarily is a place where customers can get the basic maintenance done. Then comes the ‘Auto House’ which houses vehicles anywhere between 100 and 1,000, depending on the location. Investments are made based on sales forecast for a particular region. For instance, we are building a brand center at Mathura road in Delhi where we will showcase 26 cars and which will have an ‘AMG Experience Vehicle Area’, a structure that will not only make a statement in that region but in India as a whole.

B&E: With a gamut of luxury car makers like BMW, Audi, et al, having set foot in India, what has been your focus & strategy to fight competition?
WA: Our core focus has been value for money. This is the reason we haven’t decontented our offerings. Further, we have not gone into overly aggressive discounting because at the end of the day we believe that the luxury car buyer is looking for an experience and is willing to pay the money for that. In fact, the strategy has paid off well and we have a very good bottomline. Going forward, we plan to continue along these lines.

B&E: Audi and BMW entered the Indian market 4-5 years ago and they have successfully been able to eat a considerable portion of the luxury car pie. How has this affected Mercedes-Benz?
WA: Competition has increased but then that’s market dynamics. In a market brimming with opportunities, redistribution of market share is actually healthy. If you look at markets such as Brazil, China or Russia you’ll observe similar scenarios where luxury car brands have divided the market among themselves. We are growing very significantly in China and have sold more than 1,00,000 vehicles within the first nine months of this year. This means that over 10% of our overall global sales is coming from China. While 22% comes from US, about 45% of the total global sales comes from Europe and other western countries.

B&E: How important is the Indian market for Daimler AG?
WA: As of now India is just 1%. However, 10 years down the line we will achieve the same size as that in the United Kingdom. But, at the end of day the market share that we are talking about is very small in terms of volume.

B&E: To what extent does Mercedes-Benz rely on local manufacturing?
WA: As compared to other luxury automobile manufacturers, we derive the highest degree of local value addition. For the C-class and E-class we have local body shops which takes care of the paint job. We also have assembly lines for the E-class. In fact, this flexible manufacturing setup with limited investment gives us the advantage to produce more variants and churn out larger volumes.

B&E: The road ahead for Daimler AG in India...
WA: Daimler has already made huge investments in India. We have recently announced an investment of over Rs.3 billion. In fact, with growth opportunities, investments are gradually moving up. Human resources at Bangalore have also been ramped up from 200 to about 600 employees. There are no specific plans as far as investments are concerned, but considering the overall landscape, we are definitely at par with competition in the industry.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face
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Tuesday, September 04, 2012

Date nights

Jennifer Aniston is in her 40s, is hot and still hasn’t given up… No, we see no reason either why our favourite Friends girl should give up on the hunt for her prince charming! The actress has been spotted enjoying a dinner date with Harry Morton, who happens to be Lindsay Lohan’s ex, on more than one occasion. Jen seems to be testing the turf right now ’cos she ain’t someone to hide her relationships from the media. So, good luck girl!


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Monday, September 03, 2012

CAN SHARAD PAWAR NOW FIX HIS SPOT?

Just imagine the kind of mind-boggling multi-tasking he is doing. Here you have the Supreme Court of India that loudly and publicly berates him for allegedly trying to ‘spin’ the orders passed by the Court regarding food for starving Indians. Lest you think, this Supreme Court ‘flipper’ will flip him and make him move his focus away from spin, you are wrong. There are reports that it is actually ‘fast’ and ‘swing’ bowling that holds his attention. I am really guessing out here, but I have a feeling that Justice Kapadia is at the moment less important to him than Mohammad Amir and Mohammad Asif.

And why not? Sharad Pawar has been a politician, a minister, a Chief Minister and a Prime Minister in waiting for so long that a few barbs here and there, trying to prick his conscience about starving Indians will not really matter to him. After all, how can it matter when the ‘farmer’ politician knows that a 20% food inflation will starve people (who spend almost 80% of their income on food) and then blithely announces that the menace will soon be tamed… I am sure, it was easier Taming the Shrew… But for Sharad Pawar, this is his first stint as the President of the International Cricket Council (ICC) and scandals like the one so embarrassingly visible about Pakistani players is a challenge he is facing for the first time. After all, his name in posterity could go down as the honcho of ICC, who presided over the decline and fall of cricket because fans finally got tired of watching fixed matches. Surely you know that is different from poor farmers getting tired of ‘fixed’ distribution of food.

But jokes apart, and trying our best to forget the mess that the Commonwealth Games is making when it comes to the image of India (and please don’t smirk: I won’t be surprised if some of our new IPL stars from India eventually get enmeshed in this spot fixing scam), have we given serious thought to this extreme and ultimate form of crony socialism? I mean, Sharad Pawar might be the ultimate when it comes to multi-tasking; but how does he simultaneously deal with starving Indians and the swinging ways of Pakistani fast bowlers whose girl friends tend to kiss and yell? You can give as much spin as you want to this sorry tale; but surely Sharad Pawar must be spending some quality time everyday on the spot fixing scam? What about food security for Indians?

Call me nostalgic and a fool (and I am sure some guys made money even then). But I remember being proud of being an Indian during Asian Games '82. And I was prouder still when I heard tales as a young journalist about how Madhav Rao Scindia played a key role in ensuring South Asia got the Cricket World Cup in 1996. I know, South Asia is once again preparing for the next edition of the World Cup in 2011. And I know we will rave and rant about ‘white’ and ‘western’ media and people being prejudiced and racist when it comes to simple, God-fearing, innocent folks like you and me.


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Saturday, September 01, 2012

“LOW INPUT COST WORKS FOR US”

Sunny Gaur, Managing Director, Jaiprakash Associates Limited

IN AN EXCLUSIVE INTERACTION WITH SUNNY GAUR, MD, JAL, REVEALS TO B&E WHAT MAKES JAYPEE CEMENT SO SUCCESSFUL.



While the whole industry was struggling, Jaypee Cement managed 47% growth in the first quarter. What’s the reason behind this success?
In 2002-03, our leader could foresee that with GoI’s projections of over 7% GDP growth, India’s cement consumption would grow at around 8–9%. Keeping that in mind, we initiated several measures of capacity augmentation and capacity creation. With commissioning of almost 12 MTPA in last 12 months and India’s cement consumption holding at 9% growth, our assessment of requirement of cement in India has been proved right and that is reflected in the satisfactory and healthy growth of 47% in the last quarter.

Analysts are of the view that rising cost of raw materials and expected moderation in realisation rates will affect the cement business. What are your views on the same? How do you plan to face such a situation?
Very early in our consolidation phase, we learnt that our cost control measures should effectively nullify cost of inflation. In cement there are three costs, which have to be kept in check – logistics cost, cost of power and Coal Consumption. We have the most efficient pyro process and milling department in the country ensuring least consumption of power and coal. Out of 22 MTPA cement capacity in operation, 17 MTPA of cement is being ground by most energy efficient VRMs/RPs. In order to address the cost of logistic our grinding units are located near consumption centres to keep distribution costs under check. Cost control in our company is the reason for which we have the largest base of captive thermal power.


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