Getting inspired by a fellow businessman and launching an enterprise is not unknown but laying the inception of a company, inspired by a savant is definitely something we need to bring forth before you. This is the story of Vivek’s.
Named after Swami Vivekananda, Vivek & Co was set up by B. A Lakshmi Narayana Setty, the younger brother of B.A. Kodandarama Setty, in 1965. An electronics engineer, Lakshmi Narayana, the first in the family, he went from KGF to Bangalore for higher education. Inspired by Swami Vivekananda during his stay at the Ramakrishna Mission, he wanted to begin a venture that would provide jobs and make people’s lives more comfortable. The fact that he wanted to do it in Chennai was a major move for the family as it was an unfamiliar destination.
Unfortunately, within a short span of three years of starting the business, he passed away at a very young age, and his parents left to continue his dreams. At this point, Kodandaraman and his brothers stepped in. They continued to carry on the business with the same vision of the founder. Today, the brand has established its dominance in Chennai, Bangalore and 16 other towns and cities in Tamilnadu with showrooms and about 1000 employees and the total retails space totaling approximately 215,000 sq.ft.
As B. A. Kodanadaraman puts it, “McKinsey, a leading global consultancy firm, spoke of Viveks as ‘a brand more trusted than the brands it sells’ in its report on Indian retail prepared for the CII.” Sharing about the brand, Kodanadaraman says, “We have in a way been behind the inception of modern retail in the South and initiated a lot many innovations that have become the norm today. Viveks began with an investment of Rs.5000. The primary aim for the establishment of the business was to create jobs and to make lives more comfortable. Starting with the sale of fans, folding chairs, cycles, and a few small home appliances the company has, since then, added a variety of products to its portfolio. The first showroom spread over an area of 400sq. ft., was opened in Chennai’s Mylapore in a rented place. The founders had to wrestle through the different struggles which every new entrant to the cities had to face. Till the year 1995, Viveks had only three showrooms in Chennai.”
Kodandaraman pioneered the concept of new-year sale in the year 1977, when products were offered at cost. The purpose of the sale was to thank the customers for patronizing the brand throughout the year. Hire purchase was introduced for the first time by Viveks. The company went into a fast track growth phase after 1991 when the economic liberalization opened the flood gates to retail. From 1995 to 2012, Viveks added 44 additional stores, through a completely planned approach.
The expansion of Viveks was backed by the recruitment of skilled manpower which has made Viveks what it is today. Claims Kodanadaraman, “The total turnover of the company at present is around Rs 437 crore and the growth rate has been 15-20 per cent for the last three years.”
Citing some of the earliest roadblocks, Kodanadaraman says, “In the early stages of our journey hiring trained manpower was a constrain. The purchasing power of people was extremely poor. We faced a short supply of all items. Also, the Government policy did not allow imports thus limited the choice to the customer. Often the customers had to wait after booking the item and one of the issues we faced was the stigma attached to purchase of products on credit/hire.”
Soon after the commencement of operations the foray into other product lines was started. Radios and transistors were added first, and then came the highly utilitarian mixers, followed by gas stoves, Pressure cooker etc. TVs, refrigerators, washing machines followed suit. Informs Kodanadaraman, “This obviously necessitated in moving to a bigger premises, followed by the addition of one more showroom at Purusaiwakkam in 1969, and the third one at T Nagar in 1980. As such for the first 30 years, Viveks had only 3 showrooms and subsequently 44 new ones were added.”
Adhering to its commitment towards its customers, Viveks Service Centre has been set-up to provide comprehensive technical assistance in product services, installations and repair. The service centres operate under a centralized support office with a dedicated multi-line customer service call centre. Elaborates Kodanadaraman, “Viveks Service Centre is by far the largest consumer durable retailer- developed initiative in the country. The flagship outlet is located in the heart of the city at Mylapore and spreads across 10000 Sq.Ft. with an additional nine branches located at prominent locations across Chennai. It is certified by the US-based National Electronics Service Dealers Association, of which Viveks Service Centre is a certified international member. We use the social media, by constantly updating customers through the platform. Social media has also become a tool for customers to send requests for services of the Viveks Service Centre.”
Commenting on their decision to go public, Kodanadaraman says, “With the liberalization during 1991, we recognized the need to expand and be the first to start a retail chain in durable trade. This would entail us to attract the best of trained talents available as also make us easily accessible to funds that may be required for expansion. With this in mind we went public in 1995.”
Sharing his experiences on the business of retailing, Kodanadaraman says, “Retail business is highly competitive and it is therefore necessary to focus on markets which yield profitable results and sustain the market share in these areas. Spreading thick, not thin is very important for retail business. Store location is a very important aspect of the business and it has a direct correlation to the footfalls. A professional store manager is also very important. Lastly innovation to meet and beat the challenges that one faces is imperative.” Sharing his observations on the pace adopted by retail in the country, he says, “In India, the growth of modern retail began only after 1995, post the economic liberalization. Our country is a nation of shopkeepers, with 12 million retailers across the country. There are very few ‘big boys’ in this space. In the West, retail revolution began six decades ago and the industry is mature compared to the Indian scenario. The customers today are reaping the benefits of the growth. The business of retail has scope for tremendous growth. The scope for development is huge in India, yet the growth has not been satisfactory considering the huge demand for products and services.”
– Zainab Morbiwala