'We understand our customers better,'says Bhagirath Jalan,CEO Jalan Group

The endeavour to serve the local populace with best products at affordable price drives the Jalan's at Varanasi, Uttar Pradesh. The Group, which was started by Late Sri Deendayal Jalan in 1974, has established to be the 'one stop' place where you can find
\'No one can challenge a regional retailer if cost structure is in place,\'says Bhagirath Jalan,CEO

The endeavour to serve the local populace with best products at affordable price drives the Jalan’s at Varanasi, Uttar Pradesh. The Group, which was started by Late Sri Deendayal Jalan in 1974, has established to be the ‘one stop’ place where you can find everything related to clothing, accessories and home products. In an exclusive conversation, Bhagirath Jalan, CEO of the Group, proudly says, ‘We understand our customers better’.

Your Group has been in retail since 1999. As a next generation CEO of the Group, how difficult or easy it is, to maintain the core values of your brand?

It has never been difficult, as the core values which I inherited from my parents and grandparents have helped me to shape the business well. The values which we strongly follow from generation to generation remain the same, which encourages in providing best products and services to customers, at the most reasonable price.

How has the landscape of retailing changed over the years, in particular, in segments like textile, accessories and home utility products that you retail? 

There has been a drastic change in the retailing scenario in the last ten years. If we talk about textile, ten years back, 40 per cent of sales used to come from sarees only, and other apparel categories were not much prominent. Today, I can see there is a huge change in the buying patterns due to lifestyle changes, and that has brought an increased demand for readymade garments, along with share of saree has become 25 percent of total sales. Be it branded or non-branded, apparel and accessory segments have seen steady growth. For example, in the footwear category, earlier, people used to have maximum of 2-3 pairs of footwear, while today, a man minimally keeps 5-6 pairs. In home product segment too, usage of mattress and non-stick utensils, along with cutlery products like ‘trays’ have seen inclusion in the purchase of even lower middle class people. Also, ‘luggage’ as a category has seen increased
sales, due to increased travel frequency etc.

How different it is to retail in a particular region than doing business across cities?

Retailing from a particular region is easier and convenient. For example, for a regional retailer, any product can be distributed to all the stores of that region easily and we don’t have to keep separate supply for different location stores. For example, ‘Tat Saree’ can be distributed to all the stores, in all seasons of the year in Bengal, which can’t be sent to a North India store because the region lacks the demand of such product. Being a regional player, it’s easier for us to gauge the local taste and preferences, and thereby, we get a competitive edge over others.

What are the benefits and challenges of a regional and established retailer like you?

Being local, management becomes much easier because we know each employee better, and therefore, can source the best talent from the area. We even know each employee by their faces and further information like ‘where they live’, and thus, it builds up great bonding, which inspires the employees to be more involved, dedicated and productive with our organisation. Cost structure is the second advantage that we get, because we do not have to bear the head office expense, which a national player must. Also, we can check the prices of other retailers in that area by simply visiting their stores anytime. And the most important one, being local helps us to understand our customers better.

In terms of challenges, we do miss the advantages of ‘economies of scale’, which a national level retailer earns easily with his/her multiple number of outlets. They can regularly touch base with the national level distributors, and thus, can avail benefits of discounts and related schemes.

What is your advice to regional retailers deciding on national level expansion?

When a regional player starts operating in 5-7 cities across 4-5 states, and he functions well, then he can think of going national. Also, in doing so, he should not borrow heavy loans because reckless expansion in retail is very dangerous. A retailer should focus on improving his existing stores, and then, he can think of expanding to other states.

How do you manage your inventory and planograms?

We have been following a very good inventory system in our stores. We have 10 rotations of supplies in a year that stores approximately 1-2 month’s apparel stocks, which is huge and no other retailer does it. We have a separate purchase team and we meet on 14th of every month, to evaluate and decide what to purchase for the next month. This foolproof strategy has been very fruitful, which is giving us good returns.

Talking about planograms, we do not create it very often as it  gets decided at the opening of the store or at the beginning of a new year. We do not change it very often. In planograms, we have two important elements-one is wall fixtures and another is Gondola. These two make sure all the products are appropriately placed on the shelves.

What are your future expansion plans?

Two months back, we launched our supermarket in Varanasi with newly introduced segments like food, grocery, FMCG products etc, and the response has been phenomenal. Inspired by this, we plan to come up with 3-4 such formats in a year. We also plan to launch 20, 000 to 25, 000 sq ft similar format department stores in Jaunpur, UP.

Bhagirath Jalan
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