A great series by Arun Shourie. I dont need to link to this, but in case you have missed this, it is worth a read and thought...
Part I: Hindutva and radical Islam - where the twain do meet
Part II: What more is needed to stoke reaction?
And the piece de resistance, today
Part III: The vital difference
Saturday, December 29, 2007
A great series by Arun Shourie. I dont need to link to this, but in case you have missed this, it is worth a read and thought...
Thursday, December 27, 2007
How to inflate the value of toothpaste? Just "brand" it,with what are, really, copyrighted images. (Of course, theres a lot more to it). But this is a case study in itself.
You have the choice, to buy toothpaste at about 3 times of the cost if it comes in a simple tube without these images...
After all, its your choice...on how you want to make your kids brush their teeth.
If you have been following the papers, this story is now old hat. A man, who, atleast going by what I read in print had done nothing right. There, were, of course, rights and wrongs, but going by what was written and broadcasted, in reams, he had done mostly wrongs, but the hustings proved that he had done, mostly right. The papers chose to ignore, or to not highlight the mans incorruptibility, ability to drive development, stop power theft (how important is that) and provide a strong administration and a secure environment and instead focus on a very small aspect of his tenure, that too, partially. (Thanks Churumuri, for all the links)
Now the question is what can this man become? Theres been denial, sour grapes and quite a few other emotions.
And heres B Ramans take on it. A very interesting analysis, because quite a few people I spoke to, agree with this, perhaps not very tacitly, but they do. And that could make for a very interesting future in Indian politics...
Wednesday, December 26, 2007
There are similar other villages close by like Kalpathy, Noorni and others. Kalpathy - of course has been declared as a Heritage village but I believe much needs to be done. These villages are now being steadily changed thanks to real estate prices. As one enters into the Noorni gramam - one is greeted by concrete villas as opposed to the earlier gramam style houses.
Monday, December 24, 2007
Especially when the unit size is 200 ml. So, the next time you are travelling, pack a few of these.
Wonder why no one thought of it till now?
So, all you cheapo caterers out there, especially at railway stations and tourist centers, this is a threat to those watery concoctions you pass off as tea.
Of course it is not a real threat, but it is a welcome thing for all those travelling with kids or for those who want their cup of milk.
Now, if only we could figure out how to heat it in a train :)
Sure, the long tail has been a much spoken subject for a while now, but yesterday a thought crossed my mind.
This is an area with clear potential for the Indian IT industry. Indian IT can take advantage of its multi location strategy to position itself as the service arm/product arm/maintenance arm for niche software. By having a central location or two, it can support products across the globe. And it doesnt have to be just old and defunct products. It can very well start off by launching smaller and more specialized products and reach out even a small set of customers spread across the globe. It can also acquire specialized products and be the one stop shop for them thanks to their reach. And, like restoring specialized cars or building specialized machinery, it can get to charge good rates for them too. So, how about a long tail division?
Saturday, December 22, 2007
Subhiksha, as it started off was and continues to be a contrarian in the retail market in India. Its strategy of going near catchment areas, having smaller shops and self service with a simple 10% off on the MRP was the perfect strategy to get shoppers. No air conditioning, no fancy-schmancy doorkeepers - just simple value for money.
Yet, over time its strategy seems to have floundered. The big thing wrong about them is their lack of choice. Their stores are small to begin with and ever so often seem to run out of stocks. Given that they stock a selective number of items and brands, this is a disaster. Because each time I go to their shop, I get only part of my shopping done and then I have to go to another shop to finish it. Choice is big - second only to bargaining. If you dont let me bargain, let me choose. Compare and contrast. Hold two items in two hands and compare it till you decide. No choice doesn't leave customers feeling very good.
Their vegetable shop is almost similar. It is one thing to have a small shop, it is another thing to look worse than a vegetable market. Even the market has simple decent baskets that help you select produce. It is one thing to put up an appealing display, it is another thing to put a display that is totally repellent.
So, going by my experience with this shop over the past more than a year, I change my view from what I had here, to what my compatriot had, here. The simple thing for them is go back to their basics which seems to have been lost along the way and yes, do stop selling mobiles. I come to Subhiksha to buy groceries, not mobiles and they are not the same.
Friday, December 21, 2007
And they have a TV spot for it too. I wonder why and what is the whole idea of selling mobiles.
From what I have seen of their store near where I live, I would feel confident of their ability to sell mobiles if they sold what they started off with well - grocery, pharma and vegetables. The whole ambience of their store is wrong - it is almost as if you are selling mobiles alongwith grocery - so what if they are (nearly) commodities?
I walk into an opticians at 1.45 pm. "I need an eye test done"
"Its lunch hour sir, for the optometrist from 2 to 3"
"But it is just 1.45"
"If you wait till 3, we can get it done"
And they had no Plan B. When you are building a brand on a high street, you need to be prepared to expect a customer at any time or close your shop with a board saying, its lunch time.
Reminded of my last visit to a sarkari bank...
Wednesday, December 19, 2007
Titan, a name that is synonymous with watches today. It is tough to imagine how in the world of Casios, Seikos and to a lesser extent, the HMTs the brand has made a name for itself. But it has. Titan was launched at a time when cheap watches were flooding the Indian market. Of course HMT was nearly on its last legs then, but to elevate watches made in India from the fuddy duddy image to something snazzy has been Titans doing all throughout. The ride has not been smooth and the company has gone through its share of troubles while building the brand to what it is today.
The brand has been built bit by bit. First and foremost, a Titan pretty much stands for reliability, durability and to a great extent style. My personal ownership experience has been so good that I barely look beyond Titan when I think of watches (I do wish that their designs were a little more sporty, but other than that, they are still very good.). And it is not just me, according to estimates Titan has something of a 65% market share in watches (Brand Equity, ET, today and Tatas site).
The brand is not focused on a single segment either. It has brands that pretty much straddles the entire spectrum of costs. The Edge, a slim watch launched recently is a head turner for sure. Indeed the Edge has got such a reputation that it has had a rub off on its other non "Edge" watches - even when they arent so slim. Raaga, their womens range (re)launched recently has impressive designs on offer.
They have made a smart move into Tanishq, their jewellery brand using some of their design acumen. That brand is going great guns too. (Not sure what they are doing in eyewear though - but I am going to give it a try.)
What prompted me to write this piece was their Heritage collection that uses design aspects from ancient India. The designs that Titan sells is the epitome of ancient India while at the same time it has the promise of modern India - reliable, durable and stylish. Sure, they are pricey, but who said stuff from India had to be cheap? This collection does not live in a state of denial about our heritage, indeed it showcases them. For long gifts from India have been the usual idols, pen sets and cloth items. India was never seen a country to gift a watch or a calculator from. Titan, I believe can change this - even as it shows other brands how to build with India on their minds and create a distinctively different brand identity for themselves.
Thursday, December 06, 2007
To see the retail revolution in action, one of the places that you might want to visit is a suburb of Bangalore known as Marathahalli. Many years back, for some reason, companies opened discount stores there - it was not an easy place to reach - atleast in comparison to the city. So, you had Megamart, a Titan seconds showroom (it had a name - no longer operative) and quite a few others. The idea was that companies sold stuff at a discount on the outskirts of the city and M'halli was a popular shopping haunt. Over time, the city has grown enough for M'halli to stand up and be counted as a suburb of Bangalore - indeed Bangalore has grown much beyond.
But this place is now a hub of retail. Where there was a Megamart, now there are two. Futures group picked it up as a place to have not one, not two, but three of its stores there. Brand Factory, Hometown and now Staples Future office. I did not realize that Staples Future office was a Futures group venture. The area is now in its ascendancy into the retail mindspace - and there is a lot of space out there. There are more stores opening in that area - it can well be a retail laboratory where shops of all types co-exist, atleast for now. Of course, traffic is a nightmare, there isn't enough parking space. Bus services are quite frequent since it falls enroute to a work destination - ITPL. But watch out for Maratahalli, it could well trounce the city in terms of footfalls.
On that note, I am off on a break (I already am on a blogging break). I will be back...
Wednesday, November 28, 2007
The Sakrama scheme, recently started by the BBMP is a neat way to allow people to get away with land grab. It allows one to regularize all violations. Violations like building without a sanctioned plan or building with deviations from the sanctioned plan (you get a plan sanctioned for 2 storeys and you build 11 or 15) .
Obviously many are happy. Imagine having to pay a fraction of the market value and getting land grab regularized? Some are not, but their voices are drowned.
These are the exact kind of violations that have made Bangalore the urban nightmare it is today. The land mafia, including politicians and their sons and families have latched onto the soil in a big way. Lake beds are being encroached upon, lakes are being filled, government land is being usurped and all norms are thrown to the wind. Of course they say that this is a one time thing, but like the VDIS, there will always a second coming, either now or 10 years later.
In any case, as we have seen in Delhi, politicians will never move against violators since they themselves are a part of this whole scam and so it will continue.
It plans to open luxury hotels in pilgrim centers. That is a good beginning since most pilgrim centers are pretty bad in terms of facilities. Though, I think there is a better chance for someone on the lines of Ginger coming up with a pilgrim hotels chain - earn bonus points each time you go to get a darshan of your favourite god!
More thoughts on pilgrim centers, here and here
Saturday, November 24, 2007
At one point, I thought that filter coffee is unbeatable and I still think when it comes to Indian coffee tastes, the filter coffee is perhaps the best. (Tip: Especially at South Indian weddings or at local Bangalore restaurants)
Instant coffee, well, I dont even count it as coffee (falls in the same category as powdered milk).
But the new coffee vending (no, not those horrendous powder water mixing contraptions) machines - the kind used by Barista, CCD and certain office pantries - can give filter coffee a run for its money. (The machine is, of course, a coffee filter with a lot of thingamajigs)
Previous thoughts on coffee, here.
Thursday, November 22, 2007
Go to any taxi stand in Kerala and you will see rows and rows of Ambassadors lined up there. Not Sumos - which are big as BPO cabs, not Qualis - which even after production has stopped commands a good price in the used cab market, not Bolero or even the Maruti van. Even today, in circa 2007, when the Ambassador has all but died a death on most of Indias roads, they are still conspicuous by their presence. The two taxi drivers I met had bought brand new Ambassadors in 2006. Yuck, you would think. I asked them what made them buy this behemoth. I personally, am not a fan of this vehicle, hence I was intrigued...
First, the total cost of ownership is just about 3.7 odd lakhs. Now that is cheaper than most other compact cars too. There is no power steering, but an AC is available - smart. The passengers get their comfort, the driver can get by without power steering. The first seat is a bench - unlike any other car - though the Sumo and others have basically bench seats in their cab versions - but the sideways facing back seat makes it a difficult bet (this is my thought) for the Sumos. Also, cabs are meant to be "cars" and maxicabs are "jeeps" which might be another reason for the Ambassadors survival.
The handbrake is on the right side of the driver, so 2+1 seating is comfortable in the front. The back seat, in any case has been the one strength of the vehicle in terms of space as has the boot. Apparently, the vehicle, also has what these chaps classify as "pull" - torque. The Ambassador delivers the best torque for the cost - the Qualis is of course the best. Repairability, also, is a point since with bad roads, rains, mountain roads and lack of too many dealers, the roadside mechanic does a good job with the vehicle. All in all, low total cost of ownership is what matters to these guys.
Who can challenge it? The Logan or the Indigo perhaps have a good chance...
Wednesday, November 21, 2007
the product is sold for not the product but for what is offered free beside it.
What am I talking about? Washing machines? No. DVD players? No.
I am talking about apartments.
Over the last few months there have been a flurry of advertisements in the papers, media about Orange properties. It first came out with a scheme of a free car (SX4 - no less) for all apartment owners. If that took your breath away, they came with an Audi A4 for villa buyers. Then it came up with the idea of quarter kilo gold for every 2bhk booked and a half kilo gold for every 3bhk booked. Obviously, there are riders and whatnot around this and going by ads released, they are surely getting eyeballs, talked about and even selling a few thousand square feet in the bargain.
There have always been similar schemes in the past. Quite a few builders have offered items ranging from cutlery sets to modular kitchens. The simple question I have is, there is very clearly no such thing as a free lunch and everything is paid for by the customer only? Yet, why the freebies?
Meanwhile in Karnataka, a BJP-led state government that took power just a week ago was brought down yesterday by its coalition partners because of a disagreement over allocation of ministerial portfolios. “Fight over rich ministries fells Karnataka Government” said a neat Hindustan Times headline this morning (Nov 20). The Janata Dal (S) party, led by former prime minister Deve Gowda, pulled out of the coalition because the BJP would not agree to let it have lucrative ministerial posts covering housing and development, and mining – posts that are always coveted in governments across India because of the largesse they bring from would-be licensees and contractors.
Karnataka has now had three governments in as many years and is sinking rapidly into the sort of administrative torpor more usual in the blighted northern state of Bihar. That is bad news for a state which has as its capital the showcase city of Bangalore, where big IT names such as Infosys and Wipro are located. No wonder IT companies are expanding elsewhere.That the JD(S) is all about real estate is something that is an open secret in Karnataka. Truly a son of the soil party, their focus has been land or the oil extracted from it. No wonder they wanted these lucrative ministries to milk them for all it is worth. They have nearly torpedoed the BMIC project and tried to best to deprive IT of land. I hope the voters give it back to them.
For the citizen on the ground it is a nightmare scenario each day. Traffic snarls in every conceivable direction, bad roads (some improvement noticed recently), corruption in all possible places, Bangalores huge water problem, electricity worse than rural areas. The only hope is that elections bring good governance to Karnataka which has been conspicuous by its absence over the past few years.
Related posts, here and here.
Read Churumuri for some posts on this, here
Monday, November 19, 2007
JD (S) - Joint Development (Sites)
Update: Thanks to the comments below, here are some more:
NCP: Next Comes Pawar (SRK)
DMK: Devotees of M Karunanidhi (SRK)
RJD: Rabri Jaayegi Delhi
AIADMK: Amma Is Antidote (for) devotees of M Karunanidhi (inspired by SRK)
BSP: Behenjiki Sewakakonki Party (Deepak)
I also liked Clueless Puppets of China (Morons) (via)
Friday, November 16, 2007
The latest in a series of accusations that keep getting levelled against the Indian IT industry. (via, where the points below are listed...) Unfortunately, this comes from the top boss of a company I admire, L&T, but what has to be dissed has to be dissed.
Does L&T do all its projects in India? Clearly not. Is Infosys the only Indian IT company? Clearly not. TCS, Wipro are doing good work in India. So why pick on Infosys? That way, all EOUs export hundred percent of their output. Is that wrong?
Talent drain is a problem, or is it the people typically go to the place which offers them a better salary? Whether that is abroad or within India, unless it is a socialist economy (god forbid) where a bureaucrat in his limited wisdom allocates people to different industry, this sort of disparity will remain.
India gets only 17% of its GDP from manufacturing. Why? How easy is it to set up a factory in India? Hire people? Fire people? All this is easy in IT. Nobody knows till when a job will last. The IT industry flourished because the government was out of it. If the government got out of manufacturing, manufacturing will surge. But they wont, not with the leftists tail wagging the dog.
Why do IT companies sign up civil engineers? How do they do it? At gun point? No. Then the civil engineers sign up for slaughter? No. Clearly it is an opportunity they have, which they believe is better than what the manufacturing companies give them. And to your point, L&T has some very strict guidelines for engineering applicants - as a (non) participant in their recruiting process many years ago, I myself know that.
Why do they (IT companies) pay better? They make more money, simple. Their economic model (based on labour arbitrage for all I care) allows them to. Also, why is it a crime to pay better salaries to people? IT companies changed this perception in India - till which point employees did not get half decent salaries. If you like your engineers so much, L&T, please pay them well so they will stay with you. Give them stock options. Create a good work environment. (Again, L&T is a good place to work, but many other manufacturing industries suck.)
"The least that the politicians can do is stop cutting ribbons in the outsourcing industry." No, they least they can do is cut some ribbons for the manufacturing industry as well. Lets not talk about limiting opportunities for others, let us talk about creating.
A word to churumuri and the good professor here,
Wise heads like Prof CNR Rao have bravely spoken out against the long-term damage that we could be causing to our society if all our best and brightest end up doing the same thing—writing code or answering phone calls because the money is good. What happens to linguistics, sociology, geology, history, philosophy, etc?
Please read this...
At the end of the day, I need money first, then job satisfaction. What makes anyone think that a job in an assembly line is satisfying? Job satisfaction comes, as per Maslow's theory, a little higher, once the basic needs have been met. A job is a basic need. First I need to make a living, then I will worry about changing the world.
Niranjan Rajadhyaksha writes on the economics of Bangalore. (via) The article is good from a theory perspective - as to why outsourcing happens - because of transaction costs as proved by Ronald Coase.
But that theory is applicable to the whole of India; indeed Bombay, Delhi and Chennai too - which at the beginning of the offshoring boom where largely better developed than Bangalore. But Bangalore trumped them all and does so even now to a great extent though the three cities (in tandem with Navi Mumbai/Pune, Gurgaon/Noida) are picking up.
Why did that happen?
Thursday, November 15, 2007
The once iconic brand is preparing to make a comeback. The linked article is a well written one from Businessline. The big question- will it succeed?
The brand is attempting a comeback after 7 long years - but from a memory perspective, perhaps longer - an entire generation perhaps. For the previous generation the market was something different. And remember, even for them, Vimal was about sarees and fabrics. The market has moved from there into the readymade segment, so Vimal will have a tough time convincing its customers that it "has it".
My take is that the premium market will be hard to crack. It is a very crowded market. Arvind mills, Madura and even Indigo nation have made a mark there, as has Raymonds. And we are not yet talking about Provogue, Reid & Taylor and Colour Plus etc. What will take me into a Vimal store? Curiosity.
In those days, there really was "Only Vimal"; today it is not only Vimal but a lot of other brands. Arvind has a whole panoply of cleverly overlapping brands in this segment. So, just a generic Vimal might find the going tough. Also, cotton is a big selling point in menswear these days - Vimal was never all about cotton - and even today it is not, apparently as per the article.
My take is that Vimal should build more its brand equity in the womens segment, which is something that clearly lacks a good player with decent, predictable quality and a great range.
But regardless, it will be a nice battle to watch since, after all it is Reliance at work.
Related, more thoughts on shirts...
Wednesday, November 14, 2007
How about that? Apparently the writers last went on strike in 1988 and that resulted in the birth of realty shows; they did not require scripts - as if the others do, meandering in their magnificence.
Marc Andresen has a nice analysis here (and an even better follow up). Ze Frank does his take...
But to the question as to what route will this take in terms of innovation, I have an answer. Contact Balaji Telefilms for outsourcing all those soap opera writing to India. They barely have a script and yet have hundreds of similar soaps floating all over the TV channels in India!
and makes its online presence, free (via here with a good analysis of the site itself). Till now, you had to go through a subscription wall to get through - so you know how many of them did. Theres a good set of materials available on India thanks to the financial newspapers (ET, FE, BS, Mint) apart from blogs and magazine sites. So, if you chose to wall yourself in, do you lose or gain?
The papers were always free but the first (and only?) mag to do it in India was Business world and of course, globally the trend has been to "go free". NYT did it recently, as did the Economist. WSJ is looking at this trend very closely.
Heres how I think the business mags in India stack up on their online strategies, from an earlier post. (An update is due on this post...)
The Economist, the grand old magazine, publishes a typical article on India. Sandeep has a superb post on this article.
The article starts and stop at the Gujarat riots - something which has been forgotten even by the Gujaratis as this rediff article laments.
Heres another gem, when you want to rationalize anything.
"But ghettoisation has radicalised the women in the resettlement complex. They go to the mosque more often and talk approvingly of Osama bin Laden. The otherwise mild Ayesha also praises Saddam Hussein, the Iraqi leader “who died for Islam”
Oh really, is it ghettoisation? Or is it something else? Well, the whole article is so pathetic, I cannot spend any more time dissing it. Read it and puke.
Monday, November 12, 2007
are very smart. They know how to milk the customer. But there are, surely, a few things they could do very well which they dont.
For example. You have a customer who is roaming. They send this stupid, inane welcome message - Welcome to Andhra Pradesh for example. I very well know I am in Andhra Pradesh. Can they not send me some information I can use (and make money too) ? For example, in a highway in TN, I saw a couple of emergency numbers listed. Can that not be a part of a 'Welcome' message? Or, if you are travelling along an NH, I would find it far useful to get a listing of eating joints or petrol pumps on the way.
For example, if I enter TN via NH 7 (Hosur road), they can easily send a message telling me a few important things - like an emergency number, a hospital number and some such, instead of sending me a meaningless welcome message each day...
saved 20,000 crore rupees (give or take a few zeroes), but can they not install dust bins on trains? Or are windows meant for throwing out stuff - since only the air conditioned bogies typically have dustbins?
The upper berth on three tier bogies is so cramped, you have to land into it on a horizontal position and slither into it. Anything more and you will be seeing out of the roof.
Is it so difficult to maintain a consistent order for bogies for all trains and publish it on the web, so people are spared the ordeal of a train coming in reverse? A train I saw came into the platform with the engine in front (thank god), luggage, unreserved coaches and then S12 appeared instead of S1 and then you had the familiar sight of passengers running helter-skelter searching for their bogies. Thankfully this train had vestibules, so many people just go in and dragged their luggage until they reached their place.
Can you get the trains to run faster please? Now, trains run on time because of buffer. Read the time table carefully; for every train, you will find a short distance run of a few kilometers being given an outrageous running time. So, if your train, god forbid, arrives early, then, it is punished by getting to wait at a siding in no mans land.
And then some, all in the course of an overnight train journey...
Monday, November 05, 2007
who has not sinned, when it comes to becoming a newfound critic of globalization. There are far too many people, who basically subscribe to a left winged point of view (not left brained view - the two have no similarity whatsoever) and use it as a basis to criticize globalization.
The voices against globalization are the shrillest from the uber citizens. The page 3 chatterati, the so called sane voices and intelligentsia who voice their opinion while sipping on Aquafina or wearing Crocs (Nikes is infra dig). Those, who claim, occasionally (meaning, at every occasion that presents), via their blog or magazine column written for a foreign newspaper that globalization is bad for India. Refer Anti globalization aunties.
Heres who should be ruled out. If you drive, you are out. Why? Well, there is no car, that is completely indigenous. Why, even the Scorpio and Indica had technical/design collaborations. Indeed the IC engine was invented by a foreigner. Oh, before I forget, much of the petrol also comes from abroad, Reliance notwithstanding.
Almost nearly, if you eat any thing fried in Palmolein, you are out. Why? Because most of the palmolein comes from Malaysia. Oh, btw, we have also imported wheat recently. Maggi noodles? Nestle is based out of Switzerland. Never mind those Washington apples or Kiwi apples. Italian olive oil for your skin? Stick to coconut oil.
And if you use anything than Kolhapuri chappals, you are out. India has never designed anything other than mojris. Sneakers were not invented in India, as was mineral water. Aquafina is a Pepsico brand. Bata is a Czech brand.
Btw, isnt what you are wearing, slightly "non-Indian"? Shirts and trousers were never invented in India - they are, well, foreign. (You can explore other garments and you will find a simple answer, NIH - not invented here).
Now, of course, I know what you mean. You mean selective globalization is allowed, right? Aha, but there aint nothing selective about this whole deal. You either live in your cave or come right out. And then again, you perhaps mean inclusive growth, the latest mantra? Check out this lecture and this. Are you an NGO that wants foreign funds for globalizing? Well, the dollar is a foreign currency again.
And sorry again, for if you are reading this - this is globalization personified. A blog hosted by Google (American, shriek) on a network managed by IBM (Big blue for gods sake) written over a Chinese computer, seen via a Korean monitor via an Indian service provider.
And no, leave the phone where it is. Indias largest phone brand sold is Finnish...
He writes in the NYT, no, no, no, dont follow us.
Why should you care what they’re driving in Delhi? Here’s why: The cost of your cellphone is a lot cheaper today because India took that little Western invention and innovated around it so it is now affordable to Indians who make only $2 a day. India has become a giant platform for inventing cheap scale solutions to big problems. If it applied itself to green mass transit solutions for countries with exploding middle classes, it would be a gift for itself and the world.
To do that it must leapfrog. If India just innovates in cheap cars alone, its future will be gridlocked and polluted. But an India that makes itself the leader in both cheap cars and clean mass mobility is an India that will be healthier and wealthier. It will also be an India that gives us cheap answers to big problems — rather than cheap copies of our worst habits.
Point taken, but taxing just the small car will smack of discrimination. Tax the small car and the Skodas and Mercs burn the roads? Smart. Tax all cars then? Well, thats no alternative, then people would never get to anyplace since public transport systems are nothing short of pathetic. Sunita Narain, worried about pesticides in soft-drinks and cheap car on roads. How about tackling lack of drinking water for a large of the country and some other real problems?
If the government thought like Tatas, we would have had cheap mass transit systems in all parts of the country within 60 years of independence. There is barely one and a half city which has a functional metro. The rest of the public transport in the country is worse than cattle and cabbage.
Sunday, November 04, 2007
in India is Good Knight. Yes, the mosquito repellent brand. Not toothpaste, soft drink or a car or the cricket team.
(Incidentally, in Turkey, it is a football club and a dairy in Argentina and the state owned mobile phone service in China)
In hindsight it seems very likely in India, since the chances that a mosquito repellent brand touches more lives than any single brand of milk or car or toothpaste or mobile brand (and does so effectively).
Posted by ecophilo at 6:12 PM
It's Diwali time and that of course means firecrackers. Everybody wants to make money on those who are willing to splurge on firecrackers. The amazing thing is that firecrackers are available throughout the year, but during Diwali the demand for it goes up (in the absence of a sufficiently turbocharged word) like crazy. Prices also, typically go up with the demand. (Interesting question: Does anyone know how firecrackers came to be associated with Diwali?)
This year, prices seem to be substantially higher - and there is a "fair price" element in them. The bigger brands sport a "no child labour" sticker on them. (Not sure if this was prevalent before). Interestingly, even all products from a manufacturer do not necessarily carry this label. (Then, if your factory employs children, how can you isolate a product and claim it is child labour free?)
But this is about something called firecracker arbitrage in Bangalore. (It is a serious source of income for many college youth in Bombay - exploiting the difference between wholesale and retail prices - I will leave that for a different post.). So, if you buy firecrackers in Tamil Nadu (a short ride away from Bangalore), you get a, hold your breath - 85% discount on the MRP. Many families pool together and get a car load of crackers and save money despite spending some on the petrol. So, those who sell in Bangalore, atleast some of them, offer a 60% discount (or more, but always less than the 85% in Hosur - since presumably, thats where they source from). Customers are happy getting a 60% discount, obviously, so are the sellers. So, in any case you can make 25% by buying crackers in Hosur and selling it in Bangalore (Ceteris Paribus).
Which leads me to a few thoughts.
If you have paid the MRP on any firecracker, you have been ripped off considerably, especially since the MRPs seem to be outrageous - I did hear that prices would be higher this year, but they are really crazy. (For instance, a box of 10, small, zameen chakkars, are marked at 170 rupees).
Once you factor the discount, the prices seem saner. So, why not put in the actual prices upfront?
If the dealer gives an 85% discount (you pay 15 rupees for an item thats marked as 100 rupees, so the above mentioned zameen chakkar would cost you just about 25 odd rupees) , how much money does he make? How much money does the factory make? So, what is the actual mark up?
Why is the mark up so much in crackers? Any ideas? Is it because people like Diwali discounts? Any other products that have outrageous mark ups or do all products have huge mark ups? (I had heard shirts have a 100% mark up at the dealers and at the factory level.)
Friday, November 02, 2007
Yesterday, I had the privilege of attending the Landmark quiz. It is quite a draw in Chennai, I have heard and I finally was able to attend the one in Bangalore yesterday.
The teams were a motley crowd to say the least. There were the usual suspects - the regular quizzers - and they are of course, really good. But more than them, were the school kids who turned up in uniform hoping to be a David to trounce the abovementioned Goliaths. Also, there were all women teams, there were inter-generational (father kids, mother kids) team (imagine a team with 50 odd years of collective knowledge) teams and family teams and college teams and what not. All of them, there, because they love quizzing.
Why is this a big deal? Today, quizzing is a big business. The only place where you can have a free quiz is in college - and then you cannot enter into it once you are out of college. Or you have the corporate quizzes which either have an entry fee or for which you need to be a corporate. None of these are bad for quizzing nor bad from the perspective of the spirit of the event.
But there are no quizzes like the Landmark one. You form a team of three, register and turn up and no entry fee barrier. So, you wanna partner your dad or uncle, great do it. Amazingly, there was a team of three teachers, all women, who made it to the finals yesterday and one "family" team and it was very very refreshing to see, as Derek O'Brien put it, "people who dont all look like each other."
More power to events like these...
Tuesday, October 30, 2007
Check out this piece from PSFK on the Otetsudai (via) network in Japan. The premise is simple. Mini cv's of members are circulated, as are jobs - on your cellphone and you pick and choose what you want to do that day or what you want to do next.
Once signed up to the service with a mini-cv illustrating skills and focus, they can take a daily GPS reading on their phone and just hang out waiting for offers. Businesses looking for immediate staffing or individuals lookingpicture-13.png for specific help can send a request to Otetsudai Networks and receive a list of available potential employees within the area alongside their qualifications and ratings from previous employers within minutes. Business themselves are rated on a per-manager basis for the potential workers to see how their peers have rated working for them, and the network even offers the chance for bargaining the pay-cheque!
Question: Isn't this a viable BoP idea? How about a low cost network for workers - manual skilled labourers - even plumbers, carpenters, drivers and others who are dependent on a job each day?
...this idea could have the potential to fill a very important gap not just for Japan but in the global workforce. Imagine if wherever you went you could offer your skills through the network for daily employment and eradicate the need for the current work structure?
This is an amazing idea with a lot of potential. Babajob is making a small beginning here...
Businessweek picks (again via Contentsutra, nice post) up the story that went around a few weeks back on the "drop in internet usage" and "increase in mobile internet users".
I had blogged about this sometime back that the mobile internet is not yet happening in India. It surely will, but to say it is happening now is a little too early. My bet is on broadband at this point.
Got this from Content Sutras excellent post with a snippet of Fortune global forum, day 1. I particularly liked this one:
Rajjat Barjatya, MD of Rajshri Media: Every Indian film goes up on P2P networks the day it is released. There’s piracy at grocery stores in the US. We offered full movies for download online and got over 6500 downloads of Vivah at around $10 per movie, around 600 in Finland. We hit triple digit downloads for a Marathi film we released online recently. The way to tackle piracy is - first make is available legally to customers, and THEN go after the pirates. For a lot of new releases, 20 percent is from theatres and 80 percent from other revenue streams, so there’s an opportunity there.
This logic runs counter to what Bollywood does now - delay the DVD release and encourages the pirates. What he says here is perfect. I like so many songs but I cannot buy just one of them for a low price. Make it available legally - chances are many will buy. Once it is available, go after the pirates.
Monday, October 29, 2007
Yahoo launches Internet Cafes. Not in India, in Vietnam. But who knows, it may happen here too - not really required in the urban areas, but in the rural areas.
When you cannot bring the Internet to the people, bring the people to the Internet. Yahoo Vietnam’s Yahoo! powered Internet Cafes are opening around Vietnam’s Hanoi and Ho Chi Mihn City in an effort to bring Internet to people and effectively brand Yahoo services.
Good idea. Like the e-chaupals, Rural Business Hubs it will help get the people to the internet, and hopefully improve the quality of their lives. But the yahoo branding is what I am not convinced about.
But my question is, once you get them to the internet, will they be prevented from searching on Google? :)
Here is IBMs experience on the same, from the Hindu Businessline.
IBM’s flexi work option for employees has bust three myths at one go: first, that one needs to work long and regular hours to be considered a ‘performer’; that flexi working shows ‘lesser commitment’ and could therefore jeopardise one’s career growth; thirdly, and perhaps the most interesting, that more women prefer to work from home than men.
What better way to beat traffic jams than to work from home. It really is a win win situation if handled correctly. For the employee, the commute frees up a couple of hours - and of course, you get to work without having to wear a tie. For the employer, it is a great idea because it helps retain people, reduce costs on infrastructure and quite a few other benefits. If utilized fully, this will help India retain its competitive edge in IT for a long time to come.
I also think that virtual work is the future of work for many jobs. I mean, accountants, auditors, designers can all collaborate virtually - of course thats assuming that broadband is available. Sure there are constraints, but I think it will start to happen slowly.
Me and wife got into a discussion on why meanswear overall, is better value for money while womenswear overall is plagued by ovepriced and bad quality stuff.
Here are my thoughts. The big reason I think this is perceived is because mens wear is more narrowly defined (in terms of variety and style). If you work at an office, you have a wear a shirt and a trouser. Finito. Come Friday and you will wear a jeans and some t- shirt (but thats 20%). Whatever you mix and match, thats all you can do. Women, well, start from salwar (and cuts and styles and mix and match) and end at formal wear - western or saree.
How many mens trouser colours can you find? Look around in your office and you will know. Shirts are basically blue. (Also, men dont mind seeing others wearing a similar design - it does not throw their shirts into the "use for wiping kitchen floor" category if they see someone who has a similar design.)
The same thing applies for womens formals - which is something that the manufacturers have caught on to and which is why this a great market to be in (formals for both genders). But then again women are finicky about styles, cuts etc., so marketing to them aint easy - so all the best for that.
The moment you look at non formal options, it is quite difficult to get good clothing for men as well as women. My experience with regular mens wear has been great - some of the shirts look new for a long long time - whereas a kurta is battered after a few washes (and this has nothing to do with the wash itself).
So, thats my reasoning. What say?
Sunday, October 28, 2007
Here, John Elliot, in his blog, looks at a forecast made by Baba Kalyani of Bharat Forge, where the chief of Bharat Forge, alread the second largest forgings company in the world. Who could they be?
L&T, Suzlon, Tata Steel seem to be his favourite. Bharat Forge itself could overtake leader Thyssen Krupp soon. With the formation of Raksha Udyog Ratnas (RUR), there is another big avenue that can open up in defense.
Yes, it is possible that there are 8 to 10 manufacturing leaders from India in the next few years...
Friday, October 26, 2007
Wired has a piece on a new type of computer virus, the 'storm' superworm. Some of its characteristics:
# ... A worm that attacks all the time is much easier to detect; a worm that attacks and then shuts off for a while hides much more easily.
# Storm is designed like an ant colony, with separation of duties. Only a small fraction of infected hosts spread the worm. A much smaller fraction are C2: command-and-control servers. The rest stand by to receive orders...
# Rather than having all hosts communicate to a central server or set of servers, Storm uses a peer-to-peer network for C2...
#Storm's delivery mechanism also changes regularly.
Doesn't this sound like the way a terror network operates?
Interestingly, until now, it is easier for P-note participants from dubious sources (terror, hot money, slush funds) to enter the Indian market than it is for the average Indian citizen.
A nice piece by R.Vaidyanathan in the Hindu Businessline.
Participatory Notes are a slap on the face of every citizen who is an investor. To invest in shares one has to fill up umpteen forms and provide proof of residence, PAN number, and so on. But for PN investors, the system is totally silent, even on basic information. Why not have confidence in the India story and realise that we can get funds with addresses without offering such anonymity...
So, while the spider web catches the flies, the sparrows and crow flies right through...
The situation gets better post the Sebi meeting yesterday.
Thursday, October 25, 2007
Future group plans to hire women working part-time, reports Hindu Businessline. So what, you may ask?
The IT industry and the retail industry are the new face of India - UP, Kerala and Bengal notwithstanding. Both these are dependent on the labour pool supply apart from other parameters. For both these industries, women, as a group, are an important part of the labour force and they are largely untapped. For many women, especially the kind who have moved into a housewife role after working for a while thanks to the commute and long work hours, working part time is an option they would love to have. If companies step in to provide these kind of options, they are tapping into a labour force that will be with them for a long time and help them reap benefits. This is a radical idea, one that has a lot of potential in it. IT companies are doing it and many offer work from home facilities (not just for women). BPO and call centers had potential to do it - temping and part time jobs and I am not sure they are doing it as well as they can. Retail can do it simply because of location and working hours and it looks like they have caught onto it.
Imagine someone lives near a Pantaloons outlet and they get to work there. Imagine you get to work when your kid is off at school for a few hours - without the drudgery of the morning commute and the evening late hours.
I think its a nice idea - though - a mindset (I am working in a store) has to be broken at both sides - at the hirers side and the employees side.
Here is Avtars website.
Related reading, Womenomics!
Wednesday, October 24, 2007
Retail strategy in India seems to be mostly around proximity. Which means that if there is store near you (that is where the catch is), that is the store that you will go to when you want to buy stuff. Unless the store really blows it by cheating you or by offering poor customer service or not offering discounts you will keep going to that store. What happens if there are many such stores in a certain "catchment area"? Then, they compete to capture customers - either by discount pricing or by offering value added services. If they dont, they will fall into the trap of the commodity model.
But, what is a catchment area? You can catch customers near their homes, which is the obvious strategy.
But you can also catch customers at other areas - notably the internet. The internet delivery model, using the existing physical network has a lot of potential in India. It is barely being touched upon by the existing grocers, but it has the advantage of being able to ride on the existing proximity. So, a smart retailer could offer home delivery off the internet on all days except weekends when he could get more customers into his store anyway. Of course, there are a zillion ways of doing it, but this is a model that can help break through the clutter.
Then there are the offices and IT parks and campuses. Build a store there and you will have the officegoers buying their immediate needs atleast. How about parks? Temples? Old markets?
Expect more action in this space as catchment areas get redefined...
Tuesday, October 23, 2007
So, what do Indians back home want to know about, if you are a correspondent abroad?
The answer to that is very simple. Repeat a hundred times. Of all the news in the world, the only thing your readers want to know is how are all the Indians who went abroad, especially UK or Europe doing. (We are a very envious society, you see, we keep wanting to know how everyone is doing as compared to us). You must leave no stone unturned to ferret out obscure information about them and write something about it in glorious terms.
Examples are when people of 1/12th Indian origin beat people of 1/15th Chinese origin in a Spellbee competition held in a school in the US. Especially focus on college professors who get labelled as sexy or someone who visits outer space. Governorship of a US state is a headline piece...
Fawn over them. If possible arrange an interview and get an interview from them on wide ranging topics like paratha, Kolkata and Bata. As a rule of thumb, if someone with 1/10th of Indian descent over 1782 generations does something, splash it on the first page. As the percentage of India in the person increases, try something better than the first page. If they do something incredibly stupid, include that also, but hide this in the inside pages. In any case, the preference is for spell bee competitions. Note the crucial difference between two; incredibly stupid things have to have a connection with Indian culture while the others necessarily must not.
If you a news channel or portal back in India, talk to their cobbler, barber and school teacher (preferably one who substituted for their regular teacher for half a day) and benchmates from 20 years back in that order. Ask all of them what they think of this person. Whatever they say, include, quiet, studious, brilliant and other adjectives.
Leave out Monty Panesar, Shivnarine Chanderpaul or Dinanath Ramnarine, please. Dont ask why.
Related post here on the Indian Space record.
Monday, October 22, 2007
Got this link from Tim Harfords blog, named, what else, The Undercover Economist.
This world bank funded site, aptly named Doing Business, is a guide for evaluating regulations that directly impact economic growth, underlying laws, making cross-country comparisons, and identifying good practice reforms.
The site has a lot of downloadable reports, interactive maps, ranking simulators etc. Check it out. The interactive map of India (and other countries) is quite informative.
(Crossposted on The Indian Economy Blog)
Sunday, October 21, 2007
Pepsi CEO Indra Nooyi is on the money when she says this.
Yet, the awareness on this front has some way to go. India is fast developing an affinity lifestyle diseases- whatever the figure, it is a fact that you see on the ground around you - BP, diabetes are getting people at younger ages. As India develops, people expend less calories while their intake remains the same, as she says.
Awareness is increasing (look around you - the number of people who say no to a typical Pepsi/Coke is increasing) and we are perhaps lucky that the awareness is happening even as fast food consumption is picking up. So, we may yet land up being a little lucky in terms of overall health.
So, as she rightly says, it is an opportunity for these companies. The health food boom is happening even as we speak.
Saturday, October 20, 2007
for Indian IT services. Why?
The Wall Street Journal wrote on July 4 that firms such as Riya of San Mateo, Kana Software of Menlo Park and Teneros of Mountain Lakes have wound up their Indian operations and are moving engineers to the US, largely because of frustration over rising wages for Indian engineers and difficulties in retaining them.
That makes it 2 companies. Meanwhile,
On October 30, Cisco chairman John Chambers will be in Bangalore to unveil the San Jose-based company's $50 million campus that sprawls across 14 acres.
The integrated high-tech facility will be the new home for 3,000 Indian workers across R&D, IT, sales and customer support teams.
That is not counting the recruitment plans of IBM and other companies.
The glass is half empty or half full depending on how you look at it, but in this case, it is more full than empty. So, to postulate and ask will jobs move back to US based on the above data, is, I would suspect, a little tricky. Between captives and offshoring partners, there is no one answer.
Look at China in manufacturing. There are outsourcers and there are company owned factories and both models have their own features and benefits. Just because Apple does not design its stuff in China or because or Mattel recalled many toys, how many questions were asked on whether the manufacturing jobs would move to the US? The answer there too is that there is always some movement in both directions.
Trees may or may amount not to forests...See this slightly dated TED video by Chris Anderson...
Friday, October 19, 2007
There is a report in ET on the gender gap in B-schools.
Heres an excerpt.
"I suspect the Common Admission Test for the IIMs is heavily biased towards engineers; mathematics constitutes a large portion of the test. Since the number of women opting for engineering is very low, the number of women who get into B-schools is also low," says Kidwai, the first Indian woman to pass out of Harvard Business School. Kidwai feels that B-schools should consider having a more diverse selection procedure. "After all, we don't want a company full of people who look the same," she adds.
That means, there, really, is a gender gap in Engineering (and by induction according to what is said above, non engineers cannot handle logic - the CAT is all about logic and speed, not third degree integration or calculus, right). And what do you do if the number of women who apply is lower? You scream, gender bias.
It's not just the number of women studying in management institutions that is low. The number of women applying to B-schools is also a lot less than the number of male applicants. "While 24% of the applicants this year were women, 32% of all students selected for the course were female," says Merchant.
I got it, the application forms are biased too...
On a more serious note, I think, overall most post graduate courses would have lower number of women, especially in non urban areas. This has nothing to do with the admission procedure and the answer has more to do with society than anything else.
Thursday, October 18, 2007
While all around the world, the middleman is finding his days are numbered, the railways is doing the most ridiculous thing. In the already crowded side seat, they are squeezing a third seat/berth.
Will the three passengers sit with their feet hanging in the corridors (I cant think of any other way), unlike now when they sit facing each other. As it is, anybody over 5 foot 4 inches will barely manage to squeeze in, so now the railways will have to allot seats based on height or perhaps it wont bother, it will just let the passengers manage that.
The other question being, in any case in most trains during peak time, there is an RAC passenger who hangs around; you might as well give a berth, but the question is at the cost of still lower passenger comfort? Now there are two seats and the third is sold as an RAC, seating only seat. So with the third seat now legitimate, does that mean that RAC is no longer available? Or will it make the cramped sleeper class more cramped by selling some more RAC tickets - after all revenue is boosted, is it not? This is another populist measure - you do not want to raise ticket prices because you think you will lose votes, so you squeeze more and more and make it so bad that the railways will slowly die into scrap heap.
To me this is an ill conceived move. Might as well stack passengers like chicken in a poultry truck. As passenger comfort increases in other modes of transport, the railways are going in another direction. Get ready to lose more passengers to airlines and buses...
Wednesday, October 17, 2007
Indian IT professionals among worst paid in the world, says this piece in ET based on a Mercer report.
Question: Most IT professionals think, rightly or wrongly, that they deserve to be paid better. Doomsdayers periodically tell us that the end is near and Indian IT's pay is touching the skies and will touch the moon soon and that this will be the beginning of the end.
While Indian IT managers stood fourth on the ten lowest paying countries with an average salary of $25,000, Vietnam topped the list with a meagre average salary of $15,470, followed by Bulgaria and Philippines averaging at $22,240 and $22,280 respectively. The other countries on the list were Indonesia at fifth with average wages of $31,720, followed by China (Shanghai) with earnings of $33,770, Malaysia ($35,260), Czech Republic ($35,880), China (Beijing) ($36,220) and Argentina ($43,180).
Hmm, so how will the IT industry disappear to China? The salaries are already higher there no? In any case, you can banish all hopes of your job getting migrated to Switzerland or Denmark.
In terms of the best IT salaries paying countries' Switzerland topped the list with an average annual remuneration of $1,40,960. The same job if taken in Denmark, second on the list, would pay $1,23,080, the survey said
Tuesday, October 16, 2007
is the title of the speech by the ITC chairman, YC Deveshwars. The entire speech is worth a read, but heres an excerpt.
"pioneering e-choupal initiative today comprises 6400 choupals transforming the lives of over 3.5 million farmers in 38,500 villages in 9 states of India. We hope to reach out to 10 million farmers in 100,000 villages in the not too distant future."
In another section of its speech, ITC mentions how it is collaborating with the government of Rajasthan for an integrated watershed programme covering 5000 hectares, apart from social and farm forestry over 65,000 hectares of land and other watershed programmes.
Why put more money into NREG? ITC will do a better job, given its track record. The government, on the other hand, given its track record will pour it down a giant sink. I can hear the sound of money being poured down the drain - my money.
Also, at a recent event, I saw a poster by Reliance titled, "What is good for India is good for Reliance." I wish the government and ruling parties had this as their slogan, atleast slogan.
A little late in the day I think, but over the past few days, I have been waking up late. So, heres the Nasscom snub for the health minister - who, wanted to bring about a legislation for the betterment of the BPO employees.
Oh, btw, the snub was for this sentence, Ramadoss had earlier generalised people working in the BPO sector as those who "want to make a fast buck", "party the rest of the time" after working "half the day" and indulge in "excessive smoking and drinking" -- comments that "deeply distressed" Nasscom.
Man, if BPO and call center and IT chaps get India a cool 36 billion dollars in revenue by making a fast buck, party the rest of the time, drinking and smoking excessively and work half a day, where would we be if they were saints and worked the entire day?
Note in the above linked piece there is a mention of skin problems. So, how about HRA, LRA and a new Skin Treatment Allowance? or we could call it the Boroline allowance? Or how about a rebate on companies that run BPOs without air condition?
So, where do we stop?
If you drive in Bangalore, you are in danger of being unhealthy because it is so polluted. If you dont drive, it is even worse. How about a legislation for traffic cops, rickshaw drivers and even drivers of airconditioned cars? And I have not yet spoken about water, adulterated food, pizza and deep fried chips.
The mail group that I was part of had a "healthy" exchange on this - so there need not be a policy on members of googlegroups and their health - thanks to unhealthy debates.
Monday, October 15, 2007
Bangalore has been the epicenter of many kinds of growth in the past few years. Bangalore, in retrospect, has been part of almost every boom, though earlier, it was never counted. The only exception perhaps is the financial sector boom which was mostly concentrated in Mumbai and to a lesser extent in other areas.
When the PSUs were setting up shop, Bangalore was there and Bangalore surely got the creme de la creme of them.
The manufacturing boom that never happened, but Bangalore has a small manufacturing industry too - if you count Bangalore and Hosur yes. (Why count Hosur, you may ask - many a boom here has a significant participation from there and many a factory in Hosur has Bangalore employees.)
When the garment export boom happened, Bangalore was there. The top garment exporters of the country are located here.
Of course, the IT boom happened. No prizes for guessing.
The retail boom, incidentally, also has Bangalore pretty much in its eye.
There are few other booms like the nursing college boom - Bangalore is a part of it, but perhaps not in such a big manner. Teacher training, again, Bangalore is there in a small way.
I was talking to an associate in a retail store who works as a "home delivery" person. He works 7 days a week and his pay is cut even if he takes a day off. He actually quit his garment factory job to take this up. The difference in pay between the garment factory and this place is a 1000 bucks or so. So, why did he make the change? Simply put, in retail, the work is better. Garment factories work at a pretty breathtaking pace and thats an understatement. In retail, you work in an airconditioned store, the work is not so tough on you and so on.
So, it inevitable that jobs move from one place to another. When IT happened, many people moved from manufacturing into IT - even fromPSU's likeISRO, HAL and private manufacturing units. Now with the retail boom happening, people are moving, from, you guessed it - the garment factory. It is a two way boom. While many men are moving out of garment factory into retail, call center cab driving and security, that is creating more opportunity for women. Women in turn are moving both into and out of this industry - to work as maids, caretakers, nurses and even teachers - some of it happens the other way round. Its all about opportunity.
Back in the 80s, if you mentioned jobs, the only thing that came to anybodys mind was, job shortage.
Now in the year 2007, the moment you mention jobs, the thing that comes to your mind is, talent shortage!
Some paradigm shift that...
Friday, October 12, 2007
I have been meaning to post this for a while, but finally remembered it only today. The Endless Innovation blog, has a post titled, Thomas Friedman's favourite company? (The post is on the celebration of year one of Flat world)
That is because Toms book The world is Flat and the name that Infosys, incidentally (or not incidentally) has chosen for one of its websites - Think Flat are very close to each other. The site has blogs from employees and viewpoints from the company etc.
Wednesday, October 10, 2007
is the title of a piece by Swami Aiyar, here in ET today.
For more than two decades, from 1980 to 2003, India’s GDP growth averaged around 6% per year. Reforms in 1990 produced no dramatic acceleration. Then, with no new policy impetus at all, GDP growth suddenly shot up after 2003 to average 8.6% in the next four years. How and why?
He looks at 4 theories doing the rounds:
- Tipping point
- Steady improvement followed by exogenous shocks
- Manufacturing catching up
- Global boom
The one question that I have is that role of the parallel economy - unaccounted money. I think there is a strong role of the parallel economy to play in this whole thing - I am also not sure that the effect is entirely positive and good for the country. Real estate in many parts of the country still operates on a large black component. Hawala, terror funds all find their way in a boom period.
But one thing is for sure. As long as the boom lasts (and I am not saying just the stockmarket), this is the time for India. Its now or never.
Tuesday, October 09, 2007
The TRAI report has a lot more components than the half percent drop in the internet subscriber base. One of them is employment generation. The private sector telecom companies employ about 63000 odd people while the public sector companies employ 3.6 lakh people.
Based on the number of subscribers, that translates into 193 subscribers per employee in the public sector and 2110 per employee for the private sector.
Similar to the Air India versus the other comparable airlines no?
There has been a considerable debate on a half percent drop in the internet connections in India. That has been correlated to the fact that people are turning to access the net on their mobile phones in droves. Is that really so?
We all know how the mobile phone network is in India. To say the very least, it can get a lot better. In a day and age when call drops are common, do you think really think people are getting out of the net and moving onto the mobile phone? I dont think so. And charges for accessing the net - which is at best a flaky experience - is quite high (and quite user unfriendly).
True, postpaid ARPU has increased, but just a one percent increase in the minutes of use? So, if ARPU increases with minutes remaining nearly static, then charges have gone up. Indeed if there was a drastic shift into reading the web on the mobile phone, surely you would have seen a more drastic increase in the minutes used? (correct me if I am wrong here)
The TRAI report lists 31.3 (million users) in the last quarter to 38.02 in this quarter as wireless internet users. My take here is that these users do not necessarily access the net via phones, they access the net via a laptop and a wireless card - given by some service providers (Reliance for instance).
The half percent drop is just a manner of shake outs, imho. IT guys signing out for signing into their employers accounts (well, there goes productivity, but...). Also, many companies provide wireless internet for their laptop owning employees - and this number is increasing, and these people give up their earlier connections (connect with previous sentence/para).
The people who do move out of the internet, are, really connections moving out from a city/location to another city/location. That will perhaps be seen in the next report, as a sharp surge (speculation) - but no, I dont think the net is migrating to the phone in a hurry nor is this a real drop in the number of internet connections in India. The trend is to go toward broadband, where there is a growth of 3 odd percent, but expect this number to rise...
Saturday, October 06, 2007
Wednesday, October 03, 2007
While we are still some distance from the all out, no holds barred war in the retail landscape, it is evident that the Future group has a head start. And this is from just connecting some of my previous posts, visits and observations. I dont know too much about their flagship Pantaloons, but the rest, perhaps through my experiences, yes.
Big Bazaar is sitting on what is perceived as value by the Indian consumer. Okay, so the hifalutin crowd may not go there, but there is a significant chunk that is loyal to them and it is a crowd that seems to be getting them the moolah.
The Central type of mall is for the mall types, as I put it. It is sufficiently hip and is located in a strategic point in the city (Atleast Bangalores is).
E-zone is the place to go for electronic items. I was scouting for an mp3 player and one company dealer (I forget which one) suggested I go to e-zone - instead of recommending another of their own, saying, you will get a better deal there.
Brand Factory completed the offering for discounted stuff . It would be interesting to see how the emerging players take on the Future group. And if offline was not enough, futurebazaar.com is their online presence.
The latest which opened a couple of days back here is Hometown. Modelled on Home Depot presumably, the shop is amazing in the range it covers for furnishing your home. Starting from tools, modular kitchens, it goes the whole hog with tiles, furniture, bathrooms and even offers plumbers and painters on service. What is nice about the place is the kind of space they have put together to display concept bathrooms, kitchens and bedrooms. (The home-office segment has been missed out, which they want to include.) The place was jampacked the time I went there, but it was nice to see a shop like this. DIY as a concept is yet to pick up in India, but this is a concept that has potential.
Coming back to the Future group, the formats that they have today are quite different. To copy them would be to become a me-too brand. There are glitches in each of these models, but ironing out is more experiential than anything else, so nobody will have the "perfect" model. My guess is the Futures group have a lot of fuel stored in their tanks. The newer guys may get their footfalls, but many of them will return to Big Bazaars and the like. The one thing that goes against Future group is its association with quality. Many Big Bazaar customers (including yours truly), would like a better watch on quality and this in turn makes the customer sceptical. If there is a Walmart-like model in India, is is this.
So far nobody has really taken on the Future group over their entire length and breadth. Most others, are, of course, new. Will the real Walmarts and the others take on this group or settle in different niches? Watch this space.
This time it is "Quit Retail". Read the report in BS. And laugh. Or cry. Read through it and you will find the usual suspects - the motley crowd consisting of hired protesters, communists and people with nothing better to do. I am surprised that the report made to the front page of the BS website.
There is one group missing - thats the customers and perhaps real farmers. But, the customers are voting with their feet (footfalls) into these stores.
Can you hear Mayawati thunder during the campaign for the national election, "I created thousands of jobs for vegetable hawkers by preventing Reliance Fresh from opening its stores in UP. I kept the monopoly of the traders on the markets and their strangehold over the farmers going. I ensured that these traders and their business stays out of the tax trap. I also ensured that making pushcarts and owning and renting them to poor vegetable sellers is big business. I ensured that customers will get a raw (pun intended) deal each them they venture out to shop. Now, vote for me so that I do the same for the rest of the country."
Tuesday, October 02, 2007
This post started off as comment here, but I guess it deserves more. The root piece is here.
Once upon a time in India (and that time is not too long ago) we were a licence raj- you needed a licence to live and to die or you died waiting for one. We had two (or three) car manufacturers, two (or three) bike manufacturers, two (or three) refrigerator manufacturers, two (or three) TV manufacturers. The government did everything for us, or atleast pretended to do and we in turn, as a populace pretended to be happy. We voted, once every five years or when governments fell, as a democracy should. Scarcity ruled the nation, if not anything else. Life for many of us, was an insufferable wait. Taking my own example, my dad waited 3 years to get a gas connection, 10 years for a telephone and in between a few months for procuring a licence to install an iron grill on our balcony (yes, there was one in existence), a licence to own a TV ora radio. To cut a long story short, since this is a long story everyone knows about there were few jobs.
Many good people began and ended their career as good typists did - at the typing machine. The scenario can be compared to a billion strong Truman show, as minions of the socialist machine, as grist to the mill. Fortunately air travel was not banned - they did their best to discourage flying, though through bad airplanes, bad airports, really complex visa and passport rules and finally bad autorickshaw drivers en route to the flight and bad roads. Yet some people found a way. Want a manufacturing job? Fly to the gulf as cheap labour and get screwed in the process, but if you kept your mouth shut long enough, you earned decent money. That this became a career option is itself indicative the mess we were in. Did anybody talk of a digital divide then? I dont remember hearing. There was no digital, only divide, and again, it was not a divide. It was just a multiplication, of have nots. Nobody had anything, so everybody was happy. A few did (and this had something to do with the colour of their money), but they wrote in the important papers that nobody had anything, so everybody lived in this delusion. One man broke the shackles and how!
Some 15 years later, in 2007, while the government slept, some private individuals created an industry out of nothing, they created about a million jobs (not counting the multiplier effect of about 4) - where there were none before and what is the most talked about topic at the speech of the body representing the industry? Sample these:
- What's bothersome is the slow geographical spread of IT. (Ecophilo: IT started in the late 90s. The government, if I am not mistaken, started in about 1947. What is bothersome to me is the fast spread of governmental corruption, faster than any technology.)
- The IITs of Kanpur and Kharagpur are almost non-existent on the IT map of India, proving that the IITs have had great global impact but their local impacts have not been commensurate with the hype that has come to surround them. (Ecophilo: why blame IT for it? IITs were around far longer than IT ever was, so why did it not lead to a manufacturing ecosystem around it? Clue: think government policy.)
- The need now is to think of the under-served regions and areas. (Ecophilo: great idea, where were you for sixty odd years?)
- Seventy-five per cent of our software industry is exports (Ecophilo: Give me one reason why that is wrong?)
As you drive down the Ring road (thats what it is called, it is mostly a regular vehicle path, no highway) in Bangalore towards the Mysore road, on your left, appears a building that has the name, "Large Taxpayers unit" on a board in front. Oh yes, it is the Income Tax office that has this site, presumably for those pay "a large amount of taxes."
Now, how about a building for the "Never paid income tax" unit or one for "Never asked to pay income tax" unit?
It is a little late to post on this, but a few days back, Reliance Retail was under attack in UP (and a couple of other places - Orissa). At that point, there were two options Reliance retail had, fight or flight. Knowing the current political dispensation in UP and knowing also that it is not entirely a friend of Reliance, Reliance decided to get out of UP. With it went a 1000 odd jobs. Of course, we dont know if this was what the UP government wanted, but Reliance decided to close shop.
Perhaps the government can launch UP fresh and the same goes for the other states, if they want to. Also, great, if they want their traders to continue their current monopoly, great, you will have the voters eating out of your hand.
If you dont want progress, you dont get it. A similar message has been sent to Orissa. Kerala, also will get the same message. Stew in your own juice. Of course, Reliance could have negotiated, bent and perhaps kow-towed to keep those shops open, but this is a smart move.
After all why must Reliance put life and limb at risk of its own employees (apart from investment in infrastructure), when the government couldnt care less? With Reliance exiting, do you think Big Bazaar and the rest of the retail crowd will touch UP? No. So, who loses?