India’s most profitable supermarket, D-Mart isn’t backed by Ambani, Birla, Biyani or Goenka!
India’s Walmart in the making, as a number of analysts have called it, is Avenue Supermarkets Ltd, the parent company behind a chain of supermarkets and hypermarkets called D-Mart.
Later, D-Mart, owned by notoriously media-shy investor Radhakishan Damani, cleaned up spectacularly on Dalal Street, with its shares more than doubling in value after its initial public offering (IPO).
The math behind its business model is attractive to be sure, especially when compared to corporate rivals that attract a lot more publicity. For fiscal 2016, Kishore Biyani’s Future Retail put up a profit of Rs 14.55 crore on annual revenue of Rs 6,845 crore while RPG-owned Spencer’s Retail posted a Rs 168 crore loss on revenue of Rs 1881.31 crore.
In the same period, D-mart bagged profits of Rs 320 crore on the back of Rs 8,600 crore in revenue. Even though Reliance Retail, a far larger retailer that dabbles in everything from electronics to jewellery, posted similar profit in the 2016 fiscal (Rs 306 crore), it did so by bringing in revenue of Rs 18,399 crore – more than double D-mart’s revenue. Anything that doesn’t fall into this meticulous process is abandoned. Private labels and top-end products bring in higher margins but saddle companies with inevitably higher inventory turnover. Offering multiple brands of the same product also leads to similar outcomes, which is why the assortment of products and variety of brands that one finds at a D-Mart store is often limited when compared to Reliance Fresh or Big Bazaar.
Damani likes his stores to be more like a well-tuned assembly chain: where products are converted into sales as fast as possible. Because of this, it’s able to avoid the high-stakes, perennial discount game that other retailers often get trapped in. Customers who walk into a D-Mart store understand that they are getting a no-frills approach but also know that most food items and groceries on offer will be 6% to 12% cheaper than what they will find at other stores. In some cases, certain products will be 10% below MRP.
The company is also extremely reluctant to expand geographically. Until 2014, it had stores only in four Indian states. Over the last three years, it has expanded into five more states but is still conspicuously absent in the NCR region and other high consumer spending states like Tamil Nadu. Analysts point out that it follows a principle of opening 75% of its new stories in existing states or markets and plans on staying true to this in the coming years. This strategy pays off for the company. In its 15 years of operations, it has never closed, moved or shut down a store. .
Ola is best known for the copy-cat beating Uber at its own game.
Ola was started in 2010 and Uber entered 3 years later. Ola has created its own value in the Indian market despite the presence of Uber and has been very successful in creating value through their business model.
The success of Ola shouldn’t be defined by replication but by the way it was implemented. Replicating a business model is not easy as copy-pasting, it wasn’t the replication or copy-pasting but innovation and implementation which got Ola to the heights of success.
Replicating a business model is not an easy task, especially when you’re talking entirely about a different country. It was the user experience, psychology, culture driven, product development and marketing which made Ola a successful company. Innovations like Ola cash, Ola grocery and Ola shuttle are the game changers and are no way a rip off!! Looking at it now, I would say that they have done a great job in the battle to acquire market share Innovations like Ola cash, Ola grocery and Ola shuttle are the game changers and is no way a rip off!!
Rags to riches, a success story of Rakesh Jhunjhunwala is truly inspirational. Big Bull Rakesh Jhunjhunwala Indian Warren buffet and king of Dalal Street has made a fortune of $3.1 Billion from small investment capital of Rs.5000. Rakesh Jhunjhunwala is a common man with uncommon intelligence. Making money from the stock market is like child’s play for Jhunjhunwala. Rakesh Jhunjhunwala is qualified charted accountant and stock market Investor. He manages his own stock portfolio as a partner in asset management firm, Rare Enterprise.
1. Attractive, addressable, external opportunity
2. Sustainable competitive advantage
3. Scalability and operating leverage
4. Management should be of high quality and integrity
1. Be an optimist: the necessary quality for investing success
2. Expect a realistic return. Balance fear and greed
3. Invest on broad parameters and the larger picture. Make it an act of wisdom, not intelligence
4. Caveat emptor. Never forget this four letter word: R-l-S-K
5. Be disciplined. Have a game plan
6. Be flexible for investing is always in the realm of possibilities
7. Contrarian investing: not a rule, not ruled out
8. It’s important what you buy, it’s more important at what price you buy
9. Have conviction, be patient. Your patience may be tested but your conviction will be rewarded
10. Make exit an independent decision, not driven by profit or loss
• Knowing what and how much to risk
• Knowing when and how to take a loss
• Independence of thought
• Lot of discipline
• Control over emotion
“You can’t be a good leader unless you generally like people. That is how you bring out the best in them.” He reinforces that message with all his CEOs and top managers
What do you do when hear that there’s an island, with the same name as your company, up for sale? You call up the people selling it and enquire!
Richard Branson, the founder of Virgin had never heard of Virgin island and had no idea where they were located or that they were actually called the British Virgin Islands. But one Thursday in 1978, he was told that they existed and that he could potentially own one.
He then spoke to the realtor and expressed his interest. He was still in the early days of Virgin Records and he had no enough cash to buy an island. To his luck, the realtor didn’t know this and offered him an all expenses paid trip to see the islands.
But when the realtor quoted the ‘discounted’ asking of $6 million, Richard branson’s dreams were spoiled, because he was in love with the unspoilt paradise and that he wanted to impress the love of his, he offered the highest amount he could afford, i.e. $100,000.
A year later, a charming man named Derek Dunlop arrived at his houseboat in London and explained that nobody else had made an offer on Necker, and that the owner of the Island was desperate to sell. Virgin Records was in a much better position than it had been a year before, so he quickly agreed to a purchase price of $180,000 – the only condition was that he would need to build a resort on the Island within four years.
It wasn’t that smooth sailing, however, and luckily Derek was on hand to help Richard through a formal procedure called the Aliens Land Holding License. The local Governor didn’t like his “links with the music world”, and judged him to be an unsuitable investor. So that the deal could pass he asked the Chairman of Coutts bank to vouch for him. Thankfully, he told the Governor that hr was perfectly respectable, and the sale went through.
The Patel motel and hotel network, also called “potels,” is well-known within the industry-even if few people talk about it and the details of its history are murky. When the Patel’s arrived in the United states in the 1940s, they had no experience in hospitality. It began in the 1960s when immigrants from Gujrat started applying their business acumen to the US motel industry. Nearly half of the motels in the U.S. are owned by Indian Americans NOW! Patels currently own 22,000 motels and hotels in the United States, collectively valued at $128 billion. The community owns a mix of low-budget and middle-budget hotels, both independently and as part of a franchise. Indian American motel owners appear as the American dream incarnate – self employed and self sufficient immigrants who have become successful without any government intervention, writes Dhingra in his book, ‘LIFE BEHIND THE LOBBY.