Tycoon Kishore Biyani is probably the closest Indian retail gets to a homegrown Sir Philip Green. Controversial, entrepreneurial and the creator of India’s biggest store group, failed film-maker Kishore Biyani is hero-worshipped by many of his country’s retailers.
At last month’s India Retail Forum in Mumbai, the hall was packed to the rafters to hear the man dubbed the rajah of retail.
Through his Future Group’s Pantaloon Retail division, Biyani controls 450 shops in 40 cities, trading from 465,000 sq m, which is expected to double by next year. His fascias, including supermarket Food Bazaar, the Pantaloons fashion chain and hypermarket Big Bazaar, turned over more than INR35 billion (£434 million) last year and made a profit of INR1.8 billion (£22.3 million).
Aside from the chains he has created since start-up only 10 years ago, Biyani holds franchises for foreign retailers including Staples, Marks & Spencer and Next through his Planet Retail joint venture.
Like Green, Biyani has little time for doing things by the book. “Rewrite rules, retain values” is his motto. And, also not dissimilar to Green, he sometimes sees himself as an inspirational outsider. “India lacks leadership and original thought,” he says. “When people come up with fresh thinking, they don’t want to hear. But every individual needs a face to look at and be inspired.”
That attitude is reflected in proud patriotism and a determination that Indian store groups, rather than foreign giants, should lead the country’s retail revolution. “Indian-ness” is one of Future’s “core values” and part of the group mission is to “infuse Indian brands with confidence and renewed ambition”.
But one aspect of Indian-ness that Biyani views as a potential headache is the tendency of people to save, rather than spend. In a country where the majority live in poverty, that is hardly surprising, but Biyani knows that, to create a truly world-class business and a world-class consumer culture, it needs to change. So a priority for him is to create a consumer surge to sustain and drive the present retail boom. He believes consumer credit is the answer.
Biyani launched Future Money earlier this year, encouraging and enabling shoppers to buy goods that they might otherwise be unable to. “Probably only 8 per cent of the country can afford modern retail at present,” he explains. “We have to expand the consumption basket and we need modern ways of retailing money. Banks are not going to provide loans.”
The scheme has since been extended to fund weddings and Biyani is confident that default ratios will settle at a manageable rate.
He is sanguine about the inevitable start-up problems. “When the first application comes in, the fraudsters come in, but we designed the credit business to manage risk.”
Biyani views retail as “a means of acquiring a customer” and it is customers – and how much they are willing to spend with him – that are his obsession. His determination to create and follow demand explains the host of fascias that cater for a broad range of consumers. He is particularly excited about prospects for KB’s Fair Price, an Aldi-style discount food chain that only sells non-perishables. Although there are only 10 outlets at present, Biyani thinks there could be potential for 1,500.
Biyani is sometimes criticised for allegedly lax in-store standards and his shops’ crowded and chaotic feel. But he insists that the untidiness of his shops simply reflects high footfall and success, and that it even makes them more popular. “If you see an empty shop, you don’t want to go in, but everybody likes to go into a shop where they see customers,” he says.
Despite being one of the biggest beneficiaries of India’s fast-growing economy, Biyani is cautious about some aspects of the rapid development of modern retailing. He is convinced that mall space is being created at a pace that far outstrips demand and foresees 2009 as a time of reckoning, when many shopping centres will be exposed as white elephants. “That will be a defining year,” he says. “By then, customers will have decided which retailers they like and the men will be separated from the boys.”
Future Group’s ventures include property, finance, real estate, media and bars. Anything that touches the consumer is of interest to Biyani and he feels that Future is uniquely placed to be the consumer’s first choice.
A BORN LEADER
Age: 46
Based: Mumbai
Family: married with two daughters
Did you know? Biyani recently published his autobiography, It Happened in India
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