We need to get the engines of the economy started: Gautam Singhania

Over two decades, Gautam Hari Singhania has steered the Raymond Group into new categories like FMCG, auto components, and engineering, whilst deepening its core textiles and apparels business. A year before the pandemic, the company launched Raymond Realty to foray into the real estate sector. In this interview with YourStory Media Founder Shradha Sharma, Singhania reflects on the challenging year that the group has faced.

Enterprise Story: In the grim backdrop of the COVID-19 pandemic, what would you tell young entrepreneurs and businesspeople in the country?

Gautam Singhania: We are specifically talking in light of the pandemic and what's going on. These are tough times. These are very, very tough times. And there are a few takeaways from this.

You've got to really reengineer business and look at it with a microscope, look at it very hard and say this is the way I can change my business because the survival instinct has to come into play.

The second most important thing is: have faith that this will pass. Whether it's in sport, business or life, don't lose hope. Because a positive attitude is the only thing that'll take you through.

So, these are the times that we are in—relook at what you're doing. Stay focused. And remember that famous saying: this too shall pass.

When the pandemic began to spread in India last year, you told shareholders: “It is posing serious existential questions that needs thorough introspection, logical recalibration and prudent decisions.” What are the demands that the pandemic thrust on the Raymond Group?

Raymond is a 97-year-old group. If you go back to April and May last year, we had very little data. We didn't even know what could actually be a cure to the pandemic or the disease, much less have a vaccination. And we were looking at a very long pause.

But as I had said that time—and I continue to believe the same—that as soon as the pandemic is over or things start opening up, you will see a bounce-back. If you go back to my interviews last April and May, I said the minute it opens up, you'll find people taking a flight and going to Goa. So what if they can’t go to London? A person needs a break. He needs a break. It could be in Goa and he might not go to London.

That's exactly what happened. If you see tourist places or safari parks, it was all chock-a-block. It's unfortunate that the second wave has come, and we're seeing a temporary blip. My view is that between the first of June and the 15th of June, most of India should open up.

So, there is an optimism and I also believe that the bounce-back will be strong. We're cautiously optimistic, but I think we will come back.

One of the immediate measures the Raymond Group took was to make personal protective equipment (PPE) products and even personal hygiene products. What do you remember about the agility with which your company responded to the crisis?

When everything was closed, we looked at the need of the hour. We had our garmenting facilities, and PPE (personal protective equipment) masks were the need of the hour. And we made that. We also have an FMCG company with the ability to make hand-sanitisers, floor cleaners and so on. So, we quickly adapted to that.

Today’s world is all about that: how quickly you can adapt and move forward.

How did you pull off the cost reduction target of 33 percent?

It is just a mindset. If you have to survive, there's a survival instinct that kicks in. You then got to do what you've got to do. There were very hard and very painful decisions that had to be taken.

If you’re in the Arctic with only one bottle of water, which is exactly your cash flow for one month. You know you've got only one bottle of water. You've got to figure out how to melt the ice (and) what you're going to do. You've got to figure it out.

The Raymond Group has invested in omni-channel shopping or ‘phygital’. Post pandemic, is the group looking at going the Direct To Consumer (D2C) way? 

We’ll continue to be in omni-channel. And as far as we are concerned, our product category is such that there's a lot of touch and feel to it. People want to touch the fabric, feel the fabric, drape the fabric, come with their family member. Typically, we have three people coming as a group to buy a fabric because the Indian consumer still needs a reassurance from his wife, daughter or son.

How does it look on him? He lacks the confidence to buy the product on the internet. It's unlike buying a soap or deodorant on the Internet, where you know which brand you use. That's a commodity.

Number two, in our business, shopping is an experience. Going to a Raymond shop is an experience. Going there with your wife. It's an outing. So all in all, I'm very optimistic that the shopping that we see per se will continue.

What are some of the innovations you think that the company has done, which has kept it agile?

Across businesses, it eventually comes down to the word ‘trust’. Trust comes from quality and excellence. That's what the brand stands for, and (it) is about product development. You stay on the forefront if you get the right product at the right value in the lifestyle and fabric space, which we are doing.

If you see today in our real estate space, which we entered 18 to 24 months ago, our project is doing exceedingly well. It’s probably the number one project in Thane, because eventually it’s the right product, right place, right price, right location. And that's what it's all about. And we've actually gone out of our way to design a top class product. And eventually, it's a top-class product that sells.

It's also about staying true to the basics of what people want.

We are the only brand in the world that goes through 6,000 times in price point under the same brand. We go from Rs 150 a metre to Rs 10 lakh a metre under the same brand.

Like we say, from the taxi driver to Mr Tata, everybody buys us and there's no other brand in the world that will instil that kind of confidence across such a socioeconomic strata of people.

Toyota launches Lexus. There’s Four Seasons and Ritz. So, no brand actually runs through such a large group of people. That's really the power of the brand.

In that context, tell me how do you build an iconic brand?

The core of the brand is delivering quality consistently. You have to deliver. Like I always said, putting a brand on the map is like throwing a dart on the wall and seeing where it hits. 

A brand actually gets established over a very long period of time. So if launch a brand, it could take between two and three years for somebody to try your brand. Then, the customer experiences it, then a repeat purchase, and recommends it to somebody. This process could be at least 10 years. It's very rare that you will get a brand that becomes a brand overnight.

I've seen a brand that came out with phenomenal advertising. I thought it was a super-looking brand, but they failed on the supply chain. And two weeks later, it was over. So, an iconic brand is normally built over a long period of time—Raymond has been here for 97 years. It’s seen the ups and it’s seen the downs. That’s what really makes it a brand.

When you look back at how you have consolidated and grown the Raymond Group, what are some of the things you have done right as a leader that has worked?

The single most important philosophy is to do the right thing. The right thing is never the easiest thing, but you have to do the right thing and be committed to what you believe in.

If you've committed to what you believe in and you do the right things, sometimes it's the harder route, but eventually you get there.

How do you look at overall stakeholder engagement and management?

It's a normal challenge. This week alone, I would have reached out to over 5,000 people in my trade. And it's really communicating with them, telling them what you're doing. Sometimes, there is miscommunication as to why the company is doing something.

So this week alone, I would have reached out to more than 5,000 people in the trade. I've been to 10 cities myself in the last one month and met customers, explained to them what we're doing, and why we are doing it.

Eventually, it's a partnership between your trade and yourself, your stakeholders and yourself. And they must believe in what you're doing.

A brand is more than its product. A management guru once said 60 percent of the reasons people buy your product is the brand; 40 percent are other reasons, like what the brand is, ease of availability, trust in the company, etc.

What are some of the challenges you have faced as a business leader, and how did you face those things?

The biggest challenge everybody is in is the lockdown. And I’ll give you an anecdote. I was in a Zoom call with some people. There was a guy from China who said, “Hey man, I love this lockdown. I love this work from home. I can do it for the rest of my life.”

When it was my turn to speak, I said, “You know, I can't wait for the lockdown to get over and get back to living life because life is more than looking at an iPad screen and having a conversation with 10 people around the world.”

Yes, you can do different things. You can connect with different people, which you could never do before. But life is about experiences. I mean, if you don't go out and experience life, what do you talk about?

I gave a talk about six months ago, and I was so deprived from my experiences of the previous three months. I found it very difficult to talk to people about anything because I said I've just been looking at a screen and been in my office and worked from home.

The challenges of work from home are different. I think we need to get the engines of the economy started, and actually get out there and do things. When we do things, life will be back to normal.

What anchors you?

Everybody feels the challenge today. It is just about staying positive. I’ll give you an example. I speak to a lot of my friends and what are they doing at 7 o'clock? They open the bottle, and having a drink because there's nothing else to do. And one thing I've done is I've completely gone off drinks.

This is not the time to drink and make merry. This is the time to stay focused because alcohol actually makes you happy in the short term and then depresses you in the long term. It doesn't let you focus. And the one thing I need today to bring to the job every morning is focus.

So, maybe on a Saturday night, I'll have a couple of glasses of wine, but everybody need to relax. But I've gone the other way. Currently, stay focused, stay positive. That's the most important thing.

What do you thing we need to do as a country from here?

First and the most important thing is: vaccinate, vaccinate, vaccinate! 

The faster you vaccinate, the faster our dreams will get fulfilled. You just have to vaccinate, vaccinate and vaccinate.

If you look at a basic number, We have 1.3 billion people. You need 2.6 billion vaccines. Even if it's ten dollars a vaccine, that is $26 billion. But for $26 billion, if you vaccinate, you open up a $3.5 trillion economy.

Look at the numbers. It's a no-brainer. Some of the countries have got it so right that they are back to business as usual. Look at Dubai today. It's opening up again. It’s totally opened up and it's billions and billions and billions of dollars of tourism. Look at the US. They're back to normal and it's a $20 trillion dollar economy. What is the cost of vaccines to keep that engine going?