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Raj Jain | The ‘rapid growth’ sceptic

Raj Jain | The ‘rapid growth’ sceptic
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First Published: Fri, Jun 04 2010. 10 45 PM IST

Method over madness: While he lived in China, Jain, a vegetarian, used to carry a card with a list of things, written in the local script, that he couldn’t eat at restaurants. Jayachandran/Mint
Method over madness: While he lived in China, Jain, a vegetarian, used to carry a card with a list of things, written in the local script, that he couldn’t eat at restaurants. Jayachandran/Mint
Updated: Fri, Jun 04 2010. 10 45 PM IST
He hopes that when he retires he will be able to set up an art gallery with his art-promoter wife Ritu. But ask Raj Jain, 50, president, Walmart India and managing director and CEO, Bharti Walmart Pvt. Ltd, whether he has a say in what goes up on the walls of his swank apartment that almost sits on a golf course in Gurgaon, and he chortles.
Method over madness: While he lived in China, Jain, a vegetarian, used to carry a card with a list of things, written in the local script, that he couldn’t eat at restaurants. Jayachandran/Mint
Jain has a deep rumbling laugh which becomes pronounced when he begins to tell a story he relishes. Now, he is about to narrate a life lesson he learnt on his honeymoon. “We were in Kathmandu and my wife, who has always been fond of ‘arty’ things, wanted to buy a big wooden mask. She said ‘Help me decide which one I should buy between these two’. I chose one. Instantly, she decided to buy the other. That’s when I knew never to give opinions about art.” Or interfere with what goes up on the walls of their house.
Jain and I were supposed to meet at a club in his building complex but at the last minute, he requested I come over to his home, a 5-minute walk from the club. The reason for the change, I figured out later, was because Jain wanted to be home to meet his mother, who had come down from Delhi.
After spending a few minutes with his mom, Jain settles down in his living room, orders tea and tells me he will be leaving for the US soon for his son’s graduation ceremony. I am curious what management advice he has for his son, who has got a marketing job in New York City. After all, he worked with Hindustan Lever Ltd’s (HLL’s) sales and marketing team when he joined them as a management trainee in 1980, and then spent 10 years with Whirlpool Corp. before quitting as its regional head, marketing and supply chain, Asia-Pacific. He joined Walmart in China in 2006.
The guffaw is back with full force.
“All this while, I was an ATM. Suddenly, my son wants to know ‘What should I expect at work in my first month?’ from me.” In answer, Jain says he narrated stories of his first month as a management trainee at HLL. “I have told him to be himself. Things can’t get worse than what I faced in my first week in Mumbai.” He recalls how he was hauled up before a railway magistrate at Sewri station because he didn’t have a platform ticket. “I was made to feel like a criminal, and all the while when the magistrate was talking, I was worried that I was getting late for work. I told my son that the first month at any job will always be full of surprises.”
Jain is dressed casually in a half-sleeve, off-white linen shirt and tan trousers and wears what looks like a prayer beads bracelet on his wrist. An engineer from the Delhi College of Engineering, Jain never imagined that one day he would end up a retailer. Yet retailing is in his blood—six generations or more of his family have lived in Chandni Chowk, Delhi’s wholesale hub, and have been retailers. Though Jain’s immediate family did not inherit any of these businesses (his father was a government officer and his grandfather a lawyer), as a child he received some exposure to what happens in a shop. “Whenever I went with my father to visit my uncle, who owned a shop, they both would go away and leave me in charge. My uncle used to say: ‘Tum galle ke peeche khade ho jayo (you stand behind the cash counter)’. I used to enjoy those occasions.”
Perhaps his habit of visiting shop floors at every opportunity is a hangover from those good old days, besides being integral to his current job profile. “As a retailer, the best place to get customer feedback is the store. Post-5pm on Sundays are big days at the (Best Price Modern Wholesale) cash-and-carry stores (currently, there are two stores—in Amritsar and Zirakpur—and the third is scheduled to open at Jalandhar). The good thing is that customers in India are not afraid to tell you what they don’t like if you approach them. We get fewer women customers at the Best Price stores but they are better critics. More vocal and insightful, whereas men tend to be reticent.”
A large part of Jain’s job is also to ensure that the Bharti-run retail stores, Easy Day, are well serviced since Bharti Walmart is the sole supplier to these 70 retail outlets in 30 cities. “The Bharti retail outlets are run independently but we do share our expertise in terms of processes, resources, technology and management know-how. Since foreign direct investment is not allowed in retailing, we cannot do more than this. But we interact on (a) day-to-day basis and decisions, such as which states they should open new stores (in), are interdependent since we are their sole suppliers.”
However, the demands at Best Price Modern Wholesale stores are very different from those at Easy Day outlets. Besides, as Jain points out, customers’ demands change dramatically from one state to the other. “India is a continent, not a country in that sense, because food, apparel, customs change every 200 miles. This is the reason why you don’t see any pan-India retailers as yet. I think it will be a long haul for people to be successful in retail across the country. So many flavours, so many demands—completing all these in a cost-effective manner is a tough job.”
Perhaps that’s why Jain is conservative when he estimates that Bharti Walmart will take “at least 7-10 years to make profits. I can’t think of retailing starting to make money for anybody in two years’ time.” He believes retailing is a scale business. “If you have a high-growth trajectory, then it is unlikely that you will make money in the initial years. It sucks up a lot of investment and a lot a management time.”
That’s why he says he is “walking slow now to walk fast later. I would much rather we have fewer stores and make sure no customer walks out disappointed than open a new store every month without my back-end and supply chain being perfect. In retail, if you disappoint your customer you will be penalized. However, three years from now when we have fixed all our staff and supply chain issues, to go slow then will be unnecessarily over-cautious.”
With French retailer Carrefour SA announcing that it will open its first cash-and-carry outlet in Delhi, was going to Amritsar first such a good idea in retrospect? He calls the decision an experimental risk, something he is most comfortable with. “I would classify myself as a leader who takes calculated risks. I never take ‘bet the farm’ kind of risks. When we decided to set up the first cash-and-carry in Amritsar, people laughed at us. Well, Amritsar is a huge wholesale market. It services lots of others states like Jammu and Kashmir, and cities such as Pathankot, Meerut. It is a very underserved market too and it made sense to be there first.”
It is almost time for Jain’s yoga teacher to arrive. An avid gym-goer until recently, Jain has switched to yoga because he realizes flexibility is more important than sheer muscle—a principle he follows to the tee at work.
seema.c@livemint.com
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First Published: Fri, Jun 04 2010. 10 45 PM IST