BackIndia among Kohler’s 3 most strategic markets globally: David Kohler
Kohler Co. president and CEO on the importance of India for global business, how it compares with China and whether govt has done enough
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David Kohler, president and chief executive officer (CEO) of privately held Kohler Co., a manufacturing company best known for its plumbing products with global revenues of about $6 billion, talks on the importance of India for the global business, how it compares with China and whether the new government has done enough to improve business.
Edited excerpts from an interview:
How does the India unit fit in with your global business?
India is absolutely one of our top three strategic markets.
We are number one in the US and we’re number one in China. We’re not number one in India yet—although we’re the number one international brand here—but India is right up there in our three most strategic markets globally because we think if we can lead in India over time, as well as the US and China, that’s really global leadership because of the importance that this economy and country will play over time.
How does India compare with China in that?
China was competing neck and neck with India. Now, India has pulled ahead in growth terms, since the slowdown in China in the last 12 months, and India is now the fastest growing geography globally.
You complete 10 years in India early next year. Any takeaways about this market?
It’s dynamic. It’s a very fast growing luxury market and a strong design sensibility, too, for global design and appreciation but also with your own Indian flair; so, design is really taking off in india.
That apart, the Indian consumer is very value conscious, that’s not necessarily low price, but it’s wanting, at any price point, excellent quality, design service and value for money.
For a company to be successful, you need to deliver on that, quality, after-sales service, support, which is very important here, unlike other markets.
It’s a tough market to understand, but once you do, you can build a loyalty with consumers and trade partners.
What’s been the toughest thing for you in this market?
One challenge has been finding trade partners, distribution partners that really want to scale and grow their business.
Minal Srivastava (deputy GM, marketing, for South Asia and sub-Saharan Africa): Traders weren’t used to selling bathroom fittings as a luxury product. They were used to selling it as a commodity, which would be stacked up by the roadside, one on top of another. We came in and changed those habits.
Kohler: You want a partner that understands the products technically, of course, but can also sell fashion and luxury.
Who are your customers?
Kohler: We are putting up showrooms in all the major cities across the country.
Salil Sadanandan (managing director, kitchen & bath, India and sub-Saharan Africa): We’ve crossed 100 cities; we’re touching Tier-III cities. It’s a mix of builder projects as well as 3-4-5 star hotels. The capacity to spend exists in similar quantity as in the big cities—whether you look at Ludhiana, Coimbatore, Surat or Mysore.
These are all business-driven towns, they have the money, they are discerning and they have a point of view on design.
Have you had to change your products for the Indian market?
Sadanandan: We’ve to make sure our products work in different market conditions.
For instance, the weather conditions are very different across the country. North is extremely dusty; if you go to Chennai, because it’s a coastal area, it is extremely corrosive. So, we have to ensure our products stand up to that test. These aren’t things you have to worry about in other markets like the US. Water hardness is another thing. Parts of Gurgaon, for instance, have hardness of 1,000 parts per million (ppm). In New York, the acceptable level is 50ppm.
We needed products that could withstand that range of conditions.
In India you’ve been through the boom period and the bust period. What’s your take on the business environment here?
Kohler: I don’t look at it as boom and bust. In any fast growing, developing market like this, you’re going to have cyclical volatility, and it’s going to work itself out over a period of time; and that’s just part of the landscape and that makes it a bit more challenging.
But that’s good because we’re a long-term oriented company and if it makes it more difficult for other companies that are just looking for short-term gains.
There’s nothing short-term about a commitment to India or a commitment to any country because you have to understand it.
What’s your take on how business is shaping up under the new government?
Kohler: The new government in general has been very positively perceived by the business community, and there’s great hope for progress.
From a business point of view we have high expectations for action and progress by the government, and that holds for any government in India, because it’s a country of great promise and we need to get it moving aggressively in all aspects of the economy—in agriculture and manufacturing and education—in all the areas to make it one of the strongest economies in the world. A vision’s been created we hope to see follow through and execution.
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