Dubai, UAE – February 21, 2016 :
|Vishesh Bhatia, CEO, Jumbo Group
In a candid interview with SME Advisor, Vishesh Bhatia, CEO, Jumbo Group, talks about his company's winning formula and explains why 2016 is the time to stop dwelling on the past and look ahead to fresh opportunities ...
What do you regard as the key drivers behind Jumbo's fast-growing success and acclaim?
Adaptability; adapting to changing business and economic environments. Building trust and assurance. These uncompromising characteristics were built by the Late MR Chhabria and continue to be the underlying theme for Jumbo's success.
What, according to you, was the intuitive leap that transformed you from a successful medium-sized enterprise to the Region's premier distributor and retailer?
Jumbo was launched in the UAE in 1974 by the charismatic MR Chhabria. His familiarity with the electronics sector brought with it an intuitive understanding of what consumers were seeking. Beginning with a traditional distribution business model, he aligned Jumbo with the iconic Sony brand.
Progressively, as the UAE evolved and grew under the wise leadership of this progressive nation, it led him to introduce organised retailing when there was none. Constructing the multi-storey Jumbo House in Bur Dubai in the 1990s was an inspired decision that set Jumbo apart from other retailers and provided consumers with an elegant shopping experience.
This is the bedrock of Jumbo: responding swiftly to changing business environments. Over the years, Jumbo has earned those singular characteristics sought by all enterprises: trust, reliability and dependability.
What would you say are some of the critical challenges you've had to face in your quest for growth?
When the economic climate is changing, the ability to read and understand such changes early is not easy. Passing trends can be misread as permanent adjustment. With the benefit of our own advisors supporting our inherent business acumen (and I say this with all humility), we have been fortunate to remain relatively unharmed in tough times as we grow in good times. Not all initiatives deliver the financial advantage as planned. The challenge is in determining when to exit from such businesses.
How do you keep innovating to stay different from competitors and strengthen your value proposition to consumers?
This is an ongoing process. In each of our businesses there are a few distinct (to that business) variables that make the difference.
In our Retail offering, we have quite deliberately moved away from a 'product' focused retail store, to one that is absolutely focused on the customer. Whilst our product pricing remain competitive, we are not prepared to 'give it away'. This has to be a losing proposition for both the retailer and indeed the customer. Without earning even a modicum of profit, retailers will not be in a position to invest in just those services that would make for a joyful shopping experience. In our B2B business too, post implementation of a project (our managed print services), we have a rigour of constantly checking if the SLAs (Service Level Agreements) are being met and these are reported back to our corporate customer. In our After Sales Service business (JumboServe), where the clients are also in the IR dealer channel, we have a monthly programme of collecting answers to a formal 'satisfaction' questionnaire which is used to improve the quality of service.
Peter Drucker, whom many consider as the founder of modern management, said "the purpose of business is to create a customer". This is precisely what Jumbo always seeks to do.
What are some of the emerging markets that you would say are most attractive in terms of investment, growth and business opportunities for Jumbo? Are you eyeing expansion in certain new markets?
In the present day context, we find the most exciting opportunities in the UAE. Look at the path-breaking vision of the UAE and Dubai governments and the recent initiatives. There is the Dubai Plan 2021 which describes the future of Dubai 'through holistic and complementary perspectives, starting with the people and the society who have always been, and always will be, the bedrock of the city.' Then there is The National Strategy for Innovation, launched on October 2014 with the aim of making the UAE one of the most innovative nations in the world within seven years. The strategy aims to stimulate innovation in seven sectors where innovation is key to excellence: renewable energy, transport, education, health, technology, water and space. Dubai set a new tourism vision for 2020 aiming for 20 million visitors per year in wider tourism push. Surely this would give rise to a multitude of business prospects.
Very recently, DEWA issued an RFP to consultants to develop the strategy, structure and execution plan and the governance framework for AED 100 billion Dubai Green Fund. Finally, the country's leaders last month signalled a raft of initiatives to chart the UAE's economic direction in a world of US$ 30 oil. Senior ministers attended a two-day retreat in Dubai in the presence of His Highness Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, who directed the launch of the new strategy â€śin the coming weeksâ€ť, with moves in four main areas: human capital, building a knowledge-based economy, government policies and community. With this vision from the country's leaders, we are firmly committed to growing our business in the UAE - where our roots are.
In your expert opinion, what should be the next step in the development of Jumbo's proposition?
I am no 'expert'. A team of professionals is entrusted by the shareholders to run the business. This team is constantly guided by the Main Board and Supervisory Board. As said earlier, evolving our business into new fields is the result of constantly monitoring changes that are taking place. Early in 2013, we took a deliberate step to build our capabilities in the distribution of smartphones. (These skills are very different from those needed for a traditional AV distribution). Building this was not an easy task but we make the requisite investment in both people and resources and I am most pleased to say but with all modesty, that Jumbo has supported our brand partners in the market in the best possible manner.
Jumbo is renowned for its sophisticated diversification strategy. Tell us more about it.
If I commented on this, I would let the cat out of the bag! Look, in the recent past, we have identified where we can use our competencies to best effect. This has led to starting a Manpower Supply business and more recently a 3PL business as well and indeed this is an ongoing process. All I can say right now is to watch this space!
As we enter 2016, there's a lot being said about the regional economic climate. What is your personal opinion on business trends in the months to come?
You are right in saying that 'there's a lot being said'. That being so, I am not sure I can add any more to the din of comment and analysis. Indeed the fall in oil prices brings with it a 'new reality' and honestly, the best way of coping with it...s to cope with it. In other words, we all have to alter our business models to match this change. I marvel at the swiftness with which the UAE government responded to this challenge when they held the conclave last month to discuss UAE's economic direction in a world of US$ 30 oil. This is exactly what we in the private sector should be doing and not be like the proverbial deer in the headlights.
How do you see yourself being impacted by a climate of sustained lower oil prices?
As I mentioned earlier, Jumbo took the first steps in Q3 of last year to tweak its business model in response to the market changes.
In terms of technology, what do you foresee as being 'the next big thing'?
Wearables, virtual reality, artificial intelligence and driverless cars.
What are some exciting developments in the pipeline? What's your vision for the next five years?
The next five years will witness exciting but challenging times. I guess, financial fitness will be the focus when exploring new opportunities.