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BY POOJA KOTHARI
When William Bissell wants something from one of his 99 stores in the country, such as a jar of organic tea, he pays for it across the counter – just the way thousands of Fabindia buyers do. It is business as usual for him, despite the fact that he, along with his mother and sister, owns a majority share in the country’s leading retailer of all things natural. In the process, he astonishes a business journalist accompanying him, and sends across a strong message to his employees.
“Every act of management is also an act of communication,” explains the 43-year-old managing director of Fabindia, dressed in a striped cotton shirt with wooden buttons – a product off his shelves – and casual trousers. “As long as you think about serving the company, as against owning the company, this style of operation would be par for the course,” adds he.
Bissell should know a thing or two about management styles. At a relatively young age, he inherited what was then, primarily, an export house dealing in furnishings. His dad’s poor health and subsequent passing away in 1998 were largely responsible for his early induction into the company. But he took the opportunity to reinvent the organisation and make an imprint that is uniquely his.
When he took over, Fabindia had very few stores in India, and primarily exported garments and soft furnishings. Today, it has 105 stores, of which only six are located outside India, in places like Dubai, Bahrain and Rome. Its Rs 360-crore revenue comes from selling a range of goods, from furniture to organic foods, cosmetics, formal wear, casual wear, household furnishings, women’s accessories, children’s clothing, and so on. The only common thread between the weave and weft of this product range is an essence that is quintessentially Fabindia. No one quite knows how to describe it, but everyone knows what it stands for – a combination of culture, individuality, ethnicity, tradition, fashion, and style.
The credit for building Fabindia into a brand that cuts across age groups and economic classes rests solely with Bissell. As a consumer, you are either a Fabindia type, or you are not. There’s no in-between – such is the power of the brand. It wasn’t always so. In the 80s and 90s, Fabindia belonged to the “jhola” types, or the custodians of intellectual superiority. Bissell changed all that, turning it into a brand that is sported as much in offices as on college campuses, as much by the trendy tweens as by their elegant grandmothers – and increasingly, grandfathers.
Bissell has achieved all this while running a solid business in true MBA-style leadership. Since 2002, when he put his first four-year “vision plan” in place, the company has grown exponentially; meeting targets in almost half the time. In 2002, when Vision Plan One was put into action, Fabindia’s turnover stood at Rs 2 crore a month. The aim was to take this number to Rs 8 crore a month in four years. It took the company only two years to get there. A similar success story followed the second vision plan, at the end of which, the turnover stood at Rs 20 crore a month. “We are currently working on the third vision plan, which should grow our turnover to Rs 60 crore a month by 2012,” says Bissell. That’s a whopping 2,900% growth in his topline in a decade, albeit from a small base!
Moreover, if he buys the remaining 75% stake in East, a British retail chain with 72 stores in the UK in which Fabindia had picked up 25% a few years ago, the firm’s topline will see an addition of Rs 300 crore in one stroke. That’s the kind of growth most CEOs can only dream about, especially in the retail segment.
What makes this journey even more commendable is that Bissell has not compromised on the mission laid down by his father, John Bissell, of providing a sustainable means of livelihood to thousands of rural artisans who supply their goods to Fabindia. He has simply added profitability to that social goal. The union of the two unique goals shows up in the way the firm goes about its business. For instance, if a supplier turns up with raw material later than promised, every attempt is made to find ways to use that, rather than return it. So, if it is too late for upholstery, they simply make cushions out it!
Fabindia has also formed 17 companies, called the Supplier Region Companies, in which 28,000 artisans are shareholders. These SRCs form the backbone of its supply chain, while ensuring the workers have a share in prosperity. By 2010, Bissell hopes to have 40-odd such companies.
It hasn’t been smooth sailing all the way, though. Bissell is the first to admit to mistakes, whether it was his overconfidence in the potential of the organic food line of business, or the steep price hike in garments a few years ago. “It reflected my own being out of touch with the market. We were far ahead of our time with organics,” says he.
This pace of growth has also been a challenge in terms of people and policies. Most of its earlier hiring happened through employee referrals, ensuring adherence to its ideology. But that became difficult to maintain when it grew at almost two new stores a month. Rapid scale-up was therefore balanced with a lot of policies and systems. Many old-timers were also used to working with the social goal, but not the profitability one. There was a huge debate, for instance, when the retail chain set up shop in malls, or when it introduced a system of delayed payment for its suppliers, as against the earlier one of on-the-spot payment at the time of delivery.
Bumps such as these notwithstanding, Bissell has managed to carry everyone around to his way of doing things. He can derive satisfaction not only from having found an alternate vision for business, but also from the knowledge that as his company grows, it improves the fortunes of many rural poor. And as Fabindia hopes to touch the Rs 60-crore-a-month target, Bissell shows that it is possible to have a remarkably profitable business which has a heart of gold and a mind of its own.
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