'With sheer patience and perseverance Harsh Mariwala was able to induct some talent into the business...'

By Sonu Bhasin , Mumbai | In Marketing | November 30, 2017
  • 123
An excerpt from a chapter titled 'Marico: Harsh Mariwala', from the book 'The Inheritors' by Sonu Bhasin. It's about stories of entrepreneurship and success of businesses like Marico, Dabur, Keventers, Berger Paints, and others.

Rats love coconut oil. Unknown to Harsh, in the late sixties, someone had launched coconut oil in plastic bottles. Traders had found that the rats had feasted on the bottles and the oil had oozed out, spoiling other products kept near the oil bottles. The traders, understandably, were not keen on having a repeat of this in their shops. Harsh's team looked at the details and found that the earlier bottles were square in shape. The rats, therefore, were able to get a grip on the bottles and then would gnaw at them.

Harsh had hired R.V. Bindumadhavan, a professional working at Ranbaxy. Bindumadhavan and the rest of the team got to work on the problem and their solution was simple-round bottles made of superior plastic. The rats would not be able to get a grip on the bottles, and therefore, would not be able to sink their teeth into the plastic. Harsh also told his team to make sure that the packaging was leakproof.

Sonu Bhasin Sonu Bhasin

But sellers were still apprehensive. Harsh and his team were in a fix. Unless the traders tried stocking the plastic Parachute bottles, they would not be able to see for themselves whether the bottles were rat-proof. But they did not want to risk any oil leak.

Desperate times call for desperate measures. The team conducted an experiment where they put eight to ten bottles of Parachute in a cage, along with some rats. They left the cage locked for two days and the bottles came out unscathed. This experiment was recorded on camera and the sales teams were told to use this evidence as part of their objection-handling. The traders' curiosity was aroused and they each agreed to keep half a dozen bottles to see for themselves. Slowly, the word spread and the plastic bottles of Parachute were on every shelf, and within a few years, the brand became the market leader.

Harsh was delighted at Parachute's success as the margins in the retail business were higher than in the trade. Retail also mitigated the risk of business concentration. However, Harsh was not able to grow as fast as he would have liked to. 'People were still seen as a cost by the family,' says Harsh. He needed the right talent as he was expanding the distribution network.

The entire sales structure needed to be strengthened. 'I needed more sales reps and supervisors for them. But I had to go slow,' says Harsh. The early days of living in the joint family had taught him patience and tolerance and he put it to good use in his business. He grew the business state by state. 'I had to set up one state, prove the success there, and then move on to another state,' says Harsh in a measured tone. It was a laborious process, no doubt, but prevented conflict within the family. 'It took me eight to ten years to grow my distribution all over India,' Harsh says with a wry smile. It took him almost that many years to hire talented professionals as well.

'Our office was at Masjid Bunder at that time and professionals did not want to even visit there, forget about working out of there,' he recollects. Masjid Bunder was, and continues to be, a congested area with narrow streets and small shops. Large wholesale businesses run out of these small shops. During the day, the area resounds with the constant honking of trucks and lorries and labourers' chatter. It is difficult to walk in the narrow lanes without running into another person or vehicle.

Then there was the bit about dual or multiple reporting! 'Professionals would ask me about the reporting structure. Would they report to me or my father or my uncles,' says Harsh. With sheer patience and perseverance Harsh was able to induct some talent into the business. The focus area was, of course, sales and distribution, as people in these departments brought revenue into the company. The money, in fact, was coming in truckloads. When Harsh had started his focus on the consumer business, the total turnover of the oil business was Rs 50 lakh. However, by the late eighties the business had grown to Rs 80 crore.

By then, Harsh's business of consumer products had overtaken all other businesses of Bombay Oil. But the overall business was still run by the family. He had little say in channelling the profits brought in by his business. By this time, his cousins had grown up and four of them had joined the family business. 'From five we became nine Mariwalas in the business,' says Harsh. This compounded the problem-with so many family members in the business it became difficult to attract talent. 'I felt totally frustrated and not in control of my future,' says Harsh exasperatedly. The main problem was that while there was authority for each Mariwala in the business, there was no accountability in the absence of laiddown guidelines. The family wanted the consumer business to continue to grow, but were not keen to let Harsh invest in building a big brand. They were also apprehensive about getting good talent if it came at the market price. The fact that the generation of Harsh's father and uncles were in their sixties added to the complexities.

(The book has 304 pages and is published by Penguin Random House India)

Related Articles

Search Tags

© 2017 afaqs!