We have to watch this very carefully and at this moment, realty cost in India is very high.

ZEE BUSINESS BEST B SCHOOL SURVEY

B&E: Earlier Dabur has announced its future plans would necessarily have retail and how do you want to achieve that through New U? SD: We want to make New U a profitable venture and I think at this point of time we have to consider a lot about the realty cost. Is realty going to come at a significantly high price, what form it''s going to take and how’s modern trade going to evolve. We have to watch this very carefully and at this moment, realty cost in India is very high. But I don’t think this will continue very long, soon the cost will come down and there would be equilibrium. We are waiting for that, we will not desperately create a growth model. So in terms of scale, we have put few stores with clear visibility and then we plan to emerge as a big brand.

B&E: But doesn''t venturing into retail create conflict of interest with retailers? SD: If the scale becomes really very huge, then there’s always a chance that retailers might say no to our product. But I think we are too small and we still have a long way to go.


For more articles, Click on IIPM Article.
Source : IIPM Editorial, 2008
An Initiative of IIPM, Malay Chaudhuri and Arindam Chaudhuri (Renowned Management Guru and Economist).


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