Small BusinessFuture Group: Eyeing new horizons
Trust Kishore Biyani, the founder of Future Group, to spot new revenue streams before anybody else. The latest from Biyani is Indian-style hotels and schools to train entrepreneurs and help understand consumer behaviour. Both initiatives are expected to go on stream in the next six to eight months.
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“Most hotels in the country are designed for business travellers — white-collar workers whose travel expenses are taken care of by their companies,” says Biyani. “We want to cater to the self-employed who travel to different places but are very careful about the money they spend. We will set up hotels in Indian style where people can get indigenous food.” The first such hotel is expected to come up in Raipur within the next six months. Biyani will set up a new company to manage the hotels.
Future Group’s earlier attempt to set up hotels through a hospitality fund managed by its financial arm, Future Capital Holdings, did not fructify, thanks to the collapse of Lehman Brothers which was a major investor in the fund. The fund is not a part of the foray this time. “The fund has nothing to do with our new hotel plans. We will do it separately,’’ Biyani says.
Besides hotels, Biyani has set his eyes firmly on education. Future Group, which already has a venture called Future Learning & Development, now plans to set up training schools. The first will come up in Mumbai’s outskirts. “We feel there is a need for real education — a new way of learning, something akin to what is propagated in 3 Idiots. Somebody has to initiate such learning; we thought we will do it,’’ Biyani says. The group will start three or four training schools in the next six to eight months.
This is not the first time Biyani has come up with a business model that targets India’s large middle class. Its hyper-store chain Big Bazaar, ethnic-wear chain Ethnicity, gold and jewellery brand Navaras, and no-frills store chain KB’s FairPrice are all targeted at the mid-income section of buyers. “Why should we blindly follow western formats and concepts? We should find Indian solutions for our consumers,’’ Biyani often says.
But Biyani, who says he has become a “realist” after the slowdown, is also known for pulling out of ventures that do not work out. He ended ventures with Italian brands Replay and Etam, and also pulled out from the airport retail joint venture with the UK’s Alpha group. He also scaled down expansion plans to save cash during the slowdown.
Industry analysts, however, point out that the hotel business bears little similarity to the retail business. Says a Delhi-based retail consultant who did not want to be quoted: “I am not clear what learning Biyani will take from his existing ventures to the new businesses because running a hotel is an entirely different ballgame. One has to build completely new skill sets. And it is a very strong employee-driven venture unlike retail where apart from the store manager, the rest are not key employees.’’