Businessman Siddhartha Lal got some vital tips from his mother, the luxury store founder Anita Lal, in running his motorcycle business.
When the stories of success of some of India’s biggest businesses and the people who steered them are told, more often than not, we are told stories about men—fathers, sons, nephews, and so on. But we cannot fully tell the story of the Lal family, and their quest to turn the Royal Enfield brand around, without taking a moment to examine the role played by Anita Lal, Vikram’s wife, Siddhartha’s mother, and an astute businesswoman in her own right.
Many years ago, when Vikram wanted to change the way his family would approach their business and the chain of succession, he consulted his wife. Years later, Siddhartha too would find himself looking to his mother to find new ways to revitalise the way he did things. When he took over the reins of the company, Siddhartha had to deal with the fact that Eicher had a commercial vehicle, tractor-oriented team which dealt with asset products and not consumer ones. ‘So, lots of things were attempted. He knew what he wanted, but somehow, it did not come together,’ Siddhartha told me about his father in the interview for this book.
He may have acquired his management chops from his father but he owes much of his sense of aesthetics and branding to his mother.
Quality above quantity
While Vikram stepped back from his company in 1997, Anita had decided to start one from scratch a little earlier. In 1996, she set up Good Earth, a luxury lifestyle brand that catered to those looking for high-quality ethnic home products with original designs created by local artisans and craftspeople. Working out of their Chattarpur farmhouse, Tulsi Farms, she wore her billionaire status lightly, choosing simple but elegant Indian clothes for work and mixing easily with her staff as well as occasional customers who came by to see her latest designs. She was always courteous and friendly with the vendors she worked with and gradually, the company began to grow.
In 2004–05, she worked with a small web development company to design the Good Earth website. One of the founders of the company remembers how she would serve him and his colleagues refreshing sherbets every time they went to see her with the initial designs and would make it a point of offering the very flavour that he had liked the first time.
A stickler for quality, she could spend hours on end trying to get the colours of the site just right. A perfectionist, she would visit the startup’s tiny office in Delhi’s Qutub Institutional Area and sit with the designer for as long as it took to ensure she got the desired look.
At Royal Enfield, Siddhartha needed both – his father’s management style and his mother’s attention to detail. After taking charge, he threw himself into trying different things.
That the company had to become a consumer-centric brand was absolutely clear in the minds of people at the helm of the new Royal Enfield. Yet, there was little clarity on how they could achieve that. What should the company do from there on? Should they introduce another bike? Should they go in a different direction?
In a press conference in 2001, Siddhartha had promised to introduce Electra. But so many questions remained: would that not add to more costs? Was the company ready to take on the volume pressure coming in from another bike that had to be launched in the next twelve months? Was the network ready? Could their dealers, who till now did little to push sales, sustain the pressure of selling another bike?
Around the same time, Anita too was trying to solve a similar problem in her business, one that she had started on an impulse. In 1996, when Vikram received an offer to open a Royal Enfield showroom in Kemp’s Corner, Mumbai, he was reluctant; he was already struggling to keep the brand relevant in the market, and he considered letting go of the space. But Anita expressed her wish to start Good Earth and give it a home.
‘Doing the right thing’
What Anita didn’t realise was that Good Earth would become a full-time commitment. Backed by the capital she received from her husband, she went on expanding the business, but she was far from turning a profit. Ever supportive, Vikram never asked her about the finances of the company, but to live with that was a difficult choice for her to make.
“Every year for the first five years, I would hold out a borrowing hand to our holding company whenever I ran out of money,” she told Forbes India magazine in 2014.
Anita started to think about growth, about how Good Earth would look fifty years in the future. Both mother and son would discuss their businesses with each other at length. In one of those discussions, after deep thought, Anita told Siddhartha, “I am not running behind this Western concept of growth. I do not want Good Earth to go through this rut at any cost. In fact, I want to pull back.”
On that day, Anita decided to not expand her company any further. She wanted to cut down on the one or two stores that were not doing well, and scale back on the number of stores in general. She wanted to reduce the number of stock keeping units but ensure whatever the business did, it would do it exceptionally well.
About a decade since its inception, Good Earth was able to break even in 2006; it became profitable in 2012. By 2019, it had nine outlets across Mumbai, Delhi, Chennai, Bengaluru and Hyderabad, and an international presence with two stores in Singapore and one in Turkey’s capital, Ankara.
Anita’s decision was really a big aha! moment for Siddhartha, who was struggling to find ways to take his company forward. Growth was, of course, important for Royal Enfield, but Siddhartha went on to tell his colleagues that there were other things to be considered now. “We have to grow but what I am saying is that it can’t be that growth itself that drives you. It has to be doing the right thing, serving the customers right, doing the right thing in the market. If that results in good growth, it’s great. If that results in less growth…that’s also fine. But you know you are doing the right thing,” he reportedly told them in a meeting in 2001.
Excerpted with permission from Indian Icon: A Cult called Royal Enfield, Amrit Raj, Westland.