How Pathare brothers of Maxwell took their brand VIP to the masses It's not about taking a wrong decision but it's all about taking a decision at the right time.
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Carrying forward the legacy of Jaykumar Pathare, founder of India's one of the oldest men's innerwear brand VIP promoted by Maxwell Industries Ltd, his sons Sunil Pathare and Kapil Pathare have successfully managed to uplift the growth of the company over the years while following valuable learnings offered by their father.
"My father, Kolhapur- born Jaykumar Pathare, the founder of the company was an electrical sub-contractor with state electricity board. He shifted to Kalyan, a suburb of Mumbai, for the electrical sub-station work. Then an incident took place in his life that made him to start a business of innerwear manufacturing with his good friend and colleague LJ Reddy in 1971," says Sunil Pathare, Vice Chairman and Managing Director, Maxwell Industries Ltd. Coincidently, both Jaykumar Pathare and LJ Reddy had no background of innerwear industry.
They built this organisation on the basis of thought process and trust. During 1980s, there were not many players operating in the market, which made them easy to build the brand VIP that was given very much prominence.
Their father's teaching – it's not about taking a wrong decision but it's all about taking a decision at the right time – has been deeply followed by Pathare brothers while pursuing the successive journey of the company. "Since my joining in 1991, my father taught me that if you are not taking a decision on right time, then what's the difference between you (an entrepreneur) and an employee. An entrepreneur has to be adventurous, selfconfident and experienced," further says Sunil Pathare.
He first joined the export division of the company, which was contributing 5 per cent to total revenue, and managed to achieve 10 to 12 per cent in preceding years. He was the first who decided to replace conventional ways of working with professional ones. Talking about the milestone of his journey, Sunil Pathare says, "I was heading export division. Now being a vice chairman and managing director of the company, I am handling entire sales and marketing, financial and strategic operations, and this is itself a milestone for me."
Following the footsteps of his elder brother Kapil Pathare started handling the manufacturing division of the company in 2004. "When I joined, we were outsourcing around 60 per cent of our production. Today around 70 per cent of our production is done in-house and 30 per cent being outsourced. I changed the structure, set up capital expenditure and set up factories equipped with atomisation," says Kapil Pathare, Director, Maxwell Industries Ltd.
While moving steadily but not aggressively since its inception, Maxwell Industries has been reaping the benefits of taking early move in the market. With the current annual turnover of Rs 260 crore, the company is growing by 25 to 28 per cent in the market while claiming to have captured 20-22 market share.
"We are expecting to touch Rs 300 crore by the end of current fiscal. Hence, we are aiming to make it to Rs 1,000 crore by 2020. Therefore, to touch Rs 1000-crore mark, we want the growth of all brands under the holding of Maxwell Industries. Earlier, we were only focusing on top 10 products of VIP, and the sale was happening with these top 10 products; so at the bottom line, there was a dilution of focus on other brands and products," says Sunil Pathare. Presently, the company has wide portfolio of products from lingerie to loungewear for men, women and kids.
These brands are being supplied to around 1,10,000 retailers across the country along with the leading LFOs like Pantaloons and Big Bazaar. These products are also being supplied to around 15 countries across the globe. It is operating with its two big manufacturing units located in Thinglur, Tamil Nadu, and in Umargaon, Gujarat, which contribute to 70 per cent of our total production.
The rest of outsourced production comes from Tirupur and Kolkata. For the next five years, the company will be focusing much on increasing product portfolio of its existing brands by following its sales and marketing activities, which will be designed as per the persona of each brand.
Talking about company's EBO expansion plans, Sunil Pathare says, "So far we have opened seven Inner Studios and are planning to open up 93 more Inner Studios in next three years. Each of the stores will be of 300-350 sq.ft with the franchisee investment of Rs 15 lakh. We are planning to tap Tier II, III and IV cities. These cities are yet to experience the organised retail channel."
The company is ambitiously planning to add 15,000 retail touch points in its total retail touch points to the count of 1,10,000 by the end of the current fiscal. With the expansion of few more categories, it is planning to touch overall 30,000 retail touch points by 2018. Ultimately, it is planning to increase its retail base by 20 per cent every year. It is increasing 10,000 to 12,000 stores in our retail network annually. The company will soon launch its own website where consumer can buy products.
This article first appered in the Indian edition of Entrepreneur magazine (September, 2015 issue).