The Beholder Of Beauty
While most businesses truly believe in the value their customers hold for them but YLG made it extreme.
Entrepreneurship struck Rahul Bhalchandra bit late – at 40. "I should have started 10 years before that." That's the only sign of regret you would notice in otherwise confident and no-nonsense Bhalchandra's voice – Co-Founder of Bengaluru based salon chain You Look Great (YLG). Though he started off late as an entrepreneur, it hardly took him time to find his true calling - YLG, in 2008. The company today has managed to stand out among its contemporaries.Before YLG, Bhalchandra was heading the Future Group's wellness business where he built the Health &Beauty category, was instrumental in setting up the group's company with Sachin Tendulkar (Products branded "Sach" retail across the Future Group stores) and set up its salon chain - Star &Sitara.
However, venturing into the salon business wasn't actually the "Plan A' for Bhalchandra and his wife Vaijayanti. "We wanted to start a retail chain because I already knew how to run it," says Bhalchandra.
But right into their first interaction with an investor, the duo realized that they were in the wrong boat. "The investors asked me why don't you start a salon business because foreign direct investment in retail is not allowed. And, they were ready to back me," he remembers. But, this meant controlling their evolving lifestyle, if not cutting down on it.
"The car – Innova that I had 11 years back, I still drive that. We were clear that it will take at least a decade to set up a significant service business and hence we would have to pause our material advancements," he states.
While most businesses truly believe in the value their customers hold for them but YLG made it extreme. Bhalchandra left it for his customers to name his brand. The name also resonates when it comes to quality benchmark. But in an industry that's highly unorganized how does one build the trust of quality for its customers? For YLG, it is the question of how you deliver the service.
"Every other salon might claim quality but the kind of practices we have maintained I don't think any salon does that. For e.g., all my laundry is done in-house, we have a centralized laundry service," claims Bhalchandra, now 49.
Also, every new joinee at YLG undergoes a skill test for every service and is inducted once the service trainer clears him/her. For e.g. as a stylist, YLG trainer will test him/her on cutting, blow drying, creative coloring etc. "I will not hire you even if you are coming from a large brand. You have to learn how we do things at YLG otherwise you cannot touch my customers," cautions Bhalchandra.
YLG has many industry firsts as well, including the European Light Therapy facials that use blue and red light at a certain wavelength for better penetration.
While the business has gained significant scale and size of 45 centers (36 in Bengaluru and nine in Chennai) and soon to be launched in Hyderabad, Bhalchandra has realized few things that he won't do, learning from past nine years.
At YLG instead of number of centres, it is about creating a model which is predictable, profitable and sustainable in terms of growth in a particular period.
"As a retailer if I can make the business predictable of reaching profitability in particular period, that's when the brand has cracked it, I think. To that extent we have been fairly successful in Bengaluru. We are now becoming lot more predictable in Chennai," explains Bhalchandra.
For him, the biggest achievement is being profitable at the centre level. Apart from that, YLG will remain focused on women and operate only at neighborhood stores or few mall stores.
"During our consumer studies, we found that to scale up to 100 outlets in a city means positioning our self as a mid premium players. We chose to focus on our customer as the hero and provide great value to women as the brand is well known as a women's brand," opines Bhalchandra.
When it comes to recruitment, he is sure of not having "heroes' in his system. "If someone wants a particular star stylist, creative director, or an art director who do celebrity clients– then the customer is at the wrong place." YLG has around 7,000 sq. ft of training academy which was set up even before the first salon was operational.
The company quarterly and annually recognizes top performers in both the cities and offers all expenses paid training and incentive trip to foreign locales.
"This year we are taking a 25 people team to Vienna for four days," smiles Bhalchandra. The company is currently piloting app-based home services for customers.
RE-IMAGINING BEAUTY YEAR OF LAUNCH: 2008, Bengaluru
FOUNDERS: Rahul Bhalchandra and Vaijayanti Bhalchandra
TOTAL CENTRES: 45 in total - Bengaluru (36) and Chennai (nine)
TARGET AUDIENCE: Mid premium
EXPANSION: Hyderabad in three months, piloting home-based services FUNDING: $5m from Helion Ventures in 2008 and undisclosed sum from Everstone Capital in 2012
ACADEMY: ~7,000 sq. ft
(This article was first published in the May issue of Entrepreneur Magazine. To subscribe, click here)