1. “An Entrepreneur is a person who habitually creates and innovates to build something of recognized value around perceived opportunities.”
The definition of entrepreneur above can be explained as follows. In the definition the word person is an individual or an organisation working together showing entrepreneurial characteristics. To achieve a luxury life style people establish businesses and entrepreneur runs it, entrepreneur is very different from the owner of the business. The word habitually in the definition differentiates an entrepreneur from its owner. Creates word being used in the definition that the entrepreneur begins from an unfilled place, bring into something that never existed there. Entrepreneur creates as well as innovates; entrepreneur looks the problem ahead as an opportunity. The output is the aim of an entrepreneur; build something in the definition describes that aim. Also the aim when build should be of recognised value, not necessarily in terms of money but socially also. An entrepreneur can see what others miss to see, spotting an opportunity is a quality of an entrepreneur. Manish Kalani is a perfect example of an entrepreneur; he clearly fits into the definition. There are different theories proposed by different philosophers. The theory which suits Mr. Manish Kalani the most was given by management guru Peter Drucker. (Thompson, J. & Bolton, B. 2004)
According to Peter Drucker an entrepreneur search for changes and explores the opportunity inside it and innovates accordingly. An entrepreneur utilizes its recourses in the best possible and productive form. Manish Kalani more or less fits into the theory proposed by Peter Drucker. Mr. Manish is already into his family business of manufacturing cement pressure pipe and sheet. An injection of capital in the business took Mr. Manish to sell the property owned by the family. He received an offer from a company which was planning to build a shopping mall on that place. He looked this as an opportunity to build something never seen by anyone. Mr. Manish changed the decision of selling their property and building his own baby there, which is today known as Treasure Island. He did a lot of research as it was the eighth mall in the country, which too in Tier-II city. Mr. Manish utilized the piece of land, and build the shopping mall named Treasure Island over it. This innovation was a great success for Mr. Manish Kalani. The city Indore boomed, Treasure Island became a land mark for the people. (Coulter, M. 2003)
Mr. Manish Kalani the promoter and developer of shopping malls in tire-II cities always take care of his corporate social responsibility. Mr. Manish Kalani while designing his projects made sure that the development of parks, roads and educational institutes. Mr. Manish Kalani took great initiative for providing education to many girls and boys of Chhindwara a small district in Madhya Pradesh, India. This great step taken by Mr. Kalani shows that he is society builder, he tries to generate a well educated and informed society. His social awareness also reflects on this company, Mr. Kalani appreciates young and talented people for working in organisation. He also opposes racial discrimination amongst employees. Also during the development of the project Mr. Manish Kalani keep in mind the safety and health standards of the working place. Many institutions have received contributions and donations from Mr. Manish Kalani. He has funded in the development of sure tech hospital and research centre ltd and many other institutions and organisation. This deed of Mr. Manish Kalani shows his social responsibility towards society which helped in maximizing opportunities, as it reflect a striking image. (scratchmysoul, 2008)
2. The business model of EWDPL consisted of different aspects. The first project was Treasure Island, which came when the scenario of injection of cash was required by Mr. Manish Kalani in his family business. Mr. Kalani looked upon the idea of building a shopping mall over the piece of land which was his home. He founded out that it is an extremely good proposal. After that he conducted different researches upon the demographics of the Indore city. He also performed various statistics on organized retail sector of India. The statistical data collected by Mr. Kalani and his team helped in creating a bottom line, it helped him in selecting the right target audience and applying the best marketing strategies. Mr. Manish used his research as a powerful tool for analysing. (Greenyer, A.2005)
EWDPL business model can be explained finely through Osterwalder's business model which says an organisation should consist of infrastructure, offer proposed by the company, the customer of the company and the finance of the company.
2.1The infrastructure includes the core capabilities, partner network and the value configuration of the company. EWDPL builds up shopping malls in tier II cities, which includes a variety of recognized brands, food and fun under one roof. The EWDPL is the first company to start up with a tier II city. The partner network which includes the business partners of EWDPL. Phoenix Mills private limited is deeply into development shopping malls, entertainment complex etc in Tier I cities. Other partners are Landmark Holdings, Biltech Engineers etc. The value configuration includes what are company activities; the main activity is development of finest shopping malls across tier II cities, with help of EWDPL partners. EWDPL has started its townships and vihars also.
2.2 The offer proposed or the value proposition by the company is a debating topic as it is quiet similar to the value configuration. The offering by the company is the completed malls, highly equipped towns and vihars which are the end result of the activities performed by the company.
2.3The customer interference includes the customer, the relationship with customer and the channel of the relation. EWDPL has a target audience which cannot be specified specifically in terms of age, gender or income. The malls developed are open for everyone, as the masterpiece Treasure Island is very attractive. Treasure Island the mall attracts a variety of people ranging from children to adults. To maintain the relationship with the customer EWDPL consistently work on their corporate social responsibility, it provides the visitor a security and parking services. The channel in case of EWDPL is majorly the mall itself, other things like township and vihars are still in progress.
2.4 EWDPL has a strong finance behind it, ICICI venture, Phoenix Mills, K2C, Sapphire and more. Different companies and banks have invested their capital in EWDPL. EWDPL smartly distributed the equity of the investors in different projects, which shows an efficient utilization of resources. EWDPL cost structures includes the way money has been utilized. EWDPL also utilizes its funds to attract new investors, employees, transportation, etc. (Appendix 1)
2.5 There are also drawbacks in the model which are the EWDPL does not invest its funds in Advertising of its products. In today's world advertising is the key strategy adopted by marketers. EWDPL should adopt some promotional strategy, like discounts on different shops in malls, a club for regular customer. It should target on the different audiences like Kids, teenagers, adults and old age people. For e.g. for kids a playing area, for old age a theatre which plays old movies, for adults bars and lounges. Even there channel is also not definable properly. (Appendix 3)
3. The organised retail sector was started in 1971, which can be called a rough organized retail. The very first move was Nilgiris Supermarket it started in southern part of India only. After that there were many small but effective efforts by different companies for organised retail.(Sengupta, A.2008) Now in 2010 after the recession, the current organised retail sector in India has started showing its true colours. The conversation with Mr. Naveen Wadhwani an architect on 1st February has gave his views on current organised retail sector. He said that there is strong growth in the sector as mall are becoming a trend for hangouts and shopping. There is even scope for many architects, engineers, managers, constructer and more, as building a mall requires a lot of people together. On 2nd February Mr. S.K. Gupta a civil engineer highlighted his current workings on retail sector. Mr. Gupta is under a project of development of mall. He says that building a mall is difficult task, as he frequently receives offer for the construction of malls. He feels the current demand for organized retail is growing higher day by day. Mr. N. C. Maru on 2nd February is into development to retail sector is an old player in building industry, he is well-experienced. Mr. Maru said that demand for organised retail has increased in past few years.
A general survey was done on hand full of people about their view about organized retail sector. A few general questions were asked by the people.
3.1 Today shopping from streets has shifted to organized retail sector? [Shopping mall, multi brand outlets, super markets etc]. Almost 90% of the people agreed that the shopping today is done in malls, super market and other places. The people now have shifted from the street shopping to organized retail.
3.2 Do you often visit shopping malls, multi brand outlet, super market etc? 50% of people oftely visit shopping malls, 30% of people visit more than oftely and 20% of people visit ocasionally. This shows that the shopping culture has been affected largely by organized retail sector.
3.3 Do you think the future of organised retail sector is bright enough? 95% people said that the future of organized retail is bright enough.
3.4 Does branded goods today are leaving un-branded goods behind? 70% agree to the fact that branded good are more in demand and are relpacing un-branded goods. As branded goods are the key drivers of organised retail.
3.5 What do you prefer to buy? 85% of people are willing to buy branded goods rather than 15% prefer to buy un-branded only.
3.6 Do you think malls have raised the living standard of the people? 90% of people have agreed to the statment that malls have now provided us brands and services which were not there at one place. Other 10% of people dont know or are not exactly sure about the statment.
3.7 Do you think shoppingculture and behavior has been affected due to organised retail? 95% of people have agreed that yes there has been a drastic change in the shopping behaviour.
3.8 Does the concept of everything underone roof is innovative enough? 85% people agree that yes it is good to have everything under one roof.(Appendix 2)
Does the reserch signifies that organised retail is what todays people are demanding, this shows the future of this sector is bright enough. The future ahead is of India as it will be one of the major economic power. There has been seen an increase in the disposable income of middle class familes in India. After china india is the second largest untapped retail market. The spending pattern of india has changed drasctically, its is expected that Indian retail industry will be of $500 billion by the end of 2010. (Kumar,A et al 2009) Mr. Kalani have a great contribution in development of organised retail sector in India. Mr. Kalani brought in the shopping mall in tier II city which is a great innovation. The Tresure Island at Indore is a great success. He has a first mover advantage in the field, there are big players as DLF and unitech. But the big players only foucsed on tier I city. The development of mall in tier II city raised the living standard of people there, people today have become brand concious. This played and important role for branded goods and MNC's, as the demand for them increased. The step proved to be very sucessfull and there are future plans by Mr. Kalani to open such malls in different tier Ii cities. EWDPL is curently engaged in developing 11 malls in different city.
4. Today shopping in malls have become a trend in India, according to surveys it was founded out that organised retail outlet in United States of America is around 85% comparatively India has only 5%. The future of shopping will be mall, as there is intense scope in this field. EWDPL saw this gap in the market and tried to fulfil it with its unique ideas. But building a mall in India is not an easy task; it is full of risk and challenges as it require a huge investment. Shopping mall comes under commercial real estate sector, which shows the relation between real estate and malls. There are several risks and challenges involved in building up a mall. Some of the major risks and challenges have been highlighted below. (Srivastava, R.2008)
4.1 Risk and Challenges
First the most common is the project risks which consist of several parts, from project operating and managing costs of the project, the construction period risks. Even the quality and the design of the production can be challenge for the builder. The financial risk and the sales price risk is also a topic of thinking for a developer of shopping mall. During the current recession the shopping mall developer during the time of recession faced several other problems also. The risks, challenges and other problems faced by developer of shopping malls.
4.1.1 Operating and Management risk
Operating the project and leading it to the development requires great efficiency. The risk mainly includes the unexpected outflow of the cash which generally occur due to lack in the management of the operations.
4.1.2 Construction period risk
The time required for the construction is generally risk taken care of; developers of shopping mall always take buffer days. There is risk for construction techniques as it can take more time than expected. The change in design of architecture has a great influence on the project. Construction accidents, damaged machinery are small things but can slow down the construction. Calculation errors are rare but can create a mess during or after the construction.
4.1.3 Quality and Design
The quality and design of the mall is a thing to be kept in mind by the developer. Quality of raw material used should be passed through a quality check. Even the design should be making such way that proper spaces allotted to shops, parking, traffic and disasters.
4.1.4 Demographic risk
Choosing a right place to develop a mall is most difficult and lengthy task. The demographics narrow down the selecting of correct place. A wrong decision can cause great losses, whereas a good decision can make profits. A strong research has to be done to know a demographic of a place. Age, disposable income, living standard, buyer behaviour etc are the things to be kept in mind while researching.
4.1.5 Financial Risk
The three main parts in the financial risk are:
A) Change in the Tax rate, it is the change in the operation of real estate development.
B) Change in the inflation rate, is issue which a developer cannot handle. A high rate of inflation can cause large losses, as the value future profit will be decreased.
C) Change in the Interest rate is a great threat for developer of mall; more than 50% of investment is done by the banks and other private players.
4.1.6 Sale price risk
During the time of recession Sale price risk generally faced by a shopping mall developer. During the time of recession the price expected to sell is not achieved easily. Real estate cycle is one of the cycle prefer by the buyer, as it shows the correct time to buy or invest in a piece of land.
There are also several methods to calculate the risk involved, one of them is Fuzzy risk evaluation. It consists of risk evaluation for real estate projects, this method measures the risk involved in a project. After the evaluation it correlates and tells the influence of that risk. To win the risks on the project one must apply certain methods to overcome or win the risks and earn better profits. (Suna, Y et al. 2008)
There is a bright future ahead for developing shopping centre in India as the market has only grown to 5% as compared to 85% in United States of America. The growth of retail sector in year 2008 was quiet slow, but India in 2009 is the place which global retailers are targeting to enter. Developing a shopping mall consists of high risks, but a high rate of returns is also there. The step taken by Mr. Manish Kalani towards developing mall in tier II city proved to be very successful. The EWDPL is further planning to introduce number of malls, townships and vihars also, after seeing the growth in the sector. (Kearney, A 2009)
The report gives us the conclusion that the Indian retail sector is the next big thing coming. The developers of organized retail has shaken entire nation. The future of organized retail ahead is quiet high which will be seen in the coming future. EWDPL and Mr. Manish Kalani an entrepreneur together will make India rise to the heights where people have never thought.
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