case studies ( business)

Case let 1This case provides the opportunity to match financing alternatives with the needs of different companies.It allows the reader to demonstrate a familiarity with different types of securities. George Thomas wasfinishing some weekend reports on a Friday afternoon in the downtown office of Wishart and Associates,an investment-banking firm. Meenda, a partner in the firm, had not been in the New York office sinceMonday. He was on a trip through Pennsylvania, visiting five potential clients, who were considering theflotation of securities with the assistance of Wishart and Associates. Meenda had called the office onWednesday and told George’s secretary that he would cable his recommendations on Friday afternoon.George was waiting for the cable. George knew that Meenda would be recommending different types ofsecurities for each of the five clients to meet their individual needs. He also knew Meenda wanted him tocall each of the clients to consider the recommendations over the weekend. George was prepared to makethese calls as soon as the cable arrived. At 4:00 p.m. a secretary handed George the following telegram.George Thomas, Wishart and Associates STOP Taking advantage of offer to go skiing in Poconos STOPRecommendations as follows: (1) common stock, (2) preferred stock, (3) debt with warrants, (4)convertible bonds, (5) callable debentures STOP. See you Wednesday STOP Meenda. As George pickedup the phone to make the first call, he suddenly realized that the potential clients were not matched withthe investment alternatives. In Meenda’s office, George found folders on each of the five firms seekingfinancing. In the front of each folder were some handwritten notes that Meenda had made on Mondaybefore he left. George read each of the notes in turn. APT, Inc needs $8 million now and $4 million infour years. Packaging firm with high growth rate in tri-state area. Common stock trades over the counter.Stock is depressed but should rise in year to 18 months. Willing to accept any type of security. Goodmanagement. Expects moderate growth. New machinery should increase profits substantially. Recentlyretired $7 million in debt. Has virtually no debt remaining except short-term obligations.Sandford EnterprisesNeeds $16 million. Crusty management. Stock price depressed but expected to improve. Excellent growthand profits forecast in the next two year. Low debt-equity ratio, as the firm has record of retiring debtprior to maturity. Retains bulk of earnings and pays low dividends. Management not interested insurrendering voting control to outsiders. Money to be used to finance machinery for plumbing supplies.Sharma Brothers., Inc.Needs $20 million to expand cabinet and woodworking business. Started as family business but now has1200 employees, $50 million in sales, and is traded over the counter. Seeks additional shareholder but notwilling to stock at discount. Cannot raise more than $12 million with straight debt. Fair management.Good growth prospects. Very good earnings. Should spark investor’s interest. Banks could be willing tolend money for long-term needs.Sacheetee Energy SystemsThe firm is well respected by liberal investing community near Boston area. Sound growth company.Stock selling for $16 per share. Management would like to sell common stock at $21 or more willing toExamination Paper Semester I: Financial ManagementIIBM Institute of Business Managementuse debt to raise $ 28 million, but this is second choice. Financing gimmicks and chance to turn quickprofit on investment would appeal to those likely to invest in this company.Ranbaxy IndustryNeeds $25 million. Manufactures boat canvas covers and needs funds to expand operations. Needs longtermmoney. Closely held ownership reluctant surrender control. Cannot issue debt without permission ofbondholders and First National Bank of Philadelphia. Relatively low debt-equity ratio. Relatively highprofits. Good prospects for growth Strong management with minor weaknesses in sales and promotionareas. As George was looking over the folders, Meenda’s secretary entered the office. George said, “DidMeenda leave any other material here on Monday except for these notes?” She responded, “No, that’s it,but I think those notes should be useful. Meenda called early this morning and said that he verified thefacts in the folders. He also said that he learned nothing new on the trip and he sort of indicated that, hehad wasted his week, except of course, that he was invited to go skiing at the company lodge up there”.George pondered over the situation. He could always wait until next week, when he could be sure that hehad the right recommendations and some of the considerations that outlined each client’s needs andsituation. If he could determine which firm matched each recommendation, he could still call the firms by6:00 P.M. and meet the original deadline. George decided to return to his office and match each firm withthe appropriate financing.Question:1. Which type of financing is appropriate to each firm?2. What types of securities must be issued by a firm which is on the growing stage in order to meetthe financial requirements?Case let 2This case has been framed in order to test the skills in evaluating a credit request and reaching a correctdecision. Perluence International is large manufacturer of petroleum and rubber-based products used in avariety of commercial applications in the fields of transportation, electronics, and heavy manufacturing.In the northwestern United States, many of the Perluence products are marketed by a wholly-ownedsubsidiary, Bajaj Electronics Company. Operating from a headquarters and warehouse facility in SanAntonio, Strand Electronics has 950 employees and handles a volume of $85 million in sales annually.About $6 million of the sales represents items manufactured by Perluence. Gupta is the credit manager atBajaj electronics. He supervises five employees who handle credit application and collections on 4,600accounts. The accounts range in size from $120 to $85,000. The firm sells on varied terms, with 2/10, net30 mostly. Sales fluctuate seasonally and the average collection period tends to run 40 days. Bad-debtlosses are less than 0.6 per cent of sales. Gupta is evaluating a credit application from Booth Plastics, Inc.,a wholesale supply dealer serving the oil industry. The company was founded in 1977 by Neck A. Boothand has grown steadily since that time. Bajaj Electronics is not selling any products to Booth Plastics andhad no previous contact with Neck Booth. Bajaj Electronics purchased goods from PerluenceInternational under the same terms and conditions as Perluence used when it sold to independentcustomers. Although Bajaj Electronics generally followed Perluence in setting its prices, the subsidiaryoperated independently and could adjust price levels to meet its own marketing strategies. The Perluence’scost-accounting department estimated a 24 per cent markup as the average for items sold to PuccaElectronics. Bajaj Electronics, in turn, resold the items to yield a 17 per cent markup. It appeared thatthese percentages would hold on any sales to Booth Plastics. Bajaj Electronics incurred out-of pocketexpenses that were not considered in calculating the 17 per cent markup on its items. For example, thecontact with Booth Plastics had been made by James, the salesman who handled the Glaveston area.Examination Paper Semester I: Financial ManagementIIBM Institute of Business ManagementJames would receive a 3 per cent commission on all sales made Booth Plastics, a commission that wouldbe paid whether or not the receivable was collected. James would, of course, be willing to assist incollecting any accounts that he had sold. In addition to the sales commission, the company would incurvariable costs as a result of handling the merchandise for the new account. As a general guideline,warehousing and other administrative variable costs would run 3 per cent sales. Gupta Holmsteadapproached all credit decisions in basically the same manner. First of all, he considered the potentialprofit from the account. James had estimated first-year sales to Booth Plastics of $65,000. Assuming thatNeck Booth took the, 3 per cent discount. Bajaj Electronics would realize a 17 per cent markup on thesesales since the average markup was calculated on the basis of the customer taking the discount. If NeckBooth did not take the discount, the markup would be slightly higher, as would the cost of financing thereceivable for the additional period of time. In addition to the potential profit from the account, Gupta wasconcerned about his company’s exposure. He knew that weak customers could become bad debts at anytime and therefore, required a vigorous collection effort whenever their accounts were overdue. Hisdepartment probably spent three times as much money and effort managing a marginal account ascompared to a strong account. He also figured that overdue and uncollected funds had to be financed byBajaj Electronics at a rate of 18 per cent. All in all, slow -paying or marginal accounts were very costly toBajaj Electronics. With these considerations in mind, Gupta began to review the credit application forBooth Plastics.Question:1. How would you judge the potential profit of Bajaj Electronics on the first year of sales to BoothPlastics and give your views to increase the profit.2. Suggestion regarding Credit limit. Should it be approved or not, what should be the amount ofcredit limit that electronics give to Booth Plastics.·Detailed information should form the part of your answer (Word limit 200-250 words).1. Honey Well Company is contemplating to liberalize its collection effort. Its present sales are Rs.10 lakh, its average collection period is 30 days, its expected variable cost to sales ratio is 85 percent and its bad debt ratio is 5 per cent. The Company’s cost of capital is 10 per cent and tax areis 40 per cent. He proposed liberalization in collection effort increase sales to Rs. 12 lakhincreases average collection period by 15 days, and increases the bad debt ratio to 7 percent.Determine the change in net profit.Case let 3Trust them with knee-jerk reactions,” said Vikram Koshy, CEO, Delta Software India, as he looked at thequarterly report of Top Line Securities, a well-known equity research firm. The firm had announced adowngrade of Delta, a company listed both on Indian bourses and the NASDAQ. The reason? “One outof every six development engineers in the company is likely to be benched during the remaining part ofthe year.” Three analysts from Top Line had spent some time at Delta three weeks ago. Koshy and histeam had explained how benching was no different from the problems of excess inventory, idle time, andsurplus capacity that firms in the manufacturing sector face on a regular basis, “Delta has witnessed ascorching pace of 30 per cent growth during the last five years in a row,” Koshy had said, “What ishappening is a corrective phase.” But, evidently, the analysts were unconvinced.Why Bench?Clients suddenly decide to cut back on IT spends Project mix gets skewed, affecting work allocationEmployee productivity is set to fall, creating slack working conditions. High degree of job specializationleads to redundancyWhat are the options?Quickly cut costs in areas which are non-core look for learning’s from the manufacturing sector Focus onalternative markets like Europe and Japan Move into products, where margins are better. Of course, theTop Line report went on to cite several other “signals,” as it said: the rate of annual hike in salaries atDelta would come down to 5 per cent (from between 20 and 30 per cent last year); the entry-level intakeof engineers from campuses in June 2001, would decline to 5 per cent (unlike the traditional 30 per centaddition to manpower every year); and earnings for the next two years could dip by between 10 and 12per cent. And the loftiest of them all: “The meltdown at Nasdaq is unlikely to reverse in the near future.””Some of the signals are no doubt valid. And ominous,” said Koshy, addressing his A-Team, which hadassembled for the routine morning meeting. “But, clearly, everyone is reading too much into this businessof benching. In fact, benching is one of the many options that our principals in the US have been pursuingas part of cutting costs right since September, 2000. They are also expanding the share of off-shore jobs.Five of our principals have confirmed that they would outsource more from Delta in India-which is likelyto hike their billings by about 30 per cent. At one level, this is an opportunity for us. At another, ofcourse, I am not sure if we should be jubilant, because they have asked for a 25-30 per cent cut in billingrates. Our margins will take a hit, unless we cut costs and improve productivity.” “Productivity is clearly amatter of priority now,” said Vivek Varadan, Vice-President (Operations). “If you consider benching as anon-earning mode, we do have large patches of it at Delta. As you are aware, it has not been easy tosecure 70 per cent utilization of our manpower, even in normal times. I think we need to look at why wehave 30 per cent bench before examining how to turn it into an asset.” “There are several reasons,”remarked Achyut Patwardhan, Vice-President (HR). “And a lot of it has to do with the nature of ourbusiness, which is more project-driven than product-driven. When you are managing a number ofoverseas and domestic projects simultaneously, as we do at Delta, people tend to go on the bench. Theywait, as they complete one project, and are assigned the next. There are problems of coordination betweenprojects, related to the logistics of moving people and resources from one customer to another. In fact, Iam fine-tuning our monthly manpower utilization report to provide a breakup of bench costs intoExamination Paper Semester I: Human Resource ManagementIIBM Institute of Business Managementspecifics-leave period, training programmes, travel time, buffers, acclimatization period et al.” “It wouldbe worthwhile following the business model used by US principal Techno Inc,” said Aveek Mohanty,Director (Finance). “The company has a pipeline of projects, but it does not manage project by project.What it does is to slice each project into what it calls ‘activities’. For example, communicationnetworking; user interface development; scheduling of processes are activities common to all projects.People move from one project to another. It is somewhat like the Activity Based Costing. It throws up thebench time straightaway, which helps us control costs and revenue better.” “I also think we should reduceour dependence on projects and move into products,” said Praveen Kumar, Director (Marketing). “That iswhere the opportunity for brand building lies. In fact, now is the time to get our technology guys involvedin marketing. Multiskilling helps reduce the bench time.” “Benching has an analogy in the manufacturingsector,” said Girish Shahane, Vice-President (Services). “We could look for learning’s there. Many firmshave adopted Just-In-Time (JIT) inventory as part of eliminating idle time. It would be worthwhileexploring the possibility of JIT. But the real learning lies in standardization of work. It is linked to whatMohanty said about managing by activities.” “At a broader level, I see several other opportunities,” saidKoshy, “We can fill in the space vacated by US firms and move up the value chain. But before we do so,Delta should consolidate its position as the premier outsourcing centre. Since there are only two ways inwhich we can generate revenue-sell expertise or sell products-we should move towards a mix of both.Tie-ups with global majors will help. Now is the time to look beyond the US and strike alliances withfirms in Europe- and also Japan-as part of developing new products for global markets.”Questions1. Should benching be a matter of concern at Delta?2. What are the risks involved in moving from a project-centric mode to a mix of projects andproducts?Case let 4The contexts in which human resources are managed in today’s organizations are constantly, changing.No longer do firms utilize one set of manufacturing processes, employ a homogeneous group of loyalemployees for long periods of time or develop one set way of structuring how work is done andsupervisory responsibility is assigned. Continuous changes in who organizations employ and what theseemployees do require HR practices and systems that are well conceived and effectively implemented toensure high performance and continued success.1. Automated technologies nowadays require more technically trained employees possessing multifariousskills to repair, adjust or improve existing processes. The firms can’t expect these employees (Gen Xemployees, possessing superior technical knowledge and skills, whose attitudes and perceptions towardwork are significantly different from those of their predecessor organizations: like greater self control,less interest in job security; no expectations of long term employment; greater participation urge in workactivities, demanding opportunities for personal growth and creativity) to stay on without attractivecompensation packages and novel reward schemes.2. Technology driven companies are led by project teams, possessing diverse skills, experience andexpertise. Flexible and dynamic organizational structures are needed to take care of the expectations ofmanagers, technicians and analysts who combine their skills, expertise and experience to meet changingcustomer needs and competitive pressures.3. Cost cutting efforts have led to the decimation of unwanted layers in organizational hierarchy in recenttimes. This, in turn, has brought in the problem of managing plateau employees whose careers seem tohave been hit by the delivering process. Organizations are, therefore, made to find alternative career pathsfor such employees.Examination Paper Semester I: Human Resource ManagementIIBM Institute of Business Management4. Both young and old workers, these days, have values and attitudes that stress less loyalty to thecompany and more loyalty to oneself and one’s career than those shown by employees in the past,Organizations, therefore, have to devise appropriate HR policies and strategies so as to prevent the flightof talented employeesQuestion1. Discuss that technological breakthrough has brought a radical changes in HRM.Case let 5The war on drugs is an expensive battle, as a great deal of resources go into catching those who buy orsell illegal drugs on the black market, prosecuting them in court, and housing them in jail. These costsseem particularly exorbitant when dealing with the drug marijuana, as it is widely used, and is likely nomore harmful than currently legal drugs such as tobacco and alcohol. There’s another cost to the war ondrugs, however, which is the revenue lost by governments who cannot collect taxes on illegal drugs. In arecent study for the Fraser Institute, Canada, Economist Stephen T. Easton attempted to calculate howmuch tax revenue the government of the country could gain by legalizing marijuana. The study estimatesthat the average price of 0.5 grams (a unit) of marijuana sold for $8.60 on the street, while its cost ofproduction was only $1.70. In a free market, a $6.90 profit for a unit of marijuana would not last for long.Entrepreneurs noticing the great profits to be made in the marijuana market would start their own growoperations, increasing the supply of marijuana on the street, which would cause the street price of thedrug to fall to a level much closer to the cost of production. Of course, this doesn’t happen because theproduct is illegal; the prospect of jail time deters many entrepreneurs and the occasional drug bust ensuresthat the supply stays relatively low. We can consider much of this $6.90 per unit of marijuana profit arisk-premium for participating in the underground economy. Unfortunately, this risk premium is making alot of criminals, many of whom have ties to organized crime, very wealthy. Stephen T. Easton argues thatif marijuana was legalized, we could transfer these excess profits caused by the risk premium from thesegrow operations to the government: If we substitute a tax on marijuana cigarettes equal to the differencebetween the local production cost and the street price people currently pay – that is, transfer the revenuefrom the current producers and marketers (many of whom work with organized crime) to the government,leaving all other marketing and transportation issues aside we would have revenue of (say) $7 per [unit].If you could collect on every cigarette and ignore the transportation, marketing, and advertising costs, thiscomes to over $2 billion on Canadian sales and substantially more from an export tax, and you forego thecosts of enforcement and deploy your policing assets elsewhere. One interesting thing to note from such ascheme is that the street price of marijuana stays exactly the same, so the quantity demanded shouldremain the same as the price is unchanged. However, it’s quite likely that the demand for marijuana wouldchange from legalization. We saw that there was a risk in selling marijuana, but since drug laws oftentarget both the buyer and the seller, there is also a risk (albeit smaller) to the consumer interested inbuying marijuana. Legalization would eliminate this risk, causing the demand to rise. This is a mixed bagfrom a public policy standpoint: Increased marijuana use can have ill effects on the health of thepopulation but the increased sales bring in more revenue for the government. However, if legalized,governments can control how much marijuana is consumed by increasing or decreasing the taxes on theproduct. There is a limit to this, however, as setting taxes too high will cause marijuana growers to sell onthe black market to avoid excessive taxation. When considering legalizing marijuana, there are manyeconomic, health, and social issues we must analyze. One economic study will not be the basis ofCanada’s public policy decisions, but Easton’s research does conclusively show that there are economicbenefits in the legalization of marijuana. With governments scrambling to find new sources of revenue topay for important social objectives such as health care and education expect to see the idea raised inParliament sooner rather than later.Examination Paper Semester I: Managerial EconomicsIIBM Institute of Business ManagementQuestions1. Plot the demand schedule and draw the demand curve for the data given for Marijuana in the caseabove.2. On the basis of the analysis of the case above, what is your opinion about legalizing marijuana inCanada?Case let 6Companies that attend to productivity and growth simultaneously manage cost reductions very differentlyfrom companies that focus on cost cutting alone and they drive growth very differently from companiesthat are obsessed with growth alone. It is the ability to cook sweet and sour that under grids theremarkable performance of companies likes Intel, GE, ABB and Canon. In the slow growth electrotechnicalbusiness, ABB has doubled its revenues from $17 billion to $35 billion, largely by exploitingnew opportunities in emerging markets. For example, it has built up a 46,000 employee organization inthe Asia Pacific region, almost from scratch. But it has also reduced employment in North America andWestern Europe by 54,000 people. It is the hard squeeze in the north and the west that generated theresources to support ABB’s massive investments in the east and the south. Everyone knows about thestaggering ambition of the Ambanis, which has fuelled Reliance’s evolution into the largest privatecompany in India. Reliance has built its spectacular rise on a similar ability to cook sweet and sour. Whatpeople may not be equally familiar with is the relentless focus on cost reduction and productivity growththat pervades the company. Reliance’s employee cost is 4 per cent of revenues, against 15-20 per cent ofits competitors. Its sales and distribution cost, at 3 per cent of revenues, is about a third of globalstandards. It has continuously pushed down its cost for energy and utilities to 3 per cent of revenues,largely through 100 per cent captive power generation that costs the company 4.5 cents per kilowatt-hour;well below Indian utility costs, and about 30 per cent lower than the global average. Similarly, its capitalcost is 25-30 per cent lower than its international peers due to its legendary speed in plant commissioningand its relentless focus on reducing the weighted average cost of capital (WACC) that, at 13 per cent, isthe lowest of any major Indian firm.A Bias for GrowthComparing major Indian companies in key industries with their global competitors shows that Indiancompanies are running a major risk. They suffer from a profound bias for growth. There is nothing wrongwith this bias, as Reliance has shown. The problem is most look more like Essar than Reliance. Whilethey love the sweet of growth, they are unwilling to face the sour of productivity improvement.Nowhere is this more amply borne out than in the consumer goods industry where the Indian giantHindustan Lever has consolidated to grow at over 50 per cent while its labour productivity declined byaround 6 per cent per annum in the same period. Its strongest competitor, Nirma, also grew at over 25 percent per annum in revenues but maintained its labour productivity relatively stable. Unfortunately,however, its return on capital employed (ROCE) suffered by over 17 per cent. In contrast, Coca Cola,worldwide, grew at around 7 per cent, improved its labour productivity by 20 per cent and its return oncapital employed by 6.7 per cent. The story is very similar in the information technology sector whereInfosys, NIIT and HCL achieve rates of growth of over 50 per cent which compares favorably with theworld’s best companies that grew at around 30 per cent between 1994-95. NIIT, for example, stronglybelieves that growth is an impetus in itself. Its focus on growth has helped it double revenues every twoyears. Sustaining profitability in the face of such expansion is an extremely challenging task. For now,this is a challenge Indian InfoTech companies seem to be losing. The ROCE for three Indian majors fellby 7 per cent annually over 1994-96. At the same time IBM Microsoft and SAP managed to improve thisratio by 17 per cent. There are some exceptions, however. The cement industry, which has focused onproductivity rather than on growth, has done very well in this dimension when compared to their globalExamination Paper Semester I: Managerial EconomicsIIBM Institute of Business Managementcounterparts. While Mexico’s Cemex has grown about three times fast as India’s ACC, Indian cementcompanies have consistently delivered better results, not only on absolute profitability ratios, but also onabsolute profitability growth. They show a growth of 24 per cent in return on capital employed whileinternational players show only 8.4 per cent. Labour productivity, which actually fell for most industriesover 1994-96, has improved at 2.5 per cent per annum for cement.The engineering industry also matches up to the performance standards of the best in the world.Companies like Cummins India have always pushed for growth as is evidenced by its 27 per cent rate ofgrowth, but not at the cost of present and future profitability. The company shows a healthy excess ofalmost 30 per cent over WACC, displaying great future promise. BHEL, the public sector giant, has seensimilar success and the share price rose by 25 per cent despite an indecisive sensex. The only note ofcaution: Indian engineering companies have not been able to improve labour productivity over time,while international engineering companies like ABB, Siemens and Cummins Engines have achievedabout 13.5 per cent growth in labour productivity, on an average, in the same period. The pharmaceuticalsindustry is where the problems seem to be the worst, with growth emphasized at the cost of all otherperformance. They have been growing at over 22 per cent, while their ROCE fell at 15.9 per cent perannum and labour productivity at 7 per cent. Compare this with some of the best pharmaceuticalcompanies of the world – Glaxo Wellcome, SmithKline Beecham and Pfizer –who have consistentlyachieved growth of 15-20 per cent, while improving returns on capital employed at about25 per cent and labour productivity at 8 per cent. Ranbaxy is not an exception; the bias for growth at thecost of labour and capital productivity is also manifest in the performance of other Indian Pharmacompanies. What makes this even worse is the Indian companies barely manage to cover their cost ofcapital, while their competitors worldwide such as Glaxo and Pfizer earn an average ROCE of 65 percent. In the Indian textile industry, Arvind Mills was once the shining star. Like Reliance, it had learnt tocook sweet and sour. Between 1994 and 1996, it grew at an average of 30 per cent per annum to becomethe world’s largest denim producer. At the same time, it also operated a tight ship, improving labourproductivity by 20 per cent. Despite the excellent performance in the past, there are warning signals forArvind’s future. The excess over the WACC is only 1.5 per cent, implying it barely manages to satisfy itsinvestor’s expectations of return and does not really have a surplus to re-invest in the business.Apparently, investors also think so, for Arvind’s stock price has been falling since Q4 1994 despite suchexcellent results and, at the end of the first quarter of 1998, is less than Rs 70 compared to Rs 170 at theend of 1994. Unfortunately, Arvind’s deteriorating financial returns over the last few years is also typicalof the Indian textile industry. The top three Indian companies actually showed a decline in their returnratios in contrast to the international majors. Nike, VF Corp and Coats Viyella showed a growth in theirreturns on capital employed of 6.2 per cent, while the ROCE of Grasim and Coats Viyella (India) fell byalmost 2 per cent per annum. Even in absolute returns on assets or on capital employed, Indian companiesfare a lot worse. While Indian textile companies just about cover their WACC, their international rivalsearn about 8 per cent in excess of their cost of capital.Questions1. Is Indian companies running a risk by not giving attention to cost cutting?2. Discuss whether Indian Consumer goods industry is growing at the cost of future profitability.3. Discuss capital and labour productivity in engineering context and pharmaceutical industries inIndia.4. Is textile industry in India performing better than its global competitors?·Detailed information should form the part of your answer (Word limit 200 to 250 words).1. Free trade promotes a mutually profitable regional division of labour, greatly enhances thepotential real national product of all nations and makes possible higher standards of living allover the globe.” Critically explain and examine the statement.2. What role does a decision tree play in business decision-making? Illustrate the choice betweentwo investment projects with the help of a decision tree assuming hypothetical conditions aboutthe states of nature, probability distribution, and corresponding pay-offs.Case let 7Ask the company top brass what ‘almost there’ means. The answer: a premier Indian retail company thathas come to be known as a specialty chain of apparel and accessories. With 52 product categories underone roof, Shoppers’ Stop has a line-up of 350 brands. Set up and headed by former Corona employee, B.S. Nagesh, Shoppers’ Stop is India’s answer to Selfridges and Printemps. As it proudly announces, ‘Wedon’t sell, we help you buy.’ Back in 1991, there was the question of what to retail. Should it be asupermarket or a departmental store? Even an electronics store was considered. Finally, common senseand understanding won out. The safest bet, for the all-male team was to retail men’s wear. They knew themale psyche and felt that they had discerning taste in men’s clothing. The concept would be that of alifestyle store in a luxurious space, which would make for a great shopping experience. The firstShoppers’ Stop store took shape in Andheri, Mumbai, in October 1991, with an investment of nearly Rs.20 lakh. The original concept that formed the basis of a successful marketing campaign for seven years ishere to stay. And the result is an annual turnover of Rs. 160 crores and five stores, nine years later.Everything went right from the beginning, except for one