Pak Retailers – Interview Episode 02 – Mr. Sohail Rafaqat – Bin Dawood Departmental Store

My name is Sohail Rafaqat and I did MBA from PAKAIMS. I am doing business for the last 10 years and this is our family business. Not exactly. We know the margin that distributor is offering us but not about one offered by the company. We only know clearly about the margin given to us by the distributor otherwise we have no idea. Transparency issue is regarding two things. One, we do not know exactly about the margin and the second thing is the issue of manual bill. It becomes impossible to figure out our margin given by the distributor through manual bills. Moreover, we know nothing about the margin being offered by the company. For example, what Nestle is paying to the distributor in terms of margin for the retailer is unknown. We only know what the distributor is offering us. If you see, this leads to price variation in different shops because wholesaler gives a different price and distributor gives a different price. There is a little difference in both. But, the price remains same for the consumers but retailer’s margins fluctuates this way. I cannot tell exactly but around 10-15 per day and almost 60 monthly. At times, the distributor approaches us and sometimes we have to get in touch with the distributors of the companies who do not come to us. We search for them or ask the other salesperson about the company’s distributor and coordinate with them. Even I call companies like (beep) to inform them that nobody is coming so please send someone. It happens this way but most of the time they approach us but in certain cases, we have to approach them too. Most of the time while ordering from the order taker. He tells us about the launch of the new products. Sometimes, customers inquire about the new product which is not instore so we ask the distributor or the order taker about the new product that this product is in the market and it is not available with us. It is both ways. Sometimes order taker tells us directly or we get to know about the product from word of mouth. We get to know normally from the order taker that a new promotion has come and how it can be availed. There are free offers a times or other promotional offers but mostly order taker tells us about trade promos. Companies never contact us directly to inform us. The representative of the distributor tells us about the promo and how one can benefit from it. It is very important for all kind of businesses. If the shop will not look impressive from the outside, how come a person is going to come inside? Therefore, it is necessary to decorate the shop with flexes and we are doing it. Not yet due to time constraints but if I have a chance, I will definitely go for that. Few companies like big companies such as (beep) and even few biscuit companies. Their supervisors and managers come to us. Basically they come to us to check if we are getting the services as per their set standards or not. I would love to go but my business is very time-consuming because I come 10 O’clock in the morning and go back home around 12-12:30am. So, it becomes difficult to get time for such events but my family attends such events and I would love to go too but it is difficult for me. Yes, we have a credit card facility for our customers and whenever they ask for it, we facilitate them. I came to know about it few years back. There was a food festival in fortress and there was a company called (beep). I used their app and I paid through the QR code over there. It is good for us because you do not have to carry money and you can pay by scanning the code right there. It is a good initiative. Not really right now because this is my family business and we have enough money. Maybe I go for it at a later stage. God knows better. Why not, everybody wants publicity. A business needs publicity all the time because you need to reach the people. I would love to avail such opportunity if you give it to us. Yes. I have been using smartphone for a long time. Everybody has a smartphone these days. Either the rich or the poor, educated or uneducated, everyone has a smartphone. WhatsApp, Facebook is very common everywhere. In Pakistan, everyone is using smartphone because Internet is very cheap here. Yes, I regularly use all the apps. A million dollar question. There are a lot of issues. The one issue we are facing right now is that if we order 10 products of a company, most of time we get 8 out of 10 products because 2 products are not available. While we are ordering to the order taker, he tells us that these products are available and these are not available. At times, certain products of certain companies are not available. It also happens that when the placed order is delivered, then we get to know that certain products were not available in the godown. I don’t know why the distributor does not maintain the supply of products. Everybody wants us to place the order so that it will be delivered in the morning and when it is to be delivered, products are not available. The excuse is very simple that the products were not in stock. The second issue is of pricing. We do not know our exact margin. If there are 50 products of Unilever, our margin is different on every product. Similarly, they do not tell us about the schemes. We get to know later that we were supposed to get 2 free products. There are few companies who inform us about the schemes otherwise the distributor or the salesperson informs us. Either of them creates issue somewhere. The third issue is that we do not know the margin that is set by the company for the retailer. If we know that margin, we can fight for it with the distributor that we had this margin from the company and why is not the same on the provided slip. Companies also so not disclose their margin policy and it remains hidden. We will only get to know if they will disclose it. There are two major issues: pricing and delivery and these issues need to be resolved. As far as expiry is concerned, few companies are very good in terms of expiry policy and they take the expired products instantly. Most of them of then hold it till the next delivery or do not have any expiry policy and the products are out of stock and the products cannot be replaced. These are quite common. Most of the companies have this attitude. Few companies are very good in terms of expiry policy and others try to linger on to a maximum extent. What happens next is that the product loses its shelf life and upon its return, cuts are applied to the original price of the product. These issues exist from day one and no idea when they will be resolved. The most important thing is that the retailer must know the price at which he will get the product that is coming from the company thing is transparency because MRP has been mentioned for the consumer but no price has been mentioned for the retailer. Every distributor has its own way for example if a company has set 10% margin on a product and if distributor will take away 5%, the retailer will get the remaining 5%. When the distributor changes then we get to know that the distributor’s share was 3% while the remaining 7% was for the retailer. This needs to be resolved. The other thing is the availability of the products. There must be a forum at which the company can be informed about the particular distributor of the area regarding the stock issues, pricing issues, or the services whatsoever it is. There are two things. One thing is that we must know the margins and the second thing is that we must know about the stock and availability of the product. There are few companies who regularly check through their supervisors or managers via call or visits but most of the companies remain silent on these issues. We have to approach them for complaints and once we have complained, their response is at times very slow. I had an experience with (beep). They never listen in weeks and months and I had to approach someone in the higher management and then they approached me for a solution and most of the companies adopt the same attitude and ask us to ignore it. But, in my opinion,
they know everything and I don’t get it why they do not take any action.

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