The Jos Electricals shop on MG Road has completed 60 years. Despite an annual turnover of Rs 50 crore the shop is bracing itself for recession and tough competition
By Shevlin Sebastian
Last year RR Kabel Ltd. held a meeting of dealers at Silvassa in Gujarat. More than 150 businessmen came from all over India, including M.J. Antony, managing partner of Jos Electricals.
“I had bought electric wires and cables worth Rs 3 crore from them,” says Antony. To show their appreciation, the company wanted to present an I-10 Hyundai car to Antony, but because the tax was very steep, he was given a cash gift of Rs 3 lakh.
Apart from this, he was presented with a ‘Standing Up’ award. Kabel director Tribhuvan Kabra said, “Whenever I visited the Jos Electricals shop at Kochi, over the past thirty years, I have never seen Antony sitting down. He is always on his feet dealing with customers. And look at him now: He is still standing!”
The shop, on M.G. Road, near Shenoy’s theatre, has become an institution by itself. Antony’s father, M.G. Joseph, had been a lineman for the Kerala State Electricity Board (KSEB) for four years.
However, sensing a burgeoning market in electrical items he resigned and started a small outlet in Mattancherry in 1947. Thereafter, in 1961, he opened a shop at Ravipuram and, later, moved to the present location.
Last year, this single shop had a turnover of Rs 50 crore. However, the company also had bad debts amounting to Rs 7.5 crore.
Antony admits it was his mistake that he supplied goods to individual buyers and private contractors on credit. Many of them never repaid the dues, despite several reminders.
But, thanks to the suggestion of his son, Vijo, 23, who did his MBA from Dayanand Sagar Business School in Bangalore, Antony now insists on post-dated cheques. As a result, he is recouping his losses.
“When my father was alive, he had two rules for doing business,” says Antony. “Number one: never give credit to individuals. Number two: never take loans to expand the business.”
Antony disobeyed the first rule and has paid the price for it. But he has obeyed the second command, and hence there is only one shop in his name. The other shops, in the same name, and located in different parts of the city have been set up by his four brothers.
On any given day around 500 customers come to the shop. And the items that are bought include cables, switches, wires, bulbs, tube-lights, CFL lights, switchgears, nuts, bolts and fans.
Because of the intense competition profit margins have come down. “Now it is only 2 or 3 per cent for an item,” says Antony. “There was a time several years ago when our business was a monopoly, and on non-standardised goods the profit margin was between 100 and 250 per cent.”
And things have got worse. In the past few months the price of international copper has fallen by 35 per cent. Antony has a large stock which he purchased before the prices fell.
“Now I have to sell them at a loss,” he says. “Once when I stated a higher price to a buyer, in order to make a profit, he told me that in his home town of Kothamangalam the prices were lower. So he expressed his surprise that the rates were so high in Kochi.”
Antony has learnt to deal calmly with all types of customers. “Recently, when a client got angry because of the time taken to get an item, I told him it was stocked on the third floor and hence the delay,” he says. “The man replied, ‘I will go to a shop where the goods are stocked on the ground floor’, and walked out.
Says Vijo: “There are so many electrical shops in the city now. These days it is good to be a customer and bad to be a seller.”
Meanwhile, this seller had further bad luck. At the company’s large open-air godown on Rajaji Road there was a spate of robberies. “The thieves regularly scaled the 15-foot high walls and stole copper cables,” says Antony. “We lost goods worth lakhs of rupees.”
After the police busted the gang, new security measures -- two security guards, a prowling Doberman, powerful sodium vapour and metal halide lights -- have been put in place.
Now, despite the deepening recession Jos Electricals is staying afloat by being the sole supplier to the KSEB. Says Antony: “Because of my father, I have an emotional connection to the Board.”
(The New Indian Express, Kochi)