What’s with loudspeakers inside mall atriums?

April 11, 2010

A study has shown that the trading density of most retailers goes down when general mall promotions such as “Summer Hungama” take place.  This is because the quality of footfalls go down due to these loud promotions, which disturb the mental peace of any sensible adult.  Successful malls around the world do not follow such crazy practices, but in India, it is the case of Pier Piper.  Since some idiot started the trends years ago, other idiots have to copy, don’t they?  Because, as Aamir Khan says, we are a nation of idiots.

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How big should malls be?

April 11, 2010

On an average, malls in Tier-I cities in India can have a total carpet area of between 300,000 to 500,000 square feet.  In Tier-II cities, the carpet area range that will work is between 200,000 to 300,000 square feet.  This can of course change depending upon either location or if it is a super regional mall.  Read more about it in Asipac’s study on India’s largest malls, which is available to download at www.asipac.com or write to us at the address given on our website.

Why Gyms and Salons in a Mall

April 11, 2010

Even though they may be paying a low rent, gyms and salons are very important tenants because they are very high footfall frequency drivers.

Are Indian malls safe?

April 11, 2010

The Great Indian Mall Mania will see up to 600 malls up by 2012.    About 90% of current and planned malls fall way short of international standards in design, specifications, safety and security, and have already started witnessing accidents, some even leading to deaths or severe injuries.  A series of accidents at a Bangalore mall has forced state and city authorities to rethink safety standards for malls in the city.  “Why do we take corrective actions and not preventive ones?”  When Indian developers are too keen to make lots of “mall” from the business, why just copy and paste the swanky/glitzy finishes from developed markets, and not public safety & hygiene standards?

Is it because there are no guidelines or norms?  Or due to lack of monitoring?  Or because we just don’t care.   With 1170 million people, how does it matter if 1170 were to lose their life?  Just copying international standards will not serve the purpose, because most markets with successful mall stories (eg. USA, Canada, Australia, South Africa, Dubai) have little experience of handling the crowds that visit Indian malls.  Managing large crowds needs an altogether different approach, especially in safety and security.  In India, parents’ lovingly let kids move up and down an escalator for sheer fun and even enjoy the sight with parental satisfaction; pedestrians walk aimlessly in parking areas, being blissfully oblivious of where pedestrian walkways are (if there are any), or where driveways are.  The need of the hour is to put in place strict safety guidelines.  It is time to start working towards creating our own safety norms for malls, taking necessary inputs from international standards and experience.

The road to …… roads

April 11, 2010

Look at what Praful Patel has done to the civil aviation sector in under four years.  And LPY with the Railways in even less time.  But what’s the use of Patel facilitating new and refurbished airports and Laloo upgrading railways, if we will not have proper roads to get to these airports and stations.   Across the country, roads are worsening by the day – make that hour.  In Bangalore, if I try to read an SMS message in a moving car, my optical power goes up by +0.25 per month.  A camel ride is probably more comfortable than moving in a Mercedes on Indian city roads today.  Pakistan, Bangladesh and Sri Lanka have better roads than us.  Why, even aircraft shiver on our tarmacs.

India consumes an unnecessary 16+ million litres of fuel per day because of very poor road quality (supplemented by resultant choking of traffic).  That’s Rs.650 million per day, or Rs.237 billion p.a. at today’s cost (let’s assume Rs.350 billion in 5 years on the conservative side). The cost of building world-class roads (with associated infra) is about Rs.1200 million per square kilometre.   With 32,000 sq.km of roads in the country (excluding unpaved rural roads), that’s a whopping relaying cost of Rs.38.4 trillion.  However, revamping and upgrading them to required standards can be achieved with Rs.23 trillion.  Thus, we will not only save Rs.350 billion p.a. in wasted fuel costs, but also another Rs.770-odd billion p.a. in unnecessary maintenance costs (resulting from bad roads).  This total saving of Rs.1120 billion p.a. is 4.87% p.a. on the capex of Rs.23 trillion.  Is it worth it, for sustaining 10%+ growth per annum in GDP?  Well, we’ve got intelligent economists at the helm of our country.

Can India afford horizontal development?

April 11, 2010

DCRs (development control regulations) across India need to go into a jumbo shredder.  The world realized over 50 years ago that horizontal development is expensive.  So, even the richest nations chose vertical development.  It’s a shame that Dubai (a nation-state virtually created with the knowledge and hard-work of Indians) can build a 750 meter tall tower, while majority Indian cities still have problems with 30 meter (short) buildings.  

Where is horizontal development taking us – infra is collapsing, fuel consumption growing leaps and bounds, and worse of all, accident-related serious injuries and deaths increasing daily.  How can we ignore or afford this?  The cost of decent urban infra (including mass rapid transport) is about Rs.175 lakhs per hectare.  Since DCRs in most cities allow max.2.0 FAR, a hectare provides for 265 people.  So, infra cost is Rs.66,000 per person.  Addition of 56 million to urban population in 5 years means a capex need of Rs.3.7 trillion for infra alone (excluding buildings and what goes into them).  How will we fund this?  Doubling FAR to 4.0 will save about Rs.350 billion in infra capex p.a., and Rs.550-odd billion in maintenance and fuel savings, just for 56 million people.  Over time, we could save Rs.5.2 trillion p.a. (or 13% of GDP) for a 325 million urban population.

Just because 7000-odd people don’t understand these basic fundas, 1130 million (plus many more in the future) will suffer.  Maybe if we gave just 15% of the cost savings as an official incentive to thm – that’s Rs.11 crores per person per year – they would understand.  For this, we need young leaders with fresh optimism.  If we don’t get urban infra right, we don’t need civilian nuclear power – is Karat listening?

Managing the Risks of Globalization

April 11, 2010

A couple of years ago, I was at the ET CEO Roundtable on this subject, part of ET’s Corporate Excellence Awards annual do.  An Indian corporation already manages people from 5-7 cultures who speak 8-15 languages and 3-4 variations of English.  They eat different varieties of food and have different social habits.  They are Indians.  Cultural challenges of globalization are far more manageable for Indian companies, compared with MNCs from around the world.  One key aspect that needs to be tackled is the disparity in remuneration – which is also true within India.  Within the same company, a person could be earning Rs.35 lakhs p.a. at Bangalore and his counterpart at Jaipur Rs.15 lakhs.

Let us look at another important issue.  We hire foreign consultants, especially for new-age businesses, as we believe they bring knowledge and experience, and will create value.  But we don’t follow 80% of their advice.  We say it won’t work in India.  How do we know, when we haven’t done it before?  And, if we know, why hire the foreign consultant? 

On the other hand, when foreign sahibs suggest something, no matter how irrelevant, Indian consultants and employees (sometimes even JV partners) accept it as is.  After all, the gora sahib wants it.  Well, some goras want to build apartment buildings in India with bomb-proof concrete walls and bullet-proof window panes.  They’re from a country which is under constant attack from adversaries.  They also want to mix 1-bed and 4-bed apartments on the same floor.  As is usual, the Indian partners and architects have accepted this.  Hmmm …. Globalization…