You’re reading an eChai Interview, an insightful and candid conversation with Entrepreneurs — a publication of eChai Ventures.

eChai with Nadeem Jafri, Founder & Chief Mentor, Hearty Mart

With the vision of bringing convenience to the locality of Juhapura in Ahmedabad  Nadeem Jafri started his first venture " Hearty Mart Super Market " in February 2004. After undertaking a dipstick research amongst the residents of the area he developed and modeled it as an ideal neighbourhood store. It was positioned as " Sabse Khas Ghar Ke Paas " and he wanted to establish the store as a one-stop solution for the daily needs of groceries, cosmetics, food grains etc. Initial research of the area revealed that the residents were not ready to accept a new store as they had the mindset that no store can ever survive in an area which was not supposed to be business friendly. In order to counter this hostile mindset he came out with this unique brand name " Hearty Mart ". Today it has become successful in breaking the mindset of the people here and has created many patrons for itself.

Creation of Hearty Mart at Juhapura was a great learning experience and with this learning he went to villages by developing a unique concept of rural franchising and started our first franchise in Ilol near Himmatnagar in April 2007. As on date there are many franchisees operational in prominent villages and towns like Dholka, Idar, Ilol, Kathor (Surat), Vadodara to name a few.

Creation of Hearty Mart at Juhapura was a great learning experience and with this learning he went to villages. During the process of franchise development he realized that in order to provide merchandize at a reasonable rate to hi franchise he needed good bargaining power over our vendors. He decided to plunge into food-grocery hotel supplies and created a new division solely for this purpose in 2008. 

The idea made sense as this gave him  access to quantity he would not have thought of purchasing if he had remained in retail business only. In April 2009 he merged this division with a company named " Ashish Enterprise " and created a new firm " Hearty Mart Enterprise ". Today Hearty Mart Enterprise is one of the largest food-grocery suppliers catering to more than 500 restaurants across the length and breadth of Gujarat. Hearty Mart Enterprise has given him negotiation power and has helped him service his franchisees better now.

While he started supplying to highway hotels he found out that Surat city had a huge potential and if he could somehow tap the opportunity it would further help us boost his  hotel supply business. But it was not possible to service the Surat City hotels from Ahmedabad as the city restaurants have a daily purchase unlike highway hotels which purchase on a monthly basis. He groomed to employees at Hearty Mart Enterprise, Ahmedabad and encouraged them to move to Surat with their own business called " Hearty Mart (Surat) Enterprise " on the lines of parent Hearty Mart Enterprise, Ahmedabad. Thus Hearty Mart (Surat) Enterprise started in 2009-10.

His foray into food-grocery supplies on highways also brought him face-to-face with new business opportunity as he found out that the tea consumption was huge in these hotels. Two entrepreneurs were trained at Hearty Mart Enterprise and they started " Hearty Mart Tea Packers " in the year 2010. Their brand of tea is called " Day Break " which is supplied in these highway hotels.

Hearty Mart Super Market works in the direction of network creation as it supports and trains franchisee owners. Hearty Mart Tea is solely into supplies of tea into hotels. Hearty Mart Enterprise is into hotel-supply business and it also creates private labels like " Chef ki Pasand\ " and " GoodTime ". The need was identified to integrate all these businesses and connect them together to have a unique win-win business model. Thus in the year 2010 " Hearty Mart Logistics " was formed. The company is a connecting link between all the franchisees and Hearty Mart Enterprise and Hearty Mart Tea. The products manufactured by Hearty Mart Enterprise and Hearty Mart Tea are distributed by Hearty Mart Logistics to various franchisees, retailers and store owners. Hearty Mart Logistics can also become stockiest of other products not manufactured by Hearty Mart Enterprise. Thus it is a distribution company.

At Hearty Mart they continuously look for different opportunities that can be tapped at village level and are committed to work for the development of rural public. So far they have created rural entrepreneurs with the Hearty Mart franchisees and other businesses. They  have also launched "Adarsh Gruh Udyog" that would help their social upliftment.

Here is the insightful and candid conversation with Nadeem Jafri. Join the conversation to ask any specific questions to Nadeem Jafri.

Early Years : When did it first strike you to begin this venture and why? Your Eureka Moment (the moment you decided to be an entrepreneur).

It was my visit to Mumbai in the year 2002. I was working for Grey Worldwide then and had went on a deputation to work for the advertising pitch for Reliance Infocom along with my Mumbai creative team. There was a change of guard in Reliance and Mr. Mukesh Ambani had invited various agencies apart from Mudra (the ad agency owned by Reliance) to pitch for their advertising business for the first time.

My Mumbai office was in Phoenix Mill Compound. Just opposite our office there was the first Big Bazaar. During my free time I would visit Big Bazaar quite often. I enjoyed shopping from there and was awestruck looking at the merchandise on display. I would not claim that this inspired me to be a retail entrepreneur but it definitely had some effect on my thinking mind.

Also during the same visit I frequented various recruitment consultancies and was told that at my age (I was 32 then) they did not have anything good to offer to me in Mumbai. Ahmedabad was never a good market to build a career in advertising. This seriously made me ‘think entrepreneurship’. Hence mine was not a ‘Eureka Moment’ but I would say it was ‘No Option Moment’. 

Business Venture : What is your business model and what problems does it solve? What are market opportunities? How is it different from your competitors? How do you generate revenues ?

With a booming real estate Juhapura promised development but still it remained devoid of basic amenities like a proper organized retail outlet which can provide convenience of purchase to the residents. Adanis had opened their supermarkets across Ahmedabad but for an obvious reason avoided Juhapura.

It was in this gap we found a huge opportunity to start an organized food-grocery store in the area in early 2004. Vishala Circle was the fastest developing area within Juhapura, as it was not cramped unlike other parts of the area and we could speculate a good growth of the area in near future.

With the vision of bringing convenience to the locality, we started Hearty Mart in February 2004. It was modeled as an ideal neighbourhood store and positioned as ‘Sabse Khass Ghar ke Paas’; as it was a store which was equipped to cater to all their basic needs. A store which was positioned as a convenience store and wanted to establish itself as a one-stop-solution for the daily needs of groceries, cosmetics, food grains etc. Thus it was destined to bridge the gap between demand of daily needs and the options of supplies available.

Our learning of entering into an unexplored Juhapura provided us the insights and courage to target unexplored areas of rural India and empower an aspiring entrepreneur to take up organized retail as his business through our innovative franchisee model. In this model we train an entreprenuer at our Juhapura super market and share with him insights and knowledge of organized retail and thus guide him to run his own store at his village.

We have formed a ‘Franchise Development Cell (FDC)’ at Hearty Mart. It consists of MBAs and senior partners of the company and it aims at providing retail ecosystem to our franchisees and works as a guiding force for them. We take a one time fee and enter into a contract with our franchisees and from the end of second year we charge a royalty of 0.5% on their annual sales. We have also taken a distributorship for certain brands which we purchase centrally and send to our 11 franchisee. I don’t think any retail company works with this model and hence we are unique in that sense.

We have also started a sister concern ‘Hearty Mart Enterprise’. This company caters to more than 700 restaurants across Gujarat with the supplies of food and grocery to them. The company is catering to HoReCa (Hotel-Restaurant-Caterer) segment. We have started working in the direction of making it as a food company with the launch of our private brands like ‘Chef ki Pasand’, ‘GoodTime’ in this unit.

Sales : How did you make your first sale and how much time it took you from starting up to closing the first sale ? How long is your sales cycle ?

Since ours is a retail supermarket in Juhapura I would discuss how did we ensured that our first day of the store has a memorable footfall. Hearty Mart was launched on 11th February 2004. We did a dipstick research to understand the consumer profiling and purchase ticket size. This research gave us the insights to target the prominent localities of Juhapura. We sent personal invites to the members of these shortlisted colonies. We hired an auto rickshaw which used to run the promotional jingle of Hearty Mart and distributed pamphlets announcing the launch of the supermarket in these colonies. This was done a week prior to the launch and we continued the effort for a week after the launch. A launch advertisement in the local supplement and a scroll on a cable TV completed the prelaunch campaign. On the launch day we greeted our customers with a cup of an ice-cream. This effort ensured that we had a counter of Rs. 50000/- plus on the very first day.

The organized food-grocery stores are more worried about footfalls. Once the customer enters it is going to purchase and hence sales is not a concern but entry of a customer is a major concern. Thus all the efforts are in the direction of luring the customers to your store and maintaining a long-term relationship with them. 

Company Culture : What kind of culture exists in your organization? How did you establish this tone and why did you institute this particular type of culture?

We believe in informal culture. I have worked at various levels during my professional career and have seen the stress professionals go through. I never wanted to have a business where my people undergo undue stress. I am firm believer in ‘Karma’ and have immense faith in the Almighty. I believe if you are putting right effort the result would be good. And for some reason even if the result is not up to the mark or there is a failure we try to learn out of the experience.

This attitude helps us to remain focussed in our work without thinking too much about the result and give our best. And this does not create undue stress on my employees and they remain committed to their job. Our work culture can be best defined in the following work philosophy:

“A successful businessman is not just a person who earns a huge profit or who has a big bank balance. True businessman is driven by a passion to do something good. To bring in change. To do whatever possible for his employees, so that they can run the business well. To nurture the business like a parent till it is strong enough to run on its own. That is business and that is success.”

Partnerships : What are your views about finding the right Co-Founder ? How did you find your business partner? According to you who is the ideal business partner?

A right Co-Founder is really important. You should try to look for a partner who brings in a different expertise to your venture. For example may be if you are good at marketing then have a partner who understands accounting well. Such partnership helps the venture immensely and growth becomes faster. Thus it is important to look inwards and find out your inbuilt strength and work for the partnerships on the basis of your strength.

In my case I am lucky to belong to a spiritual family which has followers in villages. They are popularly known as ‘Cheliya Muslims’ and their expertise is farming and a restaurant business. The enterprising ones moved to cities and started restaurant business while others remained in villages. I partnered with this community and started my venture. They brought the domain expertise of food & grocery while I brought my vision, experience and exposure on the table for my venture.

Hiring - How did you hire your first employee? And in general what's your hiring policy? How important have good employees been to your success?

As already informed in the earlier question I looked towards Cheliya community to provide me with manpower that can enhance my domain expertise. Saathal, a small village near Dholka has the people from this community and their main occupation is farming. Thus I hired my first employee – Sabir Momin from here. He is with us since the inception and has managed the store for 11 years now.

After 11 years Hearty Mart today is an integrated company with the presence in Retail, HoReCa, Tea, Marketing & Logistics and Non-food products like paper napkins, wraps etc. All these companies are headed by different entrepreneurs from the village who have invested in these firms. I work as their ‘Mentor Entrepreneur’ and guide them and direct their venture. These companies hire the employees on referral basis.

At Hearty Mart Enterprise we have started hiring Management Graduates to enhance our knowledge base and bring in new outlook to the organization. We recruit through referrals mostly and also approach Management colleges for our requirements.

Good employee is definitely an asset for the organization hence the entrepreneur should work in nurturing him and developing him without thinking much about ‘What if he leaves once he is trained?’ etc. Because my experience says if you provide him with a right work atmosphere and nurture him he would remain loyal to your organization. 

Learning : How did you handle your disappointments and failures?

Disappointments and failures are part of entrepreneurial journey. When I am disappointed I look back at the success which I got after I started this business. The fact that I could survive in this industry and launch an innovative model and have been written about in various magazines and newspapers; help me revive myself and start looking at the failure with a positive mind-frame.

I also tell my employees that we launched a retail franchisee network and entered HoReCa segment only because we failed initially to earn profits for almost 5 years at Juhapura store. Had we succeeded in earning profits straight away we would have remained a one-store venture without innovation.

Every failure is a stepping stone for a bigger success. If we remain calm and focussed during the testing time and see the situation as a jigsaw puzzle we can come out with innovative ideas that would solve the problems and make our business grow beyond imagination.

8. Vision: What's your vision for your venture. What do you want to accomplish in your life ? What are your future aspirations?

• To touch the life of every Indian and provide him with the best merchandise that suits his lifestyle.

• To constantly work on opening up new entreprenuerial avenues for rural communities.

Work-Life Balance : How do you find a balance between work family and social life?

After I quit my professional advertising career and started Hearty Mart I had a clear idea of maintaining a good lifestyle. As an entrepreneur it is necessary that all the three elements – Body, Mind and Soul are in sync and in good shape. This is only possible if one has time for all the three. Entrepreneurship provides independence from professional bureaucracy. There is no reporting to immediate boss as you are your own boss and if you wish you are free to take a day off without being answerable.

This is the most attractive part of entrepreneurship. But it is not always easy for an entrepreneur to remain really independent. Proper manpower planning is required right from the day one. Hence when I was expanding my business I gave lots of freedom to my partners, trusted my employees and encouraged them to think independently. I remained a Mentor to them and did not get indulge in day to day operations. This helped me in laying down a proper vision for my company and gave me enough time and space for myself, my family and social life.

I start my day with a good session of swimming or a badminton game. Try to connect with the Almighty and go to my work later on. This keeps me happy and spirited throughout the day.

Risks : Which was the boldest decision you ever made to have this venture work?

When nobody was looking at Juhapura as a viable locational option for their retail ventures we entered the area; I would say this is the boldest decision we took. Juhapura was the untouched market and it made business sense to enter the area. The negativity attached with the area and our not earning profits for many years gave birth to our innovative franchisee network and Hearty Mart Enterprise.

Today we are a chain of 12 stores retail venture and we cater to 700 restaurants through Hearty Mart Enterprise with bulk supplies of food & grocery. Our bold and wise decision making helped us to be out of losses and become one of the prominent player in the industry.

Checkout Hearty Mart story in India's leading media publications :

http://www.openthemagazine.com/article/nation/the-adrenalin-of-adversity 

http://www.thehindubusinessline.com/todays-paper/tp-life/article1086533.ece

http://youngturks.in.com/video.php?id=drBkUIz1m3I

http://forbesindia.com/article/work-in-progress/hearty-mart-endearing-success-of-a-smalltown-retailer/34049/1

Here are some amazing photos from Nadeem Jafri's entrepreneurial journey. 

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