Best Electronics Director of Marketing & Service Syed Tahmid Zaman on how Best Electronics started its journey, how it operates as a company, how it has grown from a 12 outlets retail brand to over 120 outlets in a span of a few years and its ambition going forward, his work as the Director of Marketing and Service at Best Electronics, the most critical aspects of retail business and why creating an enabling environment for your team to perform is the most surefire way to success in business.
Future Startup
Could you please tell us about the background of Best Electronics; how Best Electronics got started and a bit of its early-days stories?
Syed Tahmid Zaman
The early-day story of our company is inseparably linked with the story of my father's career. He got his first job in the electronics industry at Singer. I can't recall the exact period while he worked there. In 1987, he founded Butterfly along with several partners. He stayed at Butterfly till 2012 and left thereupon.
While working there, he realized that almost all of the electronics shops in Bangladesh including Butterfly were selling products of only one or two brands. But traffic was, as, in the present, a huge problem at that time and customers found it inconvenient to move from one shop to another to buy different brands. Thus was conceived the idea of Best Electronics--a multi-brand shop where electronic home appliances of a vast array of brands would be showcased and sold. The value proposition was straightforward, we offer a one-stop shopping experience for electronics products to customers.
Best Electronics started its journey in 2014. The planning, albeit, started much earlier.
We began with 12 outlets. It could be called a family-owned business. However, what's unique about us is that many of our employees also own equity in the company.
In the beginning, we experienced difficulties in getting authorized dealership licenses. We were selling genuine products but had to buy them from wholesalers bypassing the original manufacturers.
For instance, we used to sell Hitachi products at that time which we had to procure from a distributor in Singapore because we did not have a relationship with from Hitachi itself.
This was the situation in case of almost all of our products. However, it has changed eventually as our business grew over the years. We are now the authorized distributor for almost all the brands that we sell.
The most important change since our inception has happened to the size of our operation. There were only 20 people at Best Electronics when we first started. The team is now a strong sales-force comprising of 800 efficient managers, salesperson, and logistics personnel and so on. We started with only 12 outlets, today we have 120 outlets.
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Future Startup
Could you please give us an insight into how much has Best Electronics evolved over the years as well as an overview of Best Electronics today in terms of team and business?
Syed Tahmid Zaman
The most important change since our inception has happened to the size of our operation. There were only 20 people at Best Electronics when we first started.
The team is now a strong sales-force comprising of 800 efficient managers, salesperson, and logistics personnel and so on.
We started with only 12 outlets, today we have 120 outlets.
Our operation has expanded to almost 60 districts around the country with many big cities like Dhaka, Rajshahi, and Rangpur having more than one showrooms.
Future Startup
You have seen a phenomenal growth, how have you attracted customers and grown your business?
Syed Tahmid Zaman
In retrospect, I think a number of factors have given momentum to our new company. Due to the consistent economic growth in the last couple of years, purchase capacity of our consumers have risen remarkably. Although this growth is subject to debate, it has benefited our business by enabling the consumer to pay for premium products.
Secondly, we ensured convenience. Instead of dropping by multiple shops plying though jam-ridden streets, we brought together a vast array of brands for the consumer under a single roof. It provided them with the ease of shopping. This convenience, coupled with our huge collection of products, has resulted into the increased reliability of Best Electronics as a retail brand.
Moreover, in order to help consumers with a budget constraint, we have introduced lucrative installment deals. And the results are satisfactory. More mid- and low-range consumers are now buying premium products from us because they could afford it using our installment option.
The growth of Best Electronics has not been ignored by the global market. From 2014, many international brands began to approach us. Very soon, we wrapped up distribution deals with Whirlpool, Panasonic, Philips, Hitachi, Toshiba, Midea, V-Guard, and so on.
There are a few things about Best Electronics that we believe makes it different from other companies.
When my father left Butterfly to start this company he brought with him a number of his teammates who joined him in his new endeavor. These people had decades of experience in the electronics industry. Their practical knowledge paired with the academic expertise of the second-generation leaders (e.g. my brother, I, and other young team members) helped Best Electronics to implement new ideas and innovations like full-fledged automation of the entire operation.
We have also employed some marketing strategies that are unique to the industry. In order to provide consumers with a memorable buying experience, we emphasize on making them feel welcomed to our doors.
When a customer comes to our shops we greet them regardless of whether they make a purchase.
We have put importance on building a brand over the years. We use the same air-fresheners across all of our outlets which helps the buyers to feel accustomed to our atmosphere.
Moreover, we are extremely cautious about our post-sales service. Most of the products that we sell are hi-end electronic appliances and need expert personnel to repair.
We currently have 15 service centers that provide repair and maintenance services. The repair centres span even around air conditioning repair Mooresville NC and other such equipments. We make sure that our customers receive immediate service when they ask for it. We have even formed a separate subsidiary to look after customer service called Zaman Service Co. Limited which has recently launched an on-demand service platform called Drooto.
Secondly, we ensured convenience. Instead of dropping by multiple shops plying though jam-ridden streets, we brought together a vast array of brands for the consumer under a single roof. It provided them with the ease of shopping. This convenience, coupled with our huge collection of products, has resulted into the increased reliability of Best Electronics as a retail brand.
Future Startup
How does your partnership with supplier work? How does your operation work?
Syed Tahmid Zaman
Distribution partnership in the electronics business works in a pretty straightforward way. We provide letters of credit (LC) directly to international brands and relying upon that they send us the requested products. Although the manufacturers help us with service personnel training and other relevant supports, we determine the warranty and guarantee provisions ourselves. The process, as it is, is simple.
In each of our showrooms, there is one manager, one assistant manager, three/four executives and two/three delivery and support staffs. We pay them regular salaries and sales volume-based commissions as well. Besides that, our employees enjoy some other perks like every year the company finances a trip abroad for the best-performing employees. This culture has helped grow the business over the years.
Each of our showrooms has different product collections. We conduct regular analysis of the market and supply a given outlet only those products that have demand in its locality. In this respect, the enterprise resource planning (ERP) has been a great help to us. It provides us the real-time data on the product situation and operation of all the showrooms. You can say we are quite data driven when it comes to making these decisions.
Future Startup
Could you please tell us about your work as a Director of Marketing and Service at Best Electronics as well as how you approach your work?
Syed Tahmid Zaman
Retail is an interesting space. There are several aspects of marketing to it, and service is intimately connected with marketing. If you fail to ensure great service, no amount of promotion would help. I and my team take care of the communication part as well as the service part of the company.
The job of a marketer at Best Electronics begins with the spot selection for showrooms. It's critical in that a wrong spot means lower sales and lower profit. In fact, location is one of the most important marketing decision in retail.
We have a field team which we call the asset development team who initially chooses, visits and shortlists a spot. Then, a marketing team go to the spot and inspects the market prospects.
When the construction of the showroom is finished, our branding and HR team go there and carry out their respective primary responsibilities.
Centrally, the marketing department has the key responsibility to promote the Best Electronics brand. We run branding campaigns in almost every month. For example, we have an air-condition or AC fair recently. There are World Cup Fever and Eid offers. The list goes on.
Retail is a very happening space. Things happen on a daily basis. For marketers, the challenge is to quickly come up with ideas and execute them.
Except for print and digital advertising, we mostly plan and execute campaigns with in-house experts.
Apart from regular activities, my team is constantly finding out new ways to promote our brand using digital media. Starting with our website, our continuous endeavor in increasing organic reach of our website has placed our website in a significantly good position in our industry.
After the website, we are investing heavily in Facebook marketing, making video contents and will also soon start our hashtag campaign. Furthermore, we have tied up with 15 news portals where we are running our banner ads regularly.
I am also utilizing my academic background in digital marketing to make most of the search marketing, display advertising, and YouTube video advertising through Google platforms.
We have also employed some marketing strategies that are unique to the industry. In order to provide consumers with a memorable buying experience, we emphasize on making them feel welcomed to our doors. When a customer comes to our shops we greet them with sweets or desserts regardless of whether they make a purchase.
Future Startup
What were the challenges for Best Electronics at the beginning? What are the major challenges now?
Syed Tahmid Zaman
In order to acquire new customers at the initial stage, we offered very reasonable prices for our products. The competitive pricing strategy had apparently vexed a few of our fellow companies in the industry. It was an obstacle at first but eventually was turned to our advantage.
Another challenge that we faced, in the beginning, was setting up new showrooms. Location is a crucial element in retail business. Getting a desirable location for outlets is tough in Bangladesh. In addition, we didn't have much capital at first, and hence, had to be particularly careful in investing in showroom construction. Despite the financial difficulty, it's surprising to think that we have been able to set up over 115 outlets only in 5 years.
The competitive dynamics have changed considerably since we began. One of the biggest challenges that we face now is the increase of inauthentic product sales on the Internet. With the e-commerce boom, many online companies have sprung up that sometimes poses unfair price competition. At Best Electronics, we have always been hyper-cautious about the authenticity of our products. But due to changes in competitive dynamics, it is becoming a challenge.
There are certain policy changes happened as well around import and duty. Importing will cause price disadvantage in the coming days. To counter this, two major global brands, Samsung and LG, are assembling their products in Bangladesh in order to avoid the high import duty. Fair Group is working as the partner of Samsung and LG has partnered with Butterfly. We believe that this is the right way to go and we are working on plans to go into partnership with international brands (e.g. Sharp, Hitachi) ourselves.
We already have an assembling facility but that’s for mostly light engineering products. Ensuring quality is a major concern when you decide to assemble products in Dhaka. We are in conversation with a few of our partners and hope to see something concrete soon.
Future Startup
What are the plans going forward?
Syed Tahmid Zaman
Our major objective now is to expand the retail operation. We want to significantly grow our number of outlets by 2020. When we have a widespread and efficient distribution network, we would begin to sell products manufactured by us which we have already started on a small scale.
Currently, we are manufacturing ceiling fans in our factories and selling them at our outlets. We have plans to produce other small household electronic appliances like rice cookers and LED lights.
As for online selling, we have partnered with popular e-commerce platforms like Pickaboo.com, Daraz, Kiksha and Ami Kini. We are planning to become their electronic appliance supplier.
Additionally, we have recently re-launched our website where customers can go and buy products directly from us online.
Our logistics service Drooto has been doing well. We have launched a mobile app and are pushing the service a bit. Our goal is to significantly grow the business of Drooto as we go.
We have also undertaken a membership and loyalty program which we are calling The Plus Card where the employees of our partner companies will get discounts and other added benefits whenever they buy from us. We have already made a deal with Basic Bank and are in the process of doing more similar deals in the coming days.
Location is one of the most important marketing decisions in retail.
Future Startup
What do you think about competition?
Syed Tahmid Zaman
Seeing the success of Best Electronics, many of our competitors have begun to expand their businesses. We welcome competition because structured retail has room for growth in this country.
Over the years, we have been able to build a strong brand image and a group of loyal customers who not only shop at our stores but also recommend us to others. This is because we take customer service very seriously.
Future Startup
What do you look for when you plan to open an outlet in a new location?
Syed Tahmid Zaman
As I mentioned earlier, location is a critical decision for us. Whenever we plan to move to a new city or region, we first inspect which part of that area has banks. The existence of a bank(s) implies that a certain level of pecuniary transactions goes on there. That's what we look out for at first.
Then, we do a little bit of market research, find out about our competition and observe our customers. This is basically how we choose a new location.
Future Startup
What are some lessons you’ve learned?
Syed Tahmid Zaman
If you put your heart on something and put your utmost commitment, then no amount of backstabbing or negative publicity or challenges can stop you from achieving your goal.
Having an honest relationship with your employees or teammates helps you to build a great organization. We always try to do that in Best Electronics.
Employees at all levels of our company have access to the top management and can communicate with them in any need. This is why we have rarely seen people leaving Best Electronics. And it's with their help and effort that we hope to reach our ultimate destination.
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Interview by Ruhul Kader, Transcription Rahatil Ashekan
