The Distributors: Our Third Arm!

In all the previous articles in this blog, 'C. R. Bondre: Memoirs', I have tried to bring before the readers,  gems from my grandfather, C. R. Bondre's rich experiences while developing the exports of Kirloskar diesel engines, as early as the 1950s, when India was primarily known only as an importer of machinery and technology and exporter of sugar, cloth, et al. My grandfather's trailblazing work and pioneering efforts in the exports of Kirloskar Oil Engines, not only put the company on the global map, but also created a name for Indian manufacturers abroad, at a time, when people in foreign countries could never believe that India could manufacture engineering equipment. A close aide of the legendary industrialist, Mr. S. L. Kirloskar, C. R. or Bapusaheb as he was called by friends and associates, penned some of his most memorable experiences collected en route developing the exports, and shared some pearls of wisdom gathered on the way, most of which were published in an article series in 1991. It gives me immense satisfaction to translate and bring before the readers of this blog, yet another article from this series.

In this article, Bapusaheb shares his prolonged efforts in establishing dealer-distributor network in 42 countries, a humongous task which he accomplished in his 27 years at Kirloskar Oil Engines. He literally built up the monumental exports from zero, step by step, with painstaking efforts, encountering obstacles, battling suspicion and opposition for Indian goods abroad, while travelling the world, getting orders, meeting people, engaging them as dealers and distributors, training them and maintaining them.

"It was a beautiful February evening in 1964", Bapusaheb opens this narrative with this reminiscence. "At the famous Sun-N-Sand Hotel at Juhu, Mumbai, there was a decoration of colourful lights covering the beach with their radiance. An orchestra was playing serene music and the whole atmosphere was that of spirit and gaiety. People of various nationalities, enthnicities, and cultures were present in large numbers along with their spouses. On the dais, were Shantanurao (Mr. S. L. Kirloskar), the then Minister for Commerce and International Trade, Shri Manubhai Shah and other eminent industrialists. Speaking from the dais, Shri Shah said in a lighter vein, 'I knew that the Kirloskars manufacture great quality and efficient engines, pumps, electric motors and machine tools. However, today I got to know that they can also create an equally wonderful mini-United Nations!' And indeed, that day dealers of Kirloskar products from 42 countries of Europe, Asia, Africa, Canada, South America and Australia had gathered to celebrate Shantanurao's  61st birthday!"

"The most important, most useful, and essential link between the producer and the end customer is the Distributor", elaborates Bapusaheb. "The Distributor is indeed the extended Third Arm of the Sales Department of the Producer! In the mid-1950s, when we had just begun with exports, and I set out to find distributors for our Kirloskar engines, I realised that able, honest, efficient and trustworthy people to do the job, were very difficult to come by. There were lots of issues and obstacles in finding such people who possessed the qualities of integrity and efficiency. Similarly it was also extremely difficult in those days to locate such people or agencies which may be our potential distributors."

C. R. Bondre with the Kirloskar engine
circa 1955

"In those days, in the Western world, the responsibility of finding able distributors or local representatives, would often be taken up by banks and insurance companies. America's large commercial bank, the First National City Bank (now Citibank), Bank of London and the South African Lords' Bank had around a total of 2000 branches around the world. Similarly, Chambers of Commerce and Foreign Embassies used to promptly share the database of people or agencies which could be potential  distributors in various countries. Likewise, they also used to give reports of the internal political and economic environment of the countries in which they had branches, the laws of their land, import-export and foreign investment policies. On this background, an Indian company like ours, trying to export for the first time, had neither any takers nor any services like these available to us. Way back in the 1950s, Indian Embassies were just beginning to be established in different countries, and Indian banks and Chambers of Commerce were yet to understand the importance of Indian exports; so one could not except any help from them. As a result, I had no other option but to start a hunt for such potential distributors on my own", reveals Bapusaheb in his article written almost four decades later.

"Although, India had already attained independence then, many other countries in East Asia, Central Asia, East Africa and Australia still had British supremacy. The Philippines and Southern Africa had American economic control. Similarly, in some countries in Asia and Africa, there was German, French Belgian and Dutch dominion. As a result, if a certain superpower had political or economic control over any country, it also had the control of the country's imports and exports. These superpowers also managed to get concessions for their exports into these countries which they controlled. Naturally, it was difficult for an Indian manufacturer like us to penetrate these markets. On the other hand, State controlled economies like Eastern Europe and Russia had no place for private manufacturers and traders. The job of distribution was done by the State-run distribution agencies, which distributed products of homogeneous nature sold by similar kinds of exporters, so they were not interested in an Indian company trying to take the first baby-steps towards exports. There were some private individuals and agencies in Asia and Africa, who used to sell routine material like groceries, cloth, stationery and medicine, and along with that, equipment and machinery as well. I thought there was no point in naming them as our distributors."

"Moreover, Indian goods did not have a very good reputation in foreign markets", writes Bapusaheb candidly. "Indian traders had a reputation of cheating and swindling the customers on various counts: if it was grains, there would be small stones in it, if it was cloth, it would certainly be lesser in length and width than promised, if it was cashews, there would be worms: this was the perception that Indian traders had abroad; that they would show one sample and deliver another of cheaper quality, deliberately! So there was always a lack of trust for Indian goods, and moreover, no one could believe that India could ever produce anything apart from cotton, cloth, sugar and tea; leave alone engineering goods! And whenever I showed them pump-sets with our diesel engines, they would ask mockingly whether we imported parts from England and merely assembled them in India. There would be a tone of 'You are nowhere compared to countries like England and Germany, so why get into this?' They still felt India was a land of snake-charmers and elephants and it was hard to get them to see the skills and industrial development of our nation at that time. They knew of the cheap labour in India and had the demand that Indian goods should always be available at a low price. Although I convinced them of the quality of our engines, none of the foreign distribution agencies were willing to distribute our engines."

"To overcome this difficulty, I thought of engaging Indian traders settled abroad, who could take up our distributorship in addition to their main business of selling Indian textiles. However, the ones that I met, were unwilling to diversify into Indian engineering equipment, mainly because they thought there would be little monetary gain for them. The concept of Indian engineering exports itself was incomprehensible at that time, and that was my main obstacle. I finally decided that I had to break this vicious circle somewhere, and I could see only one solution: to create a new dedicated distributor for Kirloskar pumps from amongst the hoi polloi. Shantanurao agreed to this suggestion immediately, and we decided to develop our own distributors. These people could be anyone doing any small business, retailership or in general could be into any profession, but must be honest and hardworking, with a dedication to grow and earn."

C. R. Bondre wearing the
Arabian robe in Bahrain in 1958

"Once this was decided, I embarked upon this difficult journey of finding suitable distributors; but as I started putting concerted efforts in this direction, we started finding suitable persons from various communities, in various countries. As far as possible, we selected persons living in those countries, and we also created new distributors from amongst Indians settled abroad. Before becoming our distributors, their economic condition was ordinary, but they had an ambition, a desire to make it big, backed by willingness to work hard, and push themselves out of their comfort zones. They took the risk and became successful. They sold our engines in their respective countries, and earned name, fame and money for themselves. End-customers trusted these distributors as they did not have any set reputation. I used to constantly travel to all these countries to keep personal contact with them and tried to instil this faith in them that come what may, the company was steadfastly standing behind them for any support or help that they required. I used to take my sales executives with me, and whenever possible used to also request Shantanurao to come along, and he too used to make it convenient to travel with us whenever possible. I used to meet the Government officials, Ministers, big and small customers in these countries, and help the distributors in their work. We used to participate in international industrial exhibitions in these countries and put up our stall at our own cost. Every year, we invited them to India, paid for their travel and stay here, took them round the company to show them the utmost care and quality with which manufacturing was done. This not only established good relations with them, they also got to see for themselves the skill and craftsmanship of the Indian engineers and workers, the discipline in the organisation, the large number of capable employees working there; which they would never have imagined through only meeting with me or with Shantanurao."

"On the occasion of Shantanurao's 61st birthday celebrated at the Sun-N-Sand that day, we had warmly invited all these distributors from 42 different countries to India. These were the same hands which took our engines to thousands of small farmers, fishermen, small and medium entrepreneurs, across the world. This was indeed our extended long and strong Third Arm!" concludes the export expert, C. R. Bondre.