180. Dealing With Competition

"We have been in this business for the past many years. A person who started his business five years back has grown so much within a short time" said Madan, the Managing Director of Anand Industries, grudgingly.

"Sir, I think you are talking about Lakshmi Enterprises. They are operating at a much smaller scale than us. They can never be a competitor to us" said Sundar, CEO of the firm.

"No, Mr. Sundar! People have been talking about them, in the market. This is not a good sign. If we want to retain our market share, we should nip any competition in the bud."

"What do you suggest, sir?"

"Let us first gather complete details about Lakshmi Enterprises. I feel disturbed looking at their factory on the main road. It is a rented place. We should find a way to evict them from that place."

After two days, Sundar came to Madan, with information.

"Lakshmi Enterprises has taken their factory building on lease, for five years. The lease is going to expire in two months. The firm has been making arrangements to renew the lease" Sundar told Madan.

"We should ensure that the lease is not renewed. Get in touch with the owner of the building and request him not to renew the lease to Lakshmi Enterprises. If necessary, we can even buy that building from the present owner."

"Sir! We have not been able to make full use of the space we have in our factory building. Should we invest our funds in a new building?" asked Sundar.

"We may not be able to use the building, but we can give it for rent. Even if the building is going to remain idle, it doesn't matter. We should aim to drive our competitor out of business in six months and take over his customers."

"What if the owner of the building doesn't want to sell the building?"

"Offer thim a price higher than the market price. We will mobilize the required sum of money by raising some loans" said Madan.

"I don't understand why the owner of the building is refusing to renew the lease, at the last moment" Shanmugam, the General Manager of Lakshmi Enterprises, told Lakshminarayanan, the Managing Director.

"Ok. What can we do, if the owner of the property doesn't want to renew the lease? It will take two years for our factory building to come up in the land we have purchased recently. Till that time, we have to rent some other place for our factory. A factory building located in the industrial estate, has been vacant for the past six months. The building owner told me, when I met him in a meeting recently that he intended to give it on rent. We can rent that place. The area is slightly smaller than what we have now. But, I think we can manage" said Lakshminarayanan.

"Sir! I understand that Mr. Madan, the Managing Director of Anand Industries has given pressure to the owner of the building, not to renew the lease to us. It appears that Anand Industries is going to buy that building."

"Why should we be concerned about it? We have got another place to locate our factory."

"Sir! We should hit Anand Industries back in some manner. We can make a few of their top technical people quit Anand Industries and join us. I hear that the employees are not happy there. They will be willing to join us, even for the same salary they are getting there. We need more people, since we will be expanding our operations in two years' time. Mr. Madan will realize that this game can be played by both the sides, only if we hit him hard."

"Anand Industries is much bigger than us. But they want to grab our share of the business, which is quite small. Let, us not think like them and grab their senior staff from them. Let us just focus on our own business" said Lakshminarayanan.

"You have dropped a bombshell!" exclaimed Madan.

"The Government order is expected today. The government is taking over the land and building bought by us, for road expansion" said Sundar.

"Such takeovers will take time. Someone will get a stay from the court."

"This scheme had been announced by the government five years back. The implementation was pending, because of the cases filed by some people. With the cases pending in the court, everyone seems to have forgotten about the scheme. That was why this issue didn't come to our notice, when we bought the land six months back. Yesterday, the court gave a judgement in favour of the government. The government is acting swiftly, by issuing an order today. They will start working on the scheme without delay."

"But, the government will compensate us for taking over our land and building!"

"Yes, sir. But the price fixed by the government will be much below the market price. And, it may take a few years for the government to pay the price to us. They may even pay the price in two or more installments. We have purchased the property at a price much above the market price. The loss we will suffer may be substantial" said Sundar.

Madan began to wonder how much would the loss be and to what extent that loss would affect his business.     

Thirukkural

Section 1
The Path of Virtue

Chapter 16
Bearing No Envy

Verse 180 (In Tamil)

iRal Inum eNNAdhu vehkin viRal Inum
vENdAmai enum serukku.

Meaning:

Coveting the wealth of another, unmindful of consequences, will bring destruction. The nobility of living without coveting others' wealth will bring success.

(This is the English version of the Tamil story 'mARiyadhu kaNakku' by the same author.)

Verse 181 (Soon)
Verse 179