A matter of timing

Yashovardhan Saboo is moving with the times. For the last 20 years his company Kamla Dials and Devices Limited (KDDL) has made components for the world's most famous watch manufacturers "" including trendsetters like Swatch and Tissot.

Now, he's venturing out to highstreets and malls around India and opening showrooms to sell the same world-famous brands.

The first glittering ETHOS showroom has already opened in an upmarket shopping district in Chandigarh.

Three more showrooms "" two in Bangalore and one in Mumbai "" will throw open their doors by March. Another three "" in Mumbai and Delhi "" will open by year end.

Most of the glitzy watch showrooms that have sprung up in Indian cities belong to one company or another and they only display that company's products. Saboo hopes to be a market leader in multi-brand watch showrooms.

The ETHOS showrooms will display 15 international brands in its cases. Among the brands on sale are Longines, Dunhill, Movado, Espirit, Omega, Tissot and Citizen.

Moving into the retail trade is an expensive and notoriously risky business. Each showroom costs about Rs 2 crore and Saboo is planning to spend about Rs 20 crore totally on the project.

According to Saboo's calculations, each of the stores will break-even in their second year. Says Saboo: "We have been working with the best Swiss brands for quite some time. Now we want to make our presence felt as an umbrella one-stop shop for the increasingly aware market."

Getting into the retail trade isn't the only ambitious diversification that Saboo is attempting. He's even talking to prospective Swiss partners to open a factory in the Alpine country.

He wants to move there because that's the only way to become a supplier to premium brands like Rolex and Patek Phillippe.

The top Swiss companies outsource only to Swiss component manufacturers. And manufacturing plants in Switzerland must have a Swiss partner holding the majority stake.

The move to Switzerland is still in the future but Saboo has clearly reached a crossroads in the watchmaking industry.

For over 20 years he has built a unique niche as a company that supplies components both to Indian and foreign companies. He started back in the early '80s as a supplier to Titan Watches.

Today he supplies 90 per cent of the dials and watchhands to Titan and Fastrack, the company's brand aimed at trendy youngsters.

He also supplies the same products for Timex. Kamla Dials has four factories across the country. Of the two in Bangalore, one makes dials and hands exclusively for Titan.

Making dials and watch hands isn't a small achievement. These are high precision products and there are only five or six companies around the world that export to countries like Switzerland. KDDL is the only Indian supplier of watch hands.

Saboo is a self-made businessman who spotted an opportunity at the right time. Back in the '80s he graduated from IIM-A and started work in a textile components company. He quickly found himself fascinated by the intricate mechanisms in the components.

"I was never a technical guy," reminisces Saboo, "but I have always been fond of design." So he stumped up around Rs 1.4 crore from a variety of sources including his family.

His attention was caught by the watch industry and he quickly realised that HMT's days of total monopoly were over.

He was proved right when Titan made its debut on the scene. "They were among our first customers," says Saboo proudly.

Over the next decade Kamla Dials focused on establishing itself as the leading watch component maker in the country.

Even today it is one of only three watch companies listed on the BSE. The Rs 40-crore company has 900 employees and it expects to grow steadily at 20 per cent for the foreseeable future.

It was only in 1996 that Saboo turned his attention to the export market. "After successfully establishing ourselves, the top management in the company knew that sooner or later protection for the domestic watch manufacturers would go, and we had to reach out to the rest of the world," says Saboo.

But it was easier said than done. Saboo started pitching to the top European companies who were not terribly impressed by the Indian who was attempting to break into a terribly clubby industry.

"Most of them would fall off their chairs," he says, "and the clubbiness of the business meant that we got our first trial order only after two years." Kamla Dials got its first order for 2,000 dials from Endura of the Swatch group. The initial order was worth a mere $2,000.

Once he bagged the first customer the sky was the limit. Saboo learned fast and soon had design offices in Hong Kong and Switzerland. And for the future, Saboo knows that he will have to be even more export-oriented.

" I can safely say, despite the strong patronage we receive from Titan, we would have died if we did not make the overseas venture," he says.

Does he now face a threat from the Chinese dragon? The Middle Kingdom has the advantage of low cost structures and once duties come down there could be a threat from Chinese manufacturers.

But Saboo believes he can go on the offensive and tackle the Chinese head on. In fact, at his factory in Derabasi, Punjab he is trying to make cost-effective components for both domestic and Chinese customers.

He insists that he won't set up shop in China. "We do not want to position ourselves as an affordable alternative to the world," he says.

He's also hoping that his ETHOS showrooms will develop their own unique identity in the industry. Saboo is fascinated by antique watches and the showrooms will offer to repair antique watches for free.

There's even talk about starting a club for antique watch owners. In fact, an antique club is already operational in Chandigarh and 60 watches have been registered with it in just two months. There's even a rare nineteenth century Hanson.

Can Saboo replicate his success in the retail trade. The clock, as they say, is ticking and only time will tell.