I walk for at least an hour everyday owing to a lot of reasons like busses' timing not coinciding with that of mine, my inability to afford rickshaw, and to an extent my tummy which, lately, has started gathering some fat! This habit of walking, as one would expect, takes its toll on shoes etc. And let me tell you that I am a regular visitor of those roadside cobblers and most of them address me by name! I have spent a fortune getting my shoes, slippers, or chappals getting stitched. Last week while I was getting out of my home I realized that the outsole and the toe cap of my shoe had been separated exposing my tow with amorphous nails! I had no idea as to how in the hell was I going to reach the nearest cobbler. Still I made it there after 20 minutes which on any other day would have taken 2 minutes. I wasn't sure whether that guy would have come by then but it was such a relief when I saw him there. When I was removing a shoe of mine that had to be stitched he looked at me in disbelief and said "yeh dhandha to maine 3 din pehele hi bandh kar diya!" (I have closed down this business since three days). Now it was my turn to look at him in disbelief! I took about 10 seconds to recover before I asked "yeh dhandha bandh kiya to ab karte kya ho aap?" (Now that you have closed this business of yours, what do you do for a living?) Then he went on to say that he had stopped doing the shoe-chappal business and instead decided to stick to doing only the Rickshaw business i.e. the stitching of torn black outer covers of rickshaw and other rickshaw related work. I didn’t ask as to why he had switched his family business (it was started by his father).
[There are actually two cobblers situated within a distance of a few meters, close enough to snatch away each other's customers. Of late, there was a price war going on between them! Especially in the last few months where it seems people had stopped buying shoes or reduced the frequency of buying them (may be due inflation which forced them to postpone their purchase) which had led to good business for cobblers as people had to stay with their old pair of shoes. We actually experienced a buyer’s market where the cost of stitching went down by almost 30%!]
So now here I was left stranded with a shoe in my hand and a few meters to cover before I could reach another cobbler. And when the second one was finally done with all the stitching I extended one Rs.5 coin expecting a rupee or two back. But then he replied that it would cost me Rs.7! Without arguing I gave Rs.7 and left as I was running late. But I could not help asking one question “lagta hai aapne rickshaw ka stitching karma bandh kar diya hai?” (It seems you have stopped doing the rickshaw business) to which his reply was “haan!!” (Yes) Then I realized what had happened. Few days back they were competing for both groups of customers (Rickshaw wallas as well as people who came with their chappals, shoes etc.) which had led to a small price war. But now suddenly one dedicates himself to the rickshaw business and the other to the Chappal business which allowed them to charge higher prices as there was no competition now. And as you would agree if someone requires the services of a cobbler, it’s the nearest cobbler who would get the business. So it’s not difficult to conclude that both of them have come to some sort of agreement to create a situation where there is only one cobbler giving a particular service (which may be for shoes or rickshaw) within that area.
Now a question may arise that how did they agree upon this considering that one business may not be equally profitable as the other. And here’s where location advantage comes into picture. The person who is providing services to the Rickshaw wallas is situated near a Rickshaw stand, a chai walla as well as one sulabh shauchalaya! And the interesting thing is the Rickshaw wallas are being charged the same as they used be earlier indicating a tacit agreement between the two cobblers as the one who is looking after the chappal business would earn less than the other so to compensate for that loss he would increase the charges. One more thing which could be a part of the agreement is that the one who is handling the rickshaw can’t charge more to take advantage of the situation as this would put him in a better position than the other which could motivate the one suffering to break the agreement and start doing the Rickshaw business as well.
I know I am assuming a few things here but all these coincidences can’t be happening at the same time right? And if this is true then hats off to them for pulling it off!!
[There are actually two cobblers situated within a distance of a few meters, close enough to snatch away each other's customers. Of late, there was a price war going on between them! Especially in the last few months where it seems people had stopped buying shoes or reduced the frequency of buying them (may be due inflation which forced them to postpone their purchase) which had led to good business for cobblers as people had to stay with their old pair of shoes. We actually experienced a buyer’s market where the cost of stitching went down by almost 30%!]
So now here I was left stranded with a shoe in my hand and a few meters to cover before I could reach another cobbler. And when the second one was finally done with all the stitching I extended one Rs.5 coin expecting a rupee or two back. But then he replied that it would cost me Rs.7! Without arguing I gave Rs.7 and left as I was running late. But I could not help asking one question “lagta hai aapne rickshaw ka stitching karma bandh kar diya hai?” (It seems you have stopped doing the rickshaw business) to which his reply was “haan!!” (Yes) Then I realized what had happened. Few days back they were competing for both groups of customers (Rickshaw wallas as well as people who came with their chappals, shoes etc.) which had led to a small price war. But now suddenly one dedicates himself to the rickshaw business and the other to the Chappal business which allowed them to charge higher prices as there was no competition now. And as you would agree if someone requires the services of a cobbler, it’s the nearest cobbler who would get the business. So it’s not difficult to conclude that both of them have come to some sort of agreement to create a situation where there is only one cobbler giving a particular service (which may be for shoes or rickshaw) within that area.
Now a question may arise that how did they agree upon this considering that one business may not be equally profitable as the other. And here’s where location advantage comes into picture. The person who is providing services to the Rickshaw wallas is situated near a Rickshaw stand, a chai walla as well as one sulabh shauchalaya! And the interesting thing is the Rickshaw wallas are being charged the same as they used be earlier indicating a tacit agreement between the two cobblers as the one who is looking after the chappal business would earn less than the other so to compensate for that loss he would increase the charges. One more thing which could be a part of the agreement is that the one who is handling the rickshaw can’t charge more to take advantage of the situation as this would put him in a better position than the other which could motivate the one suffering to break the agreement and start doing the Rickshaw business as well.
I know I am assuming a few things here but all these coincidences can’t be happening at the same time right? And if this is true then hats off to them for pulling it off!!
I believe we can learn some business strategies from them for sure. what say?
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