Dubai: The year was 1919. The Middle East was recovering from the First World War, when the erstwhile Ottoman Empire was being divided among the British and French, as they sought to expand their own.
As post-war reconstruction took hold, Rao Sahib Jashanmal Jhangiani, with his brother and a few friends, sailed from India to land in Basra, Iraq, to take advantage of the opportunities that such activities would create. In this way, a 102-year journey began , with Rao Sahib selling goods and services to the British who were coming into Iraq. “He sensed the opportunity to sell these goods and services to the people who were used to a different mode of life,” says Tony Jashanmal, Rao Sahib’s grandson and the current President of the Jashanmal Group. As a result, the Jashanmal store, selling imported lifestyle products, became a success.
Following the oil discoveries
As the world progressed into the late 1920s and early 1930s, the requirement for oil suddenly exploded. As oil had already been exploited to a great extent in Iraq, the British were hunting in the region for new oil sources. It was first discovered in Kuwait, just a two-hour drive from Basra. This discovery necessitated the rapid development of Kuwait, which was a complete desert in contrast to the developed cities of Iraq.
While in Basra, Rao Sahib struck up a close friendship with Colonel Dickson, who was later to become the British Political Agent in Kuwait. He convinced Rao Sahib to open a branch in Kuwait, to cater to the needs of the officials of the oil companies and their families. This friendship led to Jashanmal opening his first store in Kuwait in 1933, which was handled by Rao Sahib’s eldest son Naraindas Jashanmal, who had just joined the family business.
The rest, as they say, is history.
As area after area in the region struck the black gold and multinational oil companies moved in, the goodwill that Jashanmal had created in his early years allowed him to follow the oil trail, setting up store after store in each of the cities that were the centres of the oil commerce.
From that single store on the Iraqi coastal city, today, the Jashanmal Group strides across the region with a multitude of stores, in addition to an extensive distribution and wholesale network to over 1,000 retailers across the GCC and India.
Following the development in the region, the Jashanmals’ journey entered Dubai in 1955. The Ruler of Dubai, Sheikh Rashid bin Saeed Al Maktoum, was in Bahrain when he visited the Jashanmal store. Impressed by what he saw, he asked Hiro Jashanmal, Rao Sahib’s son, to open a store in Dubai. The same year, Gulf Aviation, a subsidiary of the British Overseas Airways Corp (the predecessor to British Airways), began direct flights between Sharjah and Bahrain.
When Sheikh Rashid asked Jashanmal about which part of Dubai he would like to set up his business, he pointed out to a place in Deira. When asked to explain the reasons behind this decision, since most of the city’s action was in Bur Dubai, he said that since the airport was on the other side of the creek, Deira would be the area where all the new people coming in by air for the development of the city would settle down. This was all the more important since there was no bridge to carry the heavy equipment across the creek.
The first Jashanmal store came up in Deira in 1956. Such was the pioneering move that the area around the store was unofficially called Jashanaml Square. It was later renamed as Al Nasr Square, and still stands today. “There was no electricity those days, so we all used generators. We built the stores first, and the house was always on top of the store. The warehouse was behind the store,” Tony Jashanmal said.
Hiro Jashanmal’s predictions came true as Deira developed very fast afterwards. McDermott took up space at what is today the Dubai Creek Golf Club to build their rigs, along with the Oilfield Supply Company. The two principal roads in Deira — Al Maktoum Street and Bani Yas Street — led to Al Nasr Square, where the Jashanmal store was located.
As the store tasted rapid success, the company soon launched its expansion plans. The store in Abu Dhabi opened in 1963.
Jashanmal’s speciality was dealing with British goods due to links with the oil companies. “We became a one-stop-shop for all things British — literally, from foodstuff to diamonds,” said Tony Jashanmal. Since the oil companies were British, their staff were mostly British, which was followed by the telephone companies and others.
As the economies of the region opened up, smaller towns also started witnessing a rise in demand for the kind of products Jashanmal was selling. “But since the shops in the smaller towns did not have the wherewithal to import these products themselves, they started buying from us. Our distribution business was thus launched,” Jashanmal said. Today, the distribution business has overtaken the retail business, with its network having spread to more than 1,000 points of sale across the UAE, Oman, Bahrain & Kuwait, with 80,000 square metres of warehousing facilities.
Changes in ownership pattern
Running the family business becomes a challenge once the third generation comes into the scene, Jashanmal says. “Till the second generation, you are brothers and sisters. So the bonding is close. But in the third generation, you become cousins. You move far away, more so in our family as the opening of different stories meant the brothers were living far from each other, so the children were growing up in different places,” he says.
Till that point, the Jashnamals followed the traditional patriarchal system to run the family business. As Tony Jashanmal himself entered the business in 1973 after his father’s death, the need for a new approach was felt as the third generation was now in the fray. The family got together for two days at their home in Bahrain to thrash out the way forward. “We decided that we would go for a family shareholding pattern,” Jashanmal said, with each family member holding a specific amount. There is a limit on how much profit can be set aside as dividend, so that the business has enough capital for future growth.
It was also decided that no one from the family will hold the CEO or deputy CEO’s position. That would be filled in by professionals. Joining the family business remains entirely voluntary. “If any member of the family wants to enter the business, he will start at the bottom — at the warehouse,” Jashanmal said. Family members typically worked eight to 10 years in the company, before they find their own calling.
To take the company forward into the next 50 years, the Jashanmal Group decided about three years ago on a new strategy as digitalisation was increasingly taking hold. Once the plan was finalised, the company chose a new CEO — Khaled Soliman — to head its operations and lead the digital drive.
The transformation of the company structure to manage the digital drive was completed in February last year. “This was just before the COVID-19 pandemic, so it worked well for us,” Jashanmal said. The success of the strategy is borne in the fact that within just a year, e-commerce has contributed 4 per cent of the company’s turnover.
The shareholding structure has not changed, only the way of the running of the company, Jashanmal said. “This will drive us into the future. The system of the family sitting down and taking decisions collectively has worked well,” he added.
So how does a company thrive for over a century? The key to this is the adherence to a strong set of values, which hold on over the generations, Jashanmal said. “You can’t change the DNA too much for it to actually function this way. My grandfather had very strong principles and he always wanted that we keep to them. But you have to keep ahead of the times in order to stay relevant. You have to foresee what is coming.”
So what would these principles be? The main is the pricing. “You always charge fair value of a product. You have to make a profit to improve the business and be of better service to the community. But you do no charge them too much,” Jashanmal said. “Never think of yourself as a business, but think of yourself as a part of the community, where you have to do your bit.”
In terms of contribution to society, two things were in focus for the company — education and sport. Several family members were founders of prominent schools in the region, and have been active sportspeople and sports administrators over the years. “I learnt so much from my grandfather, and the younger ones learnt it from their parents, and the values carry on,” Jashanmal said.