As the service persons and their company grew, they found that (a) It was easy to get workers residing nearby and train them (b) wages, rent and electricity bills and other overhead expenses like tea were quite low (c) All customers were within radius of 5 Kms from the shop (d) customers could be reached by cycle and bus. The supervisor or chief technician had a moped and was proud of it!! (e) fuel price was low (when I bought my Yezdi bike in 1974 petrol used to cost Rupees three and paise forty per litre. (no traffic jams).
People used to report for work by 8.30 a.m sharp.
Well the city grew into a mega-city, we started to ape the west, and what happened?
(a) Technicians are difficult to get. Most of them stay 10 to 15 Kms away from the work-place.
(b) Technicians with even a minimum skill-set want to become contractors.
(c) 80% of the customers are very far off. Some even at a distance of 25 to 30 Kms away from the work place. (d) REnt, electricity and wages have shot up. Overheads have sky-rocketed. For instance a cup of tea costing Rs.2 in the year 2002 is now Rs.8 ! (d) All technicians are to be provided with motor-cycles, no other cheaper mode of transport is possible !!
RESULT: Business is fast becoming unviable.
Point No. 6
With only window air-conditioners in the market, good used machines were available. Shops used to frequently sell pre-owned (a new-age name for second hand goods) and make good money. The present day machines though far, far superior in quality than the earlier machines are not made to last long (>5 to 7 years). Nobody wants to buy a second-hand machine.
RESULT: Revenue loss.
Point No. 7
Some years back there was no sales tax on second-sales. (Today we have VAT)
There was no tax on repair/ service. (Today we have Service tax - recently hiked to 14%)
RESULT: We are proud to serve our Nation. But margins get eroded.