ROYALOAK: FROM HUMBLE BEGINNINGS TO FURNITURE EMPIRE THE INSPIRING JOURNEY OF VIJAI SUBRAMANIAM

FDT Bureau

In a heartfelt interview with Pragat Dvivedi, Co-Founder of Furniture Design & Technology (FDT), Vijai Subramaniam, the Founder and Chairman of Royaloak, discusses his personal journey, the growth of his company, new strategies, overcoming challenges, and the future of furniture retail in India.

HOW DID IT ALL HAPPEN, COMING FROM A REMOTE VILLAGE IN TAMIL NADU AND ENTERING THE FURNITURE BUSINESS?
My brother, Mr. Mathan Subramaniam, and I started the business together. We began with various ventures, from selling tea powder to candle stands. My uncle had even suggested going to Singapore, however that plan fell through and I was left with no money I couldn’t go back to my native village in Munnar, so I decided to take a bus and ended up in Cuddalore. After moving to Cuddalore, I started selling Standard Chartered credit cards. In my first month, I sold 100 credit cards, while my colleagues were selling only 30. My success led to jealousy and an attack from my colleagues, forcing me to leave that job. One Sunday evening, while walking around, I saw a fair at a government exhibition in Cuddalore. The colorful lights and the crowd attracted me. There was one empty stall among the others filled with vendors selling various goods. I inquired about theempty stall and was told it was expensive, costing 28,000 rupees for the two-month exhibition, which is why no one had taken it. I decided to take the chance and paid 2,000 rupees for the stall. I didn’t know what to sell, so I pledged my scooter for 7,000 rupees and got another 5,000 rupees from two friends who joined me in this venture. I went to Chennai, bought plastic bottles and utensils, and set up the stall. However a big company outcompeted us, so we switched to selling candle stands, which proved successful.

HOW DID YOU TRANSITION TO SELLING TV STANDS?
One day, I noticed a stall selling TV stands at an exhibition. They had only seven TV stands, but they sold well. I observed their business model: taking orders and delivering later. Inspired, we started selling TV stands at the next exhibition. Selling higher-value items like TV stands proved much more profitable, significantly increasing our revenue and margins. We focused on selling TV stands across South India, visiting cities like Bangalore, Chennai, and Thiruvananthapuram for exhibitions. This continued for four to five years By the time I turned 27, I decided it was time to settle down and get married. We planned to settle in Cuddalore but faced setbacks, including failed investments. Eventually, we were attracted to Bangalore as a base. In 1998, we moved our operations to Bangalore, buying goods from Chennai and bringing them to exhibitions. One significant exhibition was at RBANMS Grounds in Bangalore, which went well. I then looked for a permanent place to set up shop.



HOW DID YOU MANAGE TO SECURE A PERMANENT LOCATION FOR YOUR BUSINESS, AND HOW DID IT IMPACT YOUR PERSONAL LIFE?
Someone mentioned Safina Plaza, the only mall in Bangalore at that time, and I decided to take a risk by renting a 200-square-foot space for 1,000 rupees a day, even though it was a significant amount back then. Initially, the first three days were slow, and I was worried as I had no customers, losing 1,000 rupees each day while handling everything myself. By the fourth day, I decided to vacate on Sunday. However, sales picked up dramatically, with two TV stands sold on Friday, five on Saturday, and seven more by Sunday future father-in-law initially rejected me as a potential match for his daughter because he perceived my business as not financially stable enough, unaware of our growing success and other assets like our car and the construction of our house in one of the best localities in Bangalore.

THAT MUST HAVE BEEN TOUGH..
It was. After my marriage proposal was rejected again, we realized we needed to open a permanent store. Our first store was an 800-square-foot space on Kammanhalli Main Road, where we started selling furniture, a natural progression from TV Stands. The store did well, breaking even within the first month. After opening the store, I received a marriage proposal, and I am currently married to Mrs. Maheshwari Vijai. Following this success, we opened another store on CMH Road and started importing Chinese furniture, which was popular and sold well.We managed the imports by stationing a person in Chennai. However, due to irregular imports, I decided to personally visit China and import furniture myself. However due to a lack of warehouse space, we had to adapt by starting a distribution business, and by 2006-2007, we became importers and wholesalers, with wholesale making up 80% of our sales.



HOW DID THE BRAND “ROYALOAK” COME ABOUT, AND HOW WAS THE JOURNEY THEREIN?
Initially we wanted the brand name to be Oak and Oak, but we encountered a hurdle since someone had already registered a similar name. After discussions, we settled for “Royaloak” in 2010. From 2010 to 2016, Royaloak focused on conventional business practices, striving to establish profitability through product sales across its four stores. However, in 2016, the company confronted severe challenges including import restrictions, duty structure changes, and significant price increases in the furniture industry. Realizing the situation wasn’t viable; I considered closing down the business. I decided to keep only one store and close the other three. It was a tough decision, but I had to do it. I informed all our employees, who numbered over 100 at that time, to start looking for other jobs as we were shutting down all but one store.


HOW DID YOUR EMPLOYEES REACT?
All the employees refused to accept the decision. They expressed their happiness working with us. I understood that life wasn’t just about personal wealth and comfort; it was also about serving others. I called my brother, my wife, and my sisterin-law and together, we decided to expand the company boldly and restructured as a private limited entity. By the end of 2017, we opened 10 more stores, becoming the top furniture brand in Bangalore. In 2018, we opened another 20 stores, bringing our total to 30. We had created a team structure with 20 departments, including acquisition, finance, sales, and marketing. Each department was given the responsibility for managing different aspects of the business. In 2019, I called all my employees back and asked, “Okay, we reached the target of becoming Bangalore’s number one.” Then all of them said, “Sir, don’t worry. We have increased our strength by 25%. This year, we want to be South India’s number one.” It’s a big aim, goal. I said, “Okay, we’ll do it.” In 2019, we opened stores in Kukatpally in Hyderabad, Vellore, and Chennai. By the end of 2019, we had opened another 20 stores. Altogether, we had 55 stores and became South India’s number one furniture company.

BUT THEN COVID STRUCK…
When COVID -19 struck, it was a time of deep uncertainty and fear. Initially, my team was hesitant and fearful about the future. They questioned the feasibility of selling furniture during a global pandemic and lockdowns. Despite their doubts, I encouraged them to stay positive, emphasizing daily meditation and yoga to maintain resilience. Transitioning to online platforms like Google Meet and Zoom was met with resistance; many of my team members were reluctant to engage fully,their spirits weighed down by the grim news on TV. Yet, I remained steadfast, promising to find a way to pay salaries despite the challenges. We launched our business online. Slowly, revenue started trickling in, and we became one of the few in our industry able to sustain payroll throughout the COVID crisis. The initial success online boosted morale and ignited a wave of enthusiasm within the team. They began suggesting new ideas and improvements, even proposing to expand our workforce. Our journey through COVID was more than just survival; it was a testament to our resilience and determination to thrive against all odds.

HOW DID YOU MANAGE YOUR GROWTH WITHOUT EXTERNAL FUNDING? WHY DID YOU NOT RAISE FUNDS LIKE OTHER FURNITURE STARTUPS?
No, we haven’t raised any funds so far. I firmly believe that a business can thrive without external funding if your vision and execution are clear. This philosophy has been the cornerstone of our journey, and I’m even writing a book titled “No Money, No Problem: Any Business Can Do It” based on this belief. Our company is solely owned by me, my wife, my brother, and my sister-in-law, we are the core partners. Following COVID-19, we expanded rapidly, hiring significantly more employees and leveraging virtual meetings to secure 70 properties. After the lockdowns eased, we swiftly opened over 50 additional stores, surpassing 100 stores nationwide by 2021, establishing ourselves as India’s leading furniture brand. COVID-19 was a pivotal moment for us, it presented challenges for many businesses, but we saw it as an opportunity. With a positive mindset and unwavering dedication, our team worked tirelessly, adapting to virtual operations and driving our growth. Currently, we are expanding aggressively across India, including regions like Dimapur, Arunachal Pradesh, Nagaland, Delhi, Ahmedabad, and Nagaro, operating through a successful franchise model. Our franchise partners have seen exceptional returns, often achieving ROI within six months—a testament to their satisfaction and our robust business model.

WHAT WAS YOUR APPROACH TOWARDS COMPETITION?
I don’t believe in competition. The word “competition” itself is wrong in my dictionary. This universe is so big; it has everything. Even if another 10 companies come, they can survive. There is no need to compete with anyone. When youfocus on your business, your style, the kind of customers you require, and the service you give, you can survive. We don’t believe in competition. We don’t discuss competition with our staff. I just give them a direction, a goal.



WHEN YOU OPEN A NEW STORE, HOW DO YOU ENSURE IT STARTS SELLING IMMEDIATELY, AND HOW DO YOU MANAGE FURNITURE SELECTION
Opening a new store is always a daunting task, but we have a determined strategy to ensure it becomes profitable right from the outset. It’s fundamental to our business plan - to break even in the first month, covering all costs like rent and operations. Our success lies in offering furniture that is both distinctive and affordable, catering primarily to the middle and lower-middle-income segments. Despite her background in selling silk saris, my wife’s natural eye for design plays a crucial role in shaping the ambiance of our stores, creating spaces that customers find welcoming and appealing. Our journey spans cities like Delhi, Mumbai, and Bangalore, each with its own unique customer expectations. In Delhi, customers are drawn to large,statement-making pieces, while in Mumbai, practicality and compact designs are favored. Bangaloreans seek furniture that integrates seamlessly with their lifestyle and living spaces. Understanding these local preferences and meeting diverse needs has been instrumental in our success and expansion.

ISN’T IT CHALLENGING TO MAINTAIN SUCH A WIDE RANGE OF FURNITURE ON A NATIONAL SCALE, ESPECIALLY WITH THE NEED FOR EXTENSIVE STOCKING?
Our journey in South India was truly groundbreaking, we pioneered large stores spanning 15,000 to 20,000 square feet, showcasing an extensive array of products like 200 sofas, 100 beds, and 100 dining sets, a first in our region. To support this, we established a massive 35-acre warehouse with approximately 7 lakh square feet of space, serving as the heart of our operations where we meticulously manage our inventory and logistics. Initially, I traveled solo abroad to handpick furniture, driven by a deep commitment to offering the best to our customers. As our business grew, we formed a dedicated team of buyers. They now lead in selecting and negotiating based on market insights and customer feedback. This evolution has empowered us to stay agile and competitive in sourcing premium products that resonate with our clientele. Over the years, we’ve seen a remarkable increasein average customer spending—from 10,000 to 12,000 rupees in 2010 to 45,000 to 50,000 rupees by 2020. This growth reflects not only evolving consumer preferences but also our unwavering dedication to exceeding expectations in a dynamic market. We’re driven by a passion to provide exceptional furniture solutions that enhance homes across India.

DO YOU BELIEVE THAT INDIA CAN MANUFACTURE THE SAME QUALITY FURNITURE AS IMPORTS?
Yes, India certainly has the capability. Currently, 20% of our business’s contribution comes from furniture manufactured in India through our network of 40 partner factories. They produce furniture for us, which we also export to foreign markets. As part of our strategy moving forward, we are embracing the “Make in India” initiative by collaborating with our vendors from Malaysia, Indonesia, and Vietnam, who are establishing manufacturing operations in India. This shift reduces our dependence on imports and strengthens our commitment to local production. In the furniture business, products are not perishable, providing flexibility. If a design doesn’t sell well in one region, we redistribute it to others, adjusting prices as needed. Likewise we continually keep introducing new designs. This approach leverages the scale and resilience of the global furniture retail industry, which ranks second after real estate in retail importance. While there are challenges in scaling up furniture retail in India, such as high investment costs and lower returns compared to other retail sectors, we focus on balancing affordability with profitability. Our pricing strategy aims to meet customer needs while ensuring sustainable business growth. My personal journey in the furniture industry has evolved beyond profit alone. It’s about fulfilling a greater purpose, as I realized after challenges in 2016 reshaped my perspective and company goals over three years of reflection.


WHEN DID YOU START MEDITATION, AND HOW HAS IT INFLUENCED YOUR BUSINESS PHILOSOPHY?
I began practicing meditation in 2000 at the age of 20. It was during this time that I formulated my company’s foundational goal - to create expansive growth opportunities for employees and partners by enhancing customer lifestyles to international standards at unbeatable prices. This vision resonates deeply with me and guides our singular focus on the furniture sector. Since then, Royaloak has grown significantly, with investments exceeding 900 crore INR and a robust infrastructure including a 35-acre warehouse and over 200 stores, half of which are companyowned. Our unique franchise model minimizes stockholding for partners and leverages our centralized inventory; it ensures high profitability and success for franchisees. While our sofas range from 22,000 INR for a 3+2+1-seater set to 2 lakh INR, our stores cater to both individual customers and those accompanied by interior designers. This approach ensures a seamless shopping experience tailored to diverse preferences. Addressing the diversity across India’s 26 states, each akin to its own country in terms of cultural nuances and consumer preferences, remains crucial, we adapt our offerings accordingly, ensuring relevance and appeal across regions. To aspiring franchise partners in the furniture industry, my advice is simple: Focus on space, not just money. You can build a substantial business without heavy initial capital investment. With our support in furniture, interior setup, and comprehensive guidance, you can establish and grow a successful venture, potentially achieving significant scale and profitability within a short span.

WHAT DO YOU EXPECT FROM FRANCHISE PARTNERS, AND HOW DOES YOUR UNIQUE BUSINESS MODEL ENSURE THEIR SUCCESS?
Our franchise model revolves around empowering partners to run their stores autonomously while we provide products, displays, and interior design support. The key expectation is their daily presence and active involvement in store operations, ensuring a hands-on approach to management. Even without initial space, we facilitate setup options. We offer a distinctive one-year guarantee wherein any losses incurred is covered by the company, emphasizing that profits belong entirely to the franchisee. This model not only mitigates risks but also incentivizes entrepreneurial spirit and dedication. In the competitive retail landscape, understanding and adapting to evolving customer preferences is paramount. We attribute our rapid growth to continuous customer feedback integration. This approach enables us to swiftly adjust our product offerings in terms of style, size, color, and more to meet market demands effectively. Moreover, affordability is core to our strategy. We strive to provide unbeatable prices while elevating customer lifestyles to international standards - a philosophy rooted in honesty and integrity. As Tamil poet Thiruvalluvar wisely stated, success in business hinges on offering products of the same quality and price you would desire for yourself. This principle guides our commitment to delivering exceptional value and ensuring enduring customer satisfaction.



WHAT’S YOUR TAKE ON THE CASH-BURNING MODEL? STARTUPS RAISE FUNDS, BURN THROUGH CASH, THEN AIM FOR PROFITABILITY. IS IT ACHIEVABLE, A DREAM, OR PRACTICAL?
I’m skeptical. Many startups pursue this model, but I’m not convinced of its merits. Despite ample funding offers, I’m notnterested. Success requires dedication, honesty, and integrity - no shortcuts. Only through unwavering commitment and honesty can true success be achieved.

WHY DO YOU THINK ONLY 2% SUCCEED WHILE 98% FAIL IN BUSINESS?
The key aspect lies in setting right priorities. Many people chase money as their sole objective, but that’s not a sustainable path to success. Money should be a byproduct of a clear, honest vision that benefits society. Setting and diligently pursuing meaningful goals, rather than focusing solely on financial gain, is crucial. During the COVID-19 pandemic, our approach prioritized our vision over immediate profits. While other industries contracted, we expanded operations, hiring more staff and securing new properties. This success underscores the importance of staying true to our vision