Shiv Inder Singh is 62 and by any demographic definition an old man. A contrast to the young and rather sporty looking thing which he is flaunting. If you are thinking bicycles, you are pedalling in the right direction.
Over the last six years, Singh has built Firefox into, perhaps, the most differentiated Indian brand in cycles. Singh has occupied a niche in a market that has strong entrenched players like Hero and TI Cycles by not just selling bicycles, but doing so at a premium of 40-50 percent over existing brands. And he has been very successful.
A seller of premium cycles, Firefox Bikes began operations in April 2005 and sold just 1,200 bikes in its first year of operations. But in little over seven years, it’s selling well over 4,000 bikes a month and has an annual turnover of about Rs 50 crore.
Singh got into this business purely by chance. He was attending a friend’s wedding in New York in 2004, when his close friend Pradip Mehrotra, who then had a bicycle manufacturing facility in Taiwan, asked Singh to start his own business. Singh, an alumnus of Doon School and a civil engineer from IIT-Delhi, had little experience of entrepreneurship. And the milieu wasn’t too encouraging either.
“A number of people around me discouraged me and still do,” he says. But Mehrotra, who he knew for more than 30 years, egged him on. It was Mehrotra who saw a void in the bicycle segment in India and tried to persuade Singh to start the business many times before. In 2004, when Mehrotra asked, he agreed. “I thought ‘I got to do it now, or it’ll never happen again’,” says Singh. Mehrotra agreed to pump in the money and handle the manufacturing. Firefox Bikes was set up later that year.
Singh and Mehrotra knew that cars and motorcycles had moved on from standard to premium segments. But for some reason, the bicycle segment in India didn’t follow the pattern. Established players were selling two kinds of cycles: Standard and fancy.
Standard was the typical green-coloured cycle used for commute while fancy cycles, mainly targeted at teenagers, were slightly tweaked by changing the colour and shape of the frame. The basic components were the same for both. This was at one end of the spectrum where the maximum price was about Rs 6,000. At the other end was an extremely niche market for high-end imported bikes, where prices started at Rs 20,000.
Firefox saw an untapped market in between. Many Indians, who experienced the US and European cycling habit, were returning home. They wanted cycles that were as good. “It is not that 10 years ago, premium cycles didn’t exist, but there wasn’t so much concentration on them, ” says Vijay Bharadwaj, head of research & consultancy at Sport18, a part of Network18, the media company that publishes Forbes India.
Singh initially targeted children. But when he saw people using it for commuting and other activities he quickly figured the game out.
A year into operations, Firefox organised a bike ride from India Gate to Chanakyapuri in New Delhi. There Singh met a representative from an American NGO that was working with Trek Bicycle—one of the biggest bicycle makers in the world and a brand endorsed by seven-time Tour de France winner Lance Armstrong. The representative saw the Firefox store and was impressed. He got Singh to meet Trek officials.
Trek had been keen to enter India, but was unsuccessful in its search for a suitable partner. In Firefox they found a company that understood their cycles. Singh soon had rights to sell Trek bikes in India. It was a match made in heaven for Firefox.
With Trek, Firefox’s line-up in the premium (above Rs 7,000) and super-premium (above Rs 18,000) segment was complete. Currently, they sell 50 different models of Firefox bikes varying between Rs 7,000 and Rs 21,000, while there are 15 Trek models in the Rs 22,000-Rs 80,000 range. They are sold through a mix of company-owned and franchise outlets, which number 83 in all.
(This article is excerpted from the latest Forbes India 11 May, 2012 issue which is now available at news stands and book stores. You can buy our tablet version from Magzter.com)