Saturday, August 30, 2008

"Frenemies" - Sleeping with the enemy'


‘Obamanomics” seem to have taken over Hillary and Bill, the way they endorsed Obama with such precision as the next President of US at the Democratic Convention in Denver. It’s one of those hard to believe handshakes which narrate how sleeping with the enemy is not a sin. Tough times are producing some surprising bedfellows and sleeping with the enemy just seems to be one of them. I call it “Frenemies” and wiki describes it as a portmanteau of friend and enemy which can refer to either an enemy disguised as a friend or to a partner that is simultaneously a competitor. So why am I talking about making bedroom stories with enemies (or rather Frenemies) when I should be concentrating on fixing my business, which is in the midst of a whirlpool of strangling relationship between airlines and the agents? Well that’s coz my margins are exerted and the principles (I hate using the word airlines these days) are turning the heat on my business by cutting commissions and competing with me directly. That makes me take a rabbit out of the hat and think of something as illogical and as radical as cooperating and working together with the rival trade and business entities.



With the global economy on the rocks, businesses everywhere are desperately searching for ways to save money or boost revenue – even if they require collaboration with the enemy. Arrangements in which firms compete vigorously with one another, while also cooperating in specific areas – known in management jagron as “co-opetition” – are not new. Airline (uhhhhg…hate using this word) has shared check in, gate management and other facilities to reduce costs and create economies of scale.


Few rivalries have been as nasty as that between two NY newspapers -Rupert Mudroh’s New York Post and Zuckerman’s Daily News. The two titles likes to bicker over which has bigger circulation and scurrilous gossip about each other are avidly reported. Yet, behind the scenes executives from both the papers are talking about working together in some areas, such as distribution, in an effort to slash costs. Such is the power of being “Frenemies”.


So why not give this concept a try in our beleaguered industry and replicate this model of “live in” relationship between two or more companies that come together for a common cause. Crafting co-opetition is a tricky business, not least because potential partners need to swallow their pride first. Firms have to figure out exactly where you are cooperating and where you are competing, and not get your staff confused.


It makes perfect business sense to consolidate and create economies of scale while retaining your business existence and identity. Travel agents across different markets (both geographically and different market segments) can join hands for a range of services and activities that can make them use size to their advantage. They can form cartels to avert the risk from big sharks and other predators (big consolidators and on line portals) by integrating and consolidating their business backwards. So while keeping the customer interfaces same the operating systems of these businesses can be strengthened by consolidation. Enormous cost and revenue benefits can be extracted from such relationships wherein using scale and size agents can procure and source bigger and better incentive deals from suppliers like airlines and hotels.


Imagine the case of four travel agents in a city serving different market segments getting together and cooperating to achieve higher levels to airline sales and thus attracting higher PLB and other incentives. Not only will they be able to share each other’s core competencies, they will become more competitive and adaptive and be able to service their clients better. Informal tie ups of this kind already exist in the industry through backdoor diplomacy but we need to take it to the next higher level of mutual co operation and understanding through well pronounced tie up and relationships wherein an alliance of kinds can be formed at the local, regional and national level. It’s not hard to imagine a travel agent alliance across India or maybe across the Globe gaining scale and size bigger than airline alliances aka Star Alliance types. So should we say “What an idea Sirjee!”

Thursday, August 14, 2008

"Kiss Me" Model of Travel Agency Reform

(Sum developes a model of travel agency reform in the Zero Commission Ear and calls it "Kiss Me")

“Revolt, Reform or Perish” – writing on the wall is very loud and clear for the travel agencies in the zero commission eras. While TAAI, TAFI and sundries are already through with their measures of revolt, there is a lot of talk around the town and every one in the industry seems to be taking of reform. For traditional ticketing agents it’s almost like a comrade thinking of privatization reforms. The big ticket question here is “How to Reform/ evolve to outperform in the Zero Agency Commission Era”. It’s time for travel agents to go back to drawing board and redraw and reshape their business models. I would like to propose a model of travel agency reform and call this reformist model “Kiss Me” (No, I’m not getting kinky in these trying and testing times).

“Kiss Me” Model of Travel Agency Reform

K – Knowledge
I – Innovation
S – Service Driven
S – Specialization (Developing Core Competencies)

M – Meager Cost
E – Evolve

Let’s see how this “Kiss Me” model of travel agency reform help agencies evolve into a service driven, high performance, and profitable enterprise in the regime of Zero Travel Agency Commission.

Knowledge

Most important and the most ignored out of all the components. I have always believed travel agent is an ill informed community about the attributes of the product they sell, be it airlines, hotels, destinations or other derivatives. Most of the front line staff has little or no clue about the product they are selling. A hit and miss approach to customer counseling means a shaken customer confidence and his shift to alternate sources for information like website and travel portals. Questions pertaining to detailed information about facilities at the airports, aircraft configurations, special service requirements of airlines (like procedure for carrying a gun), destination information like special events and outback activities are often answered with a frown by the travel agent.

The answer clearly lies in getting and imparting knowledge to self and staff on all the products the particular staff is destined to handle and give that extra confidence to staff in his / her job profile. Destination specialist programs offered by tourism boards, certificate training programs from GDS and thorough search of airline website are some of the steps that might help. A weekly subject of interest may be taken up and studied/ researched by all the staff in the agency and on the weekend a short test concerning the same may be given to them. This will generate an element of interest and competition, and your goal of increased product knowledge will be achieved.

Objective is clear, in this competitive era when the airline websites may offer a lower fare than travel agents in future; the customer will rely on a travel agent for his knowledge of multiple products. Travel Agency needs to offer information/ knowledge to the customers which they would normally not get from a website. The leisure and business traveler must be ready to pay an incremental fee on the fare for the value addition by the travel agency. Product knowledge and information is one such value which agencies may add to their final products.

Innovation

Innovation in customer handling, pricing, promotion or product/ service attributes may differentiate an agency from its clan and make it stand out from the competition. A simple case of “Meet & Assist” being offered by an agency (for a fee) to its business and leisure customers at the airports will make it a preferred choice for the segment of traveler who needs assistance at the airports, like first time travelers, ladies traveling with infant/ kids, high profile business traveler, honeymooners (a flower bunch delivered at the airport will make their journey memorable). The agency using such innovation can provide this service to the customers of other travel agencies as well (for a fee of course). Other innovations like customer profiling, innovations in pricing (guarantying the lowest fare possible), mobile message alerts/ email alerts for flights, reserving preferred seats, rooms etc will be noticed and appreciated by the customers. A simple feedback call to customers on their return will show the agency’s concern and give valuable inputs. Innovative holiday packages like ladies only group package or a gourmet cuisine package of Rajasthan, or an airport transfer on a Harley Davidson, transfer for a dinner from the hotel on a camel are the kinds of innovation agencies need to suggest and arrange for its customers.

Innovation is the biggest attribute which can give a distinct identity to an agency and give customers a value addition which they are ready to pay for.

Service Driven

Every one talks of service, but it holds different meaning for different people. Agencies need to replace the concept of sales and marketing manager/ executives with Relationship Managers/ Executives (role reversal and not just change in Designations) to focus more on relationships with the customers. Service quality is to be identified and meant as building of bonds with customers and other markets or groups to ensure long term relationships of mutual advantage. Customer service parameters of pre transaction, transaction and post transaction considerations related to the exchange process with the customer needs to be handled with care. Every agency should necessarily involve itself in understanding what the customer buys and determining how additional value can be added to the product or services being offered, for this additional value will attract a relevant service fee. Agencies should focus on:

1. Customer retention
2. Orientation of product/ service benefits to the customers
3. Enter into long term customer relationships
4. High customer service emphasis
5. High customer commitment
6. High customer contact
7. Quality driven product/services, processes and people (Developing a quality culture)
8. Follow up and feedback procedures
9. Objective handling on service failures/ deficiency in services

Specialization

Specialization is an important way to generate propositional knowledge by applying general knowledge. It’s the opposite of generalization and the way we have seen the demise of general medical practitioners and rise of specialized medicos, travel agents needs to specialize and develop core competencies to survive in the zero commission era. Agency needs to spell all its area of operations and specialize in the one where it has skills and means to develop core competencies. It’s also important to shelve the areas which are proving futile and inoperative.

Some areas where agencies can specialize and develop core competencies:

1. MICE
2. LTC
3. Innovative and upcoming concepts in Indian tourism
a. Sports tourism
b. Heritage tourism
c. Spa tourism
d. Space tourism
e. Wedding tourism
f. Religious tourism
g. Wildlife tourism
h. Responsible/ Sustainable tourism
i. Wine tourism
j. Romance tourism
k. Self guided tourism
l. Theme tourism
m. Rural tourism
n. Self guided tours

4. Specialized services like
a. Visa Services
b. Corporate account handling
c. Destination management services
d. Hotel representations
e. Key account management

5. Cater to specialized segments
a. Students
b. VFS (Visiting Friends and Relatives)
c. Corporate
d. Government and Public sector
e. Leisure
f. Business Travel
g. Walk in / adhoc customers
h. Reference business through chain of advocators (who recommend the agency)
Meager costs

A penny saved is a penny earned. High inflation and cost pressures from spiraling salaries and property rentals, agencies are compounded with the problems of vanishing revenue base and sky rocketing costs. Service fee concept is expected to exert a lot of pressure on the margins and agents have to review their costs sheets and make deliberate cuts. Cost consciousness may include:

1. Staff costs needs to review and the utility and contribution of each staff to the sales/ profits measured against targets. Also ascertain opportunity cost of individual staff and introduce multi tasking in staff while performing their specialized functions. Technology is aiding the staff and more productivity can be expected out of each individual. Lay off in case of excess staff.

2. Fixed costs like rentals, electricity etc constitute a major portion of the costs and steps like consolidating operations of different branches in same city (at least merging low performing branches) can help save on rentals. But clear and deep thinking need to made and a cost/ benefit analysis be done before such decision making.

3. Promotional budget needs to be reviewed and low costs means of promotion like one to one customer interactions, regular mailers and tele calling can be more effective than advertising. Again a cost/ benefit analysis of the advertising medium and costs need to be done before initiating any new campaign.

4. Variable costs – Management need to keep a close and regular check on variable costs which most fluctuate with sale levels. Diverse and detailed reports on cost structure will help keep a track and control over costs.

Evolve

Lastly, evolve – or readiness to predict, recognize, accept and implement changes. An agency should focus itself on new and upcoming trends in the industry and keep itself abreast of all the issues that may affect its industry. An agency which evolves with time will be better prepared to alter its business models with time and emerge a winner.

I advocate the following steps for implementing the “Kiss Me” model of travel agency reform: (to be followed in the order they are given)

1. Environment Scanning (Internal and External)
2. Establishing Objectives
3. Market Segmentation
4. Developing Core Competencies
5. Developing right Product Mix
6. Establishing successful pricing policies
7. Promotion Mix
8. Distribution Strategies
9. Managing People
10. Developing effective service delivery mechanisms

Its time we change the way we see our businesses and take the right step forward in accepting and facing the challenges in front of us. Let’s emerge winners and challenge the dominance in an industry dominated and dictated by the airlines. Let’s say “Kiss (Keep it Simple and Short) Me” and in-corporate the changes in our revenue base effectively. “Long Live the Travel Agent”

Redefining the reform agenda – 10 point some one


(Sum's take on Indian Reforms scenario)

On the eve on Independence Day in 2008 lets conduct a post mortem of the status of Indian Reforms and develop a 10-point agenda for reforms in different sectors of India Inc. Its not about “What”, its about “How”? Here are 10 reform issues which are pending and which could raise growth as well as make it more inclusive and comprehensive.

1. Disinvestments
Never heard about the Disinvestments ministry in Manmohan’s Tenure. With the departure of comrades Disinvestments seems to be the buzz word and lowering government stake below 50 % will help PSU’s operate more freely and will help government coffers in the medium and long terms. I strongly feel that in a modern economy, government should keep itself to governing and concentrate on social and economic infrastructure; it should abstain from running businesses. Government has lined up a number of companies for Disinvestments, but sluggish stock markets and resistance from employee unions may delay / derail the process. It’s time for PC/MS combine to add steam to the process.

2. Urban Development

Some one just mentioned that our congested and crowded cities are first developed and then a master plan prepared to redesign, redevelop and reconstruct. Sluggish and unplanned urban development is the biggest dampener in slow infrastructure development and a big constraint on GDP growth. Villages are flocking to cities and cities are crumbling under pressure on resources. A major thrust on sound urban planning and development through a comprehensive policy with a sound delivery mechanism could add 1 % to GDP.

3. Highways

Highways are the face of any country and the arteries of growth for the economy. They have a transformational role both for development and growth. While China can think, plan and execute a road to Everest base in months, the case o building a simple road or flyover in India can rake years. The development of highways is moving at a slow speed; far slower than the country can afford. Problem here is not lack of resources, but lack of a comprehensive long term planning and I.M.P.L.E.M.E.N.T.A.T.I.O.N. Land acquisition reforms and push for faster highway construction does well for India.



4. Power
The biggest and best example of reforms in power sector is the Power Generation and Distribution Boards in West Bengal. Without giving any chance to the politically and reform sensitive people of Bengal, it has transformed itself into a profitable enterprise, simply by plugging holes in service delivery mechanism. My peers in Punjab are reeling with power cuts of more than 8-10 hours a day. Ironically, each successive government in Punjab is doing vote bank politics by giving free power to farmers. What about common man, who is made to pay for this? Besides power sector reforms back by a sound policy and unbundling of state electricity boards, I advocate the concept of “Pre Paid Power” where a consumer can buy certain units of assured electricity for a amount paid in advance. The power boards kitty will swell with cash from advances from rich and famous, this buffer can they be used to pay the dues and explore alternate sources of energy.

Another important aspect to highlight here is the use of diesel and other products by consumers for generating electricity through their gensets. The diesel, petrol, kerosene and LPG which government is already subsidizing, is being increasingly used for power generation in areas with heavy load shedding and power cuts. Another case of oil subsidies being misutilized ?

India with its unique location and see on three sides can actively explore setting up coastal wind energy parks (like the ones set up by Holland) and generating power from tidal waves. Wind energy potential is so huge that it, if effectively explored and utilized it can provide power to the entire peninsular region of India. Nuclear power will relieve India of its power woes in the long run.

5. Water

Clean, pure and safe drinking water is only found branded and bottled in India. The quality of drinking water ranks lower than many underdeveloped countries. Water conservation methods like rainwater harvesting, re treating the water and other water management methods are essential and critical to quality of life.

India is a land with a lot of river, and at any given time we can have flood and draught in different regions at the same time in India. Interlinking on rivers (though a costly proposition costing around Rs.100, 000 Crores) is a measure, which should be thoughtfully considered to solve the problem of water and it, can also contribute to generation of hydroelectric power.

A big slap on our face remains the high levels of pollution in our sacred and religiously important rivers (forget ecological importance) – Ganga, Yamuna and Narmada. Anyone listening?

6. Sanitation

It’s a major issue in urban, semi urban and rural India. It is imperative to build basic sanitation infrastructure (clean construction and maintenance arrangements) across India through PPP model.

Manual scavenging of human fasces is one the dirtiest job still prevalent in rural and semi urban India and must be done away with. (Already written a blog about this)

7. Housing

Housing is a national priority, but we are talking of economic housing in the millions of provide shelter, enhance quality of life and to provide security and stability and not of lavish up market accommodation running in Crores. To reduce disparity we need to develop housing projects, which discount the high land prices and provide accommodation to the weak and lower middle class of the society. This is as important as providing rural employment guarantee program and needs to be taken up at a national level. All private housing projects must have provision for low cost housing as a condition of their project approval.

8. Transport

Rail, road, water and air; all forms of transport needs to be reformed. Rail – Laloo has done a lot in terms of bringing the railways in green once again and generating reserved, but he now need to take it to the next level but means to taking up bullet trains concept between major cities like Delhi and Mumbai, Bangalore and Chennai, Bangalore and Mumbai etc. Dedicated freight corridors, expanding the rail network in northeast and the state of J & K should be taken up on a priority basis. The phenomenal success of Delhi Metro should be replicated and DMCL should be made the apex body for supervising and monitoring the progress of all Metro Projects in the country. There need to be urgency for developing Metro Projects in all cities with population in excess of 8-10 Lacs.

Road network has grown strong, but its still poor in states like UP, Bihar, Orissa and some parts of North East. Speedy implementation of road projects and highways with a strong vision of future will help India grow at a much faster growth.

Strong public transport system will enable the government to adopt free pricing of petroleum products and bring them at par with international prices. This will ease the pollution levels in cities with lesser vehicles on road.

Water transport both inland and coastal needs attention as; India doesn’t have a single passenger cruise terminal (of international standards). Developing ports with freight handling capacity and efficiency matching international standards will provide a lot of impetus to Indian Industry due to the unique geographical location of India with regards to Far East, Middle East and Europe.

I have already written a lot about reforms needed in the air transport industry. New and latest airports need to be built at lightening fast speed. Provision needs to be made for cargo and low cost passenger terminals. India need to convert its small air strips into small airports connecting every nook and corner of the country. Small aircrafts with low maintenance and operating costs needs to be developed. Private participation of international needs to be allowed in the private domestic airlines, which are already bleeding, and badly in needs to funds. Reform is a small word for what needs to be done with Air India. Air India with its unique geographical location had lost the competitive advantage of developing into a regional hub for airlines and an attractive tourist destination all thanks to our national airlines and poor airport and tourist infrastructure.


9. Rural Infrastructure
Wider roads, medical and education facilities, low cost “kuchha” airports, cargo management centers (perishable and processed agricultural products), telecommunication and IT connectivity, better access to financial institutions are just some of the many giant leaps we need to take to strengthen our rural infrastructure and have an inclusive growth for more than 600 million people living in rural areas.

10. Food and Agriculture Sector

Specific strategies for specific products, geographical areas and a grand vision for autonomous, centralized approach and action plan to achieve another Green revolution, Blue revolution, Silver revolution and many other forms of revolutions. I strongly feel that reducing subsidies and strengthening the implementation and delivery mechanism of many rural development schemes for up gradation of agriculture sector are required. India needs to uphold and strengthen its dominance in agricultural produce in the world. Sound economics needs to be applied in determining minimum support prices for the farmers and avoiding populist measures like free electricity, loan waiver; rather “kisan” smart cards should be introduced to give them access to benefits through better access to seeds, fertilizers, electricity and other essential goods and services. Agriculture procurement and marketing needs to be revolutionized so does reduced dependence on monsoon by means of assured irrigation.

(Supplementary) Medical Sector

I include this sector as supplementary as I feel medical care is a basic facility, which needs to be made available to every citizen of this country. This is a priority sector of the economy and social infrastructure in this sector needs attention. General medical practitioners have given way to specialists in big cities. Multi specialist hospitals with advance care facilities are coming up thick and fast. The state of government civil hospitals and dispensaries has taken a beating in rural and semi urban areas. There is a shortage of advance medical facilities in these areas. Rural areas even lack basic medical and maternity facilities in some parts of India. Social security of citizens and large-scale reform of all medical facilities is urgently needed. Provision of all medical students to have compulsory rural assignments before graduating is a welcome step and it needs to be supplemented with up gradation of medical infrastructure.

(Industries, Service Sector, Financial sector, land and Labor reforms needs to be taken up in Stage II of reforms)

Sunday, August 10, 2008

Role of TAAI in the Zero Percent Agency Commission Era

(Sum's take on the role of TAAI and other trade bodies in the transitionary phase from commission based revenue structure to transaction fee based structure)

TAAI should broadly accept reduction in commission to zero as a change in the structure of revenue base of travel agencies from commission based to transaction fee based. The transition phase from commission based structure to a transaction fee based structure needs to handled and put into action based on a clear cut plan so that it does not affect the travel trade adversely.

A mechanism for the implementation needs to be worked out with airlines for this transition which involves a realistic and structured time frame and educating / training the travel agents to take up such changes
The following points needs to be addressed immediately

1. Airlines should participate in discussions with TAAI to develop a mechanism of change which involves a realistic time frame. (It should be different and extended from the one which is now set by the arbitrary decision of some airlines including Air India)
2. The structure of the new revenue base for the agents (transaction fee) needs to be worked out in detail with the airlines and a consensus arrived at with regard to the percentage of the transaction fee and its features which include answering the following questions:

a. % age of transaction fee
b. How it is to be shown on the ticket
c. How will airline charge the transaction fee in case of direct selling from its offices/ website
d. The role of airlines in direct selling and not undercutting travel agency fares

3. For the implementation part of the structure and to help travel agents across India cope with change in Business Models the following steps needs to be taken:

a. TAAI should get a detailed research done and project report developed by any of the leading Consultancy firm like PWC, McKenzie to help the trade body understand how such a transition in revenue base was handled in other markets and answer the following questions:

i. How the other markets handled such transition
ii. How will such transition affect the industry
iii. How can travel trade develop alternate business models / change in existing business models to accommodate such change in revenue base
iv. How can the TAAI as a trade body increase the acceptance and adaptability of this transition among the agents across India
v. How can TAAI and travel agents continue to work with airlines and agents increase their bargaining capacity with the airlines
vi. How can the travel agents retain their existing business
vii. How do travel agents compete with airlines (in case of direct selling by the airlines)

Such a research and project handled by a professional consultancy firm will give us an outsider’s view of the agency and how agents across the world handled such changes.


4. Cooperation / Interaction with travel trade bodies in other countries/ continents like ASTA in Australia and TIA in US to understand how they handled the transition from commission based structure to transaction fee based system. Following points can be discussed with them:

a. How change in commission structure handled by them
b. How have the travel agencies been affected by such change
c. How have they developed their business models to accommodate such changes
d. How has the transition as a industry been in light of these changes
e. How has the bargaining and relationship with airlines been affected

A broad based cooperation agreement is worked out with them and efforts made to form a global alliance of different travel trade bodies in the world that provide a global platform for discussing and research on common and specific issues concerning this trade.

5. TAAI should intensify its stir against the airlines which are non- cooperating and who are taking decisions affecting the travel trade in an arbitrary manner. Air India for instance made an arbitrary decision to cut the agency commission without an open discussion with TAAI. Trade bodies like TAAI should come up with circulars to all its members to blacklist such airlines and resort to “Gandhigiri” protest. For instance to protest Air India arbitrary decision making the TAAI should instruct its members to write “ISSUED UNDER PROTEST” on all Air India tickets by its members. The agents should also be advised to cut down on sales on such airlines. Airlines that are cooperating with TAAI and travel agents should be given preference and resultant circulars should be issued commending and recognizing these airlines to all its members.


6. TAAI should form a committee with airlines participation that is entrusted with the task of interacting with the agents at the local level (one committee with four teams for each region which should visit each state and its headquarters) to educate them on the transition from commission based structure to transaction fee based structure and help and guide them through this transition phase. The committee such formed should help agents develop / change their business plans and conduct an open house to dispel all their doubts regarding this transition


7. TAAI should set up a Helpline for travel agents at the National Level wherein a counseling and help regarding this transition is provided and agent’s queries are solved.


8. Each airline should be asked to circulate among all agents a detailed informative / educative circular pertaining to this change which includes how this change was effective and did not harm the industry in other markets. It should include the suggestions / measure how airlines and travel agents continue to work together and how this transition will not adversely affect the trade

9. TAAI in association with Airlines should conduct workshops / training programs (for a fee) which would help the travel agents get trained in skills that may be essential in developing ancillary services/ alternate business models. Like a short workshop on how to sell and develop holiday package products.


10. The revenue for all the above said programs/ measure should be raised by means of sponsorships/ affiliations from the airlines.
I would again reiterate that travel agents and trade bodies should not see this transition from commission based structure to transaction fee based structure as a threat to their survival; rather we should view this as an opportunity to reduce our dependence on airlines for our revenue base and base it on the services we provide. This will not only make the trade more professional and service oriented but also give each agent an opportunity to diversify its services and products and be successful in the long run.

Recommendations to TAAI

TAAI should broadly accept reduction in commission to zero as a change in the structure of revenue base of travel agencies from commission based to transaction fee based. The transition phase from commission based structure to a transaction fee based structure needs to handled and put into action based on a clear cut plan so that it does not affect the travel trade adversely.

A mechanism for the implementation needs to be worked out with airlines for this transition which involves a realistic and structured time frame and educating / training the travel agents to take up such changes

The following points needs to be addressed immediately

1. Airlines should participate in discussions with TAAI to develop a mechanism of change which involves a realistic time frame. (It should be different and extended from the one which is now set by the arbitrary decision of some airlines including Air India)


2. The structure of the new revenue base for the agents (transaction fee) needs to be worked out in detail with the airlines and a consensus arrived at with regard to the percentage of the transaction fee and its features which include answering the following questions:


a. % age of transaction fee
b. How it is to be shown on the ticket
c. How will airline charge the transaction fee in case of direct selling from its offices/ website
d. The role of airlines in direct selling and not undercutting travel agency fares


3. For the implementation part of the structure and to help travel agents across India cope with change in Business Models the following steps needs to be taken:

a. TAAI should get a detailed research done and project report developed by any of the leading Consultancy firm like PWC, McKenzie to help the trade body understand how such a transition in revenue base was handled in other markets and answer the following questions:
i. How the other markets handled such transition
ii. How will such transition affect the industry
iii. How can travel trade develop alternate business models / change in existing business models to accommodate such change in revenue base
iv. How can the TAAI as a trade body increase the acceptance and adaptability of this transition among the agents across India
v. How can TAAI and travel agents continue to work with airlines and agents increase their bargaining capacity with the airlines
vi. How can the travel agents retain their existing business
vii. How do travel agents compete with airlines (in case of direct selling by the airlines)

Such a research and project handled by a professional consultancy firm will give us an outsider’s view of the agency and how agents across the world handled such changes.

4. Cooperation / Interaction with travel trade bodies in other countries/ continents like ASTA in Australia and TIA in US to understand how they handled the transition from commission based structure to transaction fee based system. Following points can be discussed with them:
a. How change in commission structure handled by them
b. How have the travel agencies been affected by such change
c. How have they developed their business models to accommodate such changes
d. How has the transition as a industry been in light of these changes
e. How has the bargaining and relationship with airlines been affected

A broad based cooperation agreement is worked out with them and efforts made to form a global alliance of different travel trade bodies in the world that provide a global platform for discussing and research on common and specific issues concerning this trade.

5. TAAI should intensify its stir against the airlines which are non- cooperating and who are taking decisions affecting the travel trade in an arbitrary manner. Air India for instance made an arbitrary decision to cut the agency commission without an open discussion with TAAI. Trade bodies like TAAI should come up with circulars to all its members to blacklist such airlines and resort to “Gandhigiri” protest. For instance to protest Air India arbitrary decision making the TAAI should instruct its members to write “ISSUED UNDER PROTEST” on all Air India tickets by its members. The agents should also be advised to cut down on sales on such airlines. Airlines that are cooperating with TAAI and travel agents should be given preference and resultant circulars should be issued commending and recognizing these airlines to all its members.
6. TAAI should form a committee with airlines participation that is entrusted with the task of interacting with the agents at the local level (one committee with four teams for each region which should visit each state and its headquarters) to educate them on the transition from commission based structure to transaction fee based structure and help and guide them through this transition phase. The committee such formed should help agents develop / change their business plans and conduct an open house to dispel all their doubts regarding this transition
7. TAAI should set up a Helpline for travel agents at the National Level wherein a counseling and help regarding this transition is provided and agent’s queries are solved.
8. Each airline should be asked to circulate among all agents a detailed informative / educative circular pertaining to this change which includes how this change was effective and did not harm the industry in other markets. It should include the suggestions / measure how airlines and travel agents continue to work together and how this transition will not adversely affect the trade
9. TAAI in association with Airlines should conduct workshops / training programs (for a fee) which would help the travel agents get trained in skills that may be essential in developing ancillary services/ alternate business models. Like a short workshop on how to sell and develop holiday package products.
10. The revenue for all the above said programs/ measure should be raised by means of sponsorships/ affiliations from the airlines.

I would again reiterate that travel agents and trade bodies should not see this transition from commission based structure to transaction fee based structure as a threat to their survival; rather we should view this as an opportunity to reduce our dependence on airlines for our revenue base and base it on the services we provide. This will not only make the trade more professional and service oriented but also give each agent an opportunity to diversify its services and products and be successful in the long run.

Saturday, August 9, 2008

India @ Beijing - Raping 1 Billion Aspirations

(Sum's angry on the poor look and feel of Indian Contingent at Beijing Olympics opening ceremony parade)





I consider myself to be the biggest fan of India (at any sport) and I cheer for my country at sporting events even when I know India in competing for the last three spots. But the sorry picture of Indian contingent at the opening ceremony of the Beijing Olympics has dampened my spirits for the event.
When I got back home from work, I considered myself fortunate for not missing the Indian contingent at the Olympic Sports opening parade. The grandeur of the event made me glued to the TV, sitting on the edge of my seat waiting for the arrival of “India”.

Meanwhile it was a treat watching other contingents in their national attires and I very proudly said to my Mom (I literally forced her to watch the event with me, as I told her anytime Indian Contingent would arrive in the parade) that the Best & the Most Exotic Dressed Contingent would be from India. As the contingents arrived from countries like Honduras, Kenya, Fiji, Japan, Spain immaculately dressed in their national attires and carrying loads of confidence on their faces my anxiety just grew. I was almost like a cheer girl from within waiting for my team to come.



As “India” was announced with a Chinese accent and the pictures of Indian Contingent flashed on the screen, it brought a sarcastic smile on my Mom’s face, as if she beat me to a game even without playing. I was crushed under my expectations looking at a small contingent represent ting a nation of 1 Billion dreams and aspirations (including mine). The men were dressed plainly in Sherwanis and the female were dressed as per their will. It was almost as if urban Indian female representing Youngistan were dressed in their ‘Hip” track suits and the traditional female athletes from small cities and rural background were wearing the traditional Saris. The contingent was clearly looking lost devoid of any confidence and the ladies looked as if they came out of a Saas Bahu soap opera, wearing different theme attires.

It must have been a big embarrassment for Sonia (Sonia not Sania…Sonia Gandhi Ji, I mean) waving at a small contingent with the female athletes heterogeneously dressed. To cover up I just told my Mom that actually Sania and Sunita are dressed in their tracks as they didn’t know how to tie an Indian Saari. But I was torn to pieces from within (the cheerleader in me was raped by the female Indian athletes) , and this is no exaggeration. India has lost the Olympics even without a ball being bowled. It is yet another case of India failing to rise at the world arena - "A Case of Lost Business Opportunity" in business parlance.
China showed it is made of stell and spent some USD 67 billion to showcase its rising status in the world arena and stamped it authority with dominance as a rising global powerhouse. Rise as a country not only means consitent growth in GDP figures, but it means much more to the people of the country including strengthening of socia-cultural infrastructure and sports is an important element of it.
I would give newspapers and TV a miss for the next fortnight fearing another nightmearish performance by Indians. Its the goof ups off field which put me off rather than loosing on the field with compretetive spirit. As I write this just heard "PMO intervened in Monika's case" and "Monika to go to Beijing", gggggrrrrrrrrrhhhhhhhhhhhh, what's going on India ? Politics in sports or Politics as a sport.
I stand for "Politics" to be included as a sport in next "Olympics" , for that is the only chance for India to strike Gold at this event.

India's Economy Turning Sour


(A world's perspective of Indian Economy - Economists View)


INDIA’S coalition government went to outlandish lengths to win a vote of confidence in Parliament on July 22nd, a victory it hopes will prolong its life until early next year. To appease one politician, it even renamed the airport in Lucknow, a state capital, after his father. (The ingrate still voted the other way.) Asked to justify this ploy, India’s finance minister dryly remarked, “It will facilitate better take-offs and landings.” Now he and his fellow reformers must facilitate a safe landing for India’s economy. It too may go the other way.


Until the start of this fiscal year (which began on April 1st), India’s economy had its head in the clouds. Having grown by at least 9% a year for three years, it was attracting more overseas capital than it knew what to do with. Foreigners ventured a net $20 billion on its booming stockmarket last fiscal year; overseas banks lent even more to its mighty companies.


But India’s share prices were collapsing and its economy slowing even before July 29th, when the central bank stepped up its campaign against inflation by hiking its benchmark “repo” rate for the third time in less than two months (see chart). Industrial production expanded by only 3.8% in the year to May. The figures for capital goods and infrastructure industries, such as steel, cement and electricity, were particularly dismal for a country that prides itself on having an investment boom.

A big gap has now opened up between the increasingly gloomy views of India’s prospects from abroad, and the defiant optimism of its own forecasters. The Centre for Monitoring [the] Indian Economy, in Mumbai, thinks India will still grow by 9.5% this fiscal year. JPMorgan, a foreign bank, foresees growth of just 7%. imponderable is the oil price. Though prices have eased on world markets, India still faces an import bill for crude that may reach $120 billion this fiscal year, compared with $69 billion the year before. The extra burden is about 4% of GDP—a huge amount. The Congress-led government, which must go to the polls before May, is reluctant to pass on the full cost to voters. When it raised pump prices in June, the opposition described this as an “act of economic terrorism”.


But by sparing households, it is jeopardising the public finances. Between them, the fuel subsidy, cheap fertiliser, forgiven farm loans and fatter pay-packets for bureaucrats, could increase the budget deficit to 10% of GDP this fiscal year, if the red ink spilled by state governments is included.

When you combine government largesse with the oil bill, you get an external deficit which could reach 4% of GDP this fiscal year. Narrowing that gap is a matter of urgency. The foreign capital needed to bridge it is now less forthcoming. The threat to India’s exchange rate is plain.

It would be too sensational to talk of a run on the rupee. India is not a debtor nation: its foreign assets—including more than $300 billion of foreign-exchange reserves—outweigh its foreign debts. Moreover, the foreign investors with direct stakes in India’s growth will not liquidate their back offices or assembly lines just because of a bit of cyclical gloom.

More fickle, however, are the foreigners who bet large sums on Indian shares when the stockmarket was in full bloom. They are deserting the country, withdrawing $6.7 billion so far in 2008. The only consolation is that as share prices fall, so does the amount they can repatriate, relieving some of the pressure on the currency.
Two modest reforms, pending in Parliament, might restore some of India’s charms to foreigners even before the next election. Both are designed to encourage outside investment in the financial sector. One would raise the cap which limits foreign direct investment in insurance. The other would give foreigners who invest in Indian banks voting rights commensurate with their stakes. But India must learn to cope without an inrush of foreign money. That may entail slower investment and a narrower fiscal gap. In particular, the government, having won its confidence vote and prolonged its life, cannot now afford to wait until after the next election before again raising fuel prices.

Neither epic nor tragedy
Even as they dump shares, India’s foreign investors should also take stock. They were wrong to count on a 9-10% rate of growth. Such a rate could be sustained only with a furious pace of economic reform, which India’s mutinous democracy cannot provide. Any projection that relies on the wholesale unshackling of the market for labour, land or electricity would therefore be about as useful as the astrological projections that convinced India’s opposition leader he would triumph in the no-confidence vote.

But India also benefits from what financial types might call the “democracy put”: its politics forestall the worst outcomes, even if they squander the best. India’s policymakers only seem able to reform under duress. They accomplish little during good times but have plenty of rabbits left in the hat when darker times loom. For example, India is still a lightly taxed country, and the proposed introduction of a nationwide tax on goods and services could add three percentage points to the taxman’s share of GDP. Likewise, the government still owns hundreds of enterprises. It may not have time to flog much of this patrimony before it goes to the polls. But it could prepare the ground for a sale soon after.

In the past few years, foreigners have enjoyed reciting the “India story”, the epic tale of a youthful nation throwing off its shackles to fulfil its destiny as an economic superpower. Indians enjoyed telling the story back to them, with justifiable pride and perhaps a little masala (ie, embellishment). That story is not all myth: in the past few years, India’s sustainable rate of growth has increased from less than 6% to somewhere close to 8%. But as recent events show, the India story often resembles a comedy as much as an epic. Its policymakers run around in circles, swapping partners and scandalising onlookers, but with luck pull it together at the end

Thursday, August 7, 2008

The Case of "Ambush Marketing" in Sports (Economist's view)


TAKING your hat off at the door may seem like a throwback to a more genteel age. But the practice lives on at modern sporting events. Dutch buyers of Heineken beer were given green hats to wear to the recent Euro 2008 football tournament. Anyone who tried to enter a stadium wearing one, however, as many fans did in 2004, was asked to remove it. The hats were an “ambush marketing” campaign, in which companies try to promote their brands at sporting events without paying sponsorship fees. Heineken’s rival, Carlsberg, was an official sponsor of Euro 2008, paying $21m for the privilege. A few TV close-ups of fans wearing Heineken hats would have cost very little by comparison. This was just one of 18 examples of ambush marketing at Euro 2008 identified by researchers at Coventry University Business School.

Ambush marketers have replaced hooligans as the villains of sporting events, because they undermine official sponsors, which are the main source of revenue in some sports. The stakes are highest at the Olympics. This year 12 firms, including Coca-Cola, Samsung and Visa, have paid a total of $866m to be official sponsors of the Beijing Olympics—and they want exclusivity.


The Chinese authorities have responded with their usual subtlety. Between July 11th and September 17th the Beijing Organising Committee for the Olympic games will take control of all prominent advertising sites in the Chinese capital, including those at train stations and airports, and their use will be limited to official sponsors only. (In 1996, when the Olympics were staged in Atlanta, the city was plastered with ads by Nike, which was not a sponsor.) Athletes will be banned from taking their own drinks into the Olympic Village to “protect sponsors’ rights”. And at each event if any spectators manage to get past the officials with unofficial food, drinks or clothing, broadcasters will be obliged to avoid showing them in close-up.


But preventing ambushes is difficult. Marketers tend to launch ambush campaigns only once an event has started, making pre-emptive strikes almost impossible. And policing the brand use of individual spectators at the stadium is tricky. Coca-Cola, which has sponsored every Olympiad since 1928, says sponsorship provides “a way to connect with people around the world at a very personal, emotional level”. But if that means depriving spectators of their half-finished Pepsi as they enter a stadium, the emotions may not be happy ones.


Overzealous enforcement can also result in bad press—as with the orange plastic Lederhosen given out by Bavaria, a Dutch brewery, to Dutch fans before a match at the 2006 football World Cup. Officials asked fans to remove the offending garments, to placate Budweiser, a rival beer brand that was the tournament’s official sponsor. Many fans ended up watching the match in their underwear, and the resulting fuss generated even more publicity for Bavaria

Aviation "facing worst downturn"

World aviation could be facing its worst-ever global downturn, figures have shown.


There is set to be a 7% fall in the number of flights offered by airlines in the last three months of this year, travel information company OAG said.


Airlines worldwide will offer 59.7 million fewer seats in October-December 2008 compared with the same period last year, OAG added.

(These are certainly scary figures....worst is yet to come in this industry)

Tuesday, August 5, 2008

Airlines may fly into losses in Q2 : Financial Experts

(Coming up - Bloodshed in Aviation sector .....Financial Express Article)

Against the backdrop of soaring fuel prices and capacity reduction in the aviation sector, financial planners and analysts foresee the second quarter of FY09 to be weak. The reasons cited range from high fuel costs to soaring lease rentals in the face of capacity reduction. According to experts, the sector is likely to post losses to the tune of $2 billion for fiscal of 2008-09 .


Gaurang Shah, Geojit Financial Services, said, “The high rate of inflation and low consumer confidence will adversely impact air travel which is already down by 15% in June and July. Secondly, the 3% rise in aviation turbine fuel and high interest rates on lease rentals will eat into the bottom line of all airlines.” Shah added that aviation sector stocks would under perform in the short-term. “Still it is unclear where crude price will go up further,” he added.


R Sreesankar, head, research, IL&FS Investsmart, added, “On one hand, you have costs going up and on the other, you have occupancy levels plummeting — all set to drive the sector into losses.” He added that fixed costs like parking and landing charges remained the same even with lesser capacity and is out of the airlines’ hands.
Another analyst from a Mumbai-based broking firm added, “Airlines have already started working on a stronger business model and balance sheets, to withstand the cyclical downturn.” Without naming any airline, the analyst informed that the airlines have started focusing more on recruiting domestic pilots rather than expats. There is also a possibility of airlines not renewing contracts of existing expat pilots who have salaries that are almost double of their Indian counterparts. The focus is also shifting to expand cargo operations to save bottom lines.


“Airlines are studying various international and domestic routes to enhance cargo operations. Each airline has set a target of generating at least 15% of their revenues from this venture,” he said.


The analyst added that low-cost carriers and their full-service cousins have already started downsizing the number of staff in various categories. “The airlines are planning to bring down their overall employee-strength by nearly 30%,” he said

Monday, August 4, 2008

WTO - Why Chinda said no to US (Farm Subsidy Case)

Business week explains the rationale behind the tussle in Chinda and US over Farm Subsidies at WTO


It's not often that China and India find themselves on the same side. They're the world's most populous countries and have two of the fastest-growing economies, but one is ruled by a communist regime, the other by an unruly coalition government. They don't see eye to eye about relations with the U.S. China has been a longtime supporter of Pakistan, India's bitter rival. And Indians look enviously at China's manufacturing strength, while Chinese want to replicate India's IT services success.


Following the collapse of the latest global trade talks, though, the two Asian giants find themselves in the same boat. The negotiations over the World Trade Organization's Doha Round of trade liberalization came to an inglorious halt July 29 amid disagreements about agricultural subsidies. The U.S. blames what it sees as intransigence on the part of India and China. Other nations are scolding New Delhi and Beijing, too. For instance, rather than concentrating on helping to address global concerns, India and China "focused too much on their own interests," Japan's Chief Cabinet Secretary Nobutaka Machimura told a news conference on July 30.

Rural Unrest Threatens India and China

The criticism may sting, but the two Asian giants aren't likely to succumb to overseas pressure. Both countries enjoy high economic growth, thanks to overseas demand for their manufacturing and outsourcing services. At the same time, Indian and Chinese leaders also have to worry about economic hardship in the countryside, where hundreds of millions of farmers have struggled to compete against imports from the U.S. and other countries.
China, for instance, has been trying to alleviate pain in the countryside for several years. The economy in the country's well-off coastal provinces has boomed, leaving behind rural areas home to some 500 million people. When it comes to competing against American agribusiness, "Chinese household farmers are very weak," says Wang Yong, associate professor and director of Peking University's Center for International Political Economy in Beijing.

Certainly, Chinese farmers are not able to supply all of the country's needs. Imports of soybeans, a staple of the Chinese diet, surged 53% last year, to $11.5 billion, according to statistics from China's Agriculture Ministry. Total agricultural imports for 2007 amounted to $41 billion, a 28% increase over the previous year. While Beijing has taken some measures to ease the burden on local farmers by reducing taxes, the imbalance still worries leaders such as President Hu Jintao and Premier Wen Jiabao, who have talked frequently about the need to boost development in rural areas. "The government faces very serious pressure from farmers," says Wang.

Indian Farm Subsidies: A Political Crutch

The pressure is even more acute for the Indian government. While Beijing's leaders have to worry about potential unrest in the countryside, officials in New Delhi have to confront a genuine rural revolt. The Naxalites, a violent Maoist insurgent movement based in rural

The government has other reasons to be concerned about unhappy farmers. For India's Congress-led coalition, farm subsidies remain a crucial electoral crutch. Nearly 70% of the population lives in the countryside and the vast majority of Indians derive their income directly or indirectly from farming, even though agriculture makes up less than a fifth of India's almost trillion-dollar economy. "If the government were to agree to something which will kill our agricultural sector, then their political futures will be finished," says MS Swaminathan, the director of India's National Commision on Farmers, who led the country's green revolution in the 1970s. "Already, agriculture has been neglected in India, and that affects about 700 million people.

In the past decade, as India has embraced reforms that have opened up and revitalized most of the developed sectors, agricultural growth has lagged, even as the rest of the economy grew by 8%-10%. On Indian cotton farms, for instance, the cost of reduced subsidies in the form of government price controls has already had disastrous effects. Unable to compete internationally on the cotton market, cotton farmers in central India, the second-biggest cotton producer after China, have spent a decade falling deeper into debt. According to government estimates, more than 160,000 farmers have killed themselves because of those debts. That's prompted the government to announce a $15 billion loan waiver for farmers in its current budget.

Inflation Is Also a Factor

Part of the reason for India's firm stand on protection for its farm sector is the crippling food-price inflation the country is facing. The cost of basic cereals, beans, and lentils has risen 25% in the past three years.
Maintaining some kind of stability in its agricultural sector is key to helping tame the nearly 11% annual inflation rate that threatens not only the current government, but also decades of meager income and nutritional gains among India's poor, says Karkade Nagraj, an agricultural expert at the Madras Institute for Development Studies. "You can't isolate what happens to Indian farmers because of WTO policies from what is happening in the world economy," he says. "With the crisis on the financial market, a huge amount of money moves to the commodity markets, leading to a commodity bubble. In a condition such as that, if you open up agriculture, then the farmers could gain, but that's not going to sustain anything for a long while."

Preoccupied with their own rural problems, Chinese and Indian policymakers have little sympathy for the U.S. and other countries that subsidize farmers. The Americans, Europeans, and Japanese are "asking weaker countries to dismantle their own protection measures without doing the same in their own countries," says Shi Yinhong, a professor of international relations at People's University in Beijing. "It's a double standard."

India, China Seem Unlikely to Back Down

The misunderstanding can go both ways, though, as people in China and India have inflated ideas about what sacrifices foreign governments can ask of their farmers. "People in developing countries don't fully understand the difficulties of advanced countries," Shi says. "They think rich countries have much more leeway to make [concessions] themselves."

And with the global economy hit by the American downturn, the credit squeeze, and high prices for oil, steel, and food, says Shi, governments on both sides of the debate are worried about risking any bold moves. That means it's even less likely India and China will back down in the current trade dispute.

Sunday, August 3, 2008

Will commission cuts kill the small travel agent ?

Will commission cuts kill the small travel agent ?

When an industry’s’ revenue base vanishes, its time to collapse or transform. The new no- commission world had been on its way since 1995 when airlines first started cutting down on the fee they paid to travel agents to sell their tickets in US. It would be a fallacy to say that the agents didn’t saw it coming. Agents will have to now change from being commission dependent retail clerks into service focused professionals with knowledge that leisure and business travelers are willing to pay for. Without doubt small store front travel agents will be the most affected. Large agencies and consolidators rebate commissions to their corporate customers and have been acting on a fee-for- service basis for years. In an era which used to exist, travel agents were extremely useful because they had information systems, means and expertise which allowed them to easily track all the different airlines. Airlines used travel agents to hold leisure travelers hands as the airlines pushed to expand their customer base. The airlines used the travel agents to widen the customer base for airline products and now when the airline travel market has finally matured and evolved, airline no longer feel the need to pay travel agents to bring in the first time fliers.

But the internet has changed all that, not only has it given the airlines a platform to display and sell their tickets and ancillary services, it has also introduced another segments of travel agents – online portals. The portals are bigger threat than commission cuts and direct selling by airlines. Independent travelers can now compare airline deals on these portals and club with attractive hotels, car rentals, package deals. The deals are getting bigger and better on portals as most of them are backed by venture capitalists and corporate with deep pockets. Using back ward integration the portals using their money power are getting better deals by bulk purchasing on airline seats and hotel rooms. They even offer hefty cash back schemes with credit card companies.

The travel agency business model needs to be redrawn, reshaped and remodeled to fit the new realities. Just as we have seen the demise of general medical practitioners, we have to evolve ourselves to be more specific and specialized travel agents. The survivors of this blood bath would be the ones who have figured out their market and their expertise. Travel agents need to provide inside information that the travelers can’t get off web sites easily. Add an incremental value to the final product/ service which the passenger is willing to pay for.

Final Word – The agents that survive the current shakeout period will be smarter and will probably do more business because they’ll have fewer competitors.

(Watch out for next travel agency blog - “How to survive the shakeout and emerge a smarter travel agent”)

Friday, August 1, 2008

Horse sense

(Satire on Horse Trading...)

I WANT to buy some good Horse”, he said, stroking his bushy beard. I welcomed the elderly gentleman, though it was past midnight. Why not, if I could make an extra buck in the dark!

“Any special qualities you are looking for?” I asked politely. “Well, yes. I want slow, weak doddering ones, not the strong racing types you know…”

He smiled tenderly at my bewildered face and explained: “They don’t have to do anything; in fact they should be incapable of anything worthwhile. The more useless, the better. They should be just alive so that they can be counted in my shed. That’s all, my dear!”

“What will you do with them, respected sir?” I ventured.

“My boy”, he said in kindly tones,” My rivals in the trade claim they own more horses that I do. I must outwit them with numbers”. He further explained that lame horses were easier to hold—good horses could be stolen or they could bolt away to greener pastures. It’s just a matter of numbers.

“Are you deeply into horse-trading of some kind, respected Sir?”

“God, no”, he felt offended,” it is a bad word these days. But we are traders all right-especially in the power sector; Horse is our trade mark—you know the word Horsepower.

I nodded and guided him into my underground stables. The underground bit thrilled him. It matched his midnight visit. The elderly gentleman was impressed with my collection of horses. He examined them carefully and chose a few dark ones explaining “they are easier to hide till the display time comes.” He pointed at a few white ones and asked;” can you get them painted black, my friend? I don’t want them to catch my rival’s eyes easily.

Horses can be lured out of the stables with greener grass! Times are bad, you know. Ha, ha!”

“But respected Sir”, I protested.’ I am not into the business of painting horses.”


“Doesn’t matter, my boy”. In that case can you get them tainted that’s the least you could do.”

“But Sir”, I protested again, “they are already tainted! That’s why I am selling them so cheap, and keeping them safely here, underground”.

I narrated how these horses ate up fodder in other houses stealthily, how some of them kicked to death small animals witnessing their crimes etc.

“Great!” the gentleman’s belly shook with laughter. “I see, they can’t run away easily. But I hope that at the time of counting, hey won’t cross over to my rival side”.

“No respected sir”, I assured him solemnly, “we have damaged their vital organs adequately to suit leading buyers like you. They can’t even move on their own! We have taken other precautions too. We follow the principles of Horse-trading in our great Country very, very strictly!”

He was satisfied.