LAKARCADE – A significant turning point in Sri Lankan handicrafts. 0 1993

By : Cameron Blake

With Sri Lanka becoming the number one travel destination according to The Lonely Planet rankings, the success of the novelty gift and souvenir industry, which is one of the major developing categories in tourism, is thus far stabilized. One could say LAKARCADE’s entry into the industry is well-timed, and it is the view of LAKARCADE CEO and Managing Director Anil Koswatte that it is here to cater to the demanding market, by setting up its flagship store in the heart of Colombo.

LAKARCADE is one of the biggest novelty Gift & Souvenir shopping malls in Asia located in the heart of Colombo, LAKARCADE offers a wide array of authentic Sri Lankan souvenirs and novelty gift items. The fine range on display includes carefully selected teas, spices, traditional art & craft items, batiks, gems, jewelry, silverware and many more creative products.

“Sri Lanka is now focusing more on the tourism industry, and we need to exploit this opportunity as much as possible like other South East Asian countries. When you look at tourism development, novelty gift and souvenir industry is one of the major developing categories in the world that contribute to tourism. Gem and jewelry, spa products and handicrafts are subcategories in this industry,” Koswatte said.

According to Koswatte, the statistics of tourists’ arrivals are on the rise, with numbers increasing every year; Sri Lanka currently has reached a mark of 2.5 million arrivals per year. He believes that Sri Lanka has the potential to reach the heights of countries like Thailand and Malaysia, and increase these numbers up to 20 million. As a Sri Lankan entrepreneur, Koswatte states that LAKARCADE is getting ready to take up this challenge by aiding the Government as a private entity, to boost economic growth from grassroots level by increasing its service to the rural crafts community.

LakArcade Sri Lanka
Koswatte says that almost all of the products sold at the store are manufactured by village- or cottage-based craftsmen, with the exception of some products being sourced by local but established manufacturers. Crafts and artefacts from Batticaloa, Puttalam and Jaffna, covering areas from North to South, are sourced by LAKARCADE.
“Products that require a quality assurance such as tea, coffee, and spa products, we have reputed and established local manufacturers who supply for us. All products are manufactured here and all resources and expertise are local; we’re not importing anything. So, the majority of the products are produced in the cottage industry,”

According to Koswatte, LAKARCADE provides the rural craftsmen the ability to demand their prices. He said that no bargaining happens on their part, and therefore the craftsmen are assured a reasonable income for their efforts. “We don’t tell them this is your price. They come with their prices and we accept.”

LakArcade Sri Lanka

Koswatte added that the suppliers, the cottage industry manufacturers, are very talented, creative and efficient. However, according to certain market standards and trends, some changes needs to be made, and this is where LAKARCADE collaborates with their designers and produces an end product that has more market value. “The manufacturers are very independent people. There are as per my calculations, 3000-odd suppliers of handicraft in Si Lanka. We purchase from some of these manufacturers, either what they are producing according to their designs, or after we do our own designs and value additions.”

LAKARCADE has recruited a very famous design consultant, Senaka De Silva. His expertise is utilised into understanding current market trends, and incorporated into the products produced by the suppliers.

“Suppliers come and see the stores. They can see the consumer points, consumer behaviour, market trends, what components in their production they should enhance such as packaging and weight. It’s an exposure program for them also. This is where the manufacturer and the buyer meets. They can see for themselves how the market behaves to their products,” he explained.
With a wide range of items such as gem and jewelry, handloom, Sri Lankan batik, Ceylon spices, Ceylon tea and coffee and handicrafts, the exclusivity of a gift shop such as this is its ability to make a global presence through e-commerce, says Koswatte. “We already have the facility in place for customers to do their shopping online. We’re joining with Ikman.lk and we’re aiming to have a global presence like Amazon and Alibaba as vendors.”

“Our market segment here is 80% tourists. Some people come and order items big in size such as wooden elephants or artefacts, and we will deliver it to their doorstep through our air-freight or sea cargo,” Koswatte explained.

LakArcade Sri Lanka

The team at LAKARCADE is equipped with expertise knowledge as they all have prior experience working in a similar scope. With ease, one can observe a cross-section of Sri Lankan heritage and culture at LAKARCADE.

Koswatte says that unless marketing linkage is provided, the village- or cottage-based craftsman doesn’t get reasonable prices for their efforts. He states that the backward integration in the business, from buyer to manufacturer linking, is one of its main goals. Therefore, the sustainability of this business in the long run with adequate income to the craftsman is promised when market facilities such as LAKARCADE is available in the Centre of Colombo, aiming the tourists.

“As a marketing linkage institution, LAKARCADE does not produce any items sold at the store. All these are produced in the village level, either in the cottage industry or either in a rural level craftsman-owned business. Most of the products come from the cottage industry,” Koswatte explained.
Sri Lanka has a significant advantage on gem and jewellery, being one of the major countries manufacturing gems and jewellery, in addition to tea and spices, according to Koswatte, and he further added that Sri Lanka has the competitor advantage, with the ability to demand higher prices in these categories. “If the consumers aren’t happy with our product, including our gem and jewellery, they can return it and we can pay back. We have the money-back guarantee as well.”
Koswatte says that from the point of country, LAKARCADE plays the part of brand-building or destination-marketing for Sri Lanka, and that it is their corporate responsibility, objective, vision and goal.

“The tourism industry should sustain with a good image and attractive campaign and we are part of it. Our Sri Lankan authentic products should enhance the total value of the Sri Lankan brand. I believe LAKARCADE plays a major role in providing this assurance,” Koswatte elaborated.
LAKARCADE truly Sri Lankan with a vision “To become the global representative of authentic Sri Lankan Novelty Gift & Souvenir items by preserving our heritage”.

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Jetwing Hotels – What Makes Them So Different? 0 2142

A warm and friendly nature reflected in tireless smiling faces, and willingness to help those unaware with phases of local life. From the beautiful beaches of the South-Western coast to the toe tapping and exuberant Kandyan dances, along with the majestic and ancient architecturally and archeologically distinguished cities. Bright, sunny warm days are in abundance and are common even during the height of the monsoon. The humble desire to share this experience of heartfelt warmth and the true hospitality of the people living in the small miracle in the Indian Ocean called Sri Lanka, a homely villa was built named Blue Oceanic, which is now the Jetwing Blue, with just six rooms in the early 1970s facing the sandy beaches in the Negombo City.

Hiran-CoorayA simple dream of sharing the uniqueness of this beautiful island, one of the largest, most respected, and recognized tourism organizations were born. Herbert Cooray – a visionary, a pioneer of tourism in Sri Lanka and the founding father of Jetwing, the largest family of hotels and villas across Sri Lanka, opened its doors to the world welcoming them to a family of hotels like no other.

Inspired by Herbert Cooray, his son Hiran joined Jetwing as soon as he completed his education graduating from the University of North Carolina, USA, prior to which he studied at St. Joseph’s in Colombo. Following family tradition seems to be established. Just like Hiran his sister Shiromal took up their father’s legacy. At 29 years of age, Herbert Cooray left his job to join the family business N. J. Cooray Builders – a building construction company which was founded by Herbert’s father, Jeremias.

The founding principles his father inculcated in Hiran and the family have today become the very pillars that Jetwing group operates on: “…Passion, Honesty, Integrity and Tenacity – these were the values my father instilled in us throughout our lives and they continue to be the Jetwing family philosophy. It is the secret of our success. I have the incredible honor and the responsibility now to do justice to his legacy.

The essence of simplicity and modest allure, Hiran is a son who continues to do his father proud.

BiZnomics had the pleasure of speaking to the veteran hotelier HIRAN COORAY of his journey and experience gained throughout.

Q: What was the foundation for Jetwing?

A: It all started with my dad in 1973. He started off with the Blue Oceanic Hotel in Negombo with just six rooms and later moved on to further rooms. It was just a simple beginning eventually created the Jetwing family. It was a time that no one really thought of tourism, and for some reasons it progressed quite well for the next 10 years. Then he moved onto building Royal Oceanic. Blue Oceanic now goes as Jetwing Blue and the Royal Oceanic is Jetwing Beach. During those 10 years my dad probably would have owned about five hotels. Although towards the ‘80s the troubles broke out, it didn’t really stop him from expanding. In fact, that was the time he started Jet Travels, which eventually became Jetwing Travels at the end of the 1980s.

Q: How did young Hiran get involved in the whole thing?

A: Being a Josephian, my only interest was in cricket at that time. I was the Vice-Captain of the school team and represented the Sri Lanka Schools as well. However, I realized there would be no future in cricket so that I concentrated on my studies. I went to North Carolina, Greensboro University and came back in 1987. It was also my father’s decision that made me come back. 1987- 1989 probably would have been the worst two years of history, having riots breaking out all over the country on top of the ongoing civil war but my father wanted me to come back and that’s just what I did. A degree doesn’t really tell you anything when it comes to practical knowledge. Within a year he made me the Managing Director, my father’s words were “if Castro could control a country at the age of 25, why is it difficult for you to run a company at the same age?”

Q: What are the set of goals for Jetwing?

A: What we want is to be the ‘Best service provider in the country’. In whichever way we expand we want to be the best at it. As my father used to say, provide a legendary service. In order to provide it, we have to look after our staff as much as we look after our guests. That is one of the main goals and we work on that continuously. We have been pioneering in to different new areas of tourism. We were the first to build hotels in Galle in 1995. Other than New Oriental (now Amangalla) there was nothing else. My father built there when everyone said it was going to be a failure. We started Lighthouse which is an iconic hotel in Galle. Then we went to Wellawaya when people questioned why? Again we educated people in Sri Lanka why one should visit Wellawaya. We then built in Potuvil. It is a Muslim village in the deep South East corner of Sri Lanka. People always have that question as to why? We built in Jaffna. We were the first company from the South to go to Jaffna. There were hotels there of course, but we were the first to go from this end. We have the pioneering spirit, creating opportunities and taking the lead.

Almost all our hotels were in the high-end category, but now we are working on the budget brand. We were the first to introduce that as well in 2013 called Hotel J in Negombo. Now there are three budget hotels, Hotel J Ambalangoda, Negombo and Unawatuna.

 

 

 

 

 

 

 

 

 

 

It is quite similar to a low cost carrier. You will have to buy everything apart from the seat provided in the aircraft. Similarly our brand provided at hotel J is a clean room, clean bathroom, air conditioning, WiFi, and safety. If you are a single female traveler, you must feel safe in a room. That is the five brand promises we give at hotel J. Everything else including carrying your own bag is your responsibility. And you will have to purchase everything including the bottle of water in to the room.

Hiran-CoorayQ: How do you maintain the standards of the company and its employees?

A: Continuous training. We have to be at it every day.

Q: Do you have a gender balance in your organization?

A: We are the only organization that has five female General Managers. We are very proud of that they do an amazing job. The fact that we have females in this position motivated others to improve themselves to achieve their goals. We started these 20 years ago and it is not a new concept for us. All our staff has the opportunity to grow in the company. A good example is the Manager at Jetwing Sea, who started as a security guard. We allow people to develop and it also should be in them to develop themselves by taking the opportunities.

Q: If a female employee is sexually harassed, how would it be handled?

A: We have very strict rules on those. We educate our staff on what can be said and what cannot be said, how important it is to behave in certain ways in the company. Even a simple touch is not allowed. It is a serious offence in the company and we take disciplinary action against such behavior.

Q: How does the political uncertainty affect foreign investments in our country?

A: Government policies are essential to attract foreign investors. Whenever a government changes policies change and can discourage that investors in tourism and other fields. We are sons of the soil so we have left with no choice. When foreign investors know that our policies change every time a government changes, they will not think of a long term or a safe investment environment in this country.

Q: How likely is it that a customer recommends your hotel to another?

A: We make sure the service we provide is of no comparison. The relationship we maintain with the local community, what we do to preserve the environment, all those factors are important to place your high up in the industry. People are very much aware of the environmental impact and community involvement. If you genuinely do that, look after the local community, employ and create opportunities for the local community and also look after the environment, and you showcase it, the customer who studies and buys a product will always choose the right one over others. That’s one of the very obvious difference between Jetwing and others.

We have a programme called JYDP ‘Jetwing Youth Development Programme’ which we started in the year 2006 and up to now we proudly say we have trained nearly one thousand youngsters in the hospitality industry and the English language.

Q: A little bit more on the political side. What do you think is the future status of this country?

A: My wish is that the private sector will not be dependent on politicians. The private sector has a very important role to play, irrespective of who is in leadership. The private sector must continue to play the role. The private sector should not get involved in lobbying and directing politicians. A politician should look at the country in the long term aspect, viability, sustainability of the country, and I will support anyone who thinks long term, not only till they serve the number of years. Sadly they think short term.

Q: What are your thoughts on taxation?

A: We live out of this land; hence we have to pay something for that. As long as it is bearable it is fine. I mean the Government provides certain facilities free like medical and education. That is a huge cost to the government. Somebody has to pay for it. We can’t really be borrowing to pay for those essential requirements.

I am very much against giving free higher education. Maybe the government should provide a loan facility at a very low interest rate to pay off in a certain number of years, as students have no value over what they get free. When you are given free education, they expect the government to find them a job as well. What can they actually do for themselves in that case? As a youth you should not be a burden to the country. Appreciate what you get and learn to stand on your own feet. The Government educates them free, give degrees free, and then as it is, a job should follow. How unreasonable can they be?

Value what you get free; at the same time be a responsible citizen, not a burden to the country. That’s something I very strongly believe. Appreciate what the country is doing for you. It is all our taxed money that the Government is utilizing on their education. They should at least appreciate that fact.

Q: What is the biggest people problem you are facing right now?

A: Leaving the country. After training them so hard when they leave, it hurts the company.

In a nutshell

Q: One word that describes you best?
A: Down-to-earth

Q: What are your three biggest accomplishments?
A: Number one: I am blessed with three great sons.Number two: Carrying on what my father started and adding value to the tourism industry in this country.
Number three: Being chosen as the Chairman of the Pacific Asia Travel Association the only Sri Lankan to be chosen from a small island to chair that organization for two years.

Q: What animal do you like most?
A: I am a bird watcher. It is fascinating to see their colors. I get much inspiration through that.

Q: What do you do outside work?
A: Watching cricket matches and I like walking.

Q: On a scale of 1-10 how lucky are you?
A: 10 definitely.

Q: What kind of books do you read?
A: I love reading management books, religious books, biographies and sports.

Q: If I am to take over your position, what advice would you give me?
A: Be humble, willing to learn and an honest leader.

Q: When it is all over, how do you want to be remembered?
A: A simple man who tried to make a difference (laughingly).

By: Chantal D.
Photography by: Nuwan Ranaweera

Biznomics Note Pad 0 410

biznomics-note-pad-2

By Biznomics Research Team

Monetary Policy Dilemma Everywhere

Global Financial markets have turned their attention to the emerging split among monetary policy makers towards policy rate cuts. The Federal Reserve Bank of the United States reduced its policy rate by 25 basis points, but indicated further rate reductions could be on the card as members split on what to do next. Reduced its benchmark overnight lending rate range from 2-2.5 PCT to 1.75-2 PCT

The US President Donald Trump has gone on record that Federal Reserve Bank is risking US competitiveness by keeping interest rates substantially higher than most of the developed countries.

Oil Prices Back to near normal

BiZnomics-note-spad-1Brent Crude price which soared to near USD 70/bbl after the attack on Aramco oil facility declined to near USD 60/bbl when Saudi Arabia announced that they will ensure no shortage in medium term. In the background of slowdown in global economy, the attack on Aramco oil infrastructure facility did not reflect sustained pressure on the market demand.  The surprised drone strike at the Saudi oil facility on 14th September halt the oil production impacting nearly 5 million barrels of crude processing a day which is 5 PCT of world’s daily production. The US blamed Iran for the attack.

 

US-China Trade Tension

Us and China delays further tariff increase pending high level talks between the two countries.

The Wall Street journal on 19th September reported that the World economic growth remain low in 2020 and possibly beyond if trade conflict spills over into other aspects of two country economic relationships. OECD expressed its worry over sliding economic growth among major trading partners. Slowing trade flows and business investments are signs that the trade disputes are taking a toll on global growth. The US-China official are due to meet in the third week of September to hold talks ahead of high level trade talks in October. Several rounds of tariffs have been levied by two countries on a larger percentage of commodities traded between two countries.

 

US Hit USD 1 trillion budget deficit

The US budget deficit passes USD 1 trillion mark for 2019. Reuters reported that the US government posted a USD 200 Bn budget deficit in August 2019 raising the eight-month budget deficit towards USD 1 trillion.

Cont..

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