Suitcases are what brought Vach Pillutla to Malaysia, but sportswear is what has kept him there.
"After eight years in Hong Kong, my then-employer Samsonite offered me the chance to come and head up Malaysia for them," he tells The CEO Magazine.
After working at country- or regional-level roles for various global lifestyle brands including Adidas, Sony Mobile, New Balance and VF Corporation across a career spanning more than 25 years, this was a chance too good to pass up.
"I felt good about moving to a place like Malaysia, a small country but with a solid infrastructure and friendly, welcoming people," he explains.
I saw that this was a brand that Malaysians loved. It’s homegrown. They identified with the brand. They patronised it. They are very loyal to it.
He’d been sent to Malaysia with a clear mandate and once that had been completed, he was asked to return to his previous role as Business Director for Asia. But the country had started to feel like home. "It’s a place where you can continue to lead your life the way you want to," he enthuses.
So when he was offered the CEO role at leading Malaysian sports retailer Al-Ikhsan Sports, Vach already knew his answer would be yes. "It was at an opportune moment that I received the chance to lead this organisation into a new era," he reveals.
The story of Al-Ikhsan Sports’ establishment is somewhat of a fairytale. Founded in 1993 by Tuan Haji Ali Hassan, a young football fanatic with a dream of bringing global sports brands to Malaysia, it has grown into the country’s number one multi-brand sports retailer with more than 30 per cent market share.
"He’s built the business from the ground up, and he’s a passionate sports lover with a very strong business instinct," Vach says of the company’s Founder.
In 2016, facing increased competition in the marketplace, Tuan invited Ekuinas, a government-owned private equity fund, to invest in the company in return for a 35 per cent stake. Under the new ownership structure, Tuan became Chair. And in Vach, the hiring committee found the person to "turn the business around and make it extremely competitive in this new world and new consumer scenario".
For Vach himself, the appeal went well beyond the opportunity to remain in Malaysia. "There was the potential to add value to something which is very meaningful for the country and for its consumers," he explains. "I saw that this was a brand that Malaysians loved. It’s homegrown. They identified with the brand. They patronised it. They are very loyal to it."
Yet despite the loyal base of consumers, there were gaps in the business that needed to be filled. "The opportunity was about ensuring we were able to fulfil the brand’s potential," he adds. "That was my real goal."
Vach calls the era before he joined in 2017 as Al-Ikhsan 1.0. "This was about reaching a certain scale," he says – particularly a distribution network of around 110 stores. "At this stage, the business was essentially an owner-driven one."
Al-Ikhsan 2.0 started when he joined the business. "I brought with me a professional management team, with the Chair offering guidance and advice in terms of navigating the local culture."
With the vision of the Founder and Chair – to cement the company’s place in the heart of the Malaysian consumer – guiding him, Vach explains that Al-Ikhsan 2.0 involved "clearly putting in place processes and systems for the company’s survival as well as preparing for the future".
For the first three years of his tenure, the results were extremely encouraging. "We had a double-digit corporate annual growth rate in terms of sales," he says. Over 20 new stores were opened. "But most importantly, our profitability growth was almost four times."
We are excited for a full-blown expansion of the company.
"We also outlined a strategy to forge stronger relationships with global brands such as Nike, Adidas, PUMA, Skechers and Under Armour, to introduce new brands and to take on licences with Umbro and Liverpool Football Club," he explains. "Expanding our internal brand to engage more closely with the local footballing community was also key to this phase."
Like every business, 2020 and 2021 were tough years where the plans for Al-Ikhsan 3.0 were put on hold. "For us, it was about ensuring survival and conserving our cash for the future existence of the company," Vach reveals. A handful of underperforming stores were closed but on the bright side, more than a dozen stores were added.
Fast forward to today and version 3.0 is well underway. "We are excited for a full-blown expansion of the company," he says. This year, and for the next three years, he intends to open more than 30 stores per annum, across its five distinct retail concepts: Al-Ikhsan Sports, Al-Ikhsan Sports Warehouse, Football Republic, Sneaker Street and Al-Ikhsan Sports Factory.
"We’re also strengthening our processes and infrastructure as we prepare for a much bigger Al-Ikhsan," he continues.
This strategic program is deliberate. "We can no longer be reactive," Vach explains, adding that his short-term focus is to "build a road map for everything we do".
"In the past, we may have been a bit opportunistic in terms of grasping an opportunity and then trying to use our existing resources to deliver on it," he reflects. "Now our approach needs to be more planned. Maybe we’ll say no to a lot of opportunities that are not in line with our core business commitments and structure."
Vach is also placing significant emphasis on company culture, especially in the face of the post-pandemic talent exodus. "It’s most critical for us to make our staff excited and motivated to continue doing what they do," he confirms.
More than just a job, he wants his team to see the learning opportunities the company offers. "I always like to say Al-Ikhsan is like a school where people can learn more about their functions and about how to do business so they can grow in this organisation," he says.
With the business already at the top of the leaderboard, much of his current vision revolves around human capital. "It’s not just about being market leader," he points out. "It’s more about making Al-Ikhsan the place where people come and enjoy themselves."
Making sports affordable for all
As Vach looks to fulfil Al Ikhsan 3.0, he knows there is still quite a lot of uncertainty to navigate, much of it outside of his control. But he also believes the business is well-insulated from external uncertainties. "People will always play sports, they will always buy shoes and they will always buy apparel," he explains.
And in times when the economy contracts, people rein in their spending, "choosing more functional products, for example", he says. Yet with its core purpose to make sports affordable for all, he sees no reason why consumers wouldn’t continue to choose Al-Ikhsan over the competition.
It’s about offering exceptional quality products at a very affordable price point to the sports lover.
The prices may be good, but so is the quality. "It’s about offering exceptional quality products at a very affordable price point to the sports lover," he explains. "In the process, we grow our market share, but the goal is not to build market share at any cost."
Malaysia has won a place in Vach’s heart and in Al-Ikhsan, the theme continues. "We like to be fair to our customers, to our partners and to our staff," he says. "We are a company that does its business with heart."