Fly & buy: Atul Ahuja

‘A journey of a thousand miles begins with a single step.’

It’s a familiar saying originating from a Chinese proverb that neatly encapsulates the entrepreneurial journey that Atul Ahuja has been on. As the CEO of Flemingo International, he has been an influential player in the global duty-free space and has spearheaded several successful initiatives for the business, including its launch into the Indian marketplace.

Atul says he never intended to get into this industry; in fact, it was "pure coincidence" it ever happened. The year was 2002 and his family had just closed up shop on their furniture manufacturing business. Atul was keeping his eyes peeled for new opportunities when a gentleman approached him from a Dubai-based business, Flemingo International, seeking a local partnership. He wanted someone who could represent the company in the Asian market, and Atul couldn’t say no to the offer. In 2003, he opened up his first duty-free retail store in Trivandrum, India.

First out of the gate

According to Atul’s son Arjun, who today sits as a director of the business, nobody knew just how much potential the Indian travel retail market actually had. "We were the first private duty-free operators in the country, so there was nobody else before us," he notes. "There was no real benchmark within the country. We entered the market without too many expectations.

"The rents were low and the sales were high, so we were extremely profitable. We used the cash generated to jolt the company into expansion mode that took us from operating one shop to having more than 30 across the country by 2006. We’ve thus far maintained the dominant status in the Indian market with a presence in 12 airports and 7 seaports.

"My father worked hard when he started Flemingo. He would spend hours patiently waiting for a meeting outside the offices of different bureaucrats and was instrumental in building the legislation that allowed such a business to operate in India. One mission I can remember was when he sat outside a particular person’s curtained-off office for an entire week. He started out by just taking each small step and this eventually led to bigger things."

South Asian expansion

It’s no surprise that Arjun says he was incredibly inspired by his father growing up. "I saw a man working hard day in, day out. He was always travelling and would take 4 or 5 flights a week. Seeing his work ethic inspires me, and my brothers, to work hard and push the limits to become better. I’ve seen the company go from having a US$1-million revenue in 2004 to US$700-million this year. So, you know, that’s inspiration enough. And we still have a long way to go." 

In 2012, Atul bought a majority stake in Flemingo International, and the business has since grown to have 440 duty-free shops in more than 37 countries. 

It has seen high double-digit, year-on-year revenue growth and continues to expand aggressively. The South Asian market is one current area of interest, as well as its continual growth in India, which is being driven by the business entering new airports around the country, increasing its portfolio of products, creating a loyalty program, building alliances, and doing retail sales onboard flights. Its aim is to achieve more than US$1.5 billion worth of sales by 2020.

"We hope to have close to a billion-dollar revenue by next year," Arjun explains.

"Travel in China 10 years ago is where India is at right now. The active young population of China has the aspiration to visit new places and is similar to current demographics we see through our Indian airports. This is different from the West, which is mainly driven by senior citizens. Airports have evolved from mere infrastructure to facilitate travel to a destination by itself.

Fast-paced growth

"If you look at the trips per capita in India, we have 0.06, whereas in China there are 0.4 trips per capita, and in North America there is more than one trip per capita. So the potential for us to grow is massive purely because of the consumption and travel increase by the Indian population. Beautiful new airports and world-class retail are set to shift Indian spends from foreign duty-frees from airports like Singapore, Dubai, Hong Kong back to India, while low airfare costs and an aspiration to travel will ensure good passenger supply into our stores." 

Part of the reason behind Flemingo International’s fast-paced growth has been due to several mergers and acquisitions. That, Arjun explains, has been quite testing for the company because it can be tricky to integrate different businesses and align them on the same goals and vision.