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    Building Reliance

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    RAJNI SHA
    Dhirubhai Ambani was born in 1932 in Gujarat, India to a school teacher. After finishing school, he moved to Aden, Yemen at age 17 and worked at a Shell petrol station. Within a few years, he became a sales manager. In 1958, he returned to India and started Reliance Commercial Corporation with Rs. 15,000, exporting spices and cashews. Seeing opportunity, he began exporting rayon fabric and importing nylon fiber under an Indian government scheme. He focused on the domestic market in 1978, establishing the Vimal brand of textiles and launching an advertising campaign to build brand recognition while developing an efficient distribution system.

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    Building Reliance

    Uploaded by

    RAJNI SHA
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    Dhirubhai Ambani was born in 1932 in Gujarat, India to a school teacher. After finishing school, he moved to Aden, Yemen at age 17 and worked at a Shell petrol station. Within a few years, he became a sales manager. In 1958, he returned to India and started Reliance Commercial Corporation with Rs. 15,000, exporting spices and cashews. Seeing opportunity, he began exporting rayon fabric and importing nylon fiber under an Indian government scheme. He focused on the domestic market in 1978, establishing the Vimal brand of textiles and launching an advertising campaign to build brand recognition while developing an efficient distribution system.

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    Dhirubhai Ambani was born in 1932 in Gujarat, India to a school teacher. After finishing school, he moved to Aden, Yemen at age 17 and worked at a Shell petrol station. Within a few years, he became a sales manager. In 1958, he returned to India and started Reliance Commercial Corporation with Rs. 15,000, exporting spices and cashews. Seeing opportunity, he began exporting rayon fabric and importing nylon fiber under an Indian government scheme. He focused on the domestic market in 1978, establishing the Vimal brand of textiles and launching an advertising campaign to build brand recognition while developing an efficient distribution system.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    26 views1 page

    Building Reliance

    Uploaded by

    RAJNI SHA
    Dhirubhai Ambani was born in 1932 in Gujarat, India to a school teacher. After finishing school, he moved to Aden, Yemen at age 17 and worked at a Shell petrol station. Within a few years, he became a sales manager. In 1958, he returned to India and started Reliance Commercial Corporation with Rs. 15,000, exporting spices and cashews. Seeing opportunity, he began exporting rayon fabric and importing nylon fiber under an Indian government scheme. He focused on the domestic market in 1978, establishing the Vimal brand of textiles and launching an advertising campaign to build brand recognition while developing an efficient distribution system.

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    © All Rights Reserved
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    Building Reliance

    Dhirubhai was born on December 28, 1932, to Hirachand Govardhandas Ambani and
    Jamunaben Hirachand Ambani. He was the middle of five children, three boys and two girls
    (Refer Exhibit II for the Dhirubhai family tree). His father was a local school teacher in a
    village called Chorwad in the Junagadh district of Gujarat. After his matriculation in 1949,
    Dhirubhai left for Aden, (now in Yemen) at the young age of 17. His first job was to fill gas
    and collect money at a Shell petrol station, earning Rs 300 a month. Within a few years, he
    rose to the position of a sales manager (Refer Exhibit III for Chronology of Events) in the
    same company.

    After working for eight years in Aden, Dhirubhai decided to come back to India and start
    something on his own. On December 31, 1958, he came back to Mumbai and started the
    Reliance Commercial Corporation (RCC) with a borrowed capital of Rs.15,000.

    RCC was mainly involved in exporting commodities like ginger, cardamom, pepper,
    turmeric, and cashewnut. Using his connections in Aden, he exported a wide range of
    commodities to Aden.

    Aden, being a free port attracted lot of exports. In the mid 1960s, the Government of India
    (GoI) introduced an export promotion scheme under which the earnings from the export of
    rayon fabrics could be used for the import of nylon fiber.

    If there was a very large margin of profit, why did they not take advantage of it?"1 When
    the High Unit Value scheme ended in 1978, Dhirubhai focused his attention on the domestic
    market. During this time, Reliance Textiles was not a very well known name in the domestic
    market. His first priority was to establish the Vimal2 brand, under which Reliance Textiles
    sold its fabrics in India. An advertising programme was launched to facilitate its entry into
    the domestic market.

    Dhirubhai knew that a strong brand image was crucial for winning the consumer's
    confidence. To achieve this objective, Reliance tried to emphasize the superior quality of its
    fabric in all its advertisements.

    Besides this, Dhirubhai also took steps to develop an efficient distribution system
    for Vimal as he found that the existing marketing channels were inadequate and inefficient.

    However, things were not that easy. When Reliance entered the domestic market, it faced
    lot of resistance from the traditional cloth merchants, as their loyalties lay with the older
    mills. Confronted with this situation, Dhirubhai decided to move away from the traditional
    wholesale trade and open his showrooms to tap new markets.
    He appointed several agents from non-textile backgrounds for the same. Dhirubhai adopted
    the concept of company stores from its main competitor, Bombay Dyeing (Refer Exhibit IV),
    and pursued it on a grand scale. Dhirubhai toured the entire country intensively, offering

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