Hubert Burda Media

This is How He Rolls

GS SAREEN dreamt big to found the “Ikea of tyres” Omni United. He tells Lauren Tan that making money is not a sin; doing good is good for business

Can it be?
A man sitting in a glass-encased, 30th floor One Raffles Place office, with well-publicised dreams of turning his current US$200 million in revenue into US$1 billion within the next few years, is holding back the reins of growth? As it turns out — yes.
“It was a conscious decision last year not to grow and enter newer markets, for example, South America,” says GS Sareen, one of Asia’s 25 hottest people in business, according to Fortune magazine, and founder of Omni United, a Singapore-headquartered company that designs, manufactures and distributes tyres to 80 countries.
“Setting up an organisation, you must have the management bandwidth and foundation to take stress. If you don’t, and suddenly a load worth millions of dollars is piled on, it’ll crack. This organisation I’m trying to build is for the long run,” the 46-year-old explains.
To be clear, Omni’s turnover for 2012 was “in the zip code” of US$200 million, a figure not too far off from the US$180 million in 2011, but a huge leap from the US$7 million when Sareen started the business in 2003. By 2015, turnover should hit US$500 million.
“The plan, originally, was to touch a billion in 2015, but I think that won’t happen because of the current situation,” he admits, alluding to his preference for restrained expansion, the economic climate and the expiration of tyre tariffs in the US — a market that makes up 70 percent of his business — which have left a dent in top-line figures (though not profitability). “But listen, what’s a couple of hundred million? Half a billion is a good number!” adds the gregarious Sikh, who relocated to Singapore from India in 1994, with a raised eyebrow and matching grin.
Scalability has never been an issue in any case. Some US$250 billion worth of tyres are sold worldwide each year, he estimates, making “even the little crumbs on the floor worth half a billion dollars”. “That should put things in perspective,” he adds. “We’re in a great spot. It’s full of fish. It just depends how much we want to fish.”
For Omni, it’s the company’s compelling value-for-money proposition that has hit the sweet spot. Its four brands — Radar, Goodride, Roadlux and Corsa — make quality tyres for cars, trucks, buses, SUVs and agricultural machinery that are sold at competitive prices. So successful is its market positioning that the press has taken to dubbing Omni the “Ikea of tyres”.
“I love that brand association,” he says, clearly chuffed. “Ikea is a hugely successful company designing great products at great value, and that is exactly what we do. Although, if a piece of furniture isn’t made well, it may not kill anyone, but if a tyre is substandard, you can really knock somebody out.
“So the size of the tyre industry, positioning of the company and products, and, although it’s not nice to talk about, the bad economic situation, are three things that have really helped us to scale up,” he adds.
It helps too that he dreams big, and recommends the same for others. “The genesis of everything is a thought. A thought gives rise to desire, which turns it into a will, which has an action, and after that there is a cause and effect,” he says, getting all guru-like for a moment. “Dreaming is very important and it should be taught in school. Instead, they tell you not to daydream. I think that’s the biggest mistake.”
Today, Omni has offices in Brazil, China, India, Indonesia, Dubai and the US where the firm’s flagship brand Radar is retailed at more than 800 Sears Auto Centers and is carried by top-tier tyre brand Michelin North America, which owns TCi Tire Centers. Fast-growing markets also include the UK, Spain, Germany and Australia, while major expansion in the Middle East and Africa, and the opening of more sales points in the South American markets are in the pipeline.
Already, 2013 has seen a series of firsts for the company — in professional racing. In January, the company’s foray into off-road racing resulted in its first win when Bronson Motorsports’ Class 10 buggy came in victorious on Radar’s Renegade R5 M/T tyres at the Mojave Off-Road Racing Enthusiasts New Years 200 race. The Bronson/Radar partnership has since also seen the tyre manufacturer make its full-season motorsports debut at the 2013 Lucas Oil Off Road Racing Series and Score Desert Series in the US and Mexico respectively.
“Racing is a big deal for us,” Sareen explains. “Sponsoring a team and putting our product in is a great test for our technical abilities. It also gives consumers bragging rights — these tyres they are buying are out there racing and are not just any other product coming out of China that is going to fall apart.”
Additionally, tyres and liveries for the races feature the Breast Cancer Research Foundation (BCRF) pink ribbon logo. The BCRF, of which the Radar brand is a corporate alliance partner, is a New York-based non-profit that funds clinical and translational research worldwide into finding a cure for breast cancer. Omni donates US$5 for every Radar tyre sold to the BCRF, committing itself to a minimum donation of US$200,000 annually (and a maximum of US$250,000).
“Why not bring a feminine cause into a masculine industry and educate people? Because one out of eight women will contract this dreaded disease unless a cure is discovered,” says Sareen. While fortunately no one in his immediate circle has had the disease, he says: “It’s an extremely emotional issue that concerns me as much as any other human being. Any random guy will know somebody — a mother, daughter, sister, aunt, wife or friend — who has got this damn thing.”
A socially-conscious entrepreneur, Sareen is also adamant about growing Omni in a sustainable way and, as such, engaged Ernst & Young last year to assess the company’s greenhouse gas impact and advice on initiatives that can reduce or offset its carbon footprint. While the study is still in its early days, a pilot recycling programme has already rolled out in the US.
“Making a sale is only 50 percent, what you do after is the next 50 percent. The guy is only going to come back to you if the after sales aspect has been satisfied. So what we are trying to do is to bring the tyres back at the end of their shelf life and reorganise the rubber for alternate uses. That engages the consumer and also serves the purpose of saying ‘let’s not screw around with the environment’,” he shares.
“Conceptually, people believe that when doing good, you will lose money,” he continues, “But I firmly believe that any such activity, if it’s not commercially viable, will not stand on its feet. If done well, you can actually save the environment, have a very sustainable business process and make more money than you are making right now. Making money is not a sin.”
The married father-of-two brings up Richard Branson’s 2011 tome Screw Business as Usual. “You must read it,” he instructs. “It talks about social entrepreneurship in Africa, and how doing good is good for business.” Taking a leaf out of the book, Sareen has started engaging with a local economic council in South Africa where he wants to fuel the entrepreneurial spirit by supplying products to those interested in setting up tyre fitment shops.
Clearly, Sareen is not one to do things in halves. As he likes to say: “Everything one does in life should be with full intensity.” But to truly understand how the former Indian Army officer became founder of one of Singapore’s fastest growing companies (a framed certificate by the DP Information Group hangs on the wall of his office confirming this) and an ambassador for breast cancer research and other good-doing efforts, one needs to turn back the years.
Born in Madhya Pradesh in India, Gajendra Singh Sareen was just four when his mother was left paralysed after being involved in an accident while visiting Africa. His father, a civil servant, taught the youngest of three children to be both independent in behaviour and thought. “I remember being about 10 when my father gave me a cheque for my sister’s boarding school fees. He said: ‘I can’t go, you have to go’,” he recalls. “So I put the cheque safely in my bag and travelled 1,000km overnight by bus. When I arrived at the school and went to see the principal, she couldn’t believe it. She said: ‘Where’s your father?’ I said, ‘No, it’s just me.’”
“So you learn things at a formative age,” he continues. “You learn survival and you learn to be nice to others as you manage the whole journey of life.”
On completing his education, Sareen joined the army. “I’m a Sikh, we’re a martial race. If you are not in the army, something is wrong with you,” he says. Eight years and a Sena Medal for gallantry later, Captain Sareen applied to leave the army on compassionate grounds. His brother had died in a road accident, and his father and paralysed mother were getting older.
“After the army, I had to do something. So I tried to do everything from selling potato chips to jewellery and pesticides until somebody said: ‘Can you get us some tyres?’ That’s how I realised what a great product tyres are. It doesn’t go bad like food, break like jewellery or leak like chemicals.”
In 1994, Sareen and his now-wife of 23 years Rewa, relocated to Singapore. They had literally flipped a coin to decide between Dubai and the Southeast Asian city-state. Here, Sareen took up citizenship and launched two tyre businesses, including, before finally establishing Omni in 2003. Sareen’s mother now lives with the couple and their two sons in a sprawling Bukit Timah home. (His father passed away in 2005.) Elder son Hanut, 19, is serving national service (“As we speak, he’s in Taiwan for that regular military training they go on,” Sareen says with pride), while younger son Sumer is 14.
“When I was first starting out, I was asked what charities I contributed to,” Sareen recalls. “And I said: ‘Nil’. Why? Because I believe I first have to take care of my family and then my extended family, as some of them don’t have insurance. After that, I have my employees to worry about as they are my extended family too, and people do fall sick. Once they are looked after, and there is energy and resources left, then you start paying back to the system. You can’t be a parasite on society. And that’s where our [corporate social responsibility] efforts come in.”
Still dreaming big, there are “a million more things” Sareen wants to do in life. Just weeks ago, he was alone in India for the Kumbh Mela (the world’s largest religious gathering which sees tens of millions of Hindu pilgrims coming together to take a ceremonial dip in the Ganges) and just “hanging out with all kinds of people”. Next on the agenda is buying a vineyard, hopefully in California’s Napa Valley, where he has put in an offer for a property.
All these would not have been possible if he hadn’t met with success but he’s definitely not done yet: “Success is not having a billion-dollar bank account and you sitting like an ass all alone in a corner. It is not just a destination where you stop. It’s a continuous journey.”