Many family businesses are running successfully in Pakistan; however, when it comes to having an entrepreneurial mindset the generations are taught to take over the business at a certain time. Mahmood Group is one of its kind that has several booming industries including textile, food, and real estate.
As the fourth generation in the business, Mr. Jawad Khawaja is the Director at Mahmood Group. Founded by Mr. Jawad’s great grandfather in 1935 with a leather tannery’s business, MG over the years has launched many successful businesses having a global presence in more than 70 countries. With Mr. Jawad’s strategic business management capabilities and entrepreneurial mindset, MG has ventured into many untapped industries including hospitality, and now, fashion retail.
Startup Pakistan interviewed Mr. Jawad Khawaja, to get the insights of his business and its successful corporate strategies were shared by him.
The significant insights of the talk are as follows:
- How and when Mahmood Group was founded?
- Mahmood Group is a Multan-based joint family business started by my great grandfather 85 years ago with a leather tanning business. When my grandfather Khawaja Muhammad Masood and his brother were in their early twenties, they saw an opportunity and purchased their first textile mill in Muzaffargarh naming it Mahmood Textile Mill.
During Bhutto’s Nationalization, our factories were nationalized. My grandfather then invested in lands and began cotton farming. During the denationalization phase, while we got our factories back, we were already producing cotton. This led MG to operate on ‘farm to fabric’ model where we used our then existing capacity of producing and ginning cotton, started producing yarn, and weaving fabric out of it.
2. Where does Mahmood Group stand today?
- Today, Mahmood Group has 12 diversified companies under its name with over $800 million annual turnover as of 2020. Other than manufacturing fabrics, we also have a knitting unit called Multan Fabrics, and a chinos manufacturing unit under MG Apparel. In real estate, we have a joint venture with Avari. In education sector, we have a joint venture with City College Multan.
We have leather tanneries. As of now, we are the largest leather exporter in Pakistan.
Our Food business category is divided into exports and local businesses. In our poultry division, more than 400,000 eggs a day are supplied and are mainly exported. With VHT technology, we have the capacity of processing 6 tons of fruits every day making us the only exporter of mangoes to Japan. Then, MG owns all Subway branches in Multan. Further, we have a restaurant chain in Multan and Lahore; London Courtyard and Aangan by LCY.
We also have power generation units.
Now, we will be launching our fashion retail brand- Beyond East in October 2021.
3. How was your journey from the first day you joined the MG till today?
- Being the fourth generation of Mahmood Group, it was a family tradition to join the company my forefathers found. My elder brother was in it already so I didn’t feel the pressure or a responsibility to join it immediately. I then utilized that time to get trained in textile; spinning, weaving, and ginning. I was looking after sales of yarn for quite some time. But then I realized it was not my calling. I felt I couldn’t really bring in a major change to an established business operating for decades with the latest technologies and trained staff. I was already looking after one Subway branch that we initially had in 2010, and meanwhile expanded Subway to a total of 3 branches. I then had to take a deep dive, worked on some ideas, and with constant family support, I then stepped into the hospitality & food business in 2017 opening London Courtyard in Multan, followed by Aangan by LCY in 2019 and later a branch in Lahore.
In 2017, I thought why not derive benefit from Multan’s unique geographical environment that produces the best kind of fruits and vegetables. I launched MG Agri under which we began exporting fresh produce including mangoes, red onions, potatoes, mandarin, and dry fruits to Japan, Middle East, and Europe.
2020 was the year when I started working on fashion retail. We identified a gap in the local fashion market and we decided to incentivize it with Beyond East.
4. What are your areas of interest?
- My area of interest is entrepreneurship. Coming from an entrepreneur family, I always had it in me to do something of my own. I studied entrepreneurship & international business in UK and used my experience and learning to venture into commercial business; mainly what involves direct communication with the customer on B2C model. I launched my restaurant chain and now a fashion retail brand- Beyond East.
5. What excited you to be a part of the retail industry?
Mahmood Group has expertise in providing premium materials and is exporting yarn, fabric, and leather to many renowned international fashion houses including Tory Burch, Zara, Calvin Klein, and Dockers. My idea was to use that technical expertise in a retail brand. And while I was working on it, I also saw a huge gap in fashion retail in Pakistan, especially for western and fusion wear so I had to move the needle and decided to launch Beyond East.
6. How do you think the current pandemic has affected the textile industry?
- Initially, it was a hard time for the local industry. However, now with the severity of COVID situation in India and Bangladesh, many US and European buyers began working with Pakistani textile & garment manufacturers. It also taught the industry to offer consistent quality every time to ensure long-run businesses.
7. What kind of relation has MG built with its stakeholders?
- Mahmood Group firmly believes in empowering its stakeholders. We value fair practice which has helped us be consistent and build long-term relations with our employees and clients. Many employees have been working with us for decades now. These stakeholders are a part of our growth. This is something that has been passed on to me by my forefathers.
8. How does Mahmood Group contribute to the local economy?
- Our businesses are majorly based on exports which generate foreign exchange, increases aggregate demand that leads to higher economic growth. Our vast network has helped create jobs and increased employment opportunities for more than 11,000 people. Our core values include sustainability and we think that is what makes us strong. We are proud to represent Pakistan in global markets by manufacturing quality products that are exported all around the world. Now with Beyond East, we want to provide high-end apparel that is designed keeping in mind international standards without charging a hefty price.
9. We have heard that Mahmood Group is the largest contributor to CSR in Multan. Please tell us about it.
- Mahmood Group is a strong believer in giving back to society. Our contribution in health care sector provides free meals, medicine, and health care in different hospitals. More than 8 dispensaries have been set up which cater to 400 patients daily. We have two self-operated schools with subsidized systems along with schools set up in every unit of Mahmood Group. Unlimited scholarships have been provided to deserving students. We have 15 water filtration plants installed. Our Robin Hood Army (Multan Chapter) collects surplus food from our offices and restaurants to serve deserving people.
We have provided opportunities to marginalized women of SOS village. In our environmental aspiration drive, we have done tree plantation and environmental cleanliness, development of Masood Sports Complex to provide infrastructure to staff and local community, installation & promotion of solar power plants along with construction and maintenance of green belts and local parks. We are an equal opportunity provider with 80% female workforce hired in our training school; Beena as women empowerment is an integral part of our core values.
10. How did you name this brand; Beyond East?
- We aimed to help customers define their personalities through Eastern and Western Wear that has a futuristic design appeal. We take inspiration from popular global trends, bring our innovation to them, and offer quality products that are locally manufactured. Yet, we do not want to limit this brand to clothing only, so we decided to launch it as an apparel brand that offers everything designed keeping in mind the trends from not only eastern markets but across the globe, hence Beyond East.
11. What are you offering with Beyond East?
- With Beyond East, we want to revolutionize the local fashion market by offering a one-stop apparel solution. Currently, in eastern category, we are offering pret, bottoms, casuals, evening wear along with unstitched options. There is western wear for men and women. In the future, we plan on expanding our product lines with perfumes, cosmetics, accessories, and footwear.
12. What do you think are going to be the biggest challenges that Beyond East will face in the next 5 years?
With existing economic downfall and currency devaluation, the biggest challenge from a manufacturer’s perspective is to offer quality products that provide maximum value to customers yet are competitively priced.
13. Looking ahead five years, what is your vision for Beyond East?
- I see Beyond East as the go-to brand of our new generation. We plan to have stores in all major cities of Pakistan. We will be launching more product lines making Beyond East a complete apparel solution. And finally, I am looking forward to BE going global.
14. What is the most valuable lesson that your career has taught you so far?
- If you see an opportunity or have an idea, do not waste time thinking. Start working on it immediately because you might not be the only person having that idea.
This informative session with Mr. Jawad has highlighted many significant aspects of a successful business. From starting the journey to its continuation, many challenges have been faced by Mahmood Group; the brand successfully faced the obstacles and revolutionized the business as per the modern ways.
During the pandemic, MG has proved to sustain its market position by forming and implementing strategies for its businesses. However, the Mahmood Group has become a giant contributor to the economy of Pakistan. Moreover, it is expected that MG will continue providing opportunities for Pakistanis in the upcoming years.
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