Khalid Hussain's vision and hard work drives Pak Supermarket success
by Tom Fleming
Birmingham Post, UK
May 10 2008
Tom Fleming meets Khalid Hussain, who has gone from shelf stacker to the boss of the biggest chain of Asian supermarkets in the country whilst sticking close to his ethnic roots.
When Khalid Hussain collected his young entrepreneur award at the Institute of Asian Businesses gala dinner last November the joke at the ICC was that this was the first night in memory that PAK Supermarket had closed.
If not strictly true it reflects an approach that has seen this 36-year-old businessman rise from stacking the shelves of a small corner shop grocery store to boss of a chain of supermarkets that has just opened a new £8 million superstore.
Like many before him Khalid arrived from Pakistan in the 1970s with little more than the hope of a better future. After initially working on the track at Land Rover, his father together with an uncle opened a small butchers and grocery shop on the Lozells Road.
It went well but the first faltering steps towards expansion could hardly have been less auspicious as Khalid explained: "They brought a bigger shop a few doors away and that was the real start of PAK Supermarket but it was in a terrible state and was almost burned down in the first Lozells riots.
"It was a terrible time when no one could do business in the area because people were too scared even to come into the shop."
But persistence and a refusal to be driven out paid dividends and the family started opening other small stores, including one in 1998 in Alum Road that until a few weeks ago was the national headquarters for PAK Supermarket.
The growth also included an expansion out of the groups West Midlands heartland into South Yorkshire, where a store was opened in the autumn of last year, by which time the business was providing direct employment to about 100 people in the most deprived parts of the region.
By this time, Khalid had long since become the head of the family business. Whilst at school he worked in the stores on Saturdays and during holidays and began working for PAK immediately after finishing his education, initially on the shop floor.
All this changed at just 19 when his father returned to Pakistan for a number of years leaving his son at the head of things: "It was a huge responsibility and there was plenty to learn and more than a few mistakes along the way, but I was always ambitious and had a vision."
As is often the case with people who have 'not had the benefit of an education Khalid wants the best opportunities for his son who is now aged 11.
"I want him to go to a good school and to do his best. If he decides to follow me into the family business then that will be good, but it has to be his choice," he said.
But he has no personal regrets about going directly from school to work for PAK Supermarket: "It has been very good for me and I have been very lucky. Had I worked for someone else I could never have enjoyed the lifestyle, opportunities or got the job satisfaction that this gives me."
Khalid knows that although the minority ethnic community has a relatively high proportion of people who are self employed, he knows that for many of them life is a struggle for survival.
"There are many good Asian family businesses but often they start small and stay small without ever fulfilling their full potential. People work very hard but that in itself is not enough, there needs to be a desire to make something bigger and recognition that standing still and surviving is not enough."
He thinks it is no accident that Government statistics show that whilst there are a vast number of small businesses the majority of them never get beyond the survival or subsistence stage.
"There are people who go into business because they see no other option and it is a way to survival. If this is the motivation then it is hardly a surprise that they get no further," he said.
Khalid was always keen that PAK Supermarket should break out and move to a new level. "Although our shops were doing well they were all characterised by being relatively small with limited shelf space, no car parking and it was clear to me that we had to think bigger."
He had to make a step change and that opportunity first presented itself when the site of the derelict former bus depot in Washwood Heath came onto the market three years ago. It was the start of a difficult journey with plenty of pitfalls along the way.
"I immediately recognised the potential of the site. It was in the right place and gave me the space I needed, but there were big challenges not least of which was that there were other interested buyers that were looked upon more favourably.
"In the end I bought the land without planning permission, which was a big gamble, but we finally got consent for the supermarket in June 2006."
Construction started five months later but even then things did not run smoothly as problems with the building works had to be solved. An original plan to open on Pakistan Independence Day in August last year came and went, as did other scheduled opening dates.
As is usually the way with these things the final cost of £8 million has turned out higher than was planned, but eventually the target of opening on April 1 was agreed.
The store did welcome its first customers, but gremlins with the IT system stepped in and after just a few hours it was necessary to close in order to sort things out so the proper opening happened two days behind schedule.
"It is to be expected that there will be teething troubles in any major project, but customers do not expect problems and after so much hard work the glitch was very disappointing," he says.
So after a long and far from easy pregnancy it was a difficult birth but now the baby is looking fit and well.
"I am having to learn a new way or working. In the past I have been very much the boss and have done everything but this project has required appointing a management team including a finance director, buyer and someone to head up human resources and IT.
"We have taken great trouble to try to select good people but it is hard to delegate when you have been used to making all the big decisions yourself. Heading a family business is not like working for someone else because it is very personal and letting go is very hard. I still spend a lot of time on the sales floor and if there is a problem with a display or something I will fix it myself.
"The team look after key aspects of the business and in recent months all my attention has been on the new supermarket which means I have much less involvement in the running of our other stores that remain very important to the business."
For 30 years the key customers for PAK Supermarket have been people from the Pakistani community and a key objective is to diversify and broaden the customer base beyond its traditional core.
"Ninety per cent of our customers have been from the Pakistani community. They will always be very important to us because these are the people that have given us everything we have and so we must make sure that we continue to give them the service at the same level and even better than we have in the past.
"But to grow the business it is essential to broaden our appeal and we intend this new store to become the place to come for quality ingredients for food from all ethnic traditions including Indian, Bangladeshi, African-Caribbean, the Middle East, Arabia and Africa. There is also a growing demand for the foods of Eastern Europe and we are going to cater for that need as well.
"People are much more adventurous with cuisine these days with travel all over the world and so people want to be cosmopolitan with their food and cook the meals at home that they enjoyed on holiday and this presents us with a great opportunity. We already have people coming to shop with us from as far away as Leicester and I want PAK to have a regional reputation for supplying top quality authentic ingredients for ethnic food from all over the world.
"However, it is not just ethnic food that we sell. All of the best-known consumer brands are on our shelves. The store also includes its own bakery, there is a customer restaurant and another first for PAK is that we are selling a range of non- food household goods."
Khalid Hussain rejects a suggestion that the worst economic outlook for at least 15 years is not a very good time to launch the new supermarket. Plans for further expansion and other bigger stores are in the pipeline.
"Our core product is good food at a good price and people will always need to look after their stomachs no matter how bad the economy gets. If we were retailing luxury or higher end consumables where there is discretionary spend I would be worried but we are providing the staples of life.
"There are exciting plans for the future with bigger stores, expansion into other parts of the country and a refurbishment programme for some of our smaller shops. But for the time being the priority is to consolidate, iron out any wrinkles and make sure the new supermarket is a success. Our new store is eight times bigger than any of our other outlets and so the scale is very different and we need to absorb the lessons."
Another reflection of scale is the number of employees with nearly 100 new direct jobs created at the new supermarket, almost doubling the size of the PAK payroll.
"One of the things I am very proud of is our contribution to regeneration in one of the poorest parts of Birmingham. When we were recruiting Jobcentre had a special open day for us and that was great.
"In addition to the direct jobs we are working closely with local suppliers like East End Foods and KTC which boosts the local economy. The construction of the shop took eight months and that resulted in spending locally by the building workers. We are attracting people into Washwood Heath from other parts of the West Midlands and this is bringing money into the local community. It is not just PAK that will benefit from what we have done.
"This is practical regeneration from the grass roots, not a grand strategic plan on some civil servant's desk. We have done all of this without a penny from the public purse," he says.
Still only in his mid-30s Khalid has come a long way in a short time and is not going to rest on his laurels.
"There is no great secret to our success. You need a vision, ambition, hard work and perseverance through the hard times, combined with a reasonable share of luck.
"If the West Midlands is to prosper as a region we have to unlock the latent potential of many more entrepreneurs from the minority ethnic community and part of that is getting people to believe that because you start small you do not have to stay small.
"When they look at what we have achieved in moving PAK Supermarket from a small corner shop Asian grocery store to a national chain with ambitious plans for the future I hope they get a glimpse of what is possible."
