Biz Poised To Touch Rs 2,000cr In This Fiscal
It may be an unlikely com
bination -yoga for inner peace and FMCG for external beauty -but Baba
Ramdev appears to have struck the right pose in both. The guru whose
`easy yoga' has won him a mass following is also cornering the FMCG
market with daily use products ranging from soaps to cornflakes.
Baba Ramdev's brands seem to have scaled up quite rapidly . For 2013-14,
Patanjali Ayurved, the company that manufactures the products, clocked a
turnover of about Rs 1,200 crore, up from about Rs 850 crore a year
earlier and Rs 450 crore in fiscal 2011-12,
company filings and industry sources said. And in the current fiscal,
Patanjali is expected to clock a turnover of Rs 2,000 crore, according
to Aditya Pittie, CEO, Pittie Group. This marks a 67% jump from the
previous fiscal.
Pittie is the Mumbai distributor for Patanjali's general trade business and a pan
India distributor for its modern trade segment.
Patanjali is
present in almost all categories of personal care and food products
-soaps, shampoos, dental care, balms, skin creams, biscuits, ghee,
juices, honey, atta, mustard oil, masala, sugar and much more.
Going by turnover projections of Rs 2,000 crore, Baba Ramdev’s FMCG
business could rival Emami’s (Rs 1,700 crore), and be nearly half of
Marico’s (about Rs 4,000 crore).
Baba Ramdev’s FMCG business,
Patanjali Ayurved, has expanded rapidly despite most of its products
being priced lower than its competitors. What gives the company an edge
is its very low expenses on advertisements. In comparison, leading FMCG
compa
nies spend about 20-30% of their sales on advertisements.
With
the Patanjali brand’s growing reach and popularity among consumers, it’s
now being discussed in corporate boardrooms as well. This is in sharp
contrast to its quiet beginning in 2007. At that time the existing FMCG
brands didn't quite take note. Started through the franchise route in
large cities, as the demand for his products grew, Baba Ramdev realised
the huge scope within the FMCG sector and started building the range,
taking on deep-pocketed multina
tionals. The franchisee model has grown exponentially: From about
150-200 dedicated outlets in 2012 to almost 4,000 now. The initial
success of the franchise route also prompted Patanjali Ayurved to make
its FMCG range available in the
open market. This opened up avenues for the company’s distributors who
were now allowed to sell to other kirana stores in general trade.
Now
some of the Big Bazaar, Hyper City and Star Bazaar stores in Mumbai are
also
stocking its FMCG products. In modern retail, the company’s turnover has
grown from Rs 5 lakh from five stores a month to roughly Rs 5 crore
now, with same store closing annual sales growth of 20%. “Modern retail
currently contributes about 3% of total Patanjali sales with only 30
SKUs (stock keeping units),'' said Pittie.
The next step is
online – Patanjali’s products have just started retailing at e-commerce
site BigBasket. “I am talking to Amazon which has started a new food and
grocery gourmet category,'' said Pittie.
Source: Times of India Paper dtd 13-01-2015.
