The fast moving consumer goods (FMCG) segment is the fourth largest sector in the Indian economy, with a market size that it estimated to to reach US$ 12.5 billion in FY16 and grow to US$ 74 billion by 2018 at a CAGR of 13 per cent.
The Indian FMCG space, so far ruled by urban Indian as well as multinational companies, has recently been witness to the entry of a whole new entrepreneur of sorts – the Indian baba.
Using their spiritual background as a solid foundation on which to build their brands upon, gurus like Baba Ramdev, Sri Sri Ravishankar and Baba Gurmeet Ram Rahim Singh have successfully managed to bag a large piece of the consumer goods market pie. They play up the swadeshi angle, use the Make in India card to their advantage and claim their products are 100 per cent natural, as opposed to those manufactured by MNCs in India.
Brands like Ramdev’s Patanjali Ayurved, Sri Sri Ravishankar’s Sri Sri Ayurveda and Gurmeet Ram Rahim Singh’s MSG All Trading International Pvt Ltd also highlight the social value of providing livelihood to many employed in the value chain while riding on the benefits associated with naturally found products. The revenue generated goes back to the functioning of their respective ashrams and associated activities.
Setting The Trend
Till Baba Ramdev came up with the idea of selling Ayurveda products in 1997 and branding them after Patanjali no one ever thought that the colour of money could soon be saffron.
Barring the 5,000-strong franchisee stores, Patanjali products are sold in supermarkets – including in Reliance Stores, Hypercity, Star Bazaar and the ubiquitous Big Bazaar that has allotted Patanjali products pride of shelf space – and can be ordered online too. The firm is planning more mega marts to showcase the group’s range of 562 products.
According to CLSA, Patanjali is the fastest growing fast-moving consumer company in India. It is valued at Rs 13,000 crore and is aiming to reach revenues of Rs 5,000 crore for the fiscal 2015–16.
The annual turnover of the company for the year 2014-15 increased to Rs 2,500 crore as compared to previous turnovers of Rs 1,200 crore in 2013–14, Rs 850 crore in 2012-13 and Rs 450 crore in 2011–12.
Patanjali Ayurved has a network of over 4,000 distributors, 10,000 stores and 100 Patanjali mega marts pan India.