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October, 2003 |
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Corporate Focus |
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Raybot's Expansions Why should all the cola drinks originate in USA? Why cannot there be one from Nepal as well? If you are the one who wonders like this, Gautam Bania, the Chairman of soft drinks and bottled water major Raybot Group of companies, has good news. His nearly six years old Group is all set to launch its own brand of cola range of soft drinks following nearly four-year long preparation. Bania displays the samples of the products branded Max Cola, Jux Orange and Trina Lemon in 2 litres and 500 ml disposable PET bottles lined up on his desk. Also to be launched soon is tonic water under the existing brand POP which at present has mineral soda only. To top it all, Bania declares that he is now also readying to send these brands abroad, particularly the SAARC region. To help him in this foray into the regional market, Bania has also developed two premium varieties of mineral water - Thirst-Pi Premium Spring Mineral Water and Raybot Premium Mountain Spring Mineral Water. Started in 1997 with a capital of Rs. 100 million, the Raybot Group already had tried with Juicy as a soft drink brand, which, as Bania claims, had given a very tough time for the orange flavoured drinks from MNCs, though he was forced to withdraw it after literally
flooding the market for some years. The reason for the withdrawal was some unscrupulous elements who started offering counterfeit Juicy as this product was in polyethylene pouch and served in glasses and they could put anything in the glass and call it Juicy. Later Raybot remained a mineral water major and it holds the leadership position in it with some 30% market share, according to the AC Nielsen Retail Audit Survey for the urban Nepal - July 2003 (see chart), though Bania on his part claims that his brand commands 45% market share. For some years now, Raybot is also selling mineral soda branded POP, carbonated drink branded Frujo and drink concentrate (syrup) branded Fresh-Up. Bania, however, was talking about his plan to launch cola drinks ever since 1999. In that sense, it is Bania's dream project. Accepting that the Nepali soft drink market dominated by Coke and Pepsi is already highly competitive, Bania says his company is not going to start a price war in the market to compete with these MNC affiliates by becoming a discount product. "We have a great tasting cola and that is an outstanding consumer proposition", he explains. And Bania's claim cannot be snubbed easily: His Thirst-Pi stable dominates the bottled water market relegating to the second position Kinley, the brand from Coca Cola stable. Other foreign brands in mineral water are further behind. One reason for this, according to Bania, is the fact that Raybot's source of water is a spring that oozes out of a huge rock vein while the other players use underground water. Equally important factor may be Bania's experience as the distributor of cigarettes from Surya Tobacco Company (now Surya Nepal), an affiliate of British American Tobacco. That experience must have taught him valuable lessons in selling FMCG products. In this regard, Bania repeatedly stresses on his company's fleet of delivery vans as one of the strengths of his company. But how is he going to take on the competition from the MNCs in cola drinks? In response, Bania talks of what he calls as the "four-tongued strategy". First component of the strategy is to expand on the local market and enter the neighbouring countries with focus on the core brands which are identified as Thirst-Pi water, POP mineral soda and Max Cola. Secondly, while the company is going to market itself as the beverage, major it is not going to walk away of the mineral water business. Third, there will be more investment in developing the operating capability further by becoming more innovative. Finally, the company is to focus on resources according to market type. As his brochures show, he is going to market the water as coming from the region of Mount Everest. One more point he can use to his product's marketing is the fact that Raybot is one of the many names of Lord Buddha. That way, he can also promote it as water from the land of Buddha. If you believe his claim, he already has good orders for his water from Gulf countries. Meanwhile, we can only wait and see how this David Vs. Goliath type war in Nepal's soft-drink market turns out to be. SME Focus Hajuri
Bista Making pickles may be a very simple job for the Nepali women who pride on the variety of the lips-smacking appetizer on their kitchen cupboard. But very few do venture to turn that skill into a business.
Hajuri Bista belongs to this rare breed of Nepali women and was honoured by Laxmi Bank Ltd. with the Women Entrepreneur of the Year 2003 award just recently for her remarkable business success selling pickles and candies. She sells about 15,000 Kgs (or 30,000 bottles) of the pickles per year, according to her records for the year 2001-03. But ask Bista, mother of two and holder of a certificate of Intermediate in Commerce, "What about the problems as a woman entrepreneur?" and she startles you with her answer. "So far I have not faced problems for being a woman entrepreneur," she declares shattering the popular myth that women entrepreneurs face special problems. Bista took interest in making different varieties of pickles after she attended a training program on food processing and preservation organized in 1994 by WEAN Cooperative, a Cooperative established by the Women Entrepreneurs Association of Nepal (WEAN) to provide marketing opportunities for women producers of Nepal. Then she partnered with her friend Kheshar Shrestha, both of them putting Rs. 50,000 each to start the business naming their firm HK Food Product Industry. Since WEAN Cooperative was there to sell the product, there was no problem in marketing. The brand "NAVARAS" was decided at during the training program itself. In fact the training program turned to be a trigger, which produced a considerable number of women entrepreneurs in Nepal including Bista and her friend Shrestha. Though the brand is owned by WEAN Cooperative, the producers do not have any complain. The system seems to be much similar to Lizzat Papad in India. Around 15 or 20 WEAN Cooperative members produce different food products - jam, furandana, maseura, titaura, kwanti and gundruk - under the brand Navaras and hand that over to WEAN Cooperative to market it. Among the women who attended the WEAN training, other three women beside Bista and Shrestha opted to producing pickles. Though the information about the other could not be collected, Bista says they are still producing pickles. But Bista and Shrestha later also started producing candies looking at the market opportunities. Recollecting how she started candies, Bista says while she was selling Lapsi chutney, she noticed that titaura and candies from Lapsi were also very popular in the market. So she grabbed the opportunity. The initial urge to enter business came to Bista from the leisure she got after her children grew up and they started to be busy in their own education and in planning for their own future. When she shared her desire to do something on her own, she received encouragement from her family, she recalls. And as cooking and trying out new dishes was her speciality, starting a business related to food products became her first priority. When she finally decided to take up pickle making, her husband loaned her Rs. 50,000 and she set out the field of business. But it was not as easy to begin with. For example, as she says, for nearly two years she worked in her kitchen developing various kinds of recipes of a number of pickle varieties. These initial recipes she tried with her neighbours to whom she sold the goods at a very low price (just covering her costs) so as to get the feedbacks. She never distributed it for free, because she was of the opinion that you never get a genuine feedback for a product distributed for free. Once the ball of success started rolling, there seems to be no stopping for Bista and her partner. This feature on SME has been sponsored by Laxmi Bank Ltd.) |
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