Economy
Small town challengers
Regional brands are challenging national brands
Regional brands such as Goldie Masale are beating national brands. Instead of focusing on pan India market, they target 1% of the market. Balaji Wafers is bigger than Pepsi Co. in several Indian states.
Balaji Wafers’s FY19 revenue was more than INR 2400cr. Its founders started by making potato wafers at home. Indigo Paints’ IPO was oversubscribed by 117 times. Its founder started by making cement paint, in a rented shed. Raj Group’s white perfumed laundry bar is the leader in Punjab and Haryana. Second generation owners are transforming it from INR 40cr business to a national brand. Goldie Masale’s 2020 revenue was INR 675cr. It’s market leader in Uttar Pradesh and Madhya Pradesh. VKC group from Kerala is a INR 2100cr brand in footwear segment.
As per Forbes India: In most industries — soap, FMCG or paint — branded players own around 60 percent of the market share while the balance is taken by various small and local players, usually dubbed as ‘unorganised’. The paints industry, for instance, is estimated at ₹78,000 crore. “Grabbing even 1 percent of the market share would create a large company of ₹780 crore,” says the CEO of Paul Writer, a marketing advisory firm.
The playbook of such businesses comprise of humble beginning, with small capital in small towns. Regional businesses produce superior products at lower price. Next they build distribution on their own. They focus on reliability. Finally they capture adjacent states.
Want wafers: Journey of Balaji Wafers Link
