Forest Essentials ayurvedic brand
Apr 02 2012, 14:59 | By CNBC-TV18
Samarth, an ex-banker in New York, identified the potential for ayurveda.
Image: SME Mentor
The Indian cosmetic industry has undergone a metamorphosis due to a shift in consumer preference for safer, gentler and herbal alternatives. Samrath Bedi recognised the potential of Ayurveda and gave up a banking job in New York in 2001 to start Forest Essentials.
Below is edited transcript of his interview on CNBC-TV18. Also watch the accompanying video.
What were the challenges involved?
A: We wished to target the prestige segment when we launched these products into the market. The prestige segment was very new in the market as it was not luxury and yet above the mass segment. But when we offered a high quality product with global packaging, there was a lot of interest and demand.
So when we priced our soaps at Rs 175 each, we were told that they would never sell. But that was until people tried our products and saw the benefits. Now we cater to a very wide spectrum of consumers and customers want to know what goes into our products.
In 2001, customers were looking at the price tags. By 2003 everyone was looking at the list of ingredients on the labels.
Samrath entered into a strategic partnership with the global cosmetic giant Estee Lauder. The tie-up has helped upgrade his factories to state-of-the-art manufacturing facilities. Based at the foothills of the Himalayas, the three facilities employ 30 women from the surrounding villages.
These facilities also follow environment-friendly practices with water harvesting and solar heating facilities. The water used in their products comes from two mountain springs obtained on lease. The herbs for all products are handpicked and transported to the factories.
A: At first, executives from Estee Lauder came to see how the brand was doing because they had heard about it and were interested in the way it was shaping up. Estee Lauder offered to help build the brand based on its potential.
A partnership was formally signed in 2008 and since then, Estee Lauder has been in the background and provided assistance only when needed. We still do run the day-to-day operations and Estee Lauder understands that we know the market best. It has been highly successful partnership and I feel it is going to help Forest become a global brand in the future.
While the strategic partnership will help take the brand global, Forest Essentials has consistently grown at least to a 100% every year with a sharp focus on the domestic market, and has maintained a CAGR of over 65%.
With a three-pronged strategy, Samarth is confident that Forest Essentials will become a a Rs 100 -crore company in the next two years.
A: We have two main business segments - retail and institutional. Our institutional clients comprises five-star luxury hotels, hospitals and spas. In 2009, we started an online store to sell our products. This is an extremely important segment for us and we think it gives us access to markets where we do not have stores. Today, we supply to almost 30 countries.
With a global reach and a strong pan-India presence, Forest Essentials currently has a team of 200. This includes an ayurvedic doctor present at select stores to give customers a complete buying experience.
With more than 14 exclusive, company-owned stores across eight major metros in India, Samrath now plans to set up 20 more stores by the end of 2013.
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