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Sunday, February 01, 2009

Her sweets business is a big hit

Vrinda Rajgarhia is a young woman from a conservative community who knew what she wanted since she was a young girl. She's now achieving her goals and has not confined herself to the restrictions on the fairer sex, perceived or otherwise, that she may have encountered.

Vrinda Rajgarhia, Director, Sweet World, brought a bewildering range of imported candies to India that has enticed adults and children alike. "Ever since I was little, I always wanted to do my own things and I always thought of having my own business. I guess coming from a business family, it was just business in the blood," Vrinda told CNBC-TV18.

She added, "I think that's what most Marwari women do. They just take over the family business. I think doing my own things give me a lot of satisfaction than just joining the existing family business because the value-addition in the existing business is much less. Here you started something right from scratch. . . it's like your baby and when your baby starts crawling and running, it gives you immense satisfaction."

Although she did see herself as a budding entrepreneur from a young age, she didn't know what she wanted to do. She had her share of looking for the right business to be involved in. She said, "I won't say that ever since I was a kid I wanted to open a candy store or something like that. That's not true. But I am doing something completely different from what I studied. Actually, I should have been number crunching in a bank probably. But I think that I somehow didn't see myself doing that."

So she began with garments, as she puts it. "It was not really garments. It was more like a hosiery manufacturing set-up, but in the manufacturing thing, it has its own share of problems. . . plus it didn't work out because Indian yarn at that time was not of the (right) quality, neither was there state-of-the-art machinery (present in India). The (existing) machine snapped. Now that was something completely beyond my control, because obviously I couldn't be spinning my own yarn."

"We also did leather planners. That again is a very unorganised market. Stationery is a pretty unorganised market and if you want to pay all your taxes and do it honestly, you can't compete with the unorganised sector."

She continues, "I wanted to do candies for about four years but the export duty at that time was 70%. So at 70%, the pricing would have been prohibitive and, of course, you have to cap the price because you want to be accessible to the mass public and didn't want to make it so elitist."

"A child is not supposed to know that he can or he can't afford it, he is supposed to preserve his innocence for sometime. So it's not fair to do that. Then luckily duties came down to 30% and that's when we started working on the project. Here we are constantly innovating, trying to do things in our store that is so much fun."

She's found an ideal audience to cater to. Children who usually get what they want and candies are right up there on their list. Adults have not been able to resist the range available and so kids are excused for feeling tempted!

But did she still have to incur a high cost to bring these goodies into the country?

She replied, "We are in the 30% basic import duty bracket, 16% Cenvat duty and we have very high sales tax, always in the highest bracket. In some states, it's like 9%, and 12% in Delhi, and in Mumbai it's 15.6% and up to 21% in Chennai. And then there is entry tax and so on. So most of the money goes in paying duties."

The fact is that there is competition from the local unorganised sector and kids may prefer domestic branded sweets. She reiterates, "But I am not looking at them as my competitors. We are giving them (children) a bunch of different items, which are not even made here, like jellybeans or gummy sweets, etc. We don't get those here at all and today kids are more exposed. We have a huge market of young adults, teenagers etc and they all know what they are buying. So people don't mind paying slightly more for something that they like."

The sheer variety of sugary treats has pulled in more crowds than she expected. She said, "I started more on a gut feel. I didn't sort of base it (the business) on any hi-tech strategy or anything. I still remember the day we were stocking up our Lokhandwala store. We were still filling the shelves and customers just started walking in, and it was very hard because we weren't geared to sell at that moment. In the first week that we opened, I had no place to enter my own store, I was actually on the street!"

She avers, "I don't want to grow very rapidly until I set up a system in place. Hygiene is a huge issue for us, in all our stores and we have to maintain hygienic standards in all our stores. None of the candies are handled by hand till it reaches the stores and even then, my staff only handles them with disposable gloves. So we try to maintain very high quality of hygiene in our stores, plus we have to maintain refrigerated storage, etc."

"So to set up all those systems, obviously takes a lot of time and effort. It's not nice to sort of expand and then have problems in your stores because it's not fair to the customers if you are not giving them the quality that you promised. Also one wants to know, if it (candy sales) was cyclic or if it was around-the-year trend. Then we realised that the sales are around-the-year. We have decided that we would go the mall route because there is a mall mania happening in India."

She added, "Candies are basically a feel-good thing. So I don't really think I am just in the business of selling candies. I am in the business of spreading and sharing happiness and joy and that's why I have inculcated that culture in my staff as well, and my sales staff has been very supportive."

Finally, she sees big things for her stores and the Sweet World concept.

"Sweet World is again a thing that can be taken across confectionary candies. So that the first goal is to make it synonymous with confectionary candies, which we hope we should achieve in the next couple of years. In the next 4-5 years, I think Sweet World would become a brand in itself, which could be used for things like an amusement park. It is a sweet world out there! So you want to sort of do things which can spread joy and bonhomie, which is what we are looking at and doing," she said.

Written for moneycontrol

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