In the rapidly growing beauty industry, which is slowly being taken over by women entrepreneurs, C.K. Kumaravel , MD and co-founder, Groom India Salon and Spa Pvt. Ltd., which owns the Naturals brand, is planning a rapid expansion, targeting more than 3,000 salons by 2020. While big players such as Lakme, which started off selling beauty products, took their time to enter the ‘salon’ business, Mr. Kumaravel has done the opposite — he set up the ‘salon’ business first and is now venturing into selling beauty products. In an interview, he speaks about expansion plans, new products and how the salon industry has evolved. Edited excerpts:
How has Naturals’ journey been so far?
The entrepreneurial spirit in me was always very active, and I’m a dreamer. Looking back, it was a journey of a dreamer who was not from this field. Before I started this salon business, I worked on a brand that failed. The next option was to join the family business. On one side I had the problem of a failed business and on the other I had a very easy life. Anyone in real sense will choose the latter, but I was a dreamer at heart and was not afraid of failures. I fell in love with this concept called ‘franchisee’ which pushed me to go ahead and that’s how Naturals was born.
What were the challenges you came across?
Those days, we had barber shops on one side and beauty parlours on the other. Lakme was a big player. It was very tough to break the market. And for men, if you were a hair dresser, no one would come forward to give a bride. There was no acceptance in society. That was a taboo in this industry at that point of time.
How has the salon industry changed?
Earlier, no one would want to invest in this industry. Today, salon owners are businesswomen or entrepreneurs, they are no longer beauticians or hair dressers. Banks come forward to provide loans and support this industry.
You now have 600 outlets across India and are looking at scaling it up to 3,000. What’s the strategy?
We are very strong in the Southern markets. In a few markets, we committed mistakes and then learnt from it. In other markets, we got standalone enquires and not in clusters – when we started one in each place we could not give the brand support in terms of promotion, marketing and brand-building. Some of these salons did not scale up, they survived. That’s when we learnt that cluster-based development was the key. Now we are clustering markets. For instance, we have clustered the Orissa market. Next we are planning to go to Lucknow and then Pune. We have divided India into 10 zones – including Punjab, Delhi and NCR, North East, Calcutta, Bihar and Gujarat. By 2020, we will be 3,000. Mumbai is also on cards.
What’s happening on the overseas front? You had plans to expand your brand overseas.
We want to have our presence where the India diaspora live across the globe. Wherever Indians are, we want to have a Naturals salon. Indians abroad are connected to Indian brands. We are in Singapore and Sri Lanka now. We will add more salons in these two pockets. We are also in discussions to open an outlet soon in Dubai.
We hear that Naturals is also rolling out new products. What kind of products are they?
We are now in a reverse engineering mode – salon to products. We have now launched 1,000 shades of nail polish. We now have the widest range of nail polish. This is a Naturals brand. We manufactured this in Mumbai with a firm there. French technology was used in this process. In the next five years, nail polish market will be a very important market in India. Next month, we will come out with a lipstick brand and then beauty products for the eye.
Is the tie-up with CADD Centre something unusual? How is it working?
I wanted to have a tie-up with someone who is franchise friendly and that’s how this deal worked. The ‘marriage’ worked as they are a brand who think on the same lines as we do. They are also in love with the word ‘franchise’ and that pushed me to join hands with them. Currently, they focus on the operations part of the business, while we focus on growth and other issues. Handing over the day-to-day operations to CADD is helping me focus on my business expansion plans.
How are the revenues looking?
The average business is ₹30 crore per month.
How has GST impacted your businesses?
Businesses dipped marginally. The only difference is earlier people were not worried about spending, but now they have gone back to budget spending – that’s the challenge for us now.
