Baba Ramdev’s Patanjali says calling product ayurvedic doesn’t make it one; people can spot fakes

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Updated: Jul 12, 2019 12:28 PM

There is a significant demand for our products but due to cracks in the supply chain, we have not been able to make inroads into rural India.

Acharya Balkrishna, MD & co-founder, Patanjali AyurvedAcharya Balkrishna, MD & co-founder, Patanjali Ayurved

After a meteoric rise, yoga guru Baba Ramdev-supported Patanjali Ayurved’s sales took a beating in the past two financial years as the company grappled with a weak supply chain and stiff competition. Managing director and co-founder Acharya Balkrishna tells Asmita Dey that the company is hopeful of posting good financials in FY20. Excerpts:

What is Patanjali Ayurved’s growth strategy this financial year?
There is a significant demand for our products but due to cracks in the supply chain, we have not been able to make inroads into rural India. Our focus will be to work on this particular area this year.

How much have you invested on building an efficient supply chain?
We have spent a considerable amount. I will not be able to give figures, but we did not limit ourselves to a certain quota and have spent enough on areas we thought we need to invest.

Can you give us an estimate of your FY19 revenues? What is the target for FY20?
FY19 has not been great, although slight improvement from FY18 is expected. We are expecting to report good revenues in FY20.

Why have FY19 revenues not been good?
We have had fast growth but we did not have proper planning and strategy in place to sustain that. Unlike big companies, we have not been around for 40-50 years. Some problems are a natural fallout. Also, our competitors have pushed natural and Ayurved products into the market which did impact sales to a certain extent. But we are recovering.

Patanjali’s two strength points were low pricing and natural/ayurved positioning. With competitors replicating the same, what counter-strategy do you have to offer?
The positive point is that Patanjali has pushed everyone to bring out Ayurved products and offer products at lower rates that has benefited consumers. We have faced losses because of this but it has helped crores of people. We are not a hard-core commercial company.

Moreover, people can differentiate between false and genuine Ayurved products. A product does not become Ayurved only if you name it as such. False Ayurved cannot sustain for long.

There is a view that because of fast growth, Patanjali compromised on product quality. What do you have to say about that?
There are no product quality issues. We have a strong team and four research labs. We take feedback seriously. This has been said to tarnish our brand image.

Why did you cut back on ad spends?
We did so because we were not being able to push all the products in the market that we were advertising. But advertisements are still on. We will increase the ads gradually.

Do you plan to launch new products?
No, not at present.

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