CO R N E R O F F I C E
Thums Up to man who builds brands
At the outset, a little confession would do a great deal: Ramesh Chauhan is a journalist’s delight. Every second sentence from this MIT-trained chemical engineer is a quotable quote. For a journalist interviewing him, it is a treat.
We met Chauhan (70) at Mumbai’s Cricket Club of India — his second home — on a rain-soaked evening just after he wrapped up a game of tennis with his buddies. Chauhan told us that he had been following this ritual since 1993, when, after selling off Thums Up, Limca and Gold Spot to Coca-Cola for Rs 400 crore, he was practically “unemployed’’. He took a while to get back to doing what he does best: Building brands.
Chauhan joined the family business in 1962 and acquired Bisleri from Felice Bisleri, an Italian company, in 1969 — his first real brush with big business. In those days, asking somebody to pay for drinking water would have been looked upon with disbelief. So he chose to launch Bisleri as soda in glass bottles — bottled water could wait.
The brand later changed gears and introduced Bisleri water in PVC packaging to make it more affordable. And then in the mid-’90s, this UStrained management brain got his act together: Launched Bisleri in smallsized packs, gave a strong marketing push and expanded its reach. Today, with a 60% market share, it’s the leader in the organised segment.
As we started discussing how he single-handedly built the business, Chauhan, dressed in suspenders and donning his trademark cap, preferred to go beyond business to talk about water harvesting, a subject he is passionate about. The rain water being wasted on the CCI ground offered a good enough reason to broach the topic. He believes that the water scarcity the country faces is because of lack of planning. Looking at the rain outside, we couldn’t agree more. “As a country, India receives the highest amount of rainfall in the world. And we need to capture it. It is painful to watch all this rain water getting wasted,’’ he rued, while sipping on barley water, which he said was good for the bones.
Having grown up in the western suburbs of Mumbai (Vile Parle), a stone’s throw from where his factory is located, Chauhan knows about the problems the city faces. But is there a solution? “It doesn’t need any research. Just the will to do it is enough. We just take a decision that everybody will be involved in water harvesting in our area,’’ he said.
Statistics on this issue
are clear. Almost 90% of
the rain water is sent
to the sea. “If you
can make that 90%
into 80%, you double
the water resources. The potential is huge,’’ he tells us enthusiastically.
Trained in MIT’s Sloan School of Management, Chauhan has a simple solution to today’s water problem. “We get caught up with the question of how much it takes to do rain water harvesting in a building? Is it cost effective? But it doesn’t take much...say about Rs 60,000-80,000 per building,’’ he said. It was when Chauhan started to elaborate on the process — “first, one has to dig out the land and go as far as you can go. Then fill it up with large boulders, then smaller boulders, then even smaller boulders, then sand, then soil and then one grows grass...’’— that we realised his depth of knowledge on the subject.
As we tried to veer away from water harvesting towards his business, once again, an adamant Chauhan brought us back to where we left. He was frustrated by the fact that not much was happening in a metropolis like Mumbai.
We managed to steer him back to his business by mentioning how in a city like Mumbai, where water is a serious problem, a Bisleri truck on the road is common sight. “We are more in a transport business than water business,’’ the chairman of Bisleri International said jovially, while adding, “If we add more trucks to our fleet of 160, there is a good chance of a traffic jam in the city.’’ That’s Chauhan’s favourite line, which he doesn’t mind repeating each time he is prompted to do so. Besides, the fact that Bisleri International manages the logistics of India’s leading packaged water brand effectively, only goes on to prove that demand for drinking water in the country is growing rapidly. Chauhan feels it is a strength to own a network of trucks to service customers directly. This way, the company has completely done away with warehousing, carrying and forwarding agents (C&Fs) and depots, where FMCG products are generally stored.
With so much behind-thescenes activity taking place at Bisleri on a day-to-day basis, we wonder how Chauhan sticks to his routine office hours of 10 am to 2 pm? “Efficiency,’’ he says, adding that he does not want to find out who’s not doing his job well. “If I find out, my blood pressure will go up for no reason,’’ he added. Chauhan to step down in two years
When further questioned on how, unlike other owner CEOs, does he manage to wind up work in four hours, Chauhan once again gave us a glimpse of his humourous side by saying, “mismanaging is better,’’ with his characteristic smile in place. As we remind him that the business environment was becoming more competitive, and that there was a war-for-talent out there, Chauhan revealed his plans of putting in place a business development team to work on innovative ideas. The mission is to make Bisleri available everywhere and even deliver at night. Chauhan said Bisleri needed to learn how milk and newspapers are delivered everyday.
The business development team would include mid-level managers who are expected to drive Bisleri International’s plan to accelerate the pace of growth from the current 18-20% growth per annum, to 40-50% per annum.
So, is the company looking at new business avenues, too? “We are spoilt with water. It will be ‘water plus’ for us. Any additions to that and we are asking for trouble,’’ Chauhan said. He, however, dropped a hint that the company would look at entering the flavoured water sector in the future. In premium water, Bisleri has already made a move with Vedica to compete with Himalayan.
Chauhan also wants to develop the bottled water market in Punjab and UP, “market leader Bisleri is not doing its job well. We have to put our act together,’’ he added.
Aha! So that’s the reason behind setting up a special team to implement the plan of action and put Bisleri on a high-growth trajectory, we conclude. But such talk management jargon does not find favour with the entrepreneur. That comes out clearly in Chauhan’s unambiguous remark: “We need efficient managers, who are more hands-on and not bookish or theoretical. We don’t have huge corporations backing us. So we have to be light-footed and mobile.’’
What’s more. Chauhan’s A-team is not likely to include stars and long-standing achievers from corporate India either. “That is because we will have to make them unlearn first. So it is better they get the experience from us,’’ said Chauhan, triggering another round of laughter.
But we realised that one cannot be betrayed by Chauhan’s unconventional demeanour, behind which lies hidden his business acumen. For one, Chauhan’s eyes lit up while talking of the time when Coca-Cola had to leave India in the ‘70s. “It was a wonderful time for all of us (referring to all Indian cola makers). We had a windfall,’’ he said.
Or when asked for the nth time why he sold off his carbonated drinks business to a multinational, Chauhan didn’t tire of explaining that there was no choice left and that the cola majors would have in any case bought out all his bottlers.
Chauhan also does not depend on data from market research firms as much as he believes in his own gut feeling. The company still uses the metrics and ratios of the percentage of Thums Up that was sold in a particular city three decades back to tally if Bisleri was getting the ratios right now.
Chauhan is equally comfortable to talk about his failures as he is with his successes. The company had delivered a string of failures like ‘Big Bite’, ‘Bisca’ noodles and ‘Sweet Choice’. Chauhan looks upon them for learnings like, “stick to your core competence and never overstate your brand’’.
He has one grievance though: He was never employed in any company. Chauhan often tells his daughter Jayanti, who joined the family business over a year ago that she should gain some experience in other companies. While we don’t know if she would take that cue, but one wonders if this was the best thing that happened for Chauhan. Over the years, he has developed his own business sense which is not the run-of-the-mill kind. Not to forget that even before consumerism hit India’s shores, it was iconic brands created by him such as Thums Up, Gold Spot and Limca that quenched the consumers’ thirst even in small towns. It speaks volumes about the brand’s strength that even today, multinational brands powered by high-decibel advertising have not been able to overthrow Thums Up from its pedestal.
An interesting insight into one of Chauhan’s traits is his trust in people who have had a longstanding relation with him. A case is point being how he chose to move with the men who managed his finances at DSP Merrill Lynch, which is now under Bank of America. Or for that matter, his associations with ad men like Ashok Kurien and Arun Nanda.
With Chauhan planning to hang his boots in two years when he turns 72 — since the number sounds good to him — we ask if Jayanti would take over. “I hope so,” came the reply.
On whether he would take Bisleri public, Chauhan responded in negative. “Listing for what? We don’t need the money,’’ he says. When prodded further on other plans — be it an acquisition or another marketing gamble — he is cryptic in his response: “Don’t make too many plans. Haven’t I said enough?’’ We get the point and prepare to leave.
It had stopped raining by the time we left the CCI premises — charmed by his frank talk, witty responses and showered with anecdotes. Our thoughts on the man we spent more than an hour interviewing were clearer than the skies above. We were reminded of a recent speech by Nitin Nohria, the dean of Harvard Business School, in Mumbai where he had said that “Studying ingenuity of real managers is essential to develop a sense of innovation among students.’’
Nohria may not have had Chauhan in mind when he said that. But it is very likely that management students would gain immensely studying the ingenuity of the man who gave us Thums Up, Limca and Bisleri. Because when it comes to Ramesh Chauhan, you never know what’s the next killer idea.
