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Sometimes early success has its problems, says CK Kumaravel. In 1993, he launched Raaga Herbal Shikakai powder. Its success prompted him to expand rapidly.
A range of products under the Raaga brand — hair oil, soap, and an amla -based chewing product — followed. None of them did well. He shut down the business and sold the brand to his brother. Kumaravel was back at the drawing board trying to do something different. He discussed various ideas with his wife: boutique, pre-school, salon… The aim was to earn about ₹60,000 a month. He settled on a salon and started Groom India Salon and Spa Pvt Ltd. The company’s chain of salons was branded ‘Naturals’.
First outletThe initial money, says Kumaravel, CEO and co-founder, came from friends and relatives. The first outlet came up in a posh neighbourhood in Chennai. The products were imported from Italy. A person from a five-star hotel was hired to run the salon.
In the first year, the venture lost over ₹10 lakh on a ₹20-lakh turnover. It continued to lose money though business grew. Unfazed, Kumaravel decided to stick with it and expand. In the first six years of business, he opened six outlets. While most banks turned down his request for assistance, IOB extended a loan of ₹60 lakh that gave the business a foothold, he says.
Kumaravel opted to expand through franchisees and advertised for partners. Over 340 enquiries poured in, and 33 discussed plans.
When they learnt that an investment of over ₹30 lakh would be needed, the number came down to three. And then there was none. The year was 2007. This called for a tweaking of the model. Kumaravel decided to put in half the money. The number of outlets jumped to 27 in three years and thereafter, there was no looking back. Naturals is now a 350-salon chain. It has a presence in Sri Lanka and is exploring more markets overseas.
More jobsThere are 180 women entrepreneurs in the franchise, which has generated over 6,500 jobs. “We do make a lot of money. But the focus is on creating women entrepreneurs,” he says. In 2013-14, the Naturals brand generated ₹250 crore in revenue.
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