Medimix, the Ayurvedic soap from the Cholayil group, completes 50 years of operations in February and continues to be a leader in the segment with nearly 70 per cent market share. A flurry of soap brands from both domestic and multinational brands have not stopped the growth of Medimix in the last five decades thanks to its USP ― handmade soap manufacturing with an 18-herb Ayurvedic formulation. However, the big question is whether the company will be able to hold on to its handmade process, going forward?
"Production of Ayurvedic handmade soap is laborious and time-consuming. We rely heavily on our workers, some of whom have been with us for over 25 years. We would be forced to use machines when the current team of loyal workers retire. However, there will be only minimal mechanisation like adding a small motor to mix liquids. Getting labour will be the biggest challenge in the future," said AV Anoop, Managing Director, AVA Cholayil Healthcare Pvt Ltd, and son-in-law of VP Sidhan, who created the soap five decades ago from his small kitchen in Perambur, Chennai.
Till three years ago, there was no use of power in soap manufacturing; it was all done through gravitation ― right from transferring oil from the tanker to making soaps. However, now, there is some use of power in certain sections,” Anoop told BusinessLine at his Thirumazhisai plant.
It’s been a roller-coaster ride for Medimix in the first decades. Created in 1969 by Sidhan, a doctor with Indian Railways, Medimix was used to treat railway labourers who developed skin allergies and diseases. With just ₹500, Sidhan, hailing from a family of Ayurveda practitioners, started manufacturing Medimix soap.
He used to make soaps during weekends and sell them in the market during weekdays. With the profit, Sidhan, his wife and Pradhaban (Medimix’s first employee) used to go to Parry’s Corner and procure raw materials and herbs to make the next batch of soaps, said Anoop.
The early advertisement for Medimix in the 70s, carried the tagline, ‘Doctors Prescribe,’ which vouched for the genuineness of the product. For nearly a decade, the product was available only in medical shops.
Things took a big turn in 1982 due to labour problems that forced a plant shutdown in Chennai and Chengalpet. Multinationals tried to acquire the brand, and there was also the issue of licensing (under Ayurvedic drugs), due to which the products were seized and the plant closed, said Anoop, who came on board in 1982 to sort out these issues. The plants resumed operations in 1984. Since then there has been no looking back for Medimix.
Daily output at the Chennai and Chengalpet plants used to be around 10,000 soaps a day. The response to the product has been phenomenal with daily volumes doubling. Today, Medimix in the southern market alone accounts for 900 tonnes of soap per month. The six plants in the south account for one lakh bars of soaps of different sizes every day, said Anoop.
In 2007, the Cholayil group split. Medimix manufacturing in the South went to AVA Group and to Cholayil Pvt Ltd belonging to Sidhan’s son Pradeep Cholayil in all other markets. Both the groups are doing well, said Anoop.
Tucked away in a corner of Sidco Industrial Estate in Thirumazhisai, one cannot escape the strong aroma of the Medimix soap emanating from a small factory of AVA Cholayil Group. Inside, 50 plus workers are busy making these soap pieces using a combination of palm oil, coconut oil, paraffin wax and herbs in multiple stages.
In the first stage, various oils, including palm oil and coconut oil, are mixed with paraffin wax to create a thick liquid soap by heating it. In the second stage, the liquid is mixed with herbs and aroma with two men rolling the boiling liquid in huge drums. In the third stage, huge blocks of 100 kg each are manufactured and allowed to cool. After the cooling, the huge bars are cut into pieces of various sizes.
Nearly 30 women work in the cutting, stamping and packaging section with each person packing about 25 cases a day. Each case contains 300 soaps, said Anoop.
Last year, the AVA group’s turnover was ₹300 crore, with Medimix contributing the maximum, and reasonable contribution from food products, restaurants and film production. This year, growth will be a moderate 2-3 per cent as market conditions are not favourable. In the past, the growth rate was 8-10 per cent. There is no slowdown in demand for soap but liquidity in the entire supply chain is an issue, he said.
On expansion, he said the group will also focus on expanding its other brands ― Melam, Kaytra and Sanjeevanam.