How organic FMCG brand Azafran doubled its profits despite closing 2,000 stores

Launched in 2007 by sisters mansi and Aditi Vyasbased in Ahmedabad Azafran Innovation Ltd is one of the leading internationally certified organic manufacturing companies. With a focus on organic ingredients and quality products, the offline brand has grown steadily since its inception with a presence in 2,000 general trade stores.

But the COVID-19 pandemic has hit Azafran hard.

The sisters, however, decided to take the challenge head-on – they went online in 2020 and growth has exploded since then.

Talk to SMBStory Mansi says the company has doubled its profits over the past two years. “The pandemic has taught us a lot and we’ve learned a lot more about our own business,” she says.

Establishment of the brand

Mansi and Aditi were studying in the UK when the idea of ​​starting an organic brand hit them.

Mansi says she and her sister loved cosmetics and often used a lot of certified organic, skin-friendly European products. She adds that they found that even the basics available for cooking were of different quality than those in India.

Since they come from an industrial background and their father ran a successful pharmaceutical company, setting up the business was not difficult. Azafran was launched with an initial investment of Rs 25 lakh, taken from their personal savings.

Many new-age brands in the organic industry prefer to partner with farmers to source ingredients or engage in contract manufacturing. However, Mansi and Aditi wanted complete control – from farming and manufacturing to packaging and supply chain.

“My sister did her Masters in Quality Assurance and Analysis and I have an MBA. We come from a manufacturing background and it’s not in our genes to outsource anything. We believe that control is the reason for any successful business. So, at first, we started farming for supply and grew some of the crops on our own farmland,” says Mansi.

The years 2007-2010 were a period of R&D because the agricultural land was not yet certified organic. At the same time, the sisters did extensive research on the type of products they wanted to start with.

As pilots, Mansi and Aditi started by cooking essentials like olive oil and sunflower blossom, then branched out into skincare.

The business expanded in 2015, and azafran was available nationwide in general trade stores. He had certifications from ECOCERT, USDA Organicand others.

In 2019, Azafran was present in 2,000 retail stores and was available in modern commerce stores, including Aditya Birla’s More Retail, with categories spanning skin care, home care, baby care, well-being, perfumes, etc.

Mansi says Azafran has positioned itself as a full FMCG brand, which no other company has – until now. Products such as sunscreen, organic crayons and laundry detergent have become top sellers.

Azafran farmland

A strong pivot to sustain

Although Azafran is growing well, COVID-19 has shaken the business.

“We were forced to leave the 2,000 stores and abandon more than 750 people we had hired as beauty experts and sales executives. The business was completely shut down,” says Mansi.

Not wanting to give up, the sisters decided to foray online.

“We had no online presence before the lockdown. During the lockdown, we had time to think about brand positioning and launch the website. We also got listed on marketplaces and things took off. took off from there.”

Mansi says Azafran profits have doubled since the pandemic. Unwilling to share actual numbers, she says the company’s costs have dropped significantly as the number of employees and rents have fallen.

Azafran has also made a foray into B2B private labeling, adding another revenue stream to his business.

“We have doubled our profits compared to the pre-pandemic period, but we are concerned about the cost of increased raw materials, as it would increase overhead,” says Mansi.

Azafran achieved a turnover of Rs 7 billion in FY22 and aims to close this year at 9.5 million rupees.

Azafran’s baby care range

Stand out in a crowded market

Azafran competes with Amway, Modicare, MamaEarth, etc., but stands out because it offers the entire FMCG range under one roof. It also has a presence through Amazon in the UK, US, Canada, UAE, and Australia.

“The market is crowded and it’s good to have more players because it will create more awareness. Previously, people didn’t know about using sulfate-free or paraben-free products. Now with more brands, more people are talking about organic,” Mansi says.

Talking about the future, Mansi says Azafran plans to rebuild its offline presence through the kiosk model – only in metropolitan cities from now on. The company’s flagship store is located in Ahmedabad.

“Currently we are focused on 90% online and 10% offline. We do rigorous social media marketing and the plan is to become so strong in the digital world that we should attract customers to us once we go out for general trade,” says Mansi.

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