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Home > Business > Special

Candy is dandy, and big money too

Abhilasha Ojha | January 04, 2006

Twenty-something Vrinda Rajgarhia is in expansion mode. Sitting in her office in Mumbai, she's busy scanning blueprints that will mark a new beginning for her candy company Sweet World that currently has a turnover of Rs 5-6 crore (Rs 50-60 million) thanks to her 20 outlets running in bigger cities like Bangalore, Chennai, Mumbai and New Delhi, to name just a few.

"Now we're changing our format," she announces; "we're concentrating on B class cities and getting into the kiosk and franchisee route." But why the need to shift from 350-380 sq ft to a mere 30-50 ft of space? "It's tough to sustain the stores' format," admits Rajgarhia, explaining that kiosks and franchisees are proving to be far more lucrative as compared to exclusive stores.

Though footfalls in her stores continue to swell, she feels it was time for her to chart Sweet World through a newer route. "For every flagship store in any of the high-end malls, investments can range anywhere between Rs 13-15 lakh (Rs 1.3-1.5 million),"she says.

Kiosks, on the other hand, cost not more than Rs 200,000-500,000 whereas franchisees cost another Rs 500,000-800,000. With malls opening in almost every town and city, Rajgarhia says she wants to, "test these markets and not invest blindly in projects". She adds, "We need to check whether these malls will even succeed eventually."

Rajgarhia has obviously been treading carefully ever since she opened shop in October 2002 after she returned from an overseas trip and saw the vast potential in bringing candies and sweets to India.

After careful planning, she invested around Rs 3 crore (Rs 30 million) and opened her first outlet in Mumbai's Lokhandwala area with nearly 100 varieties of candies in different shapes and sizes.

Today, Sweet World has nearly 250 varieties of candies especially imported from Europe. What's more, candies are marked in case they have gelatin content. For those of you wondering why Sweet World needed an investment of nearly Rs 3 crore, Rajgarhia has the answer.

"Our candies go through stringent quality-control methods and have to be in an air-conditioned environment 24x7 or we'll end up having melted candy in all our stores," she laughs.

What's more, Rajgarhia has paid special attention to the interiors - that she designed herself initially - to make the stores look appealing. "In malls, where there are numerous shops, our stores have to continuously stand out to ensure not just footfalls but also sales," she says.

As far as franchisees are concerned, Rajgarhia says she will be tough. "When I first started," she says, "I was confident of flagship stores. However, with the increasing demand for our products, we decided that franchising was inevitable."

Sweet World franchisees will have to adhere to stringent rules before they can ink any deals with Rajgarhia.

"We will pay attention to the hygiene and service standards. A refundable deposit of Rs 150,000 and Rs 300,000 will be taken for kiosks and stores respectively and they (the franchisees) will have to be extremely committed to the project."

Rajgarhia plans to take the number of her outlets to 100 by the end of 2006 and is going the whole hog in places like Indore, Varanasi, Lucknow, Agra, Kanpur, Panipat, Sonepat and Gwalior, to name a few.

"The real India is in the mini-metros and that's where I want to reach," she says. Is she vying for a large pie in the Rs 2,000 crore (Rs 20 billion) confectionery market that's growing at nearly 7-11 per cent per annum?

"Not at all, I'm not looking at grabbing a share of this pie because the pie itself is poised to grow much bigger," she asserts. "I want to reach out to the masses," she says.

For now, her sweet venture seems to be paying off.

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