Dabur – A Business Success Story

Inspiring Generations of Entrepreneur for 136 Years

Dabur - a 136 years old company that built block to block to emerge as an FMCG leader in India. This is one business success story that has been an inspiration for many aspiring entrepreneurs.

It is a story of how one doctor’s unwavering dedication to treating his patients with ayurvedic medicines and his patients’ strong faith towards him gave rise to a brand that was set to rule the roost and create benchmarks in the market for years to come.

Founded in 1884 by Dr. S.K.Burman in the pre-independence British capital of India – Calcutta, Dabur started as a small clinic in one of the by-lanes of the city.

How did Dabur get its name?

The name was coined by taking ‘Da’ from Daktaar (Bengali pronunciation for Doctor) and ‘Bur’ from his last name Burman.

Given the effectiveness of ayurvedic formulations to treat the then life-threatening diseases like malaria and cholera, Dr. Burman decided to start a mass production facility of his medicines.

Going forward, his son C.L. Burman started the first Research and Development center for ayurvedic medicine in India. In 1996, Dabur became a public limited company. Gradually, Dabur went on to become one of the most inspirational business success stories in India.

Product Portfolio

The diverse product offering of the company includes 250 ayurvedic products in the Hair Care, Oral Care, Health Care, Skin Care, Home Care, and Food segment. The company operates through three specific units namely – Customer Care Division, International Business Division, and Consumer Health Division. It has 20 manufacturing units spread all over the world.

Some of the Dabur offerings that have immense brand recall include Hajmola, Dabur Amla Hair Oil, Vatika, Dabur Honey, Chyawanprash, and Real Fruit Juice. Three of its brands, namely – Lal Tail in the Babycare segment, Pudinhara in the digestive segment, and Honeytus in the medicine segment have a robust brand recall among customers.

Retail Presence

Dabur has presence over 40,000 villages in India and further aims to enhance its reach to 60,000 villages in the future. The company garners 45% of its business from the rural segment, while 55% of its revenue is attributed to the urban market. Besides the robust distribution network in retail stores, the company is also experiencing a whopping 150% growth in its e-commerce segment.

Dabur ayurvedic products are available across 6.7 million retail outlets in India and over 100 countries all over the world. The overseas revenue contributes to 27% of the company’s total turnover of Rs.8,500 crore.

Competitive Edge of Dabur

The success story of a business like Dabur is unique because it is the best example of taking strategic decisions at the right time. Started as a traditional family-run business that sold ayurvedic medicines, the management of the company was flexible and adaptable to the evolving market scenario. In the year 1998, the Burman family handed the company over to the professionals. Thereafter, strategic joint ventures and innovation and improvisation in product portfolio have kept the brand growing from brick to brick.

Dealing in natural products has also proved to be the key to business success of the company as the traction towards natural products is always higher than conventional products. And this has only increased over the past decade. As per the company spokesperson, the natural segment is growing at 35% which is two times as much as the conventional segment. And Dabur is the main player in this segment.

Brand War

Out of the four key players in the ayurvedic segment in India, Dabur ranks second at Rs. 8,500 crore revenue led by Patanjali at Rs.10,500 crore and followed by Baidyanath and Hamdard, both at Rs.700 crore.

In the last decade, Dabur has faced fierce competition from Patanjali which adopted the same business strategy as Dabur. Yet, it is interesting to note how business success of Patanjali has been complimentary to Dabur’s growth. Instead of restricting their product line to ayurvedic medicines, both Dabur and Patanjali leveraged Ayurveda into FMCG products as opposed to the other two brands, namely, Hamdard and Baidyanath who had stagnated themselves in the ayurvedic medicine segment. This strategy has given both these brands a mass appeal.

In the initial days of its launch, Patanjali had an impact on Dabur’s popular brands such as Chyawanprash, toothpaste, and Honey. However, the company is said to have recovered from it soon enough. Several other organic, herbal, and ayurvedic brands are venturing into ayurvedic business for success. Yet, Dabur’s brand equity is very strong owing to its innovative marketing strategies, expansive distribution network, and product innovation that holds the ground strong enough for the company to have robust growth in the years to come. Moreover, Patanjali’s initiatives to spread awareness about natural products have only helped to pull the customer’s attention towards this segment which is sure to benefit Dabur as well.

Going Ahead

Dabur has always been a trendsetter in innovation and corporate governance. Their ability to change before other players in the market has been their winning edge. The company envisions a very high growth curve in the days to come. As per the company’s spokesperson, each of its brands is in the category of Rs.1 crore to Rs.5 crore and can grow up to Rs.100 crore. And with the growing popularity of natural products in both domestic and overseas markets, the company will surely experience a stupendous year-on-year growth.

Trivia

• Inception - 1884
• 1996 – Became a public limited company
• 2012 – Crossed the billion-dollar turnover mark
• Current revenue – over 8500 crores
• Market Capitalisation – Rs. 72,500 crore

Product Line

• Healthcare
• Personal Care
• Medical care
• Home care

Market Positioning

• Baidyanath -700 crore
• Hamdard – 700 crore
• Dabur – 8500 crore
• Patanjali – 10,500 crore

Also read:

1) Business Success Tips Every Business Owner Should Know
2) 10 Things You Should Know About Before Starting A Business
3) How to Keep Yourself Motivated as a Business person?
4) Ayurvedic Products Manufacturers in India

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