Regional Brand

Cracklin' good

Why maharashtra’s best-known chiwda brand plans to Add italian farsan and chinese bhel to its product portfolio

The irony is delicious. It was a man from Rewari, Haryana who created the most-loved brand of authentic Maharashtrian chiwda, the piquantly spiced ‘mixture’ of crispy poha, fried peanuts, finely sliced copra, handpicked raisins, roasted sesame, and pungent asafoetida and jaithmul (liquorice). “My father started with a handcart back in the British Raj,” says Babulal, son of the enterprising founder Laxminarayan Data, who still keeps his meticulous parent’s handcart licence — acquired when the old man fell in love with Pune in 1935 and decided to live here. “Slowly, we bought this place and then increased the business.” 

‘This place’ is a perpetually bustling outlet, the din rising from the confines of an old shop, opposite Pune’s crowded Bhawani Mata Temple. The action also happens at the family’s factory in the industrial area of Gultekadi, which rolls out over 3,300 kg of ‘LaxmiNarayan Best Chiwda’ every day, notched up a satisfying turnover of Rs.17.7 crore in FY12 (Rs.5.9 crore for FY13 till mid-July 2012). By 1980s, the chiwda was travelling to other cities.

“People wanted us to send it by post or even courier it to them,” chuckles Babulal’s younger son, 37-year-old Prashant. The distribution ‘strategy’ is simple — wherever there is demand, identify a shop and supply there. Over 90% of  food retailers in Pune stock the brand; out-of-Pune sales account for 20% of turnover, a figure Babulal says is rising. LaxmiNarayan Chiwda currently has 35 stockists across Maharashtra, and five in other states (two in Goa and one each in Delhi, Karnataka and Tamil Nadu).

There are now three varieties of chiwda — 60% of the turnover comes from the original rice flakes or poha variant; the rest is split evenly between the potato and maize chiwdas, which were introduced in 2000. On the day of our visit, the turnover for the factory and shop till 2 pm was Rs.3.3 lakh. 

A spicy story

Laxminarayan’s story is that of a businessman who listened to the market. “My father started by selling chiwda, samosas, kachoris and ice-cream,” says Babulal. Everything was liked but it was the chiwda that proved to be a runaway success — and Laxminarayan, who died in 1973, had the good sense to specialise in it. He quickly applied for a trademark for his carefully crafted and unique recipe under the interim government in 1949,  reapplying diligently in 1951. Since then the annual turnover has increased from close to 3 tonnes to 950 tonnes. 

The firm began exporting to the US through the agents by 1998 and subsequently to agents in the UK, South Africa and New Zealand. About 10% of the brand’s turnover, or 330 kg per day, is exported — an NRI population of largely Maharashtrians and Gujaratis shells out twice the price we pay in India to buy its favourite chiwda at small Indian stores catering to expats. “One time, an agent bought 500 kg from us and paid across the counter,” says Prashant. The family is not willing to talk margins, which it says are wafer-thin. “We rely on volumes,” says Prashant. 

Ask him about his marketing strategy and Babulal smiles. “I don’t need to sell the mix to Maharashtrians,” he says. “They love it because we cater to their taste.” Nor does the growing popularity of packaged snacks like potato chips and Kurkure worry him. “We know the traditional taste of India, our competition doesn’t,” he says placidly. It’s this comfort level that continues to work well for the brand. “The love [for the chiwda] is the same, whether it is the grandmother, mother or grandchild,” says Ramesh Jude Thomas, president of Equitor, a brand value consultancy based in Bengaluru. “The brand caters to a regional taste and it has spread thanks to the diaspora settled abroad.” 

The making of a chiwda

The three-storeyed factory building in Gultekadi looks no different from any of the other factories but, inside, the air is heavy with the aroma of spices. Six rows of mostly women dextrously filling the packets, chatting comfortably as Darpan, Babulal’s 42-year-old elder son, keeps an eye on the floor. Given this is a completely indigenous business, process innovation happens mainly in-house by trial and error. Babulal himself designed one of the three mixing machines and also created a trough to drain the dregs from the oil tins. “Now we save about 15 kg or more of oil every day,” he beams. 

Some changes happened along with global advancements. The shelf life of chiwda went up to four months once brown paper was replaced by stronger plastic packaging in 1989. “We also introduced colours to differentiate the varieties,” says Prashant.

On the first floor, a slicer chops 50 kg of coconut in two hours. The specially constructed cookers pre-heat the oil to a mind boggling 230C — the ingredients are fried for five minutes before being cooled on a table-sized tray and shovelled down a massive shaft to the packers below.

Trouble-shooting is a constant need. Once, two batches of 50 kg of pressed rice each went up in flames after being fried. “I stopped production for two days and installed blowers above the mixing trays to cool the superheated mixture,” says Babulal.  

A bigger appetite

Food inflation is hurting the business. The family has been revising prices yearly for the last two years, claiming to be the last in the market to do so each time. So far, since other vendors have also hiked prices, sales haven’t taken a hit. It helps that overheads are low since the factory and shop are owned by the family. Moreover, there is no excise duty burden since chiwda is among the snacks that falls in the exempted category.

What next for the brand that is ‘world-famous’ in Pune? “We plan to move to bigger premises so that we can stock more products,” says Prashant. The Bhawani Peth store already stocks the LaxmiNarayan brand of dry fruits, chips of another brand, and Chitale Bandhu’s bhakarwadi, another delicacy from Pune. The firm is also slowly expanding its product portfolio to stay relevant to a younger clientele. Recently, a badam chiwda has been added to the product list. “Fusion products are in demand so we are looking at items such as Chinese bhel and Italian farsan,” Prashant says, adding, “But the taste will be traditional and we’ll make them, too, without any artificial flavours or colouring.”

A push into modern trade is also on the cards. Soon, you can expect LaxmiNarayan Chiwda on the shelves of supermarket chains such as Reliance Fresh, Big Bazaar’s Future Value, D’Mart, Star Bazaar, Spencer’s and Aditya Birla Retail’s More in Mumbai and Pune. “We will be available in all major malls across Maharashtra very soon,” says Prashant. The large chains are expected to pick up stock worth Rs.30,000-40,000 per week, at the same rate as other food retail buyers. Bank loans will fund the capex. The firm is currently focusing on the demand in Maharashtra, which also suits its capacity — will the rest of the country have to wait for the next generation of Datas to turn business explorers?