Jyothy Laboratories took birth in 1983, powered by the vision of one man –
M P Ramachandran – the current Chairman & Managing Director. Started as a proprietary concern, manufacturing and selling a single product in a single district, the organization has grown to become a multi-brand, multi-product company with operations all over the nation.
In a pristine white shirt, matching trousers and white leather shoes, Ramachandran can be easily mistaken for a movie producer from Chennai or Hyderabad.
He is not. The 64-year-old Ramachandran is low-profile, almost reclusive founder chairman and managing director of Jyothy Laboratories Ltd .
Like many others of his generation from Kerala, Ramachandran migrated to Mumbai in the early 1970s with the sole intent of finding a job, and became the accountant of a small firm a position he held for 12 years.
Even at that time also, he would wear only white, a habit he picked up from his father. Besides, “wearing a white-coloured garment allows you to cultivate discipline, stay clean and calm” says Ramachandran.
His big problem at all the time was keeping his clothes perfect white which finally resulted in development of a fabric whitener which was designed to obtain most brilliant shade of whiteness to clothes. The product was baptised “UJALA” which means brightness.
In 1983, he opened a small factory in Kandanassery, his home Village, in Thrissur District investing his life savings of Rs. 5,000. The product was sold house-to-house by a team of six women. This system of selling resulted in many fertile ideas that helped Jyothy shape its distribution in future. A few months later he was ready to shut shop-business had not been earning sufficient income when he received an order for 1,000 bottles of Ujala from a wholesaler in Malappuram. Jyothy burst on the national arena in the late 1990s with its Ujala Supreme-a liquid fabric whitener-brand, which was advertised heavily on television.
At Jyothy, all sales staff come from underprivileged families. “We want people who are hungry to succeed,”. The only condition is that they must be graduates.
Also, unlike competitors, Ramachandran has ensured that the last point of sale to a shopkeeper is always serviced by a Jyothy staff. There is also a bar on lateral hiring of sales staff. Jyothy’s 1,800-strong sales force gives it a reach of 1.1 million outlets, making it the highest penetrated product after Hindustan Lever’s Lifebuoy.
Ujala has since grown into the country’s largest fabric whitener brand. According to India Infoline Ltd, it has a 72% share of a market worth Rs. 400 crore. Much of this growth came after 1997 when Ramachandran, in a burst of uncharacteristic aggression, bet the house on the brand.
From the early days, Ramachandran had a clear belief in the power of advertising. In 1997, Jyothy Laboratories’ revenue was around Rs. 100 crore. That year, Ramachandran spent Rs. 36 crore on advertising Ujala. “Everyone called us mad,” When Ramachandran decided to invest in the Ujala brand. The agency, Situations Advertising and Marketing Services Pvt. Ltd, handled the brand’s account. The huge advertising budget and a catchy jingle-the sort that plays on in an unending loop inside the head-helped and retailers across the country started demanding Ujala.
Jyothy took effective advantage of tax breaks to set up plants in so-called backward areas. Ramachandran operated with two maxims: He never relied on debt and ploughed back all his profits into the business. He lived in a 300 sq.ft., one-bedroom house till 1998.
Over the years, Ramachandran, who has several eccentricities-the fondness for white is one; his Mercedes is white, as are his other cars, all bearing the same number, 3,339-seems to have perfected a home-grown model of staffing and management that works for him.
Around 400 of his 5,000 employees have been around for at least 15 years. His colleagues at field who are the ambassador of JLL-have the responsibility of directly managing retailers, around a million of them, according to Ramachandran.
Ramachandran’s different approach in management is also evident in how his company gathers information. “We know what is happening across the country with just 20 phone calls,” says Kamath, who came on board in the 1990s to help launch Ujala in Karnataka and has since grown to become Ramachandran’s closest confidant.
Ramachandran has a weakness for testing products in Kerala. “Keralites are very choosy people. If they accept it, then the product will sell anywhere.” He is also different from other consumer goods manufacturers as his business is vertically integrated: from plastic bottles to the liquid finished product, all are made in-house.
Early this year, Ramachandran, pulled up a coup of sorts, by acquiring a majority stake in the Indian arm of Henkel AG, the German FMCG giant. The deal includes Henkel’s entire portfolio that includes Henko and Chek detergents, Pril dish cleaners and Fa deodorant, Margo & Neem brands.
The acquisition has made Jyothy the fifth largest fast-moving consumer goods company in India. Now the hard work begins. In integrating the two companies, the company knows they have a formidable challenge ahead. This is where they plan to stick to their focus on distribution, advertising and cost savings. Ramachandran is confident that the Henkel part of the operation will be able to show profits in nine months.
Also this year, Jyothy Laboratories launched a laundry retail chain in original sector-in the man himself calls it “fabric spa”-in Bangalore, Jyothy Fabricare Services. Ramachandran is convinced Jyothy can leave its mark on the business, much like it has done in the other categories in which it operates. The laundry business, however, is being tested in Bangalore, because the city has a lot of young working couples. In two years, Jyothy Laboratories hopes to take the venture national.
Here’s how the laundry service works: Jyothy’s employees will collect dirty clothes from customers at their doorstep, and deliver them after they have been cleaned. The firm has invested in world class hi-tech laundry in Bangalore, which will serve as a hub for the business when it goes national. Designer clothes and sarees will be air-freighted from other cities to Bangalore. And, in keeping with Ramachandran’s philosophy, the business will target the mass market. For a fixed fee, the company will take care of the laundry needs of a family for a month. Clearly Ramachandran is unfazed by the failure of others, including HUL, to crack the code of the laundry business.
Ramachandran, who took a year to figure out the contours of the business, is focused on delivering a reasonably priced offering and is insistent that he will not outsource any part of the service.
Almost three decades after it was set up, Jyothy Laboratories is in the same league of consumer product companies such as Marico Ltd, Emami Ltd, Dabur and Godrej Consumer Products. The company has launched Maxo, a brand of insect repellents, and Exo, a brand of dish washing soap & a few other brands to strengthen the base.
Ramachandran says the firm’s best years lie ahead. His dream is to grow, over the next 25 years, Jyothy Laboratories into one of India’s largest consumer goods company. From a one-product company, Jyothy Laboratories has managed to become a consumer products firm with several successful brands. Ujala now accounts for only one-third of the company’s revenue.
The next generation of its leadership, Ramachandran’s daughters Jyothy and Deepthy, are being groomed to meet the future challenges. Ramachandran is also buoyant with the optimism of a first-generation entrepreneur.
“When I open my eyes, I see only opportunities”, he says. “Anybody here in India has enough chance to grow”.
Office : Ujala House, Ram Krishna Mandir Road
Kondivita, Off Andheri Kurla Road
Andheri East,Mumbai – 400059
Website : www.jyothylaboratories.com