1. CavinKare – Making Lives Happier
A Case Study on India’s own innovative conglomerate…
By:
Shreya Juneja, Nikita Garg, Shreya, Akshay Karwal & Geetika Virdi

2. Table of Contents
CavinKare – The initial steps from a Rs.15, 000 venture to a Rs.5 Crore Firm............... 3
Ranganathan’s Story…inspiring entrepreneurship.............................................................................3
Chik Shampoo becoming No. 1 in South India..................................................................................4
Conquering the rural markets.............................................................................................................4
Introducing Meera Herbal Powder .....................................................................................................5
How beauty became synonymous with CavinKare............................................................................5
Perfumes for the poor.........................................................................................................................5
CavinKare Values and Beliefs............................................................................................................5
Business strategies: Why it exist?.......................................................................................... 5
Corporate Strategy:.............................................................................................................................6
Promotional Strategy:.........................................................................................................................6
Rural Marketing .................................................................................................................................6
Competitive Strategies: ......................................................................................................................6
Other strategies:..................................................................................................................................6
Business model ........................................................................................................................ 7
Role of Information Technology........................................................................................................8
Future focus........................................................................................................................................8
Product range.......................................................................................................................... 8
Personal Care......................................................................................................................................9
Food and Beverages ...........................................................................................................................9

3. Dairy Products..................................................................................................................................10
Beverages .........................................................................................................................................11
Innovative aspects of CavinKare......................................................................................... 11
Corporate Social Responsibility .......................................................................................... 13
Conclusion ............................................................................................................................. 15

4. CavinKare – The initial steps from a Rs.15, 000 venture to a Rs.5 Crore Firm
“Teamwork is the main reason for our success. We have good professionals who work really
hard. The second reason of our success is innovation. We have executed innovative ideas as
well.”1
- C K Ranganathan, Chairman & MD, CavinKare
Ranganathan’s Story…inspiring entrepreneurship
Ranganathan’s father, Mr. Chinni Krishnan was an agriculturalist by qualification and a
pharmacist by profession. Unlike his siblings, who grew up to be doctors and lawyers, he was
never interested in studies. He would never fare well and his father had always expected him to
end up into agriculture or business.
When in the fifth standard, he had a lot of pets -- more than 500 pigeons, a lot of fish and a large
variety of birds. He began earning his pocket money out of pet business. Perhaps, the
entrepreneurial spirit in him showed its first streak, then.
The concept behind sachets was his father’s brainchild. When the world purchased talcum
powders in large sealed containers, he sold them in smaller amounts, to make them affordable to
all strata of the society. Selling things in sachets was his motto as he said, 'this is going to be the
product of the future.' However, he could never market his idea well, he definitely inspired
Ranganathan.
Figure 1: CavinKare CMD CK Ranganathan2
Ranganathan gave up his family business since his ideas clashed with those of his brothers’ and
decided to start his own business with his mere savings of Rs.15,000. He had to start from
scratch. Give up on cycles, when he could travel by cars. Rented workplaces and sought after
loans.
After avoiding any direct competition with his family, he finally entered into the shampoo sector
and that is when Chik Shampoo was born. In the first month, they could sell 20,000 sachets and
from the second year, they started making profits. One of the bank managers wrote this over his
loan application: 'This person does not have any collateral to offer but there is something
interesting about this SSI unit. Unlike others, this company pays income tax!'
1
http://www.rediff.com/money/2007/mar/22bspec.htm
2
http://www.livemint.com/Companies/tJoVGVybcECI0CMTO01myM/CavinKare-risks-high-costs-with-
direct-distribution.html

5. Beyond this point, there was no turning back. It took him nine years for to overtake his brothers'
business.
The company has transformed from Personal care player to an FMCG conglomerate with interest
in Dairy, Foods, Snacks, and beverages business.3
C K Ranganathan has shown the world that it
is possible to beat the multinationals even in the most difficult market of fast moving consumer
goods.
Chik Shampoo becoming No. 1 in South India
When Chik entered the market, Velvette Shampoo was being marketed aggressively by Godrej.
But Ranganathan’s team came up with a scheme of exchanging five sachets of any shampoo for
a free Chik Shampoo sachet. Later the scheme was altered for free Chik sachet for 5 Chik
sachets. The sales went up from Rs 35,000 to Rs 12 lakh a month.
Figure 2: Chik Shampoo4
When they introduced jasmine and Rose fragrances, their sales went up to Rs 30 lakh per month
and with actor Amala as their brand ambassador, their sales rose to Rs 1 crore a month!
Conquering the rural markets
Multinational companies sold products in big bottles and not in sachets and they sold only from
fancy stores. They did not look at the small kirana stores, nor did they look at the rural market.
Chik Shampoo extended towards rural areas of South India where people hardly used shampoo.
They showed them how to use it. They did live demonstrations on a young boy and asked those
assembled to feel and smell his hair.
They planned Chik Shampoo-sponsored shows of Rajniknath's films and showed their
advertisements followed by live demonstrations. They also distributed free sachets among the
audience after those shows. This worked wonders in rural Tamil Nadu and Andhra Pradesh.
After every show, shampoo sales went up four times.
3
http://en.wikipedia.org/wiki/CavinKare
4
http://www.cavinkare.com/personal_care_chik.html

6. Introducing Meera Herbal Powder
Inspired by Shaw Wallace, a demand for herbal products was felt. In the third month itself, Chik
Shampoo topped the market of herbal product. In six months, they had 95 per cent market share,
while Shaw Wallace had only 4-5 %.
How beauty became synonymous with CavinKare
As they planned to expand to new products, they thought the name Beauty Cosmetics would be
restrictive. In 1998, they ran a contest among their employees for a name and one of them
suggested CavinKare; with C and K spelt in capitals. Cavin in Tamil means beauty and grace.
Also C and K were his father’s initials. So the name instantly clicked.
Perfumes for the poor
Good perfumes came at a huge price -- they were beyond the means of ordinary people. Going
by his father’s ideology, Ranganathan came out with a Rs 10 pack of Spinz deo. It was an
extremely successful step.5
CavinKare Values and Beliefs
Vision: "We shall achieve growth by continuously offering unique products and services that
would give customers utmost satisfaction and thereby be a role model."6
Figure 3: CavinKare values & beliefs
Business strategies: Why it exist?
Target audience: Girls and women of rural and semi-urban population of India.
5
http://www.rediff.com/money/2007/mar/22bspec.htm
6
http://www.cavinkare.com/Vision.html
Ethical
Behavoiur
Innovation
OwnershipStakeholder's
Delight
Excellence

7. Corporate Strategy:
Cavinkare maintains high standard of quality using three cardinal rules:
1. Cavinkare will never venture into marketing and will only focus on brand building, R&D
and distribution management. Outsourcing (third party manufactures) is one of the major
corporate strategies of Cavinkare. It helped the company to keep the costs low and
allowed it to focus on marketing and distribution.
2. Cavinkare will never distribute products of other manufacturers.
3. It will not let its products distributed by other people.7
Marketing Strategy:
It promotes through direct media to create brand value. Conventional media outlets such as TV
and radio still make up a large chunk of the company`s investment. It is also focusing on various
other platforms inclosing social networks.8
Promotional Strategy:
Mobile Parlors provide direct interaction with the customer by distribution of free samples of
Chik shampoo. Also, various hairstylists use it on volunteers to provide a complete brand
experience.
Cavinkare has also associated itself to various social issues such as education and empowerment
of disabled.9
Rural Marketing
Cavinkare is widely known for bringing revolution in India with the concept of small sachet.
Before the introduction of Chik shampoo, people in South India used to wash their hair with
soap. To create awareness among the customers, the company educated people on how to use the
shampoo and distributed free sachets. This was one of the most successful strategies followed by
the company and created huge customer base in Tamil Nadu and Andhra Pradesh.9
Competitive Strategies:
After introducing shampoo sachets, for instance, CavinKare took on HUL's most profitable
brand, the 'fairness cream' Fair & Lovely by launching Fairever in 1998. To get a competitive
edge, Ranganathan included milk and saffron among Fairever's ingredients - both are
traditionally associated with fairness in south India.
It launched Indica 10, a hair dye which can be washed off within 10 minutes of applying it. Rival
hair dye brands require at least 30 to 45 minutes for effect.10
Other strategies:
7
http://books.google.co.in/books?id=U4_mXbVC4bwC&pg=PA152&lpg=PA152&dq=cavinkare+cardinal+rule
s&source=bl&ots=PHxv1Z9HJq&sig=E5KdgX0Du6o5Q5f0Kba7gcg3cYI&hl=en&sa=X&ei=Ap_uUqyWJo6yrAe
4vIDADA&ved=0CC8Q6AEwAQ#v=onepage&q=cavinkare%20cardinal%20rules&f=false
8
http://www.slideshare.net/ZiaAhmad/rural-marketing-by-cavinkare-pvt-ltd
9
http://www.slideshare.net/Rushabh93/cavin-kare-and-chik-shampoo-rural-marketing#
10
http://www.cio.in/article/cavinkare-chases-big-business-it

8. 1. Chik shampoo sponsored shows of Rajnikanth`s movies. After every show, the sales went
up to three to four times.
2. Started giving one free sachet in lieu of five sachets.
3. Sold the sachets at 50 paisa when other shampoos were selling at Rs. 2. Soon Chik
shampoo got popular in the market. The sales went up from Rs. 35000 to Rs. 12 lac in
one month.11
Business model12
11
http://businesstoday.intoday.in/story/cavinkare-working-towards-a-global-presence/1/19204.html
12
http://www.icmrindia.org/casestudies/catalogue/Marketing/Cavinkare-Marketing.htm
Classify the products broadly: Shampoos,
fairness creams, deodorants and talc powder,
pickles and snacks, hair color, beverages, dairy,
and beauty salons.
Set up different sales division, divided on the basis
of customer type. For instance, different types of
retail format including convenient stores, kiranas,
chemists, bakeries, and juice parlors.
Assign head to each business
Manage the supply chain: Products in the personal care
space have a long shelf life. Therefore, the company uses
carrying and forwarding agents, like any other FMCG. But
for other businesses, especially the food segment, it
carries out operations with fewer intermediaries.

9. Role of Information Technology
IT has been the backbone of the company for more than a decade. CavinKare was one of the
early adopters of ERP, and had it at a time when none of its competitors did. It has set up an ERP
across the entire business chain which runs very efficiently.
Currently, it is in the process of automating transactions that distributors carry out with the
retailers using IT.
Future focus
The 'creators' were asked to come up with innovations that targeted the high end of the market.
"We want 60 per cent of our revenues to come from the premium segment," says Ranganathan.
Product range
Starting their journey with Chik Shampoo, a landmark innovation that democratized the use of
shampoos among the masses in India, CavinKare has become a legendary player in the Personal
Care space. The Personal Care brand portfolio consists of Shampoos (Chik, Meera, and Nyle),
Hairwash Powders (Meera & Karthika), Coconut Oil (Meera), Fairness Creams (Fairever),
Deodorant and Talc (Spinz), Hair Colours (Indica Herbal Hair Colour, Indica 10 Minutes Herbal
Hair Colour, Nyle Henna & Raaga Professional).
Over the years, CavinKare has successfully transformed itself from a pure Personal Care player
to a FMCG conglomerate with interests in Dairy, Snacks, Food and the Beverages businesses. In
the Dairy business, Cavin’s is the mother brand which offers milk and milk based products such
as milkshakes, ghee, curd, UHT and pasteurized milk. In the snacks business, Garden is the
mother brand offering an entire gamut of salted snacks including namkeens and western snack
offerings. In the foods business, they have a presence across various price points in the pickle
segment, with Ruchi in the premium range and Chinni’s in the mass-premium range. Other
products include Chinni’s Vermicelli, Chinni’s Energy Peanut Snack and Ruchi Magic Culinary
pastes. In the beverages business, they are present in non-carbonated fruit drinks with Maa as
the flagship brand. Maa is available in several flavours including guava, apple and mango.13
13
http://www.cavinkare.com/Corporate.html

10. Figure 4: You name it, they have it!14
Personal Care
The personal care brand portfolio of CavinKare spans shampoos (Chik, Meera, and Nyle), hair
wash powders (Meera and Karthika), coconut oil (Meera), fairness creams (Fairever), deodorant
and talc (Spinz), hair colors (Indica, Nyle Henna). 15
.
Food and Beverages
Over the years, CavinKare has successfully transformed itself from a personal care player to a
FMCG conglomerate by entering the food and beverages sectors as well.
In the foods business, CavinKare has two brands of pickles – Ruchi in the premium range and
Chinni's in the economic range. Garden is the mother brand that offers an entire gamut of salted
snacks and western food offerings.
In the beverages business, Maa is the flagship brand and is available in several flavors including
guava, apple and mango. CavinKare also forayed into the dairy industry with Cavin's, a range of
milk and milk based products such as milkshakes, ghee (clarified butter), curd and pasteurized
milk.16
14
http://www.cavinkare.com/
15
http://www.cavinkare.com/personal_care.html
16
http://www.cavinkareglobal.com/aboutus.aspx

11. Garden is a range of snacks and sweets available in authentic Indian flavours. Garden's range of
sweets includes Indian delicacies such as Soan Papdi, Gulab Jamun and Rasgulla among other
exotic specialties.17
Dairy Products
Cavin's is a range of dairy products such as milk, milkshakes and ghee. Cavin's offers freshly
procured milk which is then Ultra High Temperature (UHT) treated to eliminate bacteria. Cavin's
milk products include toned, double toned and diet milk.
Cavin's Milkshake comes in four different flavours - Strawberry, Banana, Vanilla and Chocolate.
The milkshakes contain healthy whey proteins that aid in building muscles which help children
stay strong and fit. Cavin's Ghee is made from cream sourced from the freshest milk and contains
vitamins A, D, E and K.
 Cavin's Milk is available in 200 ml and 500 ml packs.
17
http://www.cavinkareglobal.com/snacks.aspx

12.  Cavin's Ghee is available in pet bottles of 1 litre, 500 ml, 200 ml and 100ml.
Beverages
Maa is a brand of fruit-based beverages that are hygienically manufactured and packaged to
retain the flavour and richness of real fruits. Maa is available in Mango, Apple and Guava
flavours.
With Maa Mango Drink, India's favourite summer fruit can now be enjoyed anytime, anywhere.
Prepared from exotic mangoes, the beverage has an authentic flavour.
Maa Apple drink is made from only the finest apples and is a great thirst quencher. Experience
the refreshing taste of juicy apples in every sip.
 Maa Apple Drink is available in PET bottle of 250ml and 500ml quantities.
 Maa Mango Drink is available in PET bottles of 250ml, 500ml and 1000ml quantities
Innovative aspects of CavinKare
1. IT enabled Company - CavinKare currently runs over three million outlets through 6000
stockists located across India. With such large distribution network gathering sales and
production data becomes a difficult task. But CavinKare started using SAP, an enterprise

13. resource planning (ERP) software, to manage business operations and customer relations
very early in its business when none of its competitors had adopted ERP.
They have ERP for their entire business chain and run it very efficiently for automating
inventory management, input/output plan settings, automated transactions, and consumer
feedback. They are also working on automating the process of transactions between
distributors and retailers. 18 19
2. Trends in Vogue - Trends In Vogue Private Limited, a CavinKare initiative came into
being in July, 2002, with the sole purpose of offering customers with the best grooming
solutions. The need amongst customers for exclusive salons that can offer world class
styling for the whole family, culminated in the birth of Trends In Vogue. It operates two
successful salon chains – Limelite and Green Trends
3. Innovative marketing strategies.
 Targeting rural and small town consumers
 Not a manufacturer- rather outsourced to small producers
CavinKare is primarily marketing and brand managing company. It outsources products from
third party manufacturing units (TPUs) and markets these products
 Main agenda: Brand building, R&D and Distribution Management
 Brought ‘sachet’ culture in the market
CavinKare was the first in the market of fast moving consumer’s goods to use the concept of
sachets for selling its cosmetic products like talcum powder in 100gm, 50gm and 25gm
sachets.
4. Innovative awards to initiate innovation in FMCG market
 CavinKare ABILITY Awards- CavinKare ABILITY Awards were instituted in 2003
to honour achievers with disabilities who have soared beyond conventional barriers to
realise their chosen dreams. They are national awards recognising exemplary services
18
http://www.cio.in/ceo-interviews/it-driving-force-behind-cavinkare-accomplishments
19
http://www.cio.in/article/cavinkare-chases-big-business-it
“What rich can enjoy, poor should afford” –Chinni Krishnan

14. as well as accomplishments of the achievers. Giving these awards, the Foundation
believes, leads to awareness-building on the capabilities of persons with disabilities.20
Figure 5: CavinKare Ability Award
 Chinnikrishnan Innovation Awards
Figure 6: Chinni Krishnan Innovation Award
Dreamer, innovator, idea-tor, entrepreneur: just some of the words that can describe the late Shri
R. Chinnikrishnan, the man who pioneered the sachet revolution. His ideas were based on the
simple philosophy, "what the rich man can enjoy, the poor man should be able to afford." Today
his innovations are seen in every shop, in the form of sachets. They stand testimony to the fact
that his dream has seen fruition. In memory of the Late Shri Chinnikrishnan, CavinKare is
seeking out the next generation of innovators. CavinKare has established an award to encourage
young entrepreneurs who are running small and tiny scale industries.
"The Chinnikrishnan Innovation Awards" focuses on the overall value of the innovation in terms
of its uniqueness, its benefits to people and its ability to be scalable. 21
Corporate Social Responsibility
20
http://www.abilityfoundation.org/cka_awards.html
21
http://www.cavinkare.com/cavinChinniKrishnanInnvationawards.html

15. CavinKare Chairman CK Ranganathan always believed that 'disability is never a handicap and
people need to change their attitude to provide opportunities to the physically challenged people
to prove themselves'.
Taking that approach forward CavinKare has shown an interest in supporting organizations
working on social issues. The company has sought to associate itself to social issues of
education, empowering the disabled, imparting practical knowledge for business and
acknowledge the requirement of environment protection.
As part of Corporate Social Responsibility initiatives:
1. CavinKare has associated itself with Ability Foundation, an NGO working towards
betterment, empowerment and rights of disabled community, to institute CavinKare
Ability awards, to recognize and reward the achievements of differently abled people.
Figure 7: Music Director A.R.Rahman receives a memento from CavinKare CMD C.K.Ranganathan at the
CavinKare Ability Awards jury meet in 200922
2. CavinKare also presents the Chinnikrishnan Innovation Awards to encourage young
businessmen running small and tiny scale industries. This award is named after the Late
Shri R Chinnikrishnan, CK Ranganathan’s father, who introduced the concept of sachet
in India.
3. CavinKare has associated itself with Rotary club of Madras East to present Dr. M S
Swaminathan Award for Environment Protection which is named after Professor
Swaminathan, an internationally acclaimed agriculture scientist. This award is composed
to honor companies or eminent persons who have contributed to the society to improve
living conditions and public health while protecting the environment and natural
resources.
4. CavinKare has been lively active when it comes to activities in education sector.
CavinKare's 'Project give life' endeavors to provide educational support to deserving
children. Study aids, breakfast are some of the things that the project encompasses.
5. The CK School of Practical Knowledge on the other hand imparts practical business
oriented education alongside the regular curriculum. CK believes that the school should
22
http://www.hindu.com/2009/02/08/stories/2009020858140200.htm

16. continuously churn out students who will develop business acumen, alongside their
regular Physics, Chemistry, and Mathematics. The objective of this initiative is to apprise
students of small business operations and create in them business instincts with emphasis
on real life situations.
6. CavinKare also runs the CK College of Engineering and Technology which is situated in
Cuddalore with an aim to impart professional education especially to the people in the
coastal regions of Tamil Nadu. The college offers industry relevant courses in
Engineering and Business Management studies with an aim to develop industry ready
professionals who will contribute to creating a better society.
7. Apart from the above, CavinKare also conducts ‘Annadanam’; blood donation camps and
also sponsors green revolution projects.
Conclusion
The common thread connecting various businesses is the company culture of bringing out new
products which are significantly winning or are highly differentiated as opposed to the
competition.
CavinKare has a strong distribution footprint pan India, reaching more than 3 million outlets
through more than 6000 stock holders. Leveraging its strong distribution network, CavinKare has
entered into strategic partnerships with Coty for Adidas and Jovan brands and Hawpar
International for Tiger Balm. CavinKare has replicated the success at home and in foreign lands
as well.23
CavinKare has been extremely innovative with its concept of sachets. The company could be
successful because of its root aim of reaching out to the rich and the poor alike. Identifying target
customers is a very important measure and CavinKare made sure it never failed at that.
Although the company has been growing over the past few years, it has been losing its grip on
the market. What it requires is better marketing strategies and customizing its products as per the
requirements of various Indian states.
23
http://www.cavinkare.com/Corporate.html