The Baba Who's Making Billions
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
On a sunny April Afternoon after a six hour drive from Delhi we arrive in the holy land of Haridwar. Ahead of us are two Patanjali Yogpeeths I & II spread across more than 100 acres of land each. With a capacity of 50,000 followers, people still wait for weeks to follow yoga sessions taught by Swami Ramdev. Our car is stopped ahead as the small trail only has way for a cycle or a person one at a time. Crossing that lies Swamiji’s Kutiya (cottage). Swamiji is meeting his relationship managers before coming out to finalize the
advertisements which will appear on Ram Navmi. The chirping of birds, a bright sun overheated and sitting across us is Baba Ramdev on the swing unveiling how he brought disruption.
Who moved my Cheese?
Hearing everyday from my friends and family about Patanjali products they were using, I was intrigued to know how the consumer shift took place in the land of Dabur and Himalaya. What happened to HUL and P&Gs of the world? Is it mere faith, is it a corporate move of a yogi, or something else. I was enticed
and met the Swami myself to understand how he moved the cheese under the nose of the biggest FMCG players in India. Ask any established brand, the biggest threat they face is
someday a startup will come from nowhere and they will soon be out of business. How this startup is out to dethrone FMCG giants got me more curious.
The money making asana
Ramdev has been the biggest brand ambassador of his products, but it’s not only his followers who’ll buy into his products. Those who are looking for good quality at reasonable prices are all his buyers. Only Baba Ramdev could plan an alternate to Maggi with Patanjali Atta Noodles, why didn’t others think about giving hard competition? How a yogi turned the largest manufacturer of consumer goods in India.
A one hour’s drive from Patanjali Yogapeeth will take you to the food park which is spread across 125 acres at Ranipark, Haridwar. Patanjali food & Herbal Park has got various divisions of food, cosmetics, beverages, herbs and more. Established in 2010, the park has 10,000 workers. You can see trucks being loaded and sacks being unloaded. A yogi’s evolution as an entrepreneur Born to a farmer, Swami Ramdev went to a government school to study at the fee of Rupee 1 taking second hand books to study. “We could buy new books only once or twice but I always stood first in class,” remembers Ramdev. At the tender age of nine, Ramdev started reading Maharishi Dayanand and read about Yoga before turning to a Guru. With the belief in studying via the traditional Indian education system of Guru-shishya, Ramdev went to a Gurukul. He first went to Gurukul Khanpur. Ramdev believes that all education lies in the Vedas. “Veda is not a religious book, it’s all scientific.” Born with a weak body he started practicing yoga to strengthen himself. “Getting married was not what I wanted to do. My life turned after reading Maharishi Dayanand,” he reminisces.
Answering what brought clarity to his thoughts at a younger age he says, “I never doubted my decision. My parents supported my decision after 15 years. I have always lived by my own principles which I had set. I was clear what I wanted to do and what I didn’t. I was always clear from the start. Once I decide on something, I do it.”
“I never intended to be a yoga guru. I never wanted to build an empire. I sleep on the floor without AC, why do I need anything. I am complete in myself. Brand is not my ultimate goal. It’s just a by-product. This whole institution, organization, all the creations are mere by-product,” clarifies Ramdev shedding away the tag of owning a 5,000 crore enterprise.
Though Ramdev brings his principals and brand image to Patanjali it is Acharya Balakrishna who spearheads product development. On coming out with food products Acharya Balakrishna, CEO of Patanjali says, “Lot of farmers approached us suggesting to cut amla (gooseberry) trees as nobody was buying amla. Swamiji suggested we should make amla juice.”
On answering how they got inclined towards business he says, “We were not from business background and don’t even have a business mind. We wanted to serve the country and its people and the medium was Ayurveda.” Swami Ramdev is the only one who claimed yoga is a complete medical science. What has worked for him is bringing it to the common man.
Spiritual leaders were always around, but who imagined a spiritual guru could revolutionize the way we consume FMCG. On walking the untrodden path Balakrishna says, “We didn’t have a single court case, now we have 400 court cases. We were ready to face the consequences. We are thankful to our critics because of whom people found more about us and trusted us more.”
“We Indians perceive foreign stuff with high quality. Since 2005-2006, when we established the company we supported that Indian products are also rich in quality. You need not to be an MNC to bring out good products,” he adds. Balkrishan being the main shareholder owns 93 per cent stake in the company but doesn’t take any salary.
A Sadhu Saga
An unlikely entrepreneur as he may seem, but indeed he has turned out to be a successful one, that’s Baba Ramdev for you. Taking his product to the masses has been his forte. Swami Ramdev started giving medicines at his camps,which were available wherever the camp was. Soon people started asking “we get it now, but how will we get it in the future?” Soon they started asking if they can keep the products in their shops.
In an urge to give an alternate with a better product, they kept on developing newer products. “We didn’t go by market research, our intension was good. Manufacturing is our biggest strength as we do maximum production in-house. We also source raw material on our own. The cultivation, how herbs will be grown, from farmer to Food Park, we have a single network. To make aloe Vera juice we get aloe Vera leaves from places like Rajasthan, Gujarat. That’s what leads to quality control,” shares Balakrishna.
The bonding of Swami Ramdev and Acharya Balkrishan seems like meeting of vision with execution. Swami Ramdev and Acharya Balkrishna met somewhere around 1988 at Gurukul Kalva. “Swamiji, he was more inclined towards studying and teaching, I was more interested in Ayurveda,” shares Balakrishna. Swamiji moved towards south
India. He went to Benaras. Later in one of the gurukuls in Haryana, Ramdev took charge as a Guru. They used to communicate through letters. Around 1992-93 Acharya was in the himalyas, later Swamiji also joined him. In 1995 they established divya yog mandir trust in haridwar. Swami shankardevji gave them the ashram space. Ramdev started wearing saffron clothes and began conducting yoga camps. Those who benefited started coming again and again. “In 2005 we thought we should; create more products than just ayurvedic products for the pharmacy. We took some money from people who were not looking at returns. Then I took a personal loan. I got a loan without any paper work. It was of almost 50-60 crore on the basis of trust from a bank. Then we created a company. There was no market survey,” informs Balakrishna. Today Patanjali makes products from 55o types of herbs.
On working together Swamiji says, “We have different opinions in decisions. Connectivity is oneness. Just for legal requirement he has the shares; else he doesn’t consider himself the owner.” With 1200-1300 pharmacy they are spread across 7-8,000 villages. The franchisees get products on discounts. Acharyakulam, ayurvedic college and yoga camps also continue with their services.
This article first appeared in the Indian edition of Entrepreneur magazine (May 2016 Issue).