The Covid-19 pandemic has hit everything in the world. From travel to industries to even agarbathis have not been spared. Like most other businesses, it also moved towards work from home mode. It was a challenge for the frontline sales team to reach thousands of distributors and lakhs of retail outlets spread across the country. Agarbathi business is generally dependent on rural women to make and package and as the back-end supply chain was hit due to safety reasons, the distribution became even more difficult. In an exclusive conversation with Financial Express Online Arjun Ranga, Managing Director, Cycle Pure Agarbathi talked about the impact of Covid-19 on their business, consumer preferences and more. Excerpts:
How has the second wave of the global pandemic impacted Cycle Pure Agarbathi? What has been its effect on the agarbathi industry?
The pandemic has been difficult for our entire nation. At Cycle Pure Agarbathi, we continued our WFH when the second wave hit, however, our frontline sales team, comprising 1800 salesmen serving 5000 distributors across India, faced the biggest challenge of having to reach almost 7 lakh retail outlets. Yet, we adhered to strict social distancing and safety protocols, which especially helped to manage our frontline teams better. We are a labor-intensive industry that is dependent on rural women to make and package Agarbathi and had to shut down the back-end supply chain, prioritizing employee safety above all when the second wave hit rural areas as well.
Cycle Pure Agarbathi had a firm business continuity plan in place at the outset of the pandemic, which ensured a smooth transition to a complete lockdown and the unlock in phases. Despite no sales during the lockdown, our employees performed very well, and post unlocks, we focused on the supply chain and resuming production whilst following all safety and hygiene guidelines. We quickly introduced decentralised decision-making and empowerment of the last mile to continue business in the second wave. However, our sales are again at a standstill in this second wave as our products belong to the non-essential category.
What initiatives have you taken to stay relevant in the industry and among consumers during these challenging times?
We aggressively promoted our online and digital marketing initiatives, thereby resulting in a sudden surge in sales on Cycle.in, our e-commerce platform. Quality and hygiene have always been our top priority and we have become extra attentive towards them in the wake of COVID-19. We follow strict safety protocols and social distancing norms right from manufacturing to delivery and ensure sanitisation throughout the supply and distribution chain. Being a Zero Carbon manufacturer, sustainability is our mantra and we are glad to see consumers also evolving towards purpose-led brands like Cycle.
What has been the second wave’s influence on consumers’ buying behavior and purchase pattern?
The purchase behavior of consumers is that of bulk buying and value for money and limited store visits during the lockdown. They are sticking to trusted brands and not experimenting. With the change in the purchase pattern, the “new normal” will see a rise in consumers availing contactless delivery, doorstep delivery and the retailers will be empowered with MPOS (Mobile Point of Sales devices).
How has this pandemic changed the FMCG sector? What are the new trends in the market on the retail front?
The pandemic has transformed the way we look at our products and consumers, the latter having become more brand-loyal and demanding product availability at any cost, which has, in turn, rendered the supply chain more important than ever for FMCG businesses. Many a time, FMCG companies are compromising on the launch of new products to make existing products available.
There are some new trends such as touch-less retailing and in-store audio interaction in the brick-and-mortar sector. With consumers preferring to shop locally, brands are harnessing digital platforms to remain relevant and connected to them. Brands are constantly working to stay on top of their minds as consumers across the globe are looking at products and brands through a new lens. Impulse purchases are seeing a dip as purchasing decisions are pre-planned, leading to a change in in-store customer engagement. Technology will be a key influencer in their purchase decisions. The impulse buys at the point-of-purchase/sales will come down and in-store promotions have begun to see a shift due to social distancing norms. Deployment of in-store promoters will reduce and give way to LED panels and videos and in-store displays will be audio and visual rather than only visual.
What has been the impact of the ongoing pandemic on the company’s operations? Have these new restrictions and lockdown guidelines disrupted Cycle Pure’s supply chain?
Our operations were completely stalled for almost six months of the pandemic, as we are heavily dependent on the rural women workforce for the first stage of our agarbathi making process. The struggle extended to the supply chain of raw materials and finished goods up to the market shelf. We faced difficulties in obtaining materials from the Forestier, supplying them to the home-workers, and collecting the packaged agarbathi. Being a labor-intensive industry, we had challenges with tertiary and migrant labor and truck drivers who had migrated to their home towns. The tertiary-labor who are dependent on daily wage income are unemployed right now. It would be an arduous task to prevent their migration to other industries and bring them back to our force.
Agarbathi being a niche product in the non-essential category, we did not see significant sales in the lockdown. We decentralized the decision-making power and gave a free hand to our sales team, traders, and distributors across the country, who, in turn, worked on a seamless market plan while complying with the restrictions and guidelines in place. While considering the safety of our on-ground staff, we have kept our inventory ready to reach the shelves as and when the movement of logistics is permitted.
What are the steps that the organisation has taken for combatting the effects of the ongoing pandemic?
We have prioritised the health and wellness of our 5000-plus employees and their families in the second wave and rolled out a COVID Kavach insurance cover and additional allowances, besides organising vaccination drives with first priority to our seniors above 45 years and shop floor employees. COVID positive employees are entitled to paid leave and other relief plans.
We have donated 12 lakh rupees worth of medicines and 70 cots and beds worth 10 lakh rupees to the COVID Trauma Care Centre and are providing breakfast and lunch to all frontline volunteers of the COVID War Room in Mysuru. We also distributed sanitisers and face shields to healthcare workers, police, and citizens across Mysuru. We are supporting District Hospitals designated for COVID treatment with necessary amenities and oxygen concentrators. We will install an oxygen generation plant at a Mysuru hospital next month.
Cycle has tied up with CII Mysuru to facilitate healthcare equipment and medicine to hospitals. We have actively contributed to volunteer groups in Mysuru and Bengaluru to provide meals to migrant labourers, police on duty, and the poor. We were also able to source and secure ventilators for the Mysuru government through the international relations established by our company Rangsons Technologies.
Tell us about your product range. How have you ensured innovation in the home-worship segment?
We have an extensive product line ranging from agarbathi, Cup Sambrani, masala bathi, cones, dhoop, puja accessories, and puja packs for special occasions. IRIS Home Fragrances, our luxury home fragrance line, offers exotic fragrances and home decor products. We have also forayed into a functional air-care range with our brands “Lia” and “Stop-O”.
Innovation has been essential to us; we come up with new ideas from time to time. The sales from our puja products have seen steady growth owing to their superior quality standards. Cycle Pure is the only manufacturer in the country with a Cosmetics & Drugs certification and license for our Om Shanti Gold Class Kumkum.
We also have eco-friendly puja packs crafted for specific occasions such as Durga Puja, Lakshmi Puja, Ganesh Chaturthi, Maha Shivratri, Anniversary, and Birthday Puja Packs.
Our products are well received in the market across the segment. We have modified our product line to ensure that the tradition is kept alive in modern times and we ensured the puja experience is unhindered during the lockdown with our quality products in the home-worship category. We launched an array of home worship products under the Om Shanthi category made with pure ingredients. The brand also introduced products in the personal hygiene and bath space.
What are your most popular products? During this pandemic is there any specific product that customers are purchasing?
As Cycle specialises in the fragrance category, three-in-one Agarbathi from Cycle Pure is the most popular one, since it brings the three popular fragrances of Serene (Lily), Yugantar (Fancy), and Jagrane (Intimate) together in one pack. We have seen increased demand for the traditional Masala bathi, Cup Sambrani, and Puja oils from the Om Shanti Range in the current lockdown scenario, apart from high demand for the Sampoorna Puja kit range which comes with specific puja Vidhi and all essential puja items for a holistic puja experience.
Sales for Lia’s room fresheners and functional air care products have gone up ever since WFH became the norm.
Additionally, we also brought “PurePrayer”, a free mobile app that is available for devotees across India to participate in poojas and aartis and book their sevas along with other temple rituals from the comfort of their homes, adhering to social-distancing guidelines.
What are the most preferred fragrances when it comes to agarbathi?
Traditional fragrances like Jasmine, Chandan, Rose, Champa, and Loban are widely preferred in our country. With the industry gaining access to new materials and ingredients in the last 20 years, it has seen great innovation in fragrances. From fruity and spice scents to aqua fragrances, the industry players have been inspired by the perfume and food industries and have developed fragrances like apple, cinnamon, lemongrass, etc. New fragrances like French lavender, Amber Rose, Ylang Ylang, Lemongrass, Mandarin, etc. are popular among the younger lot.