Parryware’s Journey to Become a Leading Bathroom Product Solution in India
India’s one of the flagship bathroom products brand, Parryware, has been taking giant steps ahead with its vast range of products. With its partnership with Spanish company, Roca, the brand has become a one-stop solution for all bathroom needs of their consumers. Here is an exclusive Interview of Managing Director of Roca Parryware, KE Ranganathan, interviewed by Abha Garyali Peer, in which he shares about his personal as well as the brands entrepreneurial journey and future aspirations.
How has been your entrepreneurial journey? Kindly light us on the inception, growth and success of Parryware?
I am a Chartered Accountant and Company Secretary by qualification. I joined TVS group in 1983 and stayed with them for about 15 years. Then, in 1993, I joined Parryware as Finance Head (CFO). In year 2000, I was sent for Fulbright scholarship by the Murugappa Group. When I came back my boss wanted me to be Chairman and take over sales and marketing. It was not an entrepreneurial risk but was a professional risk, but Murugappa Group always encouraged people to move out from one function to another and try out new things.
In 2005, we, Parryware, signed a joint venture with ROCA of Spain. Along with this joint venture of fifty fifty partnership, we created a fantastic platform for ROCA to launch in India. With the help of our Indian team and ROCA’s global knowledge, we raised the performance of the company to a much higher level in the years 2005-07. In 2008, ROCA acquired the balance of the 50 per cent and the company became 100 per cent subsidiary of Roca Spain. Murugappa exited the business at a huge valuation. I was Group CEO of diversified businesses in Murugappa and I ran them till 2012, at which point I joined back TVS.
However, in 2016, they called me back and we together launched the brand Parryware and ROCA, to be on top of the mind of the customers. From 2017, we saw a huge growth rate from 1 to 18 percent till 2020. In 2020 when COVID stuck us the sales obviously went down. Nevertheless, the very next year in 2021 we hiked our sales by 55 per cent. Presently, we are running at a 45 per cent growth.
What were the factors behind the tie-up of Roca with Parryware? Has the tie-up achieved its objectives?
There are four factors. First, Sustainability, they somewhere had belief that business would not die by doing a joint venture with Murugappa, which was a huge company. Second, Scalability, they had trust because Parryware was growing at the rate of 20 per cent in those years. Thirdly, Profitability, that they can add more value to improve the sales and profits. With the global experience of having been in manufacturing sector since 1917 and having 88 factories across the world, they saw merit in bringing the best practices to India. Fourth, Compatibility, they got in terms of culture. They saw similar family run business, run by professionals with very good systems and control, Very customer oriented; long term orientation is what they saw as compatibility.
What have been the factors contributing to the success of the brand so far?
The first and foremost factor is our product offering to customers. Every year, one-fourth that is, 25 per cent of the revenue comes from new products. The world's best practice is 15 per cent but our benchmark is 25 per cent. These new products create excitement amongst customers and they go for renovation, new construction with these new products.
Secondly, a big part of the company is running due to our distribution partners. There are 15,000 of them as members of a loyalty program called ‘Utsav’ (celebration). Launched in 2017, this loyalty program for the shopkeepers of Roca Parrryware products has made them bond with the brand. It's a very simple digital based loyalty program. You just have to buy Parryware from the distributor, take a photo of the invoice and upload it in the app, you become a member on the app (named Parryware Utsav) and then you get your points. You accumulate these points and then you can encash against motorbikes, cars, television, homes etc.
Third point for the success of the company is called a ‘donut’. We do several activities in the market in a structured manner to create a demand pull. The fourth important success factor is the wonderful managers we have. We have best in class managers in every function- marketing, sales, manufacturing, HR, Finance, IT, supply chain etc. They are all loyal to the brand and the company.
As the market for Bathroom Products has been quite disorganized in India, what are your views about it? What is the market size of the organised sector and what has been the role of Roca-Parryware in taking it to this place?
Unorganised sector is reducing after the GST and demonetization. In the modern world there is a supply and demand. If the demand is met by supply based upon what the customer wants, then you are home. There are customers who buy unbranded products but we do not call them unorganised.
However we have brands in our portfolio for people from all walks of life. We have recently launched Johnson Pedder brand at the low end. Through this brand play, we expand the market. We also educate the customers to go for brands. More so, we train the plumbers to recommend our brands as generally customers want the plumbers to buy sanitary wares for their homes. We aim to go to B and C towns, small rural areas and make sure that the distribution reaches there.
What is the USP of Roca-Parryware? How is it different from the other brands in the market of its kind?
The USP of our company is ‘Focus on Customers’. When we talk about customers, it includes the end consumer as well as our trade partners, including our plumbing technicians, small retailers, architects etc. Everything we do in our company is done by keeping them in mind. Moreover, we have some digital loyalty programs, new products, donut approach too.
As the retail industry has been changing amid pandemic times. How has the company dealt with it?
During Corona virus outbreak in 2020, from March to June, the business came to a standstill because nobody was coming out of home. At that time, we created a digital platform called ‘Parryware Safe Buy’, which is still available. This digital platform was so helpful the customer that if a customer is not able to go to the shop, he or she can digitally look for the shops nearby by giving a PIN code and look catalogues of them. It helped customers to find plumbers with their mobile numbers within two kilometer radius.
Some of our counterparts in China alerted us about Covid-19 in January 2020. Taking a swift action, we created educational videos for our partners to introduce them with safety measures. We educated all our 15,000 trade partners and they also supported us.
In the last three - four months, we were able to come back to normal. We created exciting new showrooms, studios of the company in eight locations and many more will soon be in function.
Where do you see the brand in the next five years? What are your future expansion plans?
We have created new verticals like pipes and fittings, consumables. The global markets will open up for us; we can export from India today. All our factories are servicing the Indian market. They are full so we can service the export markets in the five year horizon. We'll continue to be the market leader and expand our presence into B and C towns. We are also available on digital marketplace like Amazon and Flipkart but people are very hesitant to buy ceramic products on these platforms as these are very technologically advanced products. Still, we believe that people will change, making the market more dynamic and vast, eventually.
What are the main challenges faced by this industry and how do you tackle these stumbling blocks?
The challenges are basically in the form of the requirements of the new buildings. When they construct a new building, especially the public buildings, the government rules are not that strict in terms of the number of toilets per square feet of the area built. If you go to some cinema theater, you will find a fellow standing in the queue in the toilet. Similarly, on the airport, you will find queues outside the toilets. Unfortunately, there is no government regulation. Moreover the public washrooms in many areas are very badly and poorly maintained. Even on highways, the toilets are not well maintained and we need to look for a good restaurant to use the washroom. So, these are the challenges that the industry has but the good news is that these challenges will expand the market and the market will always be growing.