Hector Beverages Pvt. Ltd., which sells beverages under the Paper Boat brand, has expanded its distribution network and operates online only launches after the lockdown due to COVID-19.
The company lost sales across modern trade channels and suffered losses in the institutional segment as sales to airlines and airports soared.
It currently has 2,50,000 outlets, and the company plans to increase that to 3,50,000 this summer, a top executive at the company said.
“I think Great study over the last few years, this (distribution) is a big lake in India, and it will continue to exist despite e-commerce. So, if you want to build a very sustainable company and long-term, go to an IPO, that is the goal, and then build your supply chain,” said Neeraj Kakkar, co-founder, and CEO, Hector Beverages.
Two years ago, the reach of Hector was limited to 40,000-50,000 out. There are over 12 million Kirana stores in India.
The company’s share of online sales has risen from 6% in pre-Covid times to 14-15% now. As a result, it is reviewing plans to bring back its seasonal launches for sale on e-commerce sites, some of which have been discontinued.
We used to launch festival-only (seasonal) products. Offline delivery was very difficult for them as it would take time for them to expand into a modern and generic business. These products are sold out online. He pointed out 2 examples, one is Kanji which is common in Holi and is sold online. The second one is panakam, popular during Ram Navami.
At the time of lockdown, e-commerce and kirana stores were overtaking modern businesses for groceries and staples, as well as large format lattes.
This year was especially trying for the beverage companies as they lost business during the main summer due to the lockdown. Indoor consumption of beverages is an important part of sales, including restaurants, street vendors, railways, movie halls, and airlines.
” We were sitting on the all-time high inventory and we were looking forward to a very good season. I think it’s good that things have recovered so strongly since June” said Cocker.
We had a turning point, 2016–17 was not so good for us, but we have been doing very well since then. We had hoped to get out of the woods by 2020, and we thought we would move towards profitability is said by Kakkar.
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