Emerald Emerging Markets Case Studies

Aachi – spicing up a growth trajectory

Swaminathan T.N. Arun Thamizhvanan
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 Aachi – spicing up a growth trajectory
T.N. Swaminathan and Arun T
T.N. Swaminathan is an
Professor of Marketing
based at the Great Lakes
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Institute of Management,
Chennai, India.
Arun T is a Lecturer
based at the Great Lakes
Institute of Management,
Chennai, India.
The authors wish to thank
Mr A.D Padmasingh Isaac,
Founder and Chairman of
Aachi Masala Foods Pvt. Ltd.
Chennai, India, for his consent
and cooperation to publish
this case study and
Nachiketas, N, Lecturer, Great
Lakes Institute of
Management, Chennai, India
for his valuable inputs.
Disclaimer. This case is written
solely for educational
purposes and is not intended
to represent successful or
unsuccessful managerial
decision making. The author/s
may have disguised names;
financial and other
recognizable information to
protect confidentiality.
DOI 10.1108/EEMCS-09-2013-0185
I envision Aachi group to create many successful brands that become household names on a
sustainable basis catering to all segments of the society at affordable prices. I firmly believe that
the future growth of Aachi is dependent on the growth of successful brands not only under the
umbrella brand of Aachi but also stand-alone brands
Isaac Padmasingh, Founder and Managing Director, Aachi Group of Companies
A.D. Isaac Padmasingh, Founder and Chairman of Aachi Masala Foods Pvt. Ltd., had just
finished addressing his employees on his birthday, which is celebrated every year in his
organization as Founder’s Day and during which he presents gifts to all his employees. On
this occasion, he had shared happy news that brought him more joy than when he was the
recipient of the “Extreme Entrepreneur of the Year” award from The Indus Entrepreneurs at
TiECon 2010, Chennai. The reason for his joy was that Aachi group sales turnover had
exceeded expectations and reached INR 7 billion (USD132 million) for the year ending
March 2011. With this milestone that he had set for the company a couple of years
previously achieved, he was inspiring his team and employees on this occasion to set their
eyes on the next landmark of crossing INR 10 billion (USD188 million) in sales revenue, and
knew of the arduous task ahead. The one question that kept ringing in his mind was: “How
can we take Aachi past the magical milestone of INR 10 billion sales revenue?”
The more Isaac thought of the question, the more his thoughts flashed back to his humble
beginnings. It has been quite an extraordinary journey for him. From a start 13 years ago
with a seed capital of INR 50,000 (ca. USD1,000) selling a single product, to selling ⬎150
products across the spectrum of processed spices and ready-to-cook/eat food products in
the fast-moving consumer goods (FMCG) market, crossing INR 7 billion revenue in the
process, he had won many accolades along the way, including the cherished “Extreme
Entrepreneur of the Year” award from The Indus Entrepreneurs at TiECon 2010.
Humble beginnings
Being born in a middle-class family at Nazareth, Tirunelveli District, Tamil Nadu, Isaac was
no stranger to the vicissitudes of a middle-class life. He lost his father when he was just 4
years old.
The entire onus of running the family fell on his mother’s shoulders. His mother worked very
hard to support her six children. By cultivating their small landholding and rearing cows and
goats, she was able to educate all six of her children. Isaac graduated in Business
Administration at Aditanar College, Tiruchendur in South Tamil Nadu, and started his career
with Godrej Soaps as a sales officer.
In Godrej, for the first time, Isaac was exposed to field selling and the distribution of FMCG
products. Via the toughness of field selling and distributor management, he learnt the
basics of the business cycle quickly. A.K.S. Rao, who was general manager at Godrej at
that time, spotted his talents and mentored him. Consistently achieving his targets, he
VOL. 4 NO. 2 2014, pp. 1-20, © Emerald Group Publishing Limited, ISSN 2045-0621 EMERALD EMERGING MARKETS CASE STUDIES PAGE 1
 advanced in the organization quickly and became Area Sales Manager – Tamil Nadu
(state) – in far fewer years than his peers.

Learning the rules of trade

While he was Area Manager, Isaac observed that Godrej Soaps sold ranges and
distributed all products to all markets. He tweaked this distribution strategy by choosing
premium-category products which he sent to affluent towns and markets with
upper-middle-class and upper-class populations and targeted other products at other
markets. His astute business sense paid dividends, as he not only exceeded his sales
target figures for his region by a large margin, but also managed to pioneer range selling
at Godrej. This proof of his sound business instincts and the mettle which he displayed by
taking this risk gave him a tremendous boost in confidence.
More than ten years’ experience at Godrej Soaps and the success of his business
reasoning kindled the spirit of entrepreneurship in him. Isaac believed he had the requisite
entrepreneurial competencies such as knowledge, skills, ability and attitude (extracted
from Table I). However, becoming an entrepreneur was a major decision and he had a
discussion with his wife, Thelma Isaac, regarding quitting the safety of his INR 20,000 per
month job to start his own entrepreneurial dream. Receiving full moral support from his wife,
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he quit Godrej Soaps and took the plunge into entrepreneurship.

Opportunity, recognition and the dawn of the “Twinkling” entrepreneur

Over the years at Godrej Soaps, Isaac had observed that to rural customers, who constituted
a huge chunk of the market (68.8 per cent of total population)[1], products that were affordable
and at the same time were of good quality were few and far between. At this juncture, Dhirubhai
Ambani’s[2] slogan “Karlo Duniya Mutti Mein”, which literally means “The world in your palm”,
was offering Reliance Communications’ affordable mobile telephony to rural customers. It
triggered Isaac’s desire to create products of quality and, more importantly, affordability for the
rural masses. He found his answer in ultramarine (liquid blue[3]), a market that offered a
business opportunity. In 1998, in Tamil Nadu, there were only two competing kinds of
ultramarine (liquid blue), namely, Ujala and Robin Blue. Regaul, which had stormed the market
and had been dominant for almost four decades, had slowly faded into oblivion. That presented
a gap and a market opportunity. Thus, Isaac’s work and personal experience, his market
knowledge and awareness of customers’ problems and an innate entrepreneurial alertness
helped him to seize this opportunity. He identified and sought help from a chemical laboratory
to come up with a quality and cost-efficient new liquid blue formula.
Testing it, Isaac was convinced of the quality and the value it offered. He branded it as
Twinkle Liquid Blue and sold it in 1-Rs sachets compared with the competitors’ INR 5.00
equivalents. However, he found product acceptance among retailers in urban areas was
poor and that it was difficult to sell there. Isaac and his first employees ended up hawking
Twinkle in the streets of rural areas. After a few months of struggle, inquiries were
generated and the rural retailers started buying the product. This established Isaac’s
independent foray into the FMCG market.
Rural people are very intelligent and calculative. For a Re 1 product, they expect Rs 1.50 value
Isaac

Table I Major food processing companies in India

Major MNCs Major Indian companies Indian MNCs likely to enter

Nestle, Pepsico, Coca-Cola, Kellogg, ITC, Dabur, Britannia, Parle, Amul, Reliance, Bharti, Tata, Wipro, Thapar
Conagra, HLL, Perfetti, GSK, Heinz, Haldiram, Godrej, Venkys, MTR,
Wyeth, Ajnomoto, Nissinmet MDH
Source: Dun & Bradstreet Food Processing Industry Report

PAGE 2 EMERALD EMERGING MARKETS CASE STUDIES VOL. 4 NO. 2 2014

 Birth of “Aachi” masala
Following the Twinkle Liquid Blue experience, Isaac looked for similar opportunities where
there were not too many established players and he found a gap in the cooking masala
market (processed and premixed dry spices and condiments[4]), which at that time was
dominated by the MTR, MDH and Sakthi brands. These catered mainly to the
premium-price segment. Apart from these major brands, unbranded masala was sold loose
in the unorganized sector, which catered to the middle-class and rural populations.
Replicating his earlier method, seeking the help of food processing and quality control
consultants, he came up with vegetarian and non-vegetarian variants of basic cooking
masala formulations, which matched the standards required for the ISI certification mark of
the Bureau of Indian Standards. While Isaac was convinced of his product’s quality and the
value it offered to customers, after initial trade trials, he discovered that the challenge to
arrive at a pricing affordable for the common man was dependent on expert ingredient
buying. The commodity was seasonal and cyclical and profitability lay in buying at low
prices during the peak season when supply exceeded demand and monetizing the stock
purchases during rest of the year. A few “trial and error” buying cycles taught him the art
of purchasing ingredients cost-effectively and Aachi masala was born and selling.
He chose “Aachi” as a brand name for his masala range of products. The brand name was
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derived from the term “Aachi” which is used in the Tamil language as an endearing term of
reference for a grandmother. “Aachi” also referred to the good hostesses of Tamil Nadu,
mentioned in the Silapadigaram, a Tamil classic. In the Chettinad culture of Tamil Nadu,
women are called “Aachi” with respect. Another reason for choosing the name is that it is
partly derived from the word “Aatchi” which in Tamil means “to rule”. Despite starting with
just a single food product, he envisioned that his Aachi brand should rule the kitchen
across many categories.

Going to market – discipline called distribution

Time and again conversations and observations at road-corner tea-shops taught him that
an average rural customer could not afford to stock products. Breaking bulk was an Indian
retail speciality. India is perhaps one of the few countries where you can buy one cigarette,
one tablet of Crocin, or a few grams of any product dispensed from a bulk pack. The retailer
did the breaking of bulk. Therefore, the solution was to come up with single-use portions
that were priced at Rs 1 or approximately 2 cents (INR 55 ⫽ USD1) or at similarly low price
points that were common for items such as shampoos, detergents and others but had not
previously applied to packaged food ingredients. He became a pioneer of launching
masalas at Rs 1. He also targeted 50-g and 100-g variants towards higher-income
households/consumers at attractive price points such as INR 5.00 and INR 10.00.
The suggestive and indicative perceptual map of the food processing industry in the late
1990s is shown in Figure 1.
As there were no competitors trading at Aachi’s price point (segment), Isaac reckoned that
success would lie in the width of distribution and coverage. Starting with towns which had
a population of fewer than 20,000, he planned to expand to other towns gradually. He and
two new recruits, who were his early employees, were doing the selling. The initial four
years were a real struggle, as nobody (trade or consumer) was aware of the Aachi brand.
The ordeal of distributing a new, unknown brand to the market was tiring and painful. His
small team addressed this meticulously by placing the product on retailers’ shelves and
collecting payment when it was sold by the retailer. Isaac focused first on distribution in
rural areas, then semi-urban and later urban districts, believing that as his products offered
quality at an affordable price, they would gain acceptance slowly but surely, and indeed
they did. However, the meticulous approach adopted caused severe monetary strain and
he barely managed to make ends meet when he was financing the project from meagre
savings and limited advances from well-wishers.

VOL. 4 NO. 2 2014 EMERALD EMERGING MARKETS CASE STUDIES PAGE 3

 Figure 1 The processed spices perceptual map

Isaac has developed his distribution network really well over the years, making it his
companies’ inimitable strength and core competence. By 2011, Aachi had established its
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reach to consumers through 3,500 agents (redistributors) who cater to a million retailers. In
Tamil Nadu, 3,500 agents translate into “an agent per village” and for Super Stockists in
Chennai Metro and other selected large towns.

Product support – when to advertise

Having trained at Godrej, which is one of the large advertisers in India’s FMCG sector,
Isaac was tempted to advertise and support the product. But the successful sales manager
within him held firm to the dictum to place the product and make it available before initiating
an advertising campaign. He had witnessed several product launches where advertising
had broken when product was not available (on account of disconnects between marketing
and sales), and in those cases, failure to coordinate had killed the products. Therefore, he
stuck to below-the-line (BTL) support and focused on deepening product penetration
where he had already achieved width. Within the first four years of operation, Aachi
achieved the targeted width of distribution in rural markets and slowly the retail
payable-when-able system had changed. By that time, the towns above the
20,000-population stratum, namely, the semi-urban and urban markets, had also started
adopting the product. When Aachi entered semi-urban and urban markets, Isaac
continued to confine himself to BTL activities for promotion, such as trade load
supplemented by in-store displays and point-of-sale material such as posters, stickers,
buntings and incentives.
Aachi first advertised in 2004 when Isaac was convinced he had achieved action standards
in both the width and depth of distribution. Since then, he has set aside 2 per cent of sales
revenue for support activity – theme and scheme. Isaac’s patience and perseverance in
distribution paid rich dividends, and the Aachi brand was a household name all over Tamil
Nadu when the advertising started.
Spending in crores is more effective than spending in lakhs, so I waited for the right time
Isaac

Aachi becomes a house of brands

With turnover crossing the magical INR 1 billion or ca. USD190000 (1 crore ⫽ 10 million
INR; USD1 ⫽ 55 INR), Aachi’s masala had become a recognized name in middle-class
households in Tamil Nadu. Isaac believed that further growth depended on expansion in
new categories. He constantly identified opportunities for products (i.e. gaps in price points
for available products) and came up with a slew of product ideas in different but related

PAGE 4 EMERALD EMERGING MARKETS CASE STUDIES VOL. 4 NO. 2 2014

 processed food categories (Exhibits 1 and 2: Products of Aachi and Brands under Aachi).
Aachi Gulab Jamun Mix and Aachi Badam Drink Mix were instant hits. The myth that badam
(almond) drink powder was meant only for the rich was dispelled, as Aachi sold it in packs
for just Rs 3 (ca. 0.05 cents).
Building on its original forte as a spice-based product supplier, Aachi Masala Foods Pvt.
Ltd. made forays into many new categories, including ready-to-cook food items, and edible
oils (sunflower and sesame). Aachi also entered the market for Ayurvedic over-the-counter
products such as rheumatic pain relievers, tooth powders and cough syrups under the
Sabash brand. In the homecare category, Aachi’s Twinkle brand ‘marketed products like
liquid blue, cleaning powder and mosquito and other insect repellents.
With such a slew of product launches, Aachi Masala Foods Pvt. Ltd. became a house of
brands and has grown consistently at a compounded annual growth rate of approximately
30 per cent over the past three years.

New way to launch

Most of Aachi’s success was due to Isaac’s sharp focus on distribution. But he did
encounter a few setbacks by relying solely on going to market. Many products were
launched and placed on shelves without proper test marketing or any in-depth knowledge
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of their particular category. Though this worked up to a point, there were failures. This made
Isaac more cautious and he turned his attention to product rationalizing, ensuring that
prudent advertisement spending was backed by effective test marketing before launch.
Now a product in any new category may take two to three years to get its release.

Aachi – the organization

The companies under the Aachi group banner are Aachi Masala Foods Pvt. Ltd., Aachi
Spices and Foods Pvt. Ltd., Aachi Special Foods Pvt. Ltd., Benny Product Pvt. Ltd., Blesso
Herbal International Pvt. Ltd. and Sabash Marketing Pvt. Ltd. Aachi’s manufacturing facility
is located at Keel Ayanambakkam, 15 km from Chennai. Equipped with state-of-the-art
technology, it employs the best quality experts and technical staff in its manufacturing and
R&D facilities. At present the facility can churn out 120 metric tonnes of spices and spice
mixes per day. Isaac’s family members hold key responsibilities in the group. His wife is
Managing Director of Nazareth Foods Pvt. Ltd. Production. Ashwin Pandian, a graduate
mechanical engineer with an MBA from the USA, manages the logistics and projects
divisions. Marketing, advertising and new products divisions are managed by Abhishek
Abraham, a graduate engineer in food technology with an MBA from Mumbai’s SP Jain
Institute. Ashwin and Abhishek are Isaac’s sons.

Outsourcing
From the time he collaborated with the chemical laboratory that helped to formulate
Twinkle, Isaac realized early in his venture that it was not always necessary for Aachi to
produce all of its products itself. He thought Aachi’s growth could be bigger if he shared
the dream with like-minded individuals. He opted to outsource production to other
entrepreneurs. Since 2009, nearly a dozen MSMEs[5] have made food products for the
Aachi brand. The number of MSMEs had grown to 24 by 2011. As of 2011, about 60 per
cent of turnover was coming from direct production under Aachi Masala Foods’ direction
and the balance was made up from outsourced production. To ensure proper quality and
consistent supply, Isaac has taken stakes of up to 26 per cent in the equity of these
MSMEs. Isaac has also set a goal of having at least 100 MSME partners by 2015. Aachi’s
decision to outsource was a key initiative, as outsourcing offered both inbound and
outbound cost advantages. The inbound advantages came from partners being close to
raw material supplies and outbound advantages were realized by reducing distribution
costs, and in addition, Aachi’s outsourcing model created opportunities that helped other
small entrepreneurs. Having achieved the number one position in Tamil Nadu, Aachi’s

VOL. 4 NO. 2 2014 EMERALD EMERGING MARKETS CASE STUDIES PAGE 5

 reputation had the power to attract good job processors and gave it access to the best
technology, which being standardized across food processing units and assuring the
quality of output enabled Aachi products to conform to international standards.

Isaac: Entrepreneurial competencies and ethos

Over the years, since Aachi’s success, Isaac has been one of the leading speakers on the
entrepreneurial circuit. He has been very vocal in encouraging many others to become
entrepreneurs with his famous line, “Entrepreneurs are not born but made”. He believed
that the significant entrepreneurial competencies are initiative, seizing opportunities,
obsession, persistence, commitment, self-confidence and persuasion. Therefore, if one
possessed these competencies, there was no reason why a person could not become a
successful entrepreneur. His mantras for succeeding as an entrepreneur were presented
in the following extracts of an interview he gave for a website[6]:
Remain committed: I am obsessed with my work. Once I decide to take up a project, I
concentrate on it 100 per cent. Till the project is implemented successfully, I will not sleep
in peace. The project would always remain in my thoughts, and dreams. It takes priority over
my personal life. Even if things don’t work out as well as anticipated, I would never give up,
but continue to remain positive and motivated. If a product does not do well in the market,
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I try to locate the root of the problem and fix it. I leave no stone unturned to ensure quality
of the product. Once I am assured the quality of the product is good, then I sort out any
hitches in distribution or marketing, I have developed a habit of overcoming challenges and
sitting back and enjoying the success of my efforts.

Treat people well: Many organizations do not understand the worth of people and keep losing
talented and skilled workers. I look at people as assets and not as liabilities. If someone is not
suited for a particular job, I will not fire the person. I believe that each person has some talent
that needs to be identified and made use of. People look for love and when you give them that
they remain loyal to you.

Seek opportunities: I always look for new opportunities. My eyes and ears are always seeking
them. Being in the FMCG sector, we are alert to the possibilities in the rural market, where the
disposable income of people is growing. We need to innovate to create new markets. We hope
to encourage the rural population to switch to ready-to-cook food items and use ready-made
masalas to prepare their food, so that they would spend less time in their kitchen and use the
time saved for other productive work. We are now a regional brand with presence in about five
states. We have plans to grow into an international brand and explore new markets.

Food processing industry in India

The food processing industry in India has been acknowledged as a sunrise sector,
which has gained recognition in the past five years. The Indian food processing industry
is estimated at USD135 billion with a growth given in a compound annual growth rate
of 10 per cent and is projected to reach USD200 billion by 2015[7]. According to a
Ministry of Food Processing Industries report, the Indian processed food market
accounts for 60 per cent, while the value-added processed food market gives 40 per
cent. The structure of the Indian food processing industry and its overall contribution in
manufacturing are given in Exhibits 3–5.
The food processing industry has a 1.5 per cent share of the total gross domestic product
of the country, and India’s share in world processed foods trade accounts for about 1.6 per
cent. The industry is extremely fragmented and largely comprises the following categories:
fruits and vegetables, milk and milk products, meat and poultry, marine products, grain
processing, beer and alcoholic beverages, packaged/convenience food and packaged
drinks. As many processed products overlap different segments, classification is not very
distinct. The unorganized segment is huge and amounts to more than 70 per cent of the
output in volume and 50 per cent in value. The organized sector is comparatively small, but
is growing at a rapid pace. It is projected to reach 40 per cent by 2015 (Exhibit 6).

PAGE 6 EMERALD EMERGING MARKETS CASE STUDIES VOL. 4 NO. 2 2014

 The government is giving priority status to all agro-processing businesses, and incentives
are being given in the field of mega food parks, cold chain and exports benefits. In addition
to the demand side, which contributes to the growth, the supply side is augmenting the
sector with the rise of organized retail, growing foreign direct investment (FDI) in food
processing and the introduction of new products. The food processing industry will
continue to offer worthy opportunities to its upcoming and existing players.
There are over 5,000 food products that can potentially be branded, whether masalas, the spicy
powders that go into the making of mouthwatering dishes, pickles, instant mixes that make life
easy for someone cooking. . .the list goes on
Isaac

Aachi versus competition

Biggest competitors are not MNCs, it’s our own mothers working at home
Isaac
India has major MNCs and major established Indian companies in its food processing
sector (Table II). Many Indian MNCs are likely to enter the sector, given the opportunities
available for cashing in. Though it is an undeclared number one in Tamil Nadu, Aachi has
not done well in other parts of the country.
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As of 2010, Aachi’s focus on rural marketing in South India had paid rich dividends. As
the rural market, according to a CRISIL study, is spending more on food consumption
than urban areas presently, 375,000 crore (USD68 billion) compared to 299,400 crore
(USD54 billion), approximately 70 per cent of Aachi’s revenues came from South India,
while 10 per cent was from other Indian states and another 20 per cent from exports.
The distribution in Tamil Nadu has given Aachi an advantage over other players in that
region; thus, it was time to look at growing Aachi’s presence in other markets,
particularly North India, where there is a significant South Indian population. Therefore,
Isaac Padmasingh was contemplating replicating the south model for his foray into the
north. Exhibit 7 gives the sector’s market potential.

Back to Founder’s Day, new ventures and challenges ahead

Having shared his dream of hitting the INR 10 billion target by 2015 with his employees on
Founder’s Day, and with the threat of FDI in branded retail looming large, Isaac has
communicated to his team plans to test new products such as mineral waters, jams and
fruit juices. He also sees a big opportunity in selling South Indian snacks in the same
manner as KFC or McDonald’s and he has expressed his intention of starting a

Table II Processed food and vegetable industry size (estimates)

Industry size (INR million)
Category Organized Unorganized Key players (organized)

Jam 900 500 HLL, Mapro, Marico, Malas

Pickles 1,500 10,000 Priya Foods, Praveen, Desai Brothers, Cavin
Kare, GD Foods
Sauce/ketchup 1,000 4,000 HLL, Nestle, GD Foods, Heinz
Pulp/concentrate 4,000 NA Foods & Inns, BEC, Clean Foods, Jain
Irrigation, Usha International
Juices/fruit-based drinks 5,000 NA Pepsico, Dabur, Parle, Godrej, Mother Dairy
Squashes 1,300 2,500 HLL, Haldiram, Mapro
Ready-to-eat vegetables 1,000 NA Tasty Bite, ITC, MTR
Potato chips 2,500 3,000 Pepsico
Cooking pastes 300 NA Dabur, HLL
Total 37,500
Source: Agricultural and Processed Food Products Export Development Authority (APEDA),
Government of India

VOL. 4 NO. 2 2014 EMERALD EMERGING MARKETS CASE STUDIES PAGE 7

 “predominantly chicken-based” fast-food restaurant business with an INR 1 billion
investment programme.

What next?
As he was giving bonuses and rewards on Founder’s Day, Isaac was also thinking of what
Aachi should do to ensure the success of his plans and take his group beyond the INR 10
billion landmark target set for 2015, which was his main concern. He was also looking to
find answers to the following questions:
 How do I extend the market dominance Aachi has in Tamil Nadu and replicate it in other
Keywords:
states?
Entrepreneur,
Distribution,  How do I grow my exports at a consistent pace in the next few years?
Aachi masala,  How do I foray into other categories such as packaged drinking water, fruit juices, etc?
FMCG marketing,
Going to the market,  Would forays into snacks work?
Growth strategy  How would the recent government move to open FDI in retail affect Aachi?

Notes
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1. Source: Rural population as per 2011 Census of India, http://censusindia.gov.in/

2. (Late) Dhirubhai Ambani was the promoter of Reliance Industries Ltd., a Fortune 500 company with
a turnover of USD51.7 billion (media release Jan 2013), who had started his career as a petrol pump
salesman in Yemen.
3. Liquid blue is a concentrated formula of ultramarine or a dye that is used to whiten white clothing
and linen post wash. Liquid blue is more easily and evenly distributed in water when mixed, thus
superior to the powdered form and hence does not stain clothes or linen.
4. Cooking masala is a must culinary ingredient in every Indian kitchen, irrespective of income.
5. MSME – micro, small and medium enterprises – as defined by Industries (Development &
Regulations) Act, 1951, Government of India.
6. www.theweekendleader.com/Columns/107/the-right-mix.html, retrieved as on 18 June 2010.
7. http://business-standard.com/india/news/kit-food-processing-industry-in-india/456812/, retrieved
on 18 June 2012.
8. If this case is not being taught in an entrepreneurship elective, the instructor could give a standard
textbook on entrepreneurship as a pre-reading exercise.

Exhibit 1

Figure EI Mr Isaac Padmasingh receiving the award

PAGE 8 EMERALD EMERGING MARKETS CASE STUDIES VOL. 4 NO. 2 2014

 Exhibit 2
Aachi product categories
 Masalas for vegetarian preparation.
 Masalas for non-vegetarian preparation.
 Spice powders.
 Rice paste varieties.
 Thokku.
 Pickles.
 Cooking paste.
 Ready-to-cook.
 Flour items.
 Special products.

Exhibit 3
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Figure EII Brands under Aachi

Exhibit 4

Figure EIII Indian food processing share in overall Indian manufacturing

VOL. 4 NO. 2 2014 EMERALD EMERGING MARKETS CASE STUDIES PAGE 9

 Exhibit 5

Figure EIV Food processing segments

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Exhibit 6

Figure EV Structure of the Indian food processing industry

Exhibit 7

Table EI Indian food industry: key statistics (in billions of USD)

Years 2002-2003 2006-2007 2010-2011 2014-2015

Food industry size 175.0 200.0 250.0 300.0

Food processing industry size 70.0 85.0 110.0 150.0
Size of organized sector in food processing industry 13.0 23.0 37.0 60.0
Per cent share of food processing industry in total food industry 40 43 44 50
Per cent share of organized sector’s in food processing industry 19 27 36 40
Source: Ministry of Indian Food Processing Industries

PAGE 10 EMERALD EMERGING MARKETS CASE STUDIES VOL. 4 NO. 2 2014

 Exhibit 8

Table EII The sector-wise market potential

Market size (INR billion)
2003-2004 2009-2010 2014-2015

Fruits and vegetables 49 290 550

Dairy 1160 2500 4400
Edible oil 495 710 980
Meat and poultry
Buffalo meat 20 50 86
Poultry 7 37 104
Non-alcoholic beverages
Tea 78 136 211
Coffee 23 33 42
Grain-based products
Rice milling 800 980 1150
Flour milling 520 650 760
Breads 38 95 198
Biscuits 69 182 393
Snack and ready-to-eat foods 29 150 486
Pasta-based foods 8 36 102
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Marine products 70 173 377

Sugar and sugar-based
Sugar 240 320 390
Confectionery 12 30 70
Chocolates 8 25 59
Alcoholic beverages
Beer 41 110 193
Spirits 190 393 870
Wine 3 50 90
Pulses 400 605 810
Aerated beverages 80 137 201
Malted beverages 12 35 75
Spices 175 450 886
Salt 25 53 90
Total 4,600 8,200 13,500
Source: Adapted from Rabobank analysis, Rabo India Finance Pvt Ltd, April 2005

Corresponding author
T.N. Swaminathan can be contacted at: tnswami@greatlakes.edu.in

VOL. 4 NO. 2 2014 EMERALD EMERGING MARKETS CASE STUDIES PAGE 11

 Abstract
Title – Aachi – spicing up a growth trajectory.
Subject area – Marketing and entrepreneurship.
Study level/applicability – The case is applicable to MBA core marketing, sales and distribution,
strategic marketing, fast-moving consumer goods (FMCG) marketing and entrepreneurship.
Case overview – Isaac Padmasingh, a first-generation entrepreneur who was awarded TiECon’s
“Extreme Entrepreneur of the Year 2010”, has built a thriving enterprise. From his first job as a salesman
in Godrej to being the founder of “Aachi” group of companies with a turnover of INR 700 crores (USD132
million) annual revenue, he has had quite an eventful journey. His early insights in Godrej in sales and
distribution, coupled with his entrepreneurial passion, have enabled him to grow his company this far in
a short span of 14 years. His business is partly managed by his wife and his two sons who are the
directors of this private enterprise. Now he is making bold moves to venture outside Tamil Nadu and
become a national brand, which means a major scaling up and moving into the next orbit. Vital questions
in scaling are: Is Aachi pursuing the right growth strategy in their effort to scale up? How can Aachi look
at the imminent foreign direct investment in retail as an opportunity for growth? Looking back over the
years, what has Aachi learnt and how to carry forward the best practices and learn from the mistakes
made?
Expected learning outcomes – Entrepreneurship: to introduce the entrepreneurial vision in creating a
new enterprise, and to understand the characteristics of an entrepreneur. FMCG marketing: to discuss
the importance of going-to-the-market strategy, to discuss the importance of distribution reach in rural
marketing, to discuss the nuances of branding in Aachi’s growth story and to familiarize students in
successfully marketing FMCG products. Growth strategies: identifying opportunities for the future, and
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to explore the growth strategies suitable for Aachi.

Supplementary materials – Teaching notes are available for educators only. Please contact your
library to gain login details or email support@emeraldinsight.com to request teaching notes.

PAGE 20 EMERALD EMERGING MARKETS CASE STUDIES VOL. 4 NO. 2 2014