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“No out of court settlement, only brand, nothing more”
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Monday, 19 January, 2015, 08 : 00 AM [IST]
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fiogf49gjkf0d  Pune-based Kutwal Foods Pvt.Ltd is into manufacturing of dairy products,fruit drinks, aerated beverages and packaged drinking water for about one-and-a-half decades under the brand name Urja. The company was in the news recently for challenging Bisleri’s new energy drink Urzza in a court of law. In a telephonic interaction with Manjushree Naik, Ram Kutwal, managing director, Kutwal Foods Pvt.Ltd, talks about the issue in detail and reveals his company’s plans for the coming year. Excerpts:
You had announced plans to reach Rs 100 crore by 2014-15 about two years ago. How far has this been possible?
Actually the target was to reach the figure in three years and not two years. We intend to cross Rs 100 crore in the next two years.
You had also planned to invest Rs 20 crore and establish 500 myUrja outlets throughout Maharashtra and Karnataka. Give us details.
We have plans to set up 100 retail outlets by the end of this financial year. Spread over next two financial years, we will go for 500 as per our plan. The investment of Rs 20 crore is being made slabwise. This has been going on smoothly as per our target. By March-end we will reach 100 outlets, the next target being 500.
Your company was in the news recently for filing a suit against Bisleri for the use of brand name Urzza for its energy drink as it sounds similar to your established brand Urja. Give us details.
We are into packaged drinking water, soft drink, and fruit drink business under Class 32 (Light Beverages) of Trade Marks Act, 1999. We registered Urja in 2004, but have been using it as our brand since 2000. We have valid certificate for registration of the trademark in Marathi and English. Bisleri has launched its drink in the same class. But we have sole rights to use the brand name in that class. As per government regulations, Bisleri will need two to three years for getting the trademark registered, but we are already using it, and hence we have challenged it in civil court.
Apart from that, the launch of Bisleri’s brand has also created confusion in the market and people keep asking us if Bisleri has taken over your company or is it a joint venture and so on. Bisleri’s brand is phonetically, structurally and visually similar to ours. Recently, they filed their say. At the next hearing, we would look at obtaining stay.
But Bisleri is having only an energy drink with that name and among your products there is no energy drink. Besides there is marked difference between the spelling and phonetics then what is it that you are objecting to?
Legally and technically it does not matter whether it is energy drink or any other drink. If you look at the can of Urzza it is a carbonated beverage and soft drink technically. Similarly Pepsi, Coke and our Jeera Fresh are soft drinks. This is because, when sugar and CO2 are added, it is a soft drink. So it has nothing to do with it being an energy drink. So if such a product falls under Class 32 then it is illegal.
For example, we are not doing juices and syrups but as per law no one else can launch them under Class 32 and use Urja as a brand name. Even if spelling difference is there this can’t be done. For example, Bisleri is a renowned brand and if we launch something with the name Bishlari, they will object to it as we will be using their hard-earned goodwill and image when we do so.
Further in all Marathi newspapers Bisleri’s drink was mentioned with the phonetic j and not z. The same would happen with public, they won’t be able to differentiate between the two as the two names are phonetically, structurally and visually similar. Since 2000, we have been using this brand and I will fight till I am able to close the other brand. Right now we have not asked for any damages and many people have been asking me if we would go for out of court settlement or ask money, but we do not have any such plans. We are doing our business ethically and it is only about the brand nothing more.
Your company has stood strong for more than a decade though most of your products have competition from multinationals and local giants. How has this been be possible?
It was more about competition from local giants till recently. Multinationals have come in only recently. But you can always find space for your product. In case of food products, since they are directly affecting human health, the stress has to be on quality. We may not claim to be extraordinarily superior but we provide quality. Further service is our strength. We own more than 40 vehicles and have good distribution facility that ensure we reach our consumers efficiently. And, of course, the market is growing and there is space for everyone.
Your key strengths seem to be R&D and innovation. Elaborate.
We have always been looking for innovation and development in meeting needs - said and unsaid - of our consumers. For example when Steve Jobs launched iPad he did not find out if people needed such a product rather he felt there was room for a product that would go in your purse or bag and replace the laptop and launched it. We have a similar way of looking at things.
Recently, we launched Taak buttermilk in 1 litre bottle. Though the product may not be much different from competition, the packaging is innovative. Though Amul was available in 1 litre Tetra Pak, no one was offering it in a bottle and we went for it looking at it as a good product for health. We innovated and worked on the product and packaging and about a fortnight ago we relaunched Taak in 1 litre and 500 ml bottles, It is going great. Our innovation team is on the job constantly.
Another area that you seem to have an advantage is that you have advanced machinery, well equipped lab and efficient transportation at your disposal. How do these give you an edge over competition?
In our industry, people hire transport but we own a fleet of vehicles. Since most of our products are frozen products such as buttermilk, ice cream and curds, we need an efficient cold chain. Further, if you don’t own the transportation facility, then you have no control over it. But since we own the transportation infrastructure and hire drivers and delivery boys, we ensure timely delivery and quality.
As for machinery, we talk to manufacturers and get these as per our needs, that is the machinery is tailor-made for optimum performance.
Apart from myUrja, which are the other innovative methods that you have adopted to reach the end-consumer?
We have launched flavoured milk in pet bottle and we are only the second company in the country to do so after Amul. All others are offering this product in glass bottles of 200 ml. For this, we have invested Rs 2 crore for the machinery. We have had a soft launch of this product last month with trials in the market and it has been successful.
Tell us about your outsourcing business.
Aarey is a government brand whose business has been taken over by a private company. We have been manufacturing flavoured milk for them for the last two years. Besides, we supply mango drink, soft drink and water to Star Bazaar for their private labels.
Food safety regulations in the country are being talked about ever since the implementation of the Food Safety and Standards Regulations, 2011. What are your observations?
This law is timely and great. It is binding on everybody. As I said earlier, food manufacturers are directly dealing with people’s lives. And hence, they have to be careful and ensure manufacturing of safe products. I think the guidelines by FSSAI are apt for this purpose.
What are your plans for the future in terms of new launches, exports, new markets and so on?
We have to reach Rs 100 crore in two years for sure. Though our focus was rural areas earlier, we are looking at new markets. Mumbai is a big market and we are having mega plans for the island city. We have started with setting up our first outlet in Bandra this week and soon we are going to set up an office in the city. We have to complete the target of myUrja outlets and as far as trade distribution is concerned, apart from Maharashtra and Karnataka, where we have strong presence, we are planning to enter neighbouring states.
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