Schauna Chauhan: Adding fizz and froth

As the story goes, Mirza Ghalib once wrote to a friend about his anguish at not being able to eat enough of his favourite fruit, mangoes. Ghalib, about 60 at the time, complained he could not eat “more than 10 or 12 in a sitting... and if they are large, then just six or seven”. We feel Ghalib’s pain. As the summer rolls around, we too can’t have our fill of the succulent fruit, however hard we try. It’s hardly surprising then that this passion for mangoes has launched thousands of businesses in the country. Mango toffee. Mango juice. Even mango frappuccino. But perhaps the most iconic of them is Frooti, one of the country’s largest selling mango-flavoured drinks from the house of Parlé Agro, among the leading players in the fruit drinks market in India.

It isn’t an easy business. Every year, Parlé Agro has about two months to buy and process Totapuri mangoes from Tamil Nadu and Andhra Pradesh, to make pulp for Frooti for the whole year, which is then sold in about 50 countries. And every year the mango crop gives a lot of anxiety to Schauna Chauhan, CEO of Parlé Agro. “Every single year, we are analysing is it going to be a good crop, or a bad crop, and what is the demand that is going to come out in the market,” Schauna, the oldest of founder Prakash Chauhan’s three daughters, tells me in her office at the end of a quiet street in Mumbai.

The big question in my head is: How has the company managed to keep Frooti thriving after more than three decades? After all, the list of fruity or fizzy drinks that have died facing the onslaught of big foreign brands like Coke and Pepsi is long. In fact, Parlé had to sell off its leading soft drink brands—such as Thums Up, Limca, Gold Spot, and Maaza—to Coke, which along with Pepsi took over the market after the economy opened its doors to multinationals in the 1990s. At that time, Parlé Group was a single company owned by the Chauhan family before it was split into Bisleri International and Parlé Agro, which went to Prakash Chauhan and his daughters. With that, they also got Frooti, the successful fruit drink he launched in 1985.

One reason why Frooti still thrives is Schauna, who joined the company at the age of 22 in 1999 after she returned from Switzerland with a degree in international management. She took over the reins from her father in 2006. When she started, Parlé Agro was a very different company,with seven manufacturing units and more than 90% of its revenue coming from Frooti. The company’s turnover was about ₹600 crore at the time, she tells me.

Today, Parlé Agro is close to a ₹4,200 crore company with 13 units and an array of products, including packaged water Bailley, fizzy drinks, and snacks. And Frooti’s revenue share has gone to about 52%. So, how did it all happen? A lot of credit for the transformation goes to Schauna, who debuts on Fortune India’s Most Powerful Women list this year.

The 42-year-old Schauna, with a signature grey-streaked bob, says the business has always been a part of her life. When she was in school, Parlé Agro owned a plant in Patalganga in Maharashtra, which she visited every week- end. That’s where she first understood the nitty-gritty of operations, from chillers and boilers to water storage tanks. “I would have the plant head walking around with me. I would actually only be learning,” she says. “It was a part of growing up. All my friends knew who I was because at that time we had Thums Up and Gold Spot. Everybody knew this is what Schauna is going to end up doing.” Her friends were right. Her initial years were all about learning the ropes from her father. It was a time of transition and restructuring, with the company selling some bottling plants and buying some others. Schauna was in charge of some of these transactions. “This is where my experience came from. That’s when I felt that I was good here. I was confident here. I felt we could do something great together with the team,” says Schauna. (She says she would be a lawyer if not a CEO).

For Schauna, the dream was always to go big with Parlé Agro. She is also constantly looking for innovative ways to cut costs as commodity prices fluctuate and the company expands aggressively. Under her leadership, the company recently set up a highly automated manufacturing facility in Mysuru to increase its presence in southern India and upgraded manufacturing units to boost productivity and capacities. She also set up a fully automated factory in Sitarganj, Uttarakhand, with robotic handling systems and minimal manual intervention. “I constantly look at how can you reduce cost by innovating something different. It could be shrink film on a bottle, it could just be a change of specs, but you realise that the change of specs and the one rupee that you saved on that one case is a lot of money at the end of the day when you calculate your complete turnover,” she says.

Last year, the company managed to save about ₹2-3 crore by just changing the specs in glue. Parlé Agro’s growth came against the backdrop of big changes in the food and beverage industry. Traditional areas of demand were shifting, and more local and international players were entering the industry.

For Parlé’s Frooti, Coke’s Maaza and Pepsi’s Slice, both mango drinks, are tough competition. As competition grew, Parlé Agro expanded from largely being the maker of Frooti to other drinks like spice- based soda Dhishoom and Frooti Fizz. In 2005, the company launched India’s first sparkling apple drink, Appy Fizz, in a PET bottle. The company currently has Appy, Appy Fizz, Bailley, Bailley Soda, Café Cuba, Dhishoom, Frio, Frooti, and Frooti Fizz in its portfolio. But Frooti still remains its flagship product.

Sometime in 2014-15, the Chauhans felt the brand was losing its recall value and decided to give it a makeover. They hired design consultancy Pentagram to re-imagine Frooti’s packaging and brought New York-based creative agency Sagmeister & Walsh on board for a design makeover. “They did not know who I am, they didn’t know what Parlé Agro is, they didn’t know what Frooti means to the Indian consumer. And I didn’t want to tell them. I didn’t want to tell them that Frooti is our flagship brand,” she says. The plan worked. Parlé Agro launched different kinds of packaging, including a plastic bottle, and changed the look and feel of the product, except for the signature yellow colour. “From then to now, Frooti has shed or is still trying to shed its old fuddy duddy values, and has started becoming a lot more contemporary,” Schauna’s sister, Nadia, tells me.

Over the years, Schauna has added more manufacturing units, modernised the plants, and ventured to newer geographies. The company has also strengthened its distribution network from about 450,000 outlets in 2006 to around 1.5 million today. So, where does she see Parlé Agro going from here? She is armed with a five-year plan aimed at making Parlé Agro a ₹10,000 crore company by 2022. As of now, a new factory is coming up in Karnataka and another in Andhra Pradesh to expand in the southern market. “We are also looking at upgrading the existing plants, putting in new machines which can produce a lot more. We are also looking at robots coming in, warehouse automation, all sorts of things to improve the efficiency of the plants,” she says.

It’s a long way from the almost 100-year-old family-run business started by a tailor from Gujarat, Mohanlal Dayal Chauhan. Dayal and his five sons set up a factory at Vile Parle in 1929 and started manufacturing confectionery, before they ventured into fizzy drinks in 1952 with Gold Spot. For all her expansion plans, Schauna is wary of acquiring companies to grow. “I would not like to buy another company. By just buying the company, you are buying all the problems of the company,” she says. But she does plan to get into newer segments.

Schauna says strong support from her younger sisters has a big role to play in her success. Parlé Agro has clearly demarcated their roles: Schauna looks at the back-end, manufacturing, operations, and finance, whereas sister Nadia manages the front-end as joint managing director and chief marketing officer. The third sister, Alisha, manages CSR. Schauna says she leaves the research and development to her father and Nadia. She gets involved only when the concept is decided to work on the team, manufacturing, and other operational details. “We are run as well as a professional business. But we have the advantage of taking decisions a lot faster. You could place down in front of me today ₹50 crore capex, and I can sign off with you today,” she says.

The story was originally published in the Oct-Dec special issue of the magazine.