Price War Between MNC’S, Growth of Ghari Threatens Small Detergent With Washout
The company that has been operating primarily in Uttar Pradesh for two decades started distribution in eight new states last year. It now covers 20 states across the country. "We are also setting up a new plant in Karnataka to cater to newer markets," Gyanchandani added. This may help Ghari challenge Hindustan Unilever's Wheel as the largest detergent brand in the country. But the multinational giant is in no mood to cede any ground. "We have taken several actions to strengthen our leadership position," a company spokesman says. "We have invested on our brands, be it in terms of innovation, product quality or marketing spends." Last year, Hindustan Unilever added more than 600,000 outlets despite having the largest network of a million retail outlets already. It increased its sales across the portfolio. Wheel reported the highest growth. Its multinational rival P&G too gained the most from Tide's low-priced variant launched a year and a half ago. Meanwhile, the fall in regional brands fortune is dramatic because many of them were seen as a threat to national brands just two years ago. Market experts expect them to return to the market when the crude oil prices bottom out. That will help them sell cheaper detergents. The trend of strong and established players gaining momentum is similar to 2004 when Nirma, the second largest detergent brand then, found itself caught in the crossfire between HUL and P&G, when both the companies slashed prices by 30%. This time, however, on the firing line are local players, each trying to replicate the Nirma model. Experts feel Ghari's market share will now even out while HUL and P&G's could show a marginal increase.