Weight loss mart on a growth curve

In its bid to retain its grip on the slimming centre market, Gurgaon-based VLCC is all set to open 30 more outlets across the country. The new weight loss centres will augment the existing 63 outlets that the company owns.

There are plans to expand the company's portfolio too. "Our aim is to become numero uno in the business of slimming and beauty," says Vandana Luthra, chairperson emeritus, VLCC group of companies.

The company's footprint that, till recently, was mainly in northern India, will soon be seen in the south too. By 2005, cities such as Vizag, Thiruvananthapuram and Kochi will have VLCC slimming centres.

Next in the line are Goa and Cuttack and the grandiose plan includes opening centres in London, Dubai, Kuala Lumpur and Colombo.

In the last few months, VLCC has added a spa, a nail salon a personal care products range to its portfolio. In the pipeline are packaged health food products -- manufactured and retailed by VLCC.

The company is in the process of setting up a resource centre that will offer consultancy to people wanting to get into the beauty and slimming business.

However, the company's managing director and Vandana Luthra's husband Mukesh Luthra says that though the company is diversifying in a big way, 'slimming centres will continue to be our growth engines.'

Luthra is also planning an initial public offering in two years time. He is currently in the process of roping in a private equity partner who can pump in Rs 50 crore (Rs 500 million) to Rs 60 crore (Rs 600 million) to fund its expansion.

In 2003-2004, the company clocked a turnover of Rs 84 crore (Rs 840 million), up from Rs 60 crore in 2002-03. In this financial year, the company is targeting a Rs 125 crore (Rs 1.25 billion) turnover.

This year, the company is also expecting growth to come from its personal care brand, Prana, comprising 130 products for hair and skin care, soaps and oils.

"We plan to launch a new product every six months," adds Mukesh Luthra. For the purpose, the company is opening a second manufacturing unit in Dehradun next month.

The company's existing factory is located in Gurgaon. It is also planning to open more nail salons in Delhi and other cities.

The focus on growth is reflected in its plans for VLCC training institutes. Says Luthra: "The first institute was started in 2000 so that we could train people for our business."

The institute offers courses in the fields of beauty, nutrition and health management. It has received the nod from the UK-based City and Guilds. From the existing three (two in Delhi and one in Lucknow), plans are on to open 12 such schools by the end of this financial year.

The beauty and fitness industry (including slimming centres, gyms, spas, and personal care products) in India is extremely disorganised and figures are difficult to come by.

However, industry sources peg it at around Rs 2,000 crore (Rs 20 billion). Commenting on VLCC's growth plans, imaging and styling expert Malavika Tiwari says that "the nail salon and spa is a great idea as it targets a niche group."

However, Delhi-based stylist Yatan Ahluwalia feels that to piggyback on the beauty business is not a good idea. "VLCC will always be associated with slimming centres. That's its forte and it should leverage that. Things like nail art are fads and very metro oriented," he observes.