Herbalife, the $1.7 billion health and nutrition company, is looking at product localisation to attract Indian taste buds.
The development comes following the realisation that Indians are not a pill-popping group unlike western counterparts. Here people prefer a proper meal rather than feeding on tablets.
"We are looking at different modes of deliveries system while keeping all the nutritional values intact. It is better to offer Indians soups and biscuits enriched with nutritional items than medicine," Manoj Shirodkar, country director of Herbalife India, said.
The company was already working on products on these lines. Shirodkar said it could be launched as early as next year.
The company has undergone major organisational and functional changes since October, which has given the company freedom in product development, marketing and distribution strategy.
"Even though we have to seek parent's nod for new product, we now have freedom to customise them according to local demand," he noted.
Herbalife's turnover is estimated at Rs 80 crore (Rs 800 million). It is expecting a turnover growth of 20 per cent per annum.
"The market is huge. According to an estimate, Rs 60,000 crore (Rs 600 billion) per year is the cost of bad nutrition in India. For company like Herbalife the opportunity is huge with the right product," an expert said.
For Herbalife, the biggest revenue grosser today is weight management items. Going by the estimated 15 per cent of Indian population suffer from obesity, the company should do well, Shirodkar noted.
The company is looking at introducing three products a year in the country. It has a large international portfolio that includes both inner and outer nourishment (cosmetics) products. However, Herbalife would concentrate on inner care items for now in India.
The company has a contract manufacturing agreement with Pune-based Litaka Pharma. Shirodkar said more units could be added to manage distribution cost.
"Whenever a region reaches volume which can economically sustain a new facility, we will look into it," he added. At present, east is the largest market for Herbalife accounting 35 per cent of total turnover.
