The COVID-19 pandemic has been tough on the agribusiness industry, which accounts for around 3% of the country’s GDP. The IBEF has predicted that the nationwide COVID-19-induced lockdown will see a quarter of all restaurants close by the end of 2020.
Unfortunately, Mumbai-based CRAVOVA is one of the companies that had to cease operations. The beverage startup was founded in September 2019 by Farhan Gigani, Thomas Giganiand Satish Negi. The company started operations in January 2020, offering RTDs (ready to drink) ranging from cold brew coffee to mojitos.
“With COVID-19, physical markets were barely functioning. Due to the market scenario, we had to get rid of our stock at a heavily discounted price to avoid staleness. We realized that it was not the right time to launch a new product on the market and stopped operations,” Satish explains in an interaction with Your story.
However, the co-founders resumed their activities in August of the same year, and this time there was no turning back.
The startup sold around 3.6 million units of beverages in 2021 itself, recording a GMV (gross merchandise value) sales value of around Rs 16 crore.
Satish Negi, co-founder of CRAVOVA
Convenience in a bottle
While arranging a meeting at home with friends, Satish wanted to buy some snacks and drinks. “The only options available were regular colas and juices. So we decided to try our hand at making something more exciting,” he says.
After watching a few videos on YouTube, he ended up making mojitos and cold coffee as welcome drinks for the guests. It became CRAVOVA’s eureka moment.
“We take the hassle out of home preparation for consumers,” says Satish.
CRAVOVA offers RTDs like cold brew coffee and mocktails. Its range of mocktails consists of classic mojitos, watermelon, kiwi, peach, orange, green apple and fresh lemonade.
In addition, it offers cold coffee – classic, struck, hazelnut and mocha; roasted peanuts and chickpea puffs.
Cold coffee variations offered by CRAVOVA
The three co-founders met through mutual acquaintances. Satish (40) has 15 years of experience in research and consulting, Farhan (34) is a commercial pilot and has 13 years of experience in FMCG distribution. Thosif (33) has 11 years of experience in FMCG distribution. Currently, the startup has a team of 15 employees.
CRAVOVA operates on a lean CAPEX model. The startup has its products manufactured by a contract manufacturer and they are then shipped to CRAVOVA’s warehouse and distributed across the country.
The startup relies on the technology of its production unit to manage warehouse entries and exits, inventory updates, as well as to manage and monitor the sales force.
CRAVOVA is currently available in 25 Indian cities, including all major metropolitan cities, and has a significant presence in Mumbai and Gujarat. It is also present in Tier II cities like Amritsar, Calicut, Kashmir, and Dehradun, among others. The omnichannel brand is present in modern commerce, general commerce and is also present online. It works through distributors and sales channel partners. CRAVOVA products are available online on Flipkart, Amazon and Bigbasket.
Sparkling mojitos are priced at Rs 50 for a 300ml bottle; and cold coffee costs Rs 50 for a 200ml bottle. Chickpea puffs and roasted peanuts are priced at Rs 40 and Rs 25, respectively.
Mojito variations proposed by CRAVOVA
“In September 2021, the government increased the GST rate on soft drinks. Our RTD sparkling mojito falls into this category. So, without too much control, we had to increase the MRP by 20%. We thought it would impact our sales, but surprisingly consumers weren’t shy about paying a little more for the product, and we saw an increase in our sales numbers,” says Satish.
Early last year, Suresh Narayan, President of Nestlé India, predicted that India’s packaged food industry would be valued at 70 billion dollars in the next 5 to 10 years. He attributed this dual growth to demographic dividends, the growing popularity of e-commerce and overall economic growth.
Several D2C coffee brands have invaded the shelves of supermarkets and kirana stores. When it comes to cold bottled coffee, CRAVOVA competes with Raw Pressery, Sleepy Owl, Cothas Coffee, Nescafe and Starbucks. Similarly, in its snack segment, CRAVOVA competes with Paper Boat, Nutty Gritties, and Jabsons, among others.
For mocktails, “we compete with RTD brands. But the market is big enough for all of us to operate and thrive simultaneously,” says Satish.
Moreover, he adds, “We are positioned in the mass premium segment because most of the products in our category are either premium or economy. We offer these products at a very affordable price so that the reach can be maximized. »
Since the previous year, CRAVOVA has recorded a growth of 500%, selling 2.3 million units of mojitos in one year. “We are aiming to achieve sales of Rs 100 crore GMC over the next two years,” says Satish.
Going forward, the startup plans to further penetrate existing cities and simultaneously expand horizontally through indirect distribution channels.
“We are optimistic about online sales and a good portion of investment will be directed towards online sales,” adds Satish.
CRAVOVA has already raised angel funding, the details of which the team declined to reveal.