Star Cuts to take on neighbourhood salons

Groom India, owner of Naturals & Page 3, is now looking at the bottom of the pyramid segment

Groom India Salon & Spa, which owns Naturals and Page 3, leading brands in the beauty salon industry, is looking at launching a new brand that will take on the largely unorganised neighbourhood salons.

The company is also lining up major expansion plans for Naturals by opening 3,000 stores in India and 100 outside India over the next three years. The company is also looking at raising around Rs 100 crore from private equity.

C K Kumaravel, CEO & Co-founder of Naturals, says the new brand 'Star Cuts' is currently under trial run in Coimbatore, Tamil Nadu with two stores and this will be expanded in the next six months.

The new brand will help Groom straddle the entire pyramid through Naturals (Unisex), Naturals W, (Women), Naturals Lounge and Page 3 (which caters to elite and celebrities), and now Star Cuts.

Groom's brands are competing with some of the major brands including Lakme, Green Trends (which is owned by Kumaravel's brother C K Ranganathan of CavinKare) and others in the Rs 6,000 crore market, which is growing at around 30 per cent ever year.

At present, the bottom of the pyramid market is addressed by local neighbourhood salons whereas all the organised players are addressing the levels above this.

Speaking about company's expansion plan, Kumaravel says over the next three years the company will take the franchise route. Asked whether it's an over-ambitious number, Kumaravel said four years ago, the company opened just seven stores a year. That number has gone up to 100 a year.

"We have identified 20 more markets in the country, if we can open 20 in each of these markets every month, we can achieve our target," he said.

One of the major focus will be tier II, III towns across the country, besides metros. "We will also go closure to the customer by opening salons in colleges, airports, offices, organised super markets etc," he said. For Page 3, the plan is to take the total number of stores to 25 from the current four in three years.

Commenting on the overseas strategy, he said the focus will be the Gulf Cooperation Council, including Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. The company is looking at opening 100 stores in these countries, under the Naturals brand in the next three years.

"The USP would be that apart from our regular services, we will also offer Ayurveda to customers," said Kumaravel.

To support the expansion and to strengthen the brand, the company roped in Kareena Kapoor, who has replaced Genelia D'Souza, as the brand ambassador of Naturals hair and beauty salon chain. The company will be spending around Rs 45 crore in 2015 and will come out with a new advertisement campaign in April, during the next Indian Premier League season.

To address the human resource challenge, the company has tied up with Godrej Good & Green to set up the largest training academy in India. The academy is expected to go on stream in January 2015.

Launched over a decade ago, Naturals today is India's No.1 unisex hair and beauty salon. With a network of more than 4100 salons evenly spread across the country. Naturals' mission is to create 1,000 successful women entrepreneurs and generate 50,000 job opportunities by December 2017.

The brand turnover for 2012-13 was Rs 300 crore and this year it is expected to close with Rs 350 crore. The target: Rs 2,000 crore in three years.