R.G.CHANDRAMOGAN

R.G.CHANDRAMOGAN
THE ICE CREAM ICON
                                                                                                                                      -by  N.R.Sampath
"The heights of great men reached and kept,
Were not attained by sudden flight.
For they, while their companions slept,
Were toiling upwards in the night."
 
In the annals of Indian businessmen, there are several success stories of those who rose from humble beginnings and reached the pinnacle of success by their hard work, sincerity, determination, innovative skill, courage, integrity, honesty, vision and human relations.
 
One such inspiring story is that of Mr.R.G.Chandramogan, Chairman and Managing Director of Hatsun Agro Product Ltd., manufacturers of the famous ARUN brand  ice cream. With indomitable will power and unshakable faith in perseverance, he crossed several hurdles, before he was able to establish his brand of ice cream as a household name in south India.
 
 
 
THE BEGINNING:
 
Mr.Chandramogan, son of a vegetable wholesaler from Tamilnadu, discontinued his college studies in the pre-university stage and  in 1970 , at the suggestion of his maternal uncle, set up Arun Ice cream in Madras (now Chennai) with a resolve 'to do something worthwhile'.
 
With his own capital of Rs.15,000 and a bank loan of Rs.21,000,the business was started and in the very first year, recorded a turnover of Rs.1.5 lakhs and profit of Rs.40,000.In a market dominated by well-known brands of ice creams like Kwality, Dasaporakash and Joy, it was not an easy task for Chandramogan to penetrate into the market and capture a decent market share.
 
To take on the competition, he had to devise innovative marketing strategies and explore new avenues. While the big brands concentrated on sales through deep-freezer based general stores, where the deep freezers were financed by the ice cream companies, supplies to hotels and to weddings and other social events, mainly in Chennai, Chandramogan decided to expand his Arun ice cream market in college canteens ( like IIT College canteen ) and educational institutions and also to ships which berthed  in Chennai port. Since these avenues were not tapped by the other brands, Arun ice cream had a very good response and in view of its quality ,taste, different flavours and reasonable cost, it became very popular.
 
NEW HORIZONS:
 

The next innovative move was to move into nearby districts and mofussil centres,where there was a good demand for ice cream, but due to supply constraints and logistical bottlenecks, the big players were hesitant to enter. At this stage,.in order to sharpen his marketing and human relations skills and update his knowledge, Chandramogan took up a course on Marketing and Personnel Management at the Davar's College. His next foray was into important centres away from Chennai, like Madurai, Pondicherry, Kumbakonam, Sivaganga and others, where he appointed agents, who sold ice cream through "Sit and Eat Parlours." "Ice cream supplied from Madras" was the slogan, with which the franchisee outlets at district centres did roaring business. Chandramogan's strict criteria for the selection of franchisees---personal and business background and those who are in early twenties, completed schooling and failed in early  business endeavours, ensured that he was  able to mobilise a band of dedicated, resourceful, hardworking and enthusiastic young men who put their heart and soul into the business and make it successful. The franchisees were so impressed with the policies and dynamism of the company, that many of them named their sons as "Arun ". By 1985, Hatsun became the largest manufacturer of ice creams in Tamilnadu.

 
INTEGRATION WITH MILK PRODUCERS:
 

While the seventies was a period of learning, the eighties was a period of growth. Since the regular,adequate and cost-effective supply of quality milk is a pre-requisite for ice cream manufacture, Chandramogan introduced the scheme of direct purchase of milk from dairy farmers in milk producing villages through milk collection centres.

 
With this holistic approach, it was possible to increase the production of ice cream and devise new marketing strategies. To cope up with increasing demand, a new plant was set up in Salem (Tamilnadu) in 1991.  Arun introduced 7 to 10 new flavours of ice creams every month and at any given time, 35 flavours of ice cream were available at the Arun Ice cream parlours.
 
INNOVATIVE IDEAS:
 
To make the Arun brand more popular, new marketing techniques, as stated below, were employed-
 
i) EAT ALL YOU CAN MELA, where for a payment of Rs.8/-,one can eat as much ice cream as he wants and the one who eats the maximum quantity gets  a prize..
 
ii) SLOW SPEED DRIVING COMPETITION for two-wheelers, the competitiuon starting from Arun ice cream parlours. The participants purchase ice creams for Rs.15/-. The winner in the competition gets a prize.
 
iii) PHONE AND HAVE AN ICE CREAM Members of the public dial specified phone numbers during given time slots and win ice cream for Rs.100/-.
 
These sales promotion strategies took the Arun icecream brand name into the nooks and corners of Tamilnadu and neighbouring states.
 
MARKET EXPANSION:
 
With the sales graphs showing an encouraging upward trend, new technolofgical upgradation was necessary to cater to the increasing sales. By 1995, Arun ice cream was transported to all its outlets in the four southern states, by refrigerated vehicles, to ensure that the customers got fresh stocks every day.  A new depot was also opened in Madurai, in 1995, to speed up delivery to the southern parts of Tamilnadu and neighbouring states.
 
ADVERTISEMENT AND COST CONTROL:
 
With a carefully planned, advertising campaign, sales strategies and innovative competitions, the Arun brand name was popularised and by early nineties, it was a well-known brand in South India.  Mr.Chandramogan carefully avoided extravagant advertisements and confined his campaign only to his target customers in selected areas. With strict control on expenses, Hatsun's distribution cost was kept as low as 7%, as against 9% of his competitors. This was one of the important factors that contributed to better efficiency.
 
MANAGEMENT:
 
Realising the importance of technological and managerial resources for the company, Mr.Chandramogan recruited well-qualified ice cream technologists, personnel and management  experts to build a cohesive team that would ensure a productive labour force with cordial relations.  With such result-oriented employees, the company is constantly in search of innovative strategies to improve its market share.
 
CHALLENGES:
 
The de-reservation, in 1992, of ice cream manufacture from the list of products for exclusive development by small-scale industries and the entry of international marketing giants like Unilever into the ice cream market  posed new challenges to the Arun brand, but by that time, Hatsun had established its network so well in the south that it was able to face the competition successfully and scale new heights of sales and profits. Today, Arun is a household name in ice cream in Tamilnadu  and also neighbouring states and today it is the market leader of South India.
 
"Great heights attract us,not the steps leading to them" Behind the success story of Arun ice cream, there are several layers of sacrifice, sincerity, courage of conviction, farsighted vision, planning, creative ideas, innovative strategies and above all, the determination to succeed, crossing all obstacles by one man Mr.R.G.Chandramogan. His life teaches many lessons for all young entrepreneurs who wish to start a new business and make a success of it.He is a role model, worthy of being emulated. .
 
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