A poor farmer’s son, who earned only Rs. 90 a month working as a watchman in a cinema hall, never imagined that one day he would establish a company with a turnover exceeding 5,000 crores.
It may sound like a story from a film, but it is true.
Humble Beginnings: A Farmer’s Son’s Struggle
10th grade has achieved remarkable success. At one point, he struggled to afford even ₹50 for rent. However, through hard work—cleaning theatre seats, putting up movie posters, and selling sandwiches in the canteen—this once-impoverished boy transformed his life. He went on to establish the largest wafer shop in Gujarat and became the owner of Balaji Wafers.
This journey was filled with challenges, and the strategy he employed was so effective that even his biggest competitor, Lays, could not surpass him.
In 1972, in a small village in the Jamnagar district of Gujarat, there lived a poor farmer named Popat Ramji Bhai Virani, who supported his family through farming.
He was somehow managing to survive with the help of the farms, but there came a year when a severe drought struck their area, resulting in the destruction of all the crops. Following this, they faced further challenges as occasional droughts and unseasonal rains continued to complicate the lives of Popat Ram Ji Bhai and his family.
Being fed up with all these problems, he sold the ancestral land for ₹20,000 and distributed the money among his three sons: Chandu Virani, Meghji Bhai Virani, and Bhikhu Bhai Virani, so they could start a business with it.
Upon receiving money from his father, 15-year-old Chandu Bhai, along with his two brothers, went to Rajkot, where they started a business in agricultural products and farm equipment.
The dealer was aware that he lacked any special knowledge of business, so he sold him counterfeit fertilizer at inflated prices.
In this manner, Chandu embarked on his first venture. Unfortunately, it shut down within a year, leaving all three brothers homeless.
There was no reason to return to the village, as there was nothing left there.
From a Watchman to a Canteen Entrepreneur
That is why these individuals began searching for work while remaining in Rajkot. However, despite their higher education, they were unable to secure a good job.
At that time, their financial difficulties had escalated to the point where they could not even afford their house rent, which was only 50 rupees. Consequently, the landlord evicted them.
However, after some time, Chandu secured a job as a watchman at a cinema hall named Aston, where he earned a salary of Rs. 90 per month. In addition to his duties as a watchman, he occasionally put up movie posters and worked in the canteen as well.
Somehow, they began to survive on less money. Because Chandu was very honest, he eventually secured the contract for the theatre Balaji faced a legal battle with the PepsiCo canteen, where he served masala sandwiches during the intermission.
People enjoyed this masala sandwich immensely, and Chandu made a profit from it.
When the situation improved slightly in 1982, Chandu called his entire family from the village to Rajkot, and all the family members began working together on this endeavor.
The Idea of Potato Wafers
However, a significant problem arose: his sandwich had become extremely popular in the area, but any sandwiches that remained unsold by the evening would develop mold by the next day, rendering them completely inedible. Chandu was increasingly concerned about the loss of these delicacies.
They began living there, and due to this issue, they started contemplating what products could be sold that would not spoil for several days. During this time, Chandu came up with the idea of selling potato wafers.
Chandu began selling thin potato chips after making a deal with a vendor. He started offering them in his canteen; however, he soon encountered issues with his business.
The vendor frequently failed to deliver the chips on time, which resulted in Chandu being unable to meet customer demand during busy intervals.
As a consequence, many customers left without purchasing chips from the canteen.
Sometimes, due to delays in supply and occasionally due to broken potato wafers, Chandu’s business thrived. He then decided that he would no longer rely on any pre-packaged potato wafers and would instead make and sell his own chips.
Homegrown Efforts: Making Perfect Potato Chips
At that time, Chandu had savings of Rs 10,000. With this money, in 1982, he constructed a small tin shed in his verandah. After closing the canteen at night, he began making potato wafers himself.
The initial days were fraught with challenges due to a lack of experience, as his chips did not sell well.
Sometimes they would get burnt, and other times they would remain soft. However, after a few days of hard work, he finally learned to make perfect potato wafers.
By making these chips at home, Chandu was able to control the quality, which led to a rapid increase in sales.
Recognizing the popularity of his potato wafers, the theatre owner partnered with Chandu, and soon they began operating the canteens of three different theatres.
In this manner, Chandu’s business thrived, and his potato wafers gained immense popularity.
The demand for their product continued to rise, and within a short period, they began supplying their chips to 25 to 30 merchants. Gradually, their popularity spread throughout Rajkot.
There were many other people in the market who used to manufacture wafers.
Establishing the Balaji Brand
In 1984, Chandu sought to establish a unique identity for his potato wafers. He drew inspiration from the Hanuman temple, Balaji, located next to his canteen, and thus named his product after it.
His potato wafers initially gained popularity under the name but this was just the beginning.
After partnering with numerous canteens and merchants, the demand for his wafers surged even further.
Eventually, every family member began working day and night to meet the growing demand for their product.
Even after working diligently, the demand was still not being met. In this situation, Chandu considered installing machinery to produce wafers, allowing for maximum output in a shorter amount of time.
With this thought in mind, when he went to purchase the machine, he discovered that it was very expensive, and he did not have enough money. What should he do now?
After considerable contemplation, he began to grasp the mechanics of the machine.
Once he understood how it operated, he invested approximately ₹5,000 to start manufacturing his own potato peeling and chopping machine.
For the next few years, he used this machine for production, and his business rose to the next level.
He aimed to produce on a large scale, so in 1989, he took out a loan of approximately 1 million rupees from the bank and established the largest potato wafer plant in Gujarat.
However, this step was quite risky because, during that time, large investors and wealthy individuals were often reluctant to invest in such new ventures.
In such a situation, if the business did not succeed even after securing the loan, the owners would have to bear the entire burden of the loss themselves. However, that time never came.
Because, with time, their market share and customer base continued to grow. Following this, the year arrived.
Scaling Up: From Local to Regional Presence
In 1992, he registered his business as a private limited company and began utilizing advanced technological machinery to automate his manufacturing process.
Chandu believed that, despite the high cost of machines, they could still be leveraged to generate profit.
It minimizes human error and ensures consistent quality.
Apart from this, it also delineated various roles and responsibilities within the business, making it easier to manage operations since everyone was aware of their specific tasks.
Later, after enhancing its distribution network, Chandu Bhai’s company, Balaji, evolved from a local brand to a regional and eventually a national brand.
At that time, there were several major brands in the market, such as Uncle Chips, Simba, and Binny’s, which posed significant challenges for competitors.
It was not easy for a new player to establish a foothold in the market, but Balaji gained popularity for his products through hard work, dedication, and exceptional quality.
While his competitors were still producing chips using traditional methods, Balaji began employing innovative techniques.
By adopting this strategy, they firmly established their brand in the market.
Observing their rapid growth, a multinational company offered Chandu 4,000 crores to sell his company; however, Chandu flatly refused the deal.
After some time, Balaji began producing namkeen and various other snacks in addition to potato wafers.
The taste of these snacks was well-received by the public, which gradually led to their expansion beyond Gujarat into states such as Uttar Pradesh, Madhya Pradesh, and several others.
This growth occurred alongside the aging of the brand.
Balaji was also ensuring that the company was producing products that aligned with the preferences of the consumers.
Chandu understood very well that the flavors favored by the people of Gujarat were not necessarily the same as those preferred by the people of Uttar Pradesh.
To ensure that the same snacks are appreciated in Maharashtra, Rajasthan, or Uttar Pradesh, they began creating snacks that cater to local tastes.
To ensure that this work is done properly, they established manufacturing units in different states.
Three of these units are located in Rajkot, Valsad, and Vadodara in Gujarat, while another is situated in Indore, Madhya Pradesh.
These manufacturing units can produce 1,000 quintals of potato wafers and 5,000 quintals of namkeen every day, demonstrating the significant production setup they have created.
The advantage of establishing factories in various locations was that they began to serve local markets more effectively, which significantly contributed to increasing their market share.
This is the reason why, in 2006, Balaji Wafers established factories in Gujarat: potato wafers had captured 90% of the market share, and since then, no one could halt their growth.
Taking on Competitors: The PepsiCo Challenge
However, in 2011, an unexpected event occurred that exacerbated the company’s challenges; in fact, Balaji’s biggest competitor, PepsiCo, intensified pressure on them.
PepsiCo filed a lawsuit against Balaji for using the distinctive deep ridge design of their Lays Max chips in a snack called Rumble.
PepsiCo neither provided any warning nor did they request one from Balaji.
Not only did they fail to communicate with each other, but they also promptly filed a design infringement case against the company.
You can envision the assault of a multinational corporation on a burgeoning Indian company.
Many people believe that PepsiCo filed this case out of frustration due to Balaji’s growing popularity in the tea market.
The effect of the product began to influence his snacks as well.
Whatever the reason, Chandu did not give up. He faced the allegations from PepsiCo and argued in court that PepsiCo was targeting him solely because of the increasing growth of Balaji Wafers.
Despite all these arguments, the High Court’s decision favored PepsiCo, and the court ordered Balaji to change the design of its chips.
After this decision, many experts believed that the design of the chips would change.
It seemed that changing the packaging design of the wafers could be detrimental to their brand.
However, Chandu stated that people trust the name the packaging design, and the logo.
It occurred later because, while Lays’ market share was gradually declining, Balaji Wafers was experiencing growth at a rate of 20 to 25 percent each year.
Expanding the Product Range
By 2019, the company offered more than 65 product ranges and expanded its reach.
It has spread from small villages to large cities. Additionally, its distribution network has expanded to include more than 1,225 dealers.
Recognizing its growth and popularity, The Economic Times has dubbed it the Sultan of Wafers.
Today, at Balaji Wafers, thousands of employees contribute to the company’s success.
Their business philosophy emphasizes treating every member like family while providing value-for-money products to customers.
This approach has fostered a loyal and trustworthy following among the community.
However, to achieve this success, Chandu developed several business strategies that his competitors could never overcome.
He understood that while Balaji Wafers originated in Gujarat, to establish a national presence, he needed to expand into other markets across India.
That is why he expanded his footprint from Gujarat to other regions of the country.
The most significant benefit of this expansion was the opportunity it provided to innovate with local flavors.
However, the innovation extended beyond just flavors; Balaji also introduced healthier snacking options, such as baked wafers and roasted namkeen, to cater to health-conscious consumers.
Recently, they entered the noodle market by launching their house-made noodles, Gippi.
Apart from this, Balaji Wafers has also entered the international market, gaining global recognition through its expansion into countries such as the USA, UK, UAE, and Australia.
The second strategy involves offering a variety of products and innovations.
Product diversification and innovation are crucial for survival in the market and for distinguishing oneself from competitors.
Balaji Wafers has recognized this importance and has diversified its product range, which includes three main categories.
The first category is Western snacks, which includes 12 products. These snacks primarily target the younger generation and urban population.
The second item is Namkeen, which is very popular in Indian households, especially as a teatime snack. They have launched 23 products in this category.
The third category is wafers, which includes 12 available products. Balaji Wafers is renowned for its unique and crispy wafers.
Embracing Technology for Consistency
Chandu is best known for this, and similarly, the company’s third strategy involves the use of technology.
Chandu initially handled every task himself, whether it involved frying the wafers or packaging them.
But he soon realized that manual labor was not easy. The lack of consistency in production also reduces the shelf life of the product.
This is why, while other brands were making handmade chips, they turned to automation. Today, Balaji Wafers imports machines from the leading food processing suppliers in the world.
This has directly impacted their production efficiency, resulting in reduced costs and enabling them to establish a competitive edge in the market.
Similarly, the fourth strategy of Balaji Wafers is
The essence of the entire story of Balaji Wafers is that they have always regarded their customers as kings.
For them, the most important goal was to offer their customers high-quality products at reasonable prices, especially when other brands failed to meet customer expectations.
They worked diligently to ensure consistent taste and quality, allowing their customers to achieve a profit.
Customers consistently receive the flavor they anticipate.
Shyam Virani, Director of Balaji Wafers, states that you will not find any brand that matches our quality, quantity, and price.
It is this confidence and dedication that have made Balaji Wafers a strong brand in the market.
Conclusion
The story of Balaji Wafers is not merely a tale of a snack company’s growth; it is also a narrative of the passion that transforms every moment into an opportunity.
Featured Image Credit: tv9bharatvarsh
Source: Live Hindi