We Are Getting Our Act Together In Quick Commerce: Veeba’s Viraj Bahl

VRB Consumer, the parent company of condiments and sauce maker Veeba, has launched a new brand called ‘Wok Tok’, marking the latest addition to its portfolio of brands. In an interview with Outlook Business, Viraj Bahl, the company’s founder and managing director, discussed their vision, the strategic focus on quick commerce, and addressed rumors that have been circulating. 

Edited excerpts 

What is your vision for Wok Tok? Is it going to be a part of VRB or an individual entity? 

My vision is to make it a healthier alternative for all our favorite snacks, especially free of palm oil and maida. As a food technologist, I have been trying to experiment with healthier alternatives for the past 2-3 years. We have invested a sum of around Rs 50 crore and a lot of hard work as well, now that it is launched, we will currently sell it under the flagship Veeba’s name, due to the brand name we have but we might as well remove the name and run it as an independent brand by next year. We are currently launching it in Delhi and Bengaluru and will expand eventually. 

When it comes to promoting and selling your new products online, would you prefer e-commerce or quick commerce? 

We are GT first company, so around 95-97 per cent of our revenue comes from general trade. The remaining comes from online sales, e-comm and q-comm. For Wok Tok as well, we will be putting it up on both the channels. As far as quick commerce is concerned, our main product, noodles, indeed comes under the impulse category, and we will have to really work along with all the quick commerce players to place it well.  

So, are you betting big on quick commerce? 

Of course, in the past 18 months, FMCG has faced a challenging period. If you had asked me this same question last year, I would have said that quick commerce and e-commerce made up 3% of our revenue. In just one year, that has doubled to 6 per cent. Most of this growth has come from quick commerce specifically, which is driving the overall increase.  

So, on the one hand, we are getting our act together in quick commerce, and on the other hand, quick commerce itself is growing rapidly. The result is that our revenue from this channel has not just doubled in percentage but has increased even more significantly in absolute terms. A lot of effort is being put into this growth. 

Major part of your revenue comes from retail, so how is your B2B business doing? 

Yes, around 94 per cent of our revenue comes from retail since we have the GT approach. The remaining 6 per cent comes from our B2B segment. Our major distributors are Domino’s, Pizza Hut, KFC and Burger King. 

You have recently crossed the Rs 1000 crore revenue, what next? 

I don’t really comment on specific revenue figures. We have turned profitable as well. My revenue goal is very simple. If you look at the past five years of our business, my vision is that we should have a growth of 25 per cent every year and we aim to double our revenue every three years. The larger aim is not at figures but to be India’s fastest growing food company with 25 per cent y-o-y growth. 

It has been long since you raised funds for Veeba, are you planning to raise funds in the near future? 

We did our last fundraise back in 2018 and it has been some 6-7 years now. We are doing really good and are self-sustaining. Until a really good acquisition offer comes, I do not see us doing any fundraising. We are very dilution sensitive, we have had the right approach, and I have been able to retain a good chunk of more than 40 per cent stakes of the company. Nowadays, there are founders who are left with single digit stakes of their company. 

When do you plan to hit the IPO market? 

Every founder has this dream of going public. Somedays when you wake up and see the market doing really good, you think of it, yes, I am cognizant of the fact that one day I have to give our investors their exit. However, we need at least a year’s time to plan before we go public. Right now, the focus is on building better brands and scaling them up before we decide to go for the IPO. 

There have been quite a lot of rumors that majority stakes in Veeba are up for sale, what do you have to say on this? 

They are all rumors at the end of the day, I have also heard that it was spread by one of our honorable oppositions. However, I want to tell you officially that we have never had a sale conversation with anyone, and we want to take the company to newer heights.