Leaving their lucrative jobs in the United States, these sisters returned to India to start in the D2C beauty space.

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In 2012, Grichma Teli and Mauli Teli worked in the United States as professionals in biotechnology research and management consulting, respectively. However, they sensed that something was wrong. So they decided to quit their jobs and return to their hometown, Ahmedabad, to try their hand at entrepreneurship.

Coming from a business family with a background in the pharmaceutical and wellness arena, the duo realized that they had a common interest in the personal care and cosmetics space, which grew. also proved to be an exciting and high growth industry in India.

Mauli Teli, co-founder, Iba Cosmetics

“But with the market dominated by large players, we needed to identify a unique space that would help us exploit the opportunity that was not ‘unsatisfied’ to allow easier entry. The space had to be large enough to be commercially viable, sustainable and with high growth potential, ie not a ‘fad’ which is very common in the beauty space, ”said Mauli. His history.

After doing the primary and secondary market research, the duo realized that the Halal cosmetic space was a big niche in the beauty industry. Many Muslim women have experienced restrictions and guilt in the pursuit of beauty due to the unavailability of Halal certified cosmetics and personal care products. Realizing that the opportunity was ripe to be seized, Mauli and Grishma founded IBA Cosmetics after two years of research and ideation.

“We launched in 2014 with two exclusive stores in Ahmedabad and a presence on Amazon with a line of over 60 skin care, hair care, makeup and fragrance products. All Iba products are free from alcohol, pork fat and other animal ingredients, harsh chemicals such as sulfates and parabens, and certified by PETA as vegan and cruelty-free, in addition to be Halal certified, ”explains Mauli.

Why Iba?

Iba operates according to a simple motto: “What makes us beautiful must also be beautiful!” The cosmetics brand aims to democratize the search for beauty for all by making clean and ethical consumption of beauty products accessible to all.

The founders say the word “Iba” means self-respect and the brand aims to empower its customers by offering them ethical product choices. Today, Iba Cosmetics has taken the D2C route by selling online through its website, in major e-commerce markets and over 2,000 general-trade retail outlets, serving approximately two to three customers. lakh per month.

Mauli explains that the size of the market for Halal Cosmetics is estimated at $ 39 billion globally and growing rapidly, with the Indian opportunity itself set at 11,500 crore rupees. According to a report by Mordor Intelligence, the global halal cosmetics market is expected to grow at a CAGR of 9.6% between 2020 and 2025. Additionally, halal cosmetics are gaining ground beyond the core demographics of practicing Muslims, thanks to to the switch to vegan and ethical beauty products.

However, when the team first started, they faced challenges such as sourcing ingredients that would meet their certification criteria, ensuring that products are formulated in such a way that even though they remain free from animal ingredients, alcohol and harsh chemicals, they are still as or more effective.

By also making sure that Iba meets GMP standards as well as Halal hygiene and manufacturing standards, which they resolved by setting up their own manufacturing unit in Ahmedabad, Gujarat, which is fully certified. Halal.

“By being the first to market a unique concept, we also had to work on raising awareness of what halal and vegan cosmetics are and how they stand out from others in the market in terms of ethics, safety and efficiency, thus encouraging trials and encouraging users to switch to Iba, ”says Mauli.

Team and manufacturing

Today, Iba Cosmetics is a strong team of 66 members that operates across all functions including R&D, manufacturing, supply chain, marketing and sales.

The team started small – with Grishma and Mauli with Chandan Nath, who is the mentor of the brand, constituting the think tank of the company. Once they focused on halal and vegan cosmetics as a concept, they set up an in-house R&D lab and hired a few researchers to work with Grishma on formulating products that meet the criteria for quality, performance and performance. certification.

“From there, we set up our own manufacturing unit with pharmaceutical grade equipment for the production and packaging of skin care, hair care and makeup, and achieved Halal certification for the entire factory of the only certification body recognized by the Indian government – Halal India, says Mauli.

Market and differentiator

Avendus report says country’s D2C activity will be worth $ 100 billion in the next five years. India has as many as 600 D2C brands – a number that will grow dramatically over the next five years, and over 16 brands have annual sales of over $ 60 million. Some of the other startups operating in the segment include Juicy Chemistry, Mamaearth, Sugar Cosmetics, Disguise, Piligrim, Plum, etc.

“Unlike brands launched to solve a specific problem or rooted in ingredients only, Iba was born out of an understanding of the struggle of a niche consumer segment to seek beauty without ‘guilt’. The entire Iba team lives according to the credo “what makes you beautiful must also be beautiful”! There is no tolerance to include any ingredient in the formulation that is harmful or does not meet strict guidelines that they are Halal, Vegan and Cruelty Free, while still providing efficacy, ”says Mauli.

From monthly sales of less than Rs 10 lakh in 2015, Iba now records sales of Rs 18 crore ARR (annual fulfillment rate), 80% of which is from direct sales to consumers online and through their offline distribution channel. Founders say it generates 80 percent income by selling products directly through their own website or through marketplaces such as Amazon, Nykaa, and Flipkart.

“With a current ARR of Rs 18 crore and a growing presence across all channels, we aspire to increase that figure by 8 over the next two years,” she adds.

Impact of COVID-19

“COVID-19 has certainly affected a lot of our offline operations, including in our stores and other retail outlets. However, given our strong online presence, loyal customers, and the rapid scale-up of operations through our own website, we were able to pivot to reach over 80% of our sales as a D2C online brand by compared to the pre-COVID-19 period, when more than 60% of our sales came from the offline channel, ”says Mauli.

The rest 20 percent comes from offline distribution through super resellers, resellers and nearly 2,000 retail outlets across India.

The pandemic has also helped consumers familiarize themselves with the idea of ​​shopping online, including for categories such as makeup. The company has adapted with an up-to-date website, increased visibility on e-commerce platforms like Nykaa, Amazon, Flipkart, Myntra, etc. , remind and announce launches, upgrades and offers.

Iba claims its gross margins are greater than 60 percent, and the brand is now striving to reach 65% in the next eight to ten months by reducing overhead per unit while increasing sales. The company is funded by existing investors Gujarat Venture Finance Limited (GVFL) and Addvantis Enterprises, LLP.

Iba’s immediate plan is to further expand its presence in India by reaching out to a growing consumer base, primarily through the D2C channel. They also plan to expand their product line and fill some gaps in the portfolio, especially in makeup.

“The global halal cosmetics and clean beauty market is also growing rapidly and we aim to enter a few key markets such as GCC and Southeast Asia in the coming years with the aim of making Iba a leader in its category in this space ”Mauli signs.


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