Backwaters Committee

IIM Kozhikode
IIMK Campus P.O.
Kozhikode 673 570
Web: www.backwatersiimk.com
Email: backwaters@iimk.ac.in

On-The-Mark: Aava Case Challenge
About Aava
Aava is promoted by Sheelpe Enterprises, based out of Ahmedabad. It was launched in October 2005
and used its location advantage to serve West and South India without any major logistical
constraints. The plant operates at a capacity of 400,000 litres per day and includes Spice Jet, Air India
and Le Meridien in its list of marquee customers. With an annual growth rate of 400%, Aava is
looking to expand its reach to all corners of the country in the coming years.
The source for Aava comes from a natural mineral water spring in the Tarangana range at the foothill
of the Aravallis where it was discovered by the promoters while quarrying in the region. After
conducting tests on the water it was discovered that it was naturally pure and did not require
putting through any chemical processes such as UV radiation or reversing osmosis. It has a natural
mineral composition that is beneficial to health and absolutely safe to drink.

Company Information:
Manufacturing Facility and distribution system
The Aava manufacturing system is fully automatic, washable, air conditioned and hygienic
The plant adheres to pharmaceutical standards and uses clean room technology so
theoriginal mineral composition and purity is maintained at all times
Aava is untouched by human hands
There are no chemical processes Aava is put through
The Company manufactures, distributes and markets Aava . Geographically the company is
dominant in western India although it does have a national footprint.
Being a Natural mineral water the as per BIS rules the water must be bottled close to or at the
source of the water due to which there are restraints of multiple plants. The company has 1 bottling
plant with its own bottle blowing, filling, and packing unit. It has 3 lines with a combined capacity of
200 bpm (bottles per minute of the 1 ltr variant). Currently the plant is manufacturing nearly 1.35 lac
cases a month. The company also has a bulk water 10ltr and 20ltr water filling and sealing line with a
capacity of 150 containers/hour.
On the distribution end the company has owned go downs at Mumbai, Ahmedabad and Baroda. The
company also has its own depots via its foreign investor in Delhi, Bangalore, Hyderabad and Chennai.
The company has a distributor network in Rajasthan specifically Udaipur and Jaipur. There is also a
tie-up with DTDC for Pan India deliveries. The company has its own small vehicles for distribution in
the above cities and also owns trucks to deliver goods from central warehouse all across India.
Gujarat being the plastic capital of India, the sourcing of the main raw material plastic preform is
largely done from Gujarat and 1 supplier in Indore. Most of the raw material sourcing is done from 4
states, Gujarat, Maharashtra, M.P. and Delhi


Backwaters Committee
IIM Kozhikode
IIMK Campus P.O.
Kozhikode 673 570
Web: www.backwatersiimk.com
Email: backwaters@iimk.ac.in

Current Marketing Strategy
Currently the brand does not do any above the line strategies. The below the line marketing ,
branding and advertising strategies involve distribution of free goods at events in exchange for
collateral and like Max Bupa Walkathon , Zoom Holi Party, Vibrant Gujarat Summit, free goods in
exchange for branding at India vs Pakistan series
To create awareness about the natural mineral water category and to get newspaper coverage, we
have tie ups with good PR agencies. In natural mineral water category PR goes a long way rather
than traditional media advertising.
The company has recently changed the packaging to shift to a fresh green natural look with leaves
and all future branding / product designing is going to be along the same lines
List of major clients
AIRLINES HOTELS AND RESTAURANTS
Jet Airways I. Ltd Trident Hotels (Oberoi Group), Pan India
Air India Ltd. Marriott Group of Hotels, Pan India
Emirates HRH Group of Hotels
Indian Airlines Four Seasons , Mumbai
Swiss Air JW Mariott, Mumbai
Continental Air
Entire Sarovar Group Pan India (55
hotels)
Air France Grand Hyatt Goa
Kingfisher West In Goregaon
Qatar Airlines Indigo Group of Restaurants
Spice jet Degustibus Hospitality
Go air Taj Residency Ummed
Oberoi Flight Kitchen Services Mumbai &
Delhi Le Meridian
Ambassador Flight Kitchen Ramada Group, Goa
Fortune Exotica Thane
Fortune Exotica Vashi
The Orchid, Mumbai
I.T.C. Welcome Group, Baroda
I.T.C. Grand Central
I.T.C. Maratha Hotel
Fortune Landmark
Ginger Hotels
Caf Upper Crust
The Intercontinental Marine Drive
St. Laurns Ahmedabad
Ramada ,Ahmedabad
The Grand Bhagwati Group
Ginger Hotels




Backwaters Committee
IIM Kozhikode
IIMK Campus P.O.
Kozhikode 673 570
Web: www.backwatersiimk.com
Email: backwaters@iimk.ac.in



BANKS CLUBS / GYMKHANA
Axis Bank Cricket Club of India ,Mumbai
UTI Bank Ellisbridge Gymkhana
Bank of India EME Officers Mess
Bank of Maharastra Golf Club Cantonment
IDBI Home Finance Gujarat Club
HDFC BANK Gujarat Cricket Association
Gulmohar Green Golf & Country Club Ltd.
Sports Club of Gujarat
Karnavati Club
Malabar Hill Club Ltd

CORPORATES
Adani Groups Infocity
Adani Willmar Ltd. ISRO
Balaji Entainment P.Ltd. Ramniklal & Sons
Cama Motors ITC Ltd. (Welcome Group)
City Pulse Kores India Ltd.
Dishman Pharmaceuticals Mudra Communication
Godrej Properties N.G. Corporation
Gujarat Gas Company Nicholas
HCP Design & Project Management Rasna Pvt. Ltd.
IIM N.K. Proteins
ILFS Education Techonology Ltd. Torrent House
Indiabulls Financial Services Tribhuvandas Bhimji Zaveri & Sons
Spick N Span HMS Host
Havmore Breach Candy Club
Tomatoes Royal China (Bandra)
Mirch Masala Nature Baskets Ltd.

Areas of key concerns
We are currently at a stage where we are slowly transitioning from a mass water image to a
premium water image by changing the packaging and improving placement of the product
through deals like the Oberoi group, Indigo Airlines etc. Improving brand perception is the
biggest priority currently for the brand.
There is a major scope of improvement in the sales and marketing of the company. The
companies majority clientele is institutional primarily airlines and hotels . As a result of which
there is a great stress of maintaining relationships with these bulk consumers and brand
visibility is also poor. The company is currently beefing up its sales efforts to get better and
more diverse clientele so as to spread risk and also increase brand visibility.
The company is currently also facing a lot of production constraints due to poor availability of
labour and trained staff for slightly complex machinery. Better management of production and
raw material supply chain is also a need of the hour.


Backwaters Committee
IIM Kozhikode
IIMK Campus P.O.
Kozhikode 673 570
Web: www.backwatersiimk.com
Email: backwaters@iimk.ac.in

Due to poor margins, and stressed payment terms financial planning becomes very difficult as
money does not rotate as much. Also the wafer thin margin in the business due to lack of
awareness among public regarding natural mineral water does not give much space for
innovation and advertising.
Reduction of plastic and environmental sustainability is also a major area of concern. The
company is keen to find alternate sourcing of bio-degradable plastic etc. However it is nearly
impossible to find any vendors of the same in India who are reliable and can give material
which can conform to the existing machinery.

Corporate goals in terms of future objectives
The company aims to grow in other beverage categories apart from just Natural Mineral
Water and has a target and a growth map to cross 50 Crore INR in revenues by FY 17-18 and
at the same time diversifying into other products like Tonic Water, Sparkling Water,
Flavoured Water, Juices etc and other products which can be pushed via its current
distribution network. Also , in 2009 Aava was valued at 120 crore INR and has also got
foreign investment. The company aims to gather a 5x multiple to its previous valuation and
believes that the above growth map will help in achieving the target and help in the funding
scheduled for FY 17-18.
The company also aims to setup a better and more widespread distribution network and a
co-packer network so as to manufacture and distribute new products and become a
successful beverage company.
Other information
The following link- https://www.youtube.com/watch?v=giB9FKs0-as . It is an informative
movie about the Aava story
Refer to the Aava_Exhibits document for in-depth information about Aava
On-The-Mark: The Aava Case Challenge
To Summarize, Aava wants you to focus on 2 key challenges:
1. Improving Aavas brand perception vis--vis other mineral water brands
a. Assess the factors that determine premium brand perception in the natural bottled
water category
b. Find the reasons as to why Aava is not currently seen as a premium brand in this
segment
c. Suggest ways in which Aava could improve its brand perception
2. How can Aava leverage its current institutional distribution network to make a
transformation to a complete beverage brand
a. What should be the product mix that Aava should look at ensuring it is in line with
Aavas value proposition
b. What parts of its value chain can Aava hope to outsource to keep down costs
c. How can Aava leverage its current channel and equity and what other channels
would you suggest