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Beco Banks On Affordability To Get Indians To Switch To Ecofriendly Products

Beco Banks On Affordability To Get Indians To Switch To Ecofriendly Products

Beco uses bamboo and corn starch to manufacture daily consumable products such as dinner napkins, toilet rolls etc

Beco product’s cost is comparable to the existing unsustainable market options

The company claims to have a revenue of INR 5 Lakh per month

From water scarcity in Chennai reaching acute levels, to congestion in Bengaluru and Mumbai, to the ever-widening layer of smog in Delhi — the depletion and degradation of quality of life has become a scary reality for Indian cities. Given the state of affairs, one can hardly afford to be indifferent about how their lifestyle choices impact the environment.

This growing need for a sustainable lifestyle in Indian cities has inspired a slew of eco-friendly startups and indigenous products. These include sustainable consumer goods ranging from biodegradable sanitary napkins, to eco-friendly stationery, food packaging items, dinner napkins, and more. In fact, as India’s appetite for online shopping and deliveries increases, the need for eco-friendly packaging, sustainable and recyclable everyday essentials is only getting more and more acute. 

According to These Come From Trees, it takes one tree to manufacture about 100 pounds of paper. Which means, a family of four will consume two trees a year when using non-recycled paper-based products. In India, very few cities and municipal corporations have an official recycling policy, which means that often consumers are left to their own devices when recycling or making a sustainable choice. 

With a vision to provide sustainable alternatives to such everyday single use products, Aditya Ruia, Anuj Ruia, and Akshay Varma founded Beco (Be Eco), a consumer goods company in 2018, which manufactures biodegradable and sustainable alternatives to single use-products such as dinner napkins, toilet roll, facial tissues, tissue roll and more. 

The Mumbai-based startup claims to use biodegradable and compostable raw materials like bamboo and corn starch to prepare various SKUs of tissue, straws, toothpicks, cotton balls, and kitchen towels. Beco also claims to use recycled and craft paper to package its finished goods in contrast to the plastic packaging used by most of their competitors. 

Talking about their choice of raw material, Aditya said, “Bamboo is a crop and unlike trees it isn’t uprooted but is harvested. Bamboo grows back 5x faster than trees. This is what makes it unique and sustainable.” 

Competitive Pricing 

India has no dearth of sustainable consumer goods brands, but these tend to become luxury brands to compensate for the higher manufacturing and procurement costs for sustainable products. Beco claims its competitive pricing is in line with what many big paper products companies charge, which makes more sense for the consumer. 

A pack of four Beco bamboo tissues comes at a price of INR 225, and a box of facial tissues is priced at INR 90 which is about the same as what consumers pay for similar paper-based non-recyclable products made by brands such as Selpak and Origami. 

Talking to Inc42, Aditya said that the company has been able to bring down the cost by keeping the company’s margins extremely thin. “We are hoping as our customer base grows, we can drive the cost down further,” he added. 

Inspiring a large-scale behavioural change in consumers usually requires incentives such as government regulation and cost subsidies. While there has been certain push by the current government to support bamboo production and entrepreneurial initiatives around it, there’s a greater need to make such products less cost incentive. This is likely to inspire more product uptake. At the moment, Beco is stuck in a deadlock where the company needs to reduce costs to acquire more customers, but it needs more customers to reduce costs in the long run. 

Currently, Beco is betting on appealing to the social conscience of the customers. But, the depletion of trees is a classic case of tragedy of commons — where the individuals continue to choose easily accessible unsustainable consumer goods over the larger well-being of the society. 

However, the company claims to see a growth in its number of repeat customers, based on which Beco is also planning to foray into subscription-based model in the next few weeks. The company claims to have a revenue of INR 5 Lakh per month, which gives it the confidence to enter the subscription model. 

Even though, Beco has authority over what raw products are used for the manufacturing of their products. The company outsources its manufacturing to existing manufacturing plants, who are more experienced in it than the Beco team, said Aditya. 

The brand’s lack of authority over the goods’ manufacturing means that established players such as Johson and Johnson, Kimberly Clark, and Tempo, can easily gain an edge over the new-age brand by shifting to sustainable products manufacturing. Further, with their huge customer base and manufacturing ownership, established brands can incentivise a customer’s shift to sustainable alternatives by providing more value.

More Offline Users Than Online Users

The company claims to be present in over 1500 stores in Mumbai and has plans to expand to Goa, Pune, Surat, Chennai and Hyderabad by end of this financial year. In addition to its offline presence, Beco products are also available online on their own ecommerce store LetsBeco.com, and other online marketplaces such as Amazon, Nykaa, The Better India, and Qtrove. 

It’s also looking to get listed on hyperlocal grocery delivery platform Big Basket. According to Aditya, for a product line like Beco’s people are usually looking for ease of purchase rather than the choice of purchase and thus their offline traction is higher than online. Beco’s initial strategy was to establish themselves as a retail first brand and thus they had started with positioning their product at various pharmacies, kirana and general stores. 

To start with, Beco targeted ‘Class A’ outlets and premium supermarkets which are frequently visited by ecologically-conscious consumers. The company also participated in several exhibitions and farmers’ markets every week to directly interact with potential consumers. 

“We feel that in the long run the consumer behaviour will adapt and household or kitchen care will also move to online similar to how most of the electronics are now bought online,” he added.

The company has recently got a significant push from many celebrity consumers and social media influencers, who had bought and promoted Beco products online.

Pushing The Envelope 

Beco majorly targets the consumers in the 18 to 40 year age bracket, and claims the addressable market size is close to $1.8- $2 Bn in this core audience. Other brands competing in this segment include Indian baby care startup Mamaearth which also makes bamboo-based baby wipes, Canadian household products brand Caboo, and US-based tree-free consumer goods company Green2

In the future, Beco aims to push the envelope by expanding its product line and introducing products such as compostable trash bags, diapers and sanitary napkins into the market. With the growing population, there has also arisen the need for sustainable alternatives and so the market for these products will continue to be in demand, he added.  

The Union Budget 2019 revealed the government’s plans to support private entrepreneurship in driving value-addition to farm produce and from allied activities. The government is focussed on produce such as bamboo, honey and khadi clusters. The budget has also introduced a ‘Scheme of Fund for Upgradation and Regeneration of Traditional Industries’ (SFURTI), with a focus on promoting these sectors and making traditional industries more productive, profitable and capable for generating sustained employment opportunities.

“We believe that saving the planet is a community effort, and Beco is every citizen’s way of contributing towards a greener tomorrow.” – Aditya Ruia.

Author

Yatti Soni

Inc42 Staff

A software engineer from Amity University, Noida. After graduation, she was part of a 14 months Communication for social change & media rights fellowship - ‘Ideosync Unesco India Fellow’ (IUIF). You can write to her at [email protected]

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