How Dabur went from a small manufacturing outlet in Kolkata to a brand in over 100 countries

More than 130 years ago, in the mid-19th century, there was an Ayurvedic doctor by the name SK Burman who lived in Calcutta (now Kolkata). He would often spend his days at home concocting medicines with various herbs and plants. Daktar (or Doctor) Burman, as he was lovingly called, worked tirelessly to make Ayurvedic medicines to cure diseases such as malaria and cholera.

The success of these medicines, which were affordable, helped the poor a lot. There was a common faith in Ayurveda. Its herbal formulations, recorded in ancient texts, have been passed down several generations orally. Daktar SK took it to a whole other level by making it his vocation. As his medicines began curing more and more people in the city of Calcutta (now Kolkata), he thought of ways of reaching patients in far-flung villages and towns. He came up with the idea of sending them his remedies via mail-order. It worked.

He used the first two letters of the word “Daktar” and the first three letters of his surname to name the company he founded in 1884, and called it Dabur.

Over three decades later in 1919, his son, CL Burman, set up a unit to carry out research and development for the medicines. CL also introduced machines to produce them. The business began growing. More and more people began to use the products.

Gradually, CL Burman’s two sons Puran and Ratan Chand took over, and divided up the work. Puran took care of the manufacturing part, while Ratan made sure the medicines sold well. Dabur started producing hair oil with amla in the 1940s, one of the first of such products in the country. The business was growing and so was the family. Three generations of the Burman family lived together in one house. That was seven families in total living under the same roof. Although the families had different living spaces, they ate their meals together every day. They often discussed ways and means to improve their business.

Every elder of the family groomed the younger ones to run the business. For many years, this practice continued. Unfortunately, in the late 1960s and through the 1970s, Calcutta became a hotbed of political and social turmoil. The Naxalite movement was gathering steam in West Bengal, and trade unions were becoming very assertive and sometimes aggressive. The workers began seeing businessmen as their class enemies. Industries began closing down. Many companies, such as the famous Birla Group and State Bank of India, moved their headquarters out of Calcutta.

The Burman family too found it increasingly difficult to stay in the city. They decided to move north, towards New Delhi. Since 1972, Dabur has been headquartered in New Delhi and the family made the city its home.

By 1998, Dabur was being looked after by the fourth and fifth generations of the Burman family. They had begun making many different products – from hair oils to chyawanprash to toothpaste. Business flourished but not at the pace that the family would have liked. They thought hard about what to do in order to grow faster and decided to seek the help of an expert.

They asked the global firm, McKinsey & Company, who came up with a very unusual suggestion: The Burmans would have to give up control of the business. That meant the family would have to stop participating in the day-to-day running of the company. Instead, they would have to hire professionals from outside or within the company to be the chief executive officer, financial officer, and so on.

Although they could not take salaries from Dabur, they would keep their shares in the company. The family would also retain their places on the company’s board of directors and decide the overall vision for the company’s future.

The final decision on which new products to launch, which countries or new cities to sell in, which locations to set up manufacturing plants in and what quantities to produce – would all be taken by professionals who did not belong to the family. This was a radical idea at the time. There were very few business families in India that had taken such a step. Nevertheless, the Burmans agreed to this suggestion.

It was difficult initially. There were teething problems with this new arrangement, and many times, the family’s resolve was put to the test. In 2009, when Anand Burman (the fifth generation) was chairman of the company, he was asked to taste a new flavour of Hajmola during a meeting. Anand did not like the flavour at all. However, he asked the chief executive officer, Sunil Duggal, what the research team thought about the candy. Sunil said that the research team’s feedback was that the candy would sell well. So, even though Anand did not like the candy, Hajmola Mint was launched.

Dabur India is now headed by Mohit Malhotra and its chairman is Anand’s cousin, Amit Burman. A management graduate from Pune University, Amit had joined Dabur as a management trainee in 1994 and was made chairman in 2019.

The family has a council that acts as an interface between the Burmans, and the board and management of Dabur. They decide the strategy. Four members of the Burman family – Amit, Mohit, Aditya and Saket – represent the family on the board of directors. The family members run their own businesses outside Dabur. It seems to have worked well for Dabur, which is the world’s largest Ayurvedic healthcare company. It makes a wide array of consumer products in categories such as hair care, oral care, healthcare, skincare, home care and foods. The company has grown from one small manufacturing plant in a bylane of Kolkata to 12 locations in India and eight overseas.

Dabur has in its kitty over 250 herbal or Ayurvedic products, including over-the-counter medicines such as Dabur Honitus, a cough syrup, and Dabur Ashokarishta, a health tonic for women. It operates mainly through five flagship brands: Dabur, as the master brand for natural healthcare products; Vatika, for premium personal care; Hajmola, for digestives; Réal, for fruit juices and beverages; and Fem, for bleaches and skincare products. Its Ayurvedic products are found in over 6.7 million retail outlets in more than 100 countries.

The family has proven to the business community that sometimes it is better to detach from full management control by the business family for the greater good of running a large business in the long term.

Excerpted with permission from They Meant Business: 50 Inspiring Stories from Indian Biz, Rosemary Marandi, Hachette India.