Excelling in selling and distribution of consumer products, fast-moving consumer goods (FMCG) companies have time and again found it tough to crack the consumer services market. Companies that have ventured in the services business have not been able to make it a significant contributor to their overall revenues and bottomline, despite having a presence in it for over a decade.
The performance of the decadeold laundry services of Jyothy Laboratories has deteriorated in recent years, even as the company has put in more money in the business in the past two years. The business incurred a loss in each of the past two financial years.
Kaya, a skincare business, has been loss-making for the past three years. The skin clinic business was demerged from Marico in 2013-14. The Kaya stock has lost three-fourths of its value since its listing on the bourses in 2015. Last year, the company shifted its emphasis from capital-intensive formats, such as own stores, shop-in-shops, to a widespread distribution network across general and modern trade channels.