A drug retail chain grew from ₹8 crore a year to ₹1000 crore without the MSME tag⁠— the founder has lessons to share with other small biz

• Indian medtech platform – Wellness Forever had an annual turnover of ₹8 crore in 2008, when it was founded.
• Gulshan Bakhtiani, director of the company, shares his experience of having grown the company without the MSME tag.
• Wellness Forever has over 160 centres, with most of them in Mumbai.

An Indian drugs retail chain, and now a medtech platform, Wellness Forever, had an annual turnover of ₹8 crore in 2008, when it was founded. Today, the annual revenue is close to ₹1000 crore ($133.3 million). The co-founder Gulshan Bakhtiani revealed to Business Insider that he made this stupendous journey without the tag or benefits of being a micro, small and medium enterprise (MSME) in India.

This may not be an option for most small business owners who may not be from the big cities, or for those who do not have access to the rich or privileged. However, the experience of Bakhtiani has some nuances and useful lessons to understand ground realities and different approaches to the issue of uplifting small businesses. .

The size of the problem

Bakhtiani chuckled as he remembered a popular advice in his early years. “Don’t grow your business beyond ₹40 lakh, they would say. This is because beyond a certain revenue, MSMEs wealth has to be audited by a CA,” he shared in a chat with Business Insider. Bakhtiani himself is a chartered accountant.


There is growing cry for additional support for India’s millions of MSMEs struggling to survive during the COVID-19 pandemic and the subsequent lockdown. On May 13, the Indian government allowed companies up to a revenue of ₹100 crore to be classified as MSME for subsidised loans and preferential treatment for tenders worth up to ₹200 crore.

The banker approving the loans is looking at many more things other than these definitions and thresholds

The banks prefer bigger businesses with more assets available for collateral. “If you look at the statistics more thans 95% of the businesses in the MSME sector are in the micro space and 98% of them employ less than 10 people. But the bane of the industry continues to be the lack of capital. If your creditworthiness is good, you’ll get those loans. But we need to address the issues – what’s going wrong with the companies that are not being able to maintain the working capital cycle,” said Anupam Prasad of AP Law Chambers.


It’s not just the banker

Existing relationships with banks matter but many small businesses, particularly the micro ones, still stay away from banks as they can. “A businessman just wants to make money – he doesn’t understand terms like debt, debt equity ratio or more,” he said. Wellness Forever is backed by the family offices of several high net worth individuals including Adaar Poonawalla.

That’s a problem for the banker and rightly so. “ There are two components in the way businesses are run today – an equity portion that a promoter brings in and a debt that the firm brings. There is promoter money and the money from the bank in the business. Today, the problem in the ecosystem is that the lines are blurred. For MSMEs to expand, they should have avenues to raise equity,” said Sunil Daga, Sr EVP and Head, Business Lending solutions at Kotak Mahindra Bank.

The solution, according to Bakhtiani, is for banks to conduct financial literacy courses and, possibly, a ‘lender maturity programme’.

Aspiration to leave the comfort zone

Most small businesses are modelled around the sops. Growing bigger would mean losing some of the benefits and, for many, it’s a question of survival. “MSMEs should internally decide the time for which they want to be in one particular bracket. This time frame will help them plan better,” he said.

It’s easier said than done for many; it's definitely a good idea for those who can aspire. In 2008, Wellness Forever started with three stores. Today, it has over 160 centres, though most of them in Mumbai, Bakhtiani’s home. But the company has plans to scale up the business to 400-500 stores in the next two years.

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