One year ago, Guruprem Khalsa, a soft-spoken bee keeper from England, took a gamble and bought the rights to the name of a foundering natural soft drink company in Toronto.
That gamble is paying off.
Guruprem brought the label he purchased to Washington and proceeded to set up shop. He invented new flavors and syrup formuluas, instituted sophisticated marketing techniques and a program of moderate, controlled growth. In less than a year, he turned the Honey Pure Beverage Co. into the No. 1 natural soft drink maker in the country.
Sales jumped an astonishing 3,000 percent between the first and third quarters of operation, from $4,300 to $122,000, and Guruprem is predicting revenues next year in the neighborhood of $250,000 a month.
Guruprem Khalsa is not a typical young business executive. Both he and his office manager and only full-time employe, Karta Kaur Khalsa, are converts to the Sikh Dharma religious sect, a 500-year-old offshoot of Hinduism that was brought to the U.S. 10 years ago. (Khalsa, which means "the pure one," is a common last name among sect members)
Guruprem and Karta Kaur also belong to the church's 3HO (Health, Happy, Holy Organization) family, the group responsible for such local enterprises as the Golden Temple Restaurant and the Sakti Corp., a shoe manufacturer.
"One of the principles (of the faith) is that work is workship," explained Karta Kaur. Members are encouraged to go into business for themselves. They run bakeries, vegetarian restaurants, health food stores and other lines of business that are in keeping with the spiritual and natural way of life the church represents.
Guruprem joined Sikh Dharma in 1970. One of the most important benefits he has derived from his association with the sect has been kundigali yoga, which he taught for a time. "I don't think I could handle what I'm doing now-all the pressures and hassles-if I didn't have a solid background in yoga," he said.
Honey Pure and the other businesses have no financial ties to the Sikh Dharma group, which is self supporting. The soda company is completely independent and completely owned and run by Guruprem. However, in the future, some of the firm's profits may go to the sect's various community programs.
Running their own small business gives Guruprem and Kharta Kaur a golden opportunity to put many of their religious beliefs into practice in the competitive world of wholesale.
"It's a spiritual organization," said Karta Kaur, who has been with Honey Pure from the beginning. "We trust each other, we don't rip off customers, we don't overprice. We're respected because of the very high policies we have on our product and the way we treat our customers. It's an extension of our everyday religious practices."
Guruprem runs his fledgling business from a small office at 457 Florida Ave. NW. The actual production and bottling are done in Baltimore at the Popular Club Beverage Co. The reason I chose them is they were so helpful in showing me the business," he said. "I used to spend a lot of time there during the first six months before I had a product available."
Guruprem supervises every phase of production. He makes all the syrups from his own recipes and often rides along in the tractor trailers that haul his soda to East Coast markets. There are four flavors of Honey Pure on the market in both 10-ounce and 28-ounce bottles: black cherry, English ginger, lemon cooler and mountain root beer.
All contain no preservatives, no caffeine and no sugar. "We don't as a practice eat sugar," said Karta Kaur. "And we don'gt want our children to." When she first tested Honey Pure, she knew that "there was nothing like it anywhere."
The main ingredient responsible for Honey Pure's popularity and success is honey. Before he came to the U.S. five years ago, Guruprem was a bee keeper and once ran his own honey company. "I think I know a lot more about honey than most people," he said. "I have to blend it sometimes to get the right taste . . . to get it close to straight soda, so if doesn't taste mediciney or honeyish."
A reporter who recently sampled a bottle of the black cherry soda found it much richer than regular soda, with more effervescence and fuller flavor.
Much of the three tons of honey that Guruprem uses every week is clover from Sascatchewan, a very mild and high-quality honey.
Guruprem admitted that it's not always easy to maintain consistency when using natural products. When political turmoil in Jamaica forced him to look elsewhere for ginger, he had to settle for a lower-quality variety from Africa. The same holds true for bees. "I love working with bees," he said. "But it can be very frustrating because you're dealing with nature."
In the Washington area, Guruprem has set up an impressive distribution network. Honey Pure soda is sold in every health food store and restaurant in D.C., Maryland and Virginia. More than 2,000 non-health-food outlets such as Woodward & Lothrop and Kramer Books carry the beverages, and they are sold at several small newstands around town that also offer regular soft drinks and junk food.
Honey Pure has big markets in Baltimore, New York and especially Boston, as well as in the Midwest and Southwest. Following the marketing approach adopted by Perrier, Guruprem is planning to establish bottling and distribution facilities in designated regions throughout the country. RC Cola already has made overtures to Guruprem about providing bottling services for his company in the West.
"By early spring, we're going to be sending soda to as far away as Southern California," said Karta Kaur. "We'll hit all 48 states by March."
All this interest in Honey Pure is being generated with minimal advertising. The company advertises in health food magazines such as Vegetarian Times and in serveral local papers but, as Guruprem said, "I'm not doing a Procter and Gamble trip in terms of advertising. Basically, the product is selling itself."
Guruprem is convinced that the key to success for Honey Pure lies in making sure that production and distribution keep pace with demand. "I'm trying to expand very slowly," he said. "After July 1, I refused to open any more distributors. I like to supply the guys I already have. When you start having a demand for your product, it gets you involved in this type of energy (rapid expansion). I've seen so many businesses go down the tubes that way." Eventually, Honey Pure will enlarge its flavor line to incude tropical fruit flavors.
One of the lessons he learned early on was that selling his soda in returnable bottles spelled potential financial disaster.
Guruprem had the foresight to surround himself with financia experts, including his accountant Jack Fox, "a very spiritual guy," to keep his company growing at a managable rate. Karta Kaur says that at this point "we'd like to get our scene together and get really professional."