Ample Graphics: Focusing on what customers want

PWI: 100+ installations. An achievement…
Rajeev Jagga (RJ): We have crossed 137 installations thus far. It took us around two-and-a-half years to achieve the 100 mark. We hope to notch up 200 by the end of this year.

PWI: Your area of operation is rigid boxes?
RJ: Yes, one of the focus areas is the rigid box. Box making industry is moving towards automation. Printers dealing in mobile boxes and sweet boxes are opting for automation.

PWI: How so?
RJ: Currently, everything is being produced manually. Consider, Nagpur city, which has a requirement of four-lakh sweet boxes of different sizes per day. We are talking to a customer who has orders for supply of one-lakh boxes but he is able to do supply only 10-15% of the requirement because the operations are manual.

PWI: In what way does this translate into real numbers across India?
RJ: If you see the market for sweets pan-India – there are over 24-crore households. So if you assume each one buys sweets just once a month, there’s a requirement of 24-crore boxes per month. This is the bare minimum. The premium market, that is, boxes for mobile, perfumes, cosmetics, and beverages and so on would be an additional 20-25%.

The phone consumption is high during festive seasons – October to April, when the numbers boom, while the months of June-September are low. Smartphone usage is becoming more prevalent among Indians as online shopping rises. 61% per cent of users aged between 15 and 74 own smartphones and they demand smart packaging.

PWI: What are the trends that you are seeing in rigid boxes? Define the market? 
Sachin Kala (SK): The mobile box business is more or less saturated. The Chinese mobile companies are inviting its own suppliers from China. People who were supplying the boxes to these companies in China are being invited to India to set up the plant. So majors like Vivo, Oppo, Xiaomi have purchased huge tracts of land in Noida with the aim of setting up plants for its suppliers. This might not be good news for Indian printers and converters. On the other hand, there are segments like wine and perfume boxes. I know the volumes are low. But niche players will be able to monetise this segment.

PWI: What are the key drivers for the corrugation sector?
SK: Corrugation is moving from outer carton to inner carton. And in inner cartons, mono cartons are being replaced with G- or E-flute. Volume and weight-based products which used mono-cartons are moving into micro flutes.

PWI: Why are micro flutes popular?
SK: It’s a cheaper alternative to the higher thickness boards which are used for heavy products, which proves costly. Micro-flute for inner packaging is growing. This is one segment where 100% automated machines are not made in India. It has to come from overseas. Other than the Chinese machines, there are machines from Taiwan and some from European countries, but they are very expensive. We entered into the mid-range of this segment with HRB Pack Group, a Chinese manufacturer. HRB manufactures affordable, but quality machines.

PWI: What about lamination machines?
RJ: We are the India representative for Tiancen & Huawei brands. It’s been our launch product, but now the numbers are piling up in this segment too. The packaging is improving and we see a lot of premium consumer products arriving in India. These require a metalised base and UV printed boxes. The lamination of the metallised base film requires automatic machines for quality purposes. Growth is coming from this segment and not the traditional overprint lamination.

PWI: These machines are part of the 137 installations?
RJ: The first 100 installations were made at 34 customers’ plants. More than 40% of our customers gave us repeat orders. This helps Ample in keeping the marketing costs low.

PWI: Interesting. But what’s the reason?
RJ: There is more than one reason. First is: after-sales services. Second, we have partnered with the right kind of manufacturers from China. We make sure we will get the right kind of support in the long-run. There are many manufacturers in China who operate in India through multiple dealers. But we chose to remain exclusive.

PWI: What do you mean by after-sales service? It’s an opaque term…
RJ: Not at all, it means the proper installation, which I think is very critical. Either Sachin or I, we ensure a visit to the installation site during or after installation to make sure that the commitments made while closing the orders are delivered to the customers.
Training is another important aspect of after-sales service. We believe that inadequate or improper training to those who are going to operate the machine, is one of the main reasons, for customer dissatisfaction and mishandling. This leads to breakdowns.

PWI: Almost all suppliers say this ...
RJ: Plus, we do one other thing — we don’t over commit during sales negotiations, because a customer always demands heaven. And we say we can’t deliver heaven on earth.

PWI: What’s your role in after-sales service?
RJ: We started with one engineer two-and-a-half years ago, now we have five. We will be adding one more soon. This is in addition to our principals’ teams.

PWI: Sachin, you are a print engineer. What are the things you seek in a manufacturer before you decide on aligning with them?
SK: Firstly I visit the manufacturing set-up and study their facilities. For example, if they don’t have a CNC tooling machine, then they cannot produce same parts on a consistent basis. If the company is manufacturing one machine today and another tomorrow, then both the machines should have identical parameters.
Secondly, we visit the customer sites that are using the machines for at least three-four years to understand the consistency of quality and service. I also find out the engineering capabilities, if they’d be in a position to deal with emergencies, especially if our engineers are unable to provide a solution.

PWI: One of the problems faced by printers is after buying a new machine, whose responsibility it is to do the work of clearance?  
RJ: After GST, it has become easier to offer most of the customers a deal in Indian rupees (INR) as against USD. If the customer accepts an Indian rupee deal, then we undertake the entire responsibility.

Prior to GST, only customer not covered under excise took the INR bill since as a trader we were unable to give him an excise invoice. In GST, the excise has been included. If the customer makes the INR payment, then he need not worry about any customs clearance, we handle this for the customer. 

PWI: Chinese manufactured machines have a low reputation, of being low-cost, use-and-throw machine. How do you deal with such sentiments?
SK: European machines offer long-life but for a business person he cannot focus on the life of the machine. He has to consider the ROI as well.

PWI: Explain how? 
SK:If I am buying a Rs 100 machine and I have to pay interest on it, it will ultimately increase my production cost. Later after five years, I’ll be selling this machine for Rs 50. Now, consider another situation, where I am buying an Rs 50 machine and I discard that machine after five years. The second option will be more profitable for me. I have faced lots of problems while selling the machines. One of my customers, I would not like to name them, said I will never allow any Chinese machine into my company. Now I have sold four machines to that company. Also, while negotiating with Chinese manufacturers, we have to keep in mind that manufacturers are expecting a good margin out of the sale.

PWI: How do your products help the printer or converter build their business? 
SK: Our products have helped our customers to switch from manual to automated operations. Rigid boxes and corrugation have been additional businesses for some of our customers. When you automate, your capacity increases and so does the business. I feel this is because it eventually reduces the per unit price and makes more profits.

PWI: There have been changes in the technology as well as the economy, how does Ample respond to that?
RJ: One change was the implementation – and rationalisation – of GST. It has helped us. Earlier machines had to be directly sold to an excise registered packaging customer because traders were not allowed to pass on the CVD (counter vailing duty). After GST, we can buy and sell machines. We take payment in INR from our customers, retain our margin and transfer the money to the supplier. Customer-hassle has been reduced. He does not have to bother about procedures related to the import of the machine. We are importing it and selling it under GST. To sum up, GST has simplified the process for our customers and improved the cash-flow for us.
In terms of technology, the manual process has to be converted into automation. Inefficiency in labour and related cost are causing the change. 

PWI: India imports machinery, be it from Europe or China. Why?
SK: Now NBFCs are financing 100% without collateral. NBFCs have also started leasing. Also, the interest rates have gone down. These all factors have resulted in an increase and import of better machines.

Yes, there’s the Make in India sentiment, but if you compare the two in terms of infrastructure and workforce, I think it we will take a few years to achieve what the Chinese have achieved. This gap will reduce only if automation or labour efficiency increases.
There’s automation happening in the printing and converting segment, not manufacturing. Our customers are opting for automation not because they are having high volumes but to reduce labour inefficiency.

PWI: Will we see Ample manufacturing print equipment?
RJ: Not really, we are infants in the industry. We haven’t fully explored the trading part yet. We have just started focussing on Central India. We don’t want to run but walk confidently. Once we reach a client base of 1,000-1,200, we may think of manufacturing. But it’s too early to say anything right now.

Sachin Kala: In conversation:

Sachin Kala of Ample Graphics

Sachin Kala began his print innings in 1996 after completing his printing technology studies. He spent eight years in the production line in Rajasthan. That’s how he developed practical technical knowledge.

In 2004 he joined TechNova. Kala says, “It’s a place of passionate workers with great decision-making skills.” Kala’s stint at TechNova, handling the Rajasthan market was a turning point. He says, “I took the challenge of selling machines in a difficult market, due to which I was promoted as regional head of Delhi. Along with sales, I provided technical support to the customer.” For his efforts he received a TechNova award from Pranav Parikh and CG Ramakrishnan for “best sales performance”.

Rajeev Jagga was a distributor of TechNova in Rajasthan and Delhi, and since Kala was handling the capital equipment business at TechNova, they became “friends”. The friendship was bolstered by “the systems they sold, together”. 

In 2009, Kala joined Autoprint. The Coimbatore-based manufacturer required a specialist to handle their post-press business. Kala explains, “Although Autoprint was strong with the mechanical aspects and had a solid marketing team, post-press was a new frontier. I sold a good number of machines.”
Later, Kala was a partner of one of Autoprint’s company called  Vidhur Graphics.

Post Autoprint, he joined hands with Jagga. Ample Graphics was born. Kala says, “We told each other that we will plan for the next three years. If all goes well, we will march ahead, if not, we will dissolve the partnership.”

Today the count is, 137 machines (and counting) to show as Ample’s success. Kala is delighted when he says, “When we began, not many in the packaging segment were familiar with Jagga. I had good relations with many I interacted with in my previous occupations, but they did not want to take the risk of buying from a new venture, barring Nutech Packaging, Dev Print Pack and Prem Industries, who gave us the first opportunity. I think that initial phase of criticism was a learning experience.”

Sachin Kala signs off, “And here we are, marching...”

Team Ample Graphics

List of Companies:

Shanghai Tiancen Machinery – Hot-knife lamination machine 
Huawei Printing Machinery – Chain-knife lamination machine
Dongguan LongXingSheng Machinery – Semi-automatic rigid box
Guangdong Lishunyuan Intelligent Automation – Automatic rigid box
HRB Pack Group – Corrugation machineries 
Ruian Huayin Machinery – Automatic die-cutter
Ruian Haoxing Machinery – Window patching 
Zihong Printing Packaging  – Folder-gluers
Machines in our own brand – Stripping / blanking machine

Key customers:
Nutech Packagings, Noida
Any Graphics, Noida
Prem Industries, Ghaziabad
Tirupati Polymers, Kala Amb
Dev Print pack, Ahmedabad
Bhambari Printers, Chandigarh
Brijwasi Art Press, Noida
 Nebula Home Products, Goa
Summit Mod Styles, Vasai
SaiSwaram, Vadodara
Jash Packaging Co, Vadodara
Balaji Post Press, Rajkot
Edelmann India, Baddi
Award Offset Printers, Silvasa
Perfect Print & Pack, Vasai
Avon Rigid Packs, Faridabad
United Computer Media, Chandigarh
Laxmi Print & Pack, Ambarnath, New Mumbai
Interprint, New Mumbai
Shreeji Graphics, Rajkot
Aggarwal Corrugators, Jaipur
Amar Offset Printers, Amravati
Essence Ecocraft, Mumbai
Hycorr Containers, Noida
Lynx Designer & Creators, Noida
Maruti Industries, Firozabad