TCPL’s Goa plant: Quality is the name of this game - The Noel D'Cunha Sunday Column

Ever since TCPL announced the installation of the KBA Rapida 106 at its Goa plant, I was keen to visit the new plant which became functional in the month of January 2019. On 21 April, Akshay Kanoria, executive director at TCPL invited me to the plant.

The TCPL plant visit lasted for three hours, and I was escorted around by Kanoria and his colleague, Mahendra Patil, the plant in-charge.

The TCPL plot is in Kundaim Industrial Estate, at the top of a mountain forest. It houses a huge 1.65-lakh sqft two-storied-building where the KBA Rapida 106 is installed, along with a six-colour Manroland press and a raft of pre-press and carton converting and finishing equipment.

Challenges, lessons, and mistakes
The reason for the step-type building was the topography, which was the biggest challenge. It was steep. And we had to literally trek to get to the edge of the plot. Plus of course, the condition of the plot.

After an initial survey, the site development work began. Halfway through, we realised how uneven the plot’s topography was. There was a huge amount of work in terms of material shifting movement that was carried out. And I'm talking about movement of soil, the cutting of the mountain, and filling.

Monsoons in Goa can be hard, and it was no different in the two seasons during which the TCPL plant’s development was underway. The condition of the temporary road leading up to the plant deteriorated, making the movement of material and manpower difficult.

People would ask, why would you want to build a plant all the way in the corner of a hill? I would tell my colleagues here that Mukesh Ambani built the Reliance plant in Kutch in Gujarat, in the middle of nowhere, in 36 months. Why can’t we build this relatively little factory in six to eight months?

Overestimation was a mistake we made. It was a blip, given the location and the topography of the plot, not to mention the heavy monsoon in this part of Goa.

The plant was expected to begin operation in October 2018 (Diwali time), which kept getting delayed. Finally, the plant started to function in January this year, just four months behind schedule.

It’s still work in progress, and I think within a year or two, this would be a completely changed place – a fruit of all the efforts we have poured into our labour of love.

And the earnings ...
We should plan much more and a lot more in advance, perhaps three years down the line. Because in India, there’s always going to be a contingency, and one needs a plan for that contingency.

Step-type building can be a nightmare when moving materials in and out, can't it?
If you have seen our Silvassa plant, we grew piecemeal. We started really small, and then expanded by buying adjacent plots. The material movement there is not as smooth as we would like, but still, there’s a good process flow.

Here in Goa, it’s much smoother, because it’s one big site. And even though it’s a step-building, we have planned it in such a way that the storage of the material is at one level and the production processes in another. However, the raw material movement to the production area to delivery is in tandem with our workflow.

What is the organisational structure at the Goa plant?
Mahendra Patil is in-charge. He joined us in Guwahati before he was moved here to assist in setting up the plant. There are heads for planning, commercial, pre-press, quality check, and dispatch.

What is the capacity of the plant?
Our warehouse can store up to 1,500 tonnes of paper and paperboard. 

You already had a plant in Goa?
Yes, it was a rented premise with three sheds, which was in operation for the past three years. It was about one-third of the size of the present building. The space to operate was much less, and it was not up to our standards. But it was like a spare set up.

I see. What type of machines did that factory have?
In terms of machinery, there was the 2001-make Manroland six-colour offset press, corrugation machine, a single-phase flute laminator, two folder-gluers, a die-cutter and one UV coater.

Have all these equipment been moved to the new plant?
Yes. Besides, we have added coating machines, foiling machines, die-cutting machines, folder-gluers, a new corrugation line, a few flute laminator; a new lamination machine, a window patching machine, and a new inspection machine. We have enough space for two to three more printing lines.

Is it good enough?
It's a full-fledged set-up. In terms of infrastructure, you'll see it's very modern, built for the next 10 years requirement. Besides, we have lots of space to expand.

Process bottlenecks: What do you do when things go wrong? How is it tackled, and who is responsible?
Things can go wrong on multiple fronts. First, the biggest concern would be quality. So quality is a system-driven thing. You need good people and you need a good system. And as long as you adhere to the good system, good people, even a 30-year-old machine should be more than capable of giving you decent quality. One advantage here is that the systems are uniform across all units.

What kind of systems?
We have factory-wise QA heads, who follow a rigorous system developed over a period of time. We were the first carton packaging company in India to get ISO-9000! We have extremely demanding customers especially in tobacco and FMCG industries who have driven change in our systems over the years. It helps that we are always positive and receptive to changes suggested by foreign experts as well as our customers. It's all about the attitude! We also have a centralised QA in-charge to coordinate system improvements, and audits etc. and to drive learnings from one plant to the other. 

What about machine breakdowns?
That could become a production bottleneck. If your machine breaks down, then you fail to service your customer on time. We understand the perils of having a one-machine factory, it’s not a sustainable way of working. You need to have two lines over a period of time.

Fair point. But is it feasible for an SME firm?
Obviously, no one is saying you start a new plant with two lines, I don't think that's required. What I am saying is, you start with one line, then stabilise it, fill up the machine, then you put the second line, but ultimately, you have to have a solid backup.

The KBA Rapida 106

You have multiple sites producing cartons. Are they a back-up to each other?
Yes, the Goa plant is a backup to Silvassa and likewise, Silvassa is a back-up to Goa. When we were operating with a plant in Silvassa, sometimes we could not service our customers especially during festive seasons like Diwali, when the demand peaks. So if Silvassa was running at full capacity, we had no recourse.

Now is it comfortable?
Now, with the Goa plant set up, we are very comfortable; that tension is not there. We have space here. So we can keep growing, and adding lines; there is no issue.

You spoke about systems, which software do you use?
We have our ERP system which is painstakingly customised to our needs. There are many fail-safes built into it. Each time there’s a bug, we fix it. You learn by fixing bugs. Sometimes people don't realise how important the software is to a company's success. 

Can rejections be painful?
I think, in general, our waste levels and our rejection levels are quite low. You know, we have very demanding customers, and they have really taught us to reduce waste and rejection, over a long period of time.

But is it feasible to be zero rejection at a customer site?
Obviously, that's not 100% feasible because, in the printing industry you have so many variables that can go wrong. Paperboard is one. It is very difficult to maintain good quality with cheaper raw materials. There can be issues with board – dust, patches – which cause problems down the line. So, we have to use good raw materials.

What about the inks?
You have the ink – a small change in ink can cause so much problem on the customer's line; and varnish, as well. So if the quality of your varnish quality is not good enough, then your pack won't run on the customer’s line. Then you have to maintain good quality dies. Otherwise, once again, you're going to have formability and runability issues. Customers also need to be more understanding about the minor issues occurring in a very small percentage of the lot.

Employee involvement?
Your system has to be super efficient. But even more, the people working for you have to believe in the system.

Your customers are demanding a certain level of proficiency, which means your input materials have to be top notch. This brings me to the question: do you audit your suppliers for quality?
We do, but I don't think we can say we do it as stringently as our customers audit us. But we audit our suppliers.

I see.
The irony is: Packaging companies are small entities squeezed between big suppliers and big customers.

Please explain what you mean.
So our suppliers, for the most part, are the big ones, say ITC or Siegwerk. They are pretty much standard as far as quality is concerned. They have good systems. In fact, we learn from them. I don’t think good quality suppliers need to be audited.

What about audits for new suppliers?
For new suppliers, say a die supplier or a new ink maker, we have audits. We are very exacting on our standards, and they sometimes don't understand why. Then they improve their quality and ultimately it benefits them. I think we've driven some improvement in suppliers as well.

That brings us to the safety and environment records…
We are Sedex certified. Above that, we have everything in place and ready to be certified for ISO 9001, ISO 14001, OHSAS 18001, and BRC. And it’s not for the audit that we are preparing, but for our own benefit. We have a fire safety drill done on a regular basis. I would go a step further and say, a re-audit would be bad news. It has never happened to us.

There’s an argument that print-packaging players are aiming big by becoming the cheapest. There’s huge price disruption in the market, which is affecting other players in terms of prices…
It’s a very competitive market. But I think, to some extent, we have grown much more than the competition in the market.

So, what is your USP?
When it comes to some key customers, I think we are more a natural choice.

It is difficult to command a price as a service provider?
Yes, if you are not adding value. Now, what is value for us? It’s when our products don’t stop my customers’ line during production. If our customers' production line is stopping because of the bad quality of cartons we supplied, it will lead to poor supply and a default on their schedule. Today, any customer can get a cheaper price by opening the floodgates to 200 different suppliers. But what will you do at the end of the day with that price if the production line will not deliver as per schedule due to cheap quality cartons?

What does one do?
Packaging is so visible. It’s the first communication for a brand. So I don't think people like to take a chance with their packaging.

Some business gurus say, staying future-focused can lead companies astray. They are constantly looking forward not realising that their greatest strength could be hidden in their past. How do you see this?
I agree. I recently read an article in the Wall Street Journal about GE, the big American conglomerate, and how they lost their way. It was because they tried to do 100 different things and got thoroughly confused. I think we focus on our core, and stay in our comfort zone. So we are still operating in the offset printing space. Even in flexible packaging, at the end of the day, we understand the technology. For us, the customer base remains the same. I think you get into problems when you get into things you don't understand.