Zaware reboots with greenfield packaging plant - The Noel D'Cunha Sunday Column

Back in 1999, Zaware Creative Enterprises began its print business in Pune with telecom companies being its major clients. It was more of paper and print, but like six other print companies in Pune, the company’s intense focus was on product excellence. It was the seventh in the city to have a four-colour press.

Some 15 years later, Zaware Creative Enterprises’ product portfolio saw a shift from ordinary paper and print to more niche jobs. The client had started asking for better quality and would not accept any variations in print, which was acceptable in 2001-2002. But as the company expanded and its reputation for quality turned it into one of the top print companies in Pune, the company soon realised that it had to have everything under one roof.

Rahul Zaware, executive director, Zaware Creative Enterprises, shares an example. “We had multinational companies which were demanding labels from us and they are extremely colour conscious. They demanded that the delta E value should not be greater than two. We generally produce prints with a delta E value of three, which is exceptional and in accordance with ISO 12647/3. For this particular client, we had to do a lot of experimentation, especially with the ink, to get the required parameter that was demanded.”

By 2017, the commercial printing firm had everything a customer wanted – from spot UV, and aqueous coating to die-cutting, because, “the clients would not accept any variations in print.” In the same year, the company also installed a brand new Heidelberg SM 74 five-colour press with Prinect workflow and Heidelberg Suprasetter CTP. “Gone were the days when it was just about the CMYK prints. It became all about spot UV, aqueous coating and texture coating. Section-sewing and perfect-binding have also come a long way. And die-cutting was in a different league.”

The recently installed DGM machine, a Technocut 1050 die-cutter

Challenging business environment
By mid-2016, Zaware had reached a stage where the advantages of digital had started impacting its business. The company’s premium brands started realising that India was evolving. “In the automobile segment, for example, the buyer behaviour had changed. The customers did not visit the showroom when they had to buy their second car. Hence there was little exchange of printed brochures.”

That’s when it became crucial for Zaware and his company to find an appropriate business diversification that in future could help him and the company survive. “I started taking baby steps towards packaging and from 2016 onwards in producing premium mono carton packaging. We aimed at the requirements of quality-conscious customers and start-ups. We were primarily doing side-pasting and lock-bottom jobs.”

In the next year, the company continued to utilise the new equipment it had invested in, locking into annual corporate orders with five to six clients. “These were huge volume clients where every month we stock their goods at our end and distribute them across India as and when the requests are made from their marketing departments. We manage the inventory of print material for these companies,” says Zaware.

Zaware Creative Enterprises also steadily grew its packaging business, which was about 15% by then. Zaware says, “That’s where the Heidelberg cylinder machine came in, which is a sturdy quality printing press converted to die punching capabilities. We realised that packaging is here to stay and it would grow further.”

The greenfield packaging project
Zaware Creative Enterprises made news in late May last year when during the PrintPack India 2022 show, it signed a deal for DGM machines – a Technocut 1050 die-cutter and a Smartfold 1100 SL folder-gluer. Since then, the two machines have been installed at the new plant that Zaware has built in Shirwal, which is about 50 kms away from Pune on the Mumbai-Satara highway.

The site in Shirwal is a 45,000-sqft plot. Zaware Creative Enterprises has an approved plan to develop the 48,000-sqft plant. “We are building it in phases. So, in the first phase, we are planning 29,500-sqft, and then escalate as we are running,” says Zaware.

The Heidelberg Speedmaster SX 74, the four-colour press at work at the Zaware Creative Enterprises plant

The reason it is building the plant in two phases is because of the rates of steel and cement. “It’s crazy. What was Rs 1 is Rs 1.7 now. So, it does not make sense for us to put up the whole factory in one go,” explained Zaware.

Once phase I is completed, Zaware will move the entire print operation from Pune to the new plant in Shirwal. “We had envisaged the new plant much before the Covid-19 pandemic and had given ourselves five years. But the pandemic just hastened the move.”

For Zaware, first GST and then Covid-19 impacted its commercial business. “We are still doing but not those kinds of volumes we would be doing say, six to eight years ago. I believe in corporate MNC type of business rather than those coming from local builders. That was not our forte, and it is something that we have consciously kept away from. For us, the corporate has been a typically good customer.”

A plant in Shirval, why not in Pune? Zaware explains that Pune has seven to eight packaging players, two of whom have forayed from commercial to packaging. So there are the likes of Vikram Printers, Akruti, and Parksons, among others. “What I realised was that growth will come through the organised mid-level players. We are just 300-mtrs off the Pune-Satara highway, which is part of the larger Mumbai-Bengaluru highway. That location allows me to look for print business from Wai, Satara, right up to Belgaum and Hubli,” says, Zaware. ” Zaware’s USP is going to be a one-stop solutions shop. The approach: whatever it takes to get to growth. “That’s how we have done our business.”

Nitin Wani (l), Zaware (c) with Team Zaware Creative Enterprises

Building a new legacy
With the new plant at Shirval which will focus on packaging, would Zaware Creative Enterprises move out of commercial printing? No says, Zaware. “There will be a line kept for commercial printing. We still cater to MNCs across India, and our despatches across India are done from a central location. So it really doesn’t matter to us. Yes, we may lose a few customers who are the print-on-demand kinds. But, we are prepared to lose some things to gain some things.”

So, for Zaware, it is not about leaving the commercial print legacy, but it’s basically sharpening the vision, and getting focused on what the future holds for him. “Where would Zaware Creative Enterprises be in the next 20 years, is a question I ask. I’m already 46. So I need to visualise where I’d be at 66. So well, in a way I’d say, we are building a new legacy.”

And Zaware believes that people exaggerate when they see that there is a huge difference between the packaging and commercial businesses. “The only difference is the different finishing lines. One may be simple, the other may look complicated. I say, follow the processes.”

Understanding core issues
Whether in commercial or packaging, it is necessary to benchmark quality if one has to succeed, says Zaware. And for that Zaware hopes to take the same commercial print management approach that has made him successful, while managing the packaging business. “I am not a print person, hence I have people in key positions. I understand management, and how to solve clients’ problems.”

Zaware Creative Enterprises employs printing engineers. “Of course, there are many companies which employ engineers now, but we would probably have been the first ones to have mechanical and print engineers in the company’s employee roll,” says Zaware. Even today, there are three engineers and one diploma holder working – two on the shop floor, one helping in MIS and one in marketing. So, when I say we have technical people, it’s because we believe they have the expertise to understand core issues to the fullest.”

The other secret to success is quick thinking, says Zaware. He gives an example of quick thinking. “Some six years ago, I was visiting a client, and I saw the officer compiling documents while talking to me. He made a packet of the documents, put a label on it, and kept it ready for despatch. I asked him, what was he doing? He informed that he is preparing a package of brochures (which we print) for dispatch to his offices across the country. Since there is no office-help to do this work, he had to do it,” says Zaware, continuing, “I told him, what if my company just did it for him? We manage it for his office. All he had to do is arrange for the courier to come and collect it from us, and deliver it to the location he wanted it to go.”

Since then, Zaware Creative Enterprises fulfils this customer’s orders, printing brochures, updating it, keeping stock, and also tracking the deliveries. “We have added three more companies, and this business will continue. In total, we’ve got around 130 to 140 brochures in stock for different customers,” says Zaware.

That’s how Zaware hopes to stay relevant in the packaging business too, with such out-of-the-box solutions. “We are tapping an opportunity with an FMCG in managing their entire godown. The company wants to plug pilferages and streamline supplies,” informs Zaware.

Zaware has mechanical and print engineers on the company’s payroll

What in packaging?
At present, Zaware Creative Enterprises produces mono cartons at the Pune unit, but runs are between 5,000 to 20,000. That’s because Zaware feels that packaging cannot be run from a small unit. “Producing packaging needs space, you need your permissions in place, the pharma approvals, the MNC approvals, FMCG approvals, the factory has to be compliant with certain standards, and so on. With the new plant, we intend to target runs from 50,000 and upwards upto around 4,00,000.”

Zaware has also added two flute lines for corrugation packaging at the plant. “We have focused only on E- and F- flute lines. These are the cartons where printing and finishing is the key.”

One element that every serious packaging converting facility requires is the right equipment, people and regulatory compliances to help make it go. While Zaware’s has the required equipment and people, making the plant completely compliant with all the norms in place, is work-in-progress. In that, he is assisted by Nitin Wani, Zaware’s technical consultant since 2004 and an additional consultant, who has been associated with the pharma industry.

Zaware says, “I do not invest in machines without Nitin Wani’s advice. And for the new project, the expert we are engaged with is a pharma specialist, having experience in audits and compliance. Once we are at par with the pharma requirements, I think we will be good enough for the FMCG sector too.” He added, “Talking about compliance since our products fall in the secondary packaging, generic norms for packaging like tracking of material, certified material, quality checks, and finally inspections are all managed through stringent SOPs laid out. We have kept a free space of one meter around all our machines, with markings to enable smooth movement of people and material.”

Right mix of technology
For a greenfield project, bringing in high technology requires both big thinking and tight constraints. More often, you must figure out where, when and how the technology fits into and adds value to an operation. It’s a delicate dance that Zaware is very familiar with. “We ordered/installed the DGM folder-gluer kit with four- and six-corner folding features, keeping the pharma and FMCG requirements in mind. Bobst was one of the options while we discussed the converting and finishing equipment investment, but at this stage, we were more focused on boosting our finishing lines rather than spending on a big-ticket kit. It’s value for money which made our choice, firm in investing with DGM.”

Zaware’s site in Shirwal is a 45,000-sq ft plot with an  approved plan to develop the 48,000-sqft

That said, Zaware had the opportunity to link things up very purposefully to be able to take advantage of the existing machinery. There are two press machines from Heidelberg, there is four unit SX 74 and a two-colour 102 sheetfed offset machine. The plates, inks and chemistry are all from Saphira. “The whole process is Heidelberg-driven technology, which gives us ease of operation. Today, all I have to do is flag a problem, and it is sorted. That’s because I am buying consumables from one source, and it’s printed on the press that is manufactured by the company supplying the consumables. There’s no finger-pointing.”

Growth, but how?
According to Zaware, the ideal kind of customers should be: 40:40:20 — high-margin, moderate-margin, and those with big volumes where margins may be low but  keeps the machines running. “Larger the volumes, lower the margins. We are operating with 50:40:10, but we hope to get to the 40:40:20 ratios soon.”

But it’s not going to be easy. Competition is going to get fierce. “I welcome competition, but I will compete on solutions, quality, and management, not pricing,” asserts Zaware. “I have always believed in this line: When you are paid Rs 100 for service, the customer should feel like you have given back Rs 101. Go one step further, to reach the satisfaction of the customer. Service includes everything, quality, communication and the ability to provide key technical inputs.”

However, the Covid-19 pandemic has seen many commercial printing houses move to packaging. Zaware however, says it was not Covid-19 which pushed him to diversify into packaging. “We have moved into it rather in a progressive manner, and I would think that in these last eight years, there may be 40 to 50 players who have already moved into packaging while doing commercial business. I think there’s enough work for everyone. How you run your business is more important – are you making a profit, or are stressed.”

At the other end of the spectrum is the silver lining. “Our manufacturing facilities are improving, our industries are improving. Take pharma or FMCG. Even the masala-wala wants his product to reach more people, so he uses Amazon, and Flipkart or goes online. So, eCommerce and electronics are driving the growth of packaging,” concludes Zaware.