Elephantine ambitions

 Omprakash Malu remembers the Mahashivratri festival of 1999 with great nostalgia. An elephant was brought to the mela in Sangli and the task on hand was to see if it could break a plastic ghamela, a pan used by labourers at construction sites. Luckily for Malu, the ghamela held out. The product came from his company’s manufacturing unit in Sangli and this was the best possible advertisement for its claim that it was made of ‘unbreakable plastic’. “We recorded sales of ₹25,000 on those two days of the festival,” says Malu, marketing director, Samruddhi (‘prosperity’) Industries. “It remains a very important moment for us.” 

The idea of a plastic ghamela struck the three Malu brothers because, “What was made of iron was prone to breakage and caused serious damage to the hands,” says Ramakant Malu, 46, the oldest sibling and Samruddhi’s managing director. “The only hitch was that our product, at ₹90, was more expensive than the cruder version priced at ₹65.”

After the initial breakthrough, they decided to invest ₹65 lakh — of this, ₹25 lakh was from their own funds and the rest came from the Maharashtra State Financial Corporation. The brothers own the company equally and have no plans of bringing in investors for now. An early venture of trading in milk crates manufactured by Supreme Industries left them with losses of ₹80 lakh but the fascination with plastic remained. “It was then that we decided to look at a segment where we could be in a strong position,” says Omprakash. “The ghamela was our first product.” The elephant became the company’s logo. “We wanted to say our products were as tough as the elephant,” says Ramakant. 

Consumers bought that. From a turnover of ₹1 crore in 2001, Samruddhi logs sales of ₹150 crore and a profit of ₹10 crore. The product portfolio, too, has expanded: from the solitary ghamela, Samruddhi now has 164 products including buckets, crates, dustbins, mats and a range of furniture that has plastic chairs, tables and racks. The company started by pitching its products to 2,000 villages across Sangli, Kolhapur and nearby Belgaum. It hired people on motorcycles and vans to spread the message. More importantly, says Omprakash: “It was clear that a robust system had to be in place if we wanted to get out of Maharashtra.” Reasonable progress is evident — Samruddhi now manufactures out of factories in Rudrapur (Uttaranchal) and Madanapalle (Andhra Pradesh), employs 650 people and has an annual production of 10,000 tonne of plastic, and is available even in locations such as Kargil and the Andaman & Nicobar Islands. 

Of course, it has stiff competition from brands like Princeware, Polyset and Ratan. Samruddhi has tried to get closer to its customer by opening exclusive retail outlets, with mixed results. Since 2009, 45 Samruddhi Family Shoppe outlets have been opened across small towns in Maharashtra. The 450 sq ft exclusive stores are run on the franchise model and also stock stainless steel products. In the next three years, the company plans to have 4,000 such stores. “We have to go to the consumer. It will be foolish to think the consumer will come to us,” says Pramod, 38, the youngest brother, also a director at Samruddhi. 

Another retail venture, the Samruddhi Metro Shoppe, wasn’t as successful. Launched in 2008, 10 outlets were opened on the outskirts of Mumbai (Vasai, Turbhe and the like), but they failed to take off. “Consumers there wanted a certain colour to match with a bathroom wall and we could not make an impact since we had a different mindset,” says Ramakant. The brothers haven’t given up on the idea of a presence in metros, though. “We are kings of the semi-urban and rural segments but the move to larger cities is a must in this day. We need to grow quickly and that is the agenda,” says Ramakant, as his siblings nod in unison.