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Photo credit:R A Chandroo

Big Idea

Origami is in a roll
How Manoj Pachisia successfully created a national brand in a hyper-competitive domestic paper tissue market.

"Until recently, Indians used more water and not paper for cleaning up. Now, they are switching to paper" —Manoj PachisaCEO, Origami India

Paperless office? Think again. Increasingly, there’s paper in almost every aspect of urban Indian life, whether at office or home  — wet wipes, paper napkins, paper cups and plates, kitchen towels, toilet rolls. It may be the stuff of green crusaders’ nightmares, but for one Bengaluru-based couple, at least, this urge to reach for the nearest box of tissues is a dream come true. Manoj and Neelam Pachisia are the promoters of Origami India, a ₹100-crore company that’s taken less than a decade to make its mark in the $280-million Indian organised tissue paper market. “Until recently, Indians used more of water and not paper for cleaning up. Now, more are switching to paper and with it, our business, too, is picking up steadily,” says Manoj Pachisia, CEO, Origami India.

The Pachisias didn’t start out with any ambitions for the paper products industry. Far from it. An alumnus of IIM Ahmedabad’s batch of 1986, Manoj’s summer projects with watch companies such as Allwyn and HMT proved so interesting that he decided to not join any company on graduation, and instead started his own watch band factory at Bengaluru, with loans from his family and local financial institutions. Neelam joined the business after marriage, but wanted to try her hand at something else. She got the opportunity in 2004, when the Pachisias’ neighbours wanted someone to run their paper products factory. “I told him that while we may not know anything about paper, we did know how to run a factory,” recalls Neelam Pachisia, co-founder. The arrangement continued for a couple of years, but the business was deep in the red — at which point, the Pachisias decided to take over the entire business. They paid around #16 lakh to buy out their neighbours, renamed the business Origami India and exited the watch band business to focus on this new venture. 

It helped that customer preferences were also changing at the time. As VP Leekha, CMD, Pudumjee Pulp & Paper Mills, points out, “Changing demographics and increasing earning capacity is leading to greater usage of paper products. Increasing middle class consumption will drive the growth, going forward.” Now, Origami is among the top three players in the market, along with Ballarpur Industries and Wintex, and they together account for nearly 50% value share of the retail tissue paper market. The company produces tissues, wet wipes, toilet tissue rolls, napkins, kitchen towels for retail customers; housekeeping paper products and napkins for institutional customers; kitchen towels, toilet paper and napkins in the private label segment; and matched sets, paper table covers and embossed metallic plates for export to the UK, UAE, Australia and Singapore. 

 

No paper tiger

One indicator of Origami’s growing scale is the quantity of paper it uses — from 500 kg a month, it now uses a little over 500 tonne each month, which is processed at five paper converting centres across the country. Most of the paper is sourced from Nagpur, where the company acquired a paper mill two years ago with a capacity of 500 tonne a month. “It is difficult to find the right quality of paper in India. With this mill, we have some control over an important factor of production, enabling us to control quality and also bring in some cost benefits,” says Pachisia. 

But the key difference when it comes to manufacturing is that about 80% of Origami’s products are manufactured from recycled waste paper in compliance with environmental norms. The manufacturing process involves using a combination of pulp and recycled waste paper or tissue paper. The pulp is pressed and the water drained and steam rolled to dry and the resulting paper is rolled to give it uniform thickness using highly specialised machines. The paper is made in large rolls and then sliced and cut or ‘converted’ for end uses. While the Pachisias have successfully cracked the manufacturing part of the business, the focus is now beefing up Origami’s presence.

The couple has extended Origami’s footprint with sales offices in cities such as Mumbai, Pune, Delhi, Kolkata, Chennai, Hyderabad, Chandigarh as well as Coimbatore. This move has also helped keep a check on costs — although paper products are light, they are bulky, making transportation costs prohibitive. “With local branches, we are able to restrict transport costs to 8%, thus increasing our distribution while being financially viable,” Pachisia explains. On the radar are plans to open multi-location manufacturing plants, but that would entirely depend on how well and soon Origami achieves critical mass.

 

What's on paper

A majority of Origami's revenue comes from institutional sales

For now, institutional sales to restaurants and catering businesses and corporate offices account for close to half the company’s sales (see: What’s on paper). Typically, these are signed as annual or bi-annual contracts with clients such as IBM, Google, HP, Infosys, Domino’s and Indigo Airlines, where Origami provides branded tissues and other paper products. Origami is also a private label manufacturer for most of the large supermarket chains and supplies products under various store brands such as Kare Mate to Big Bazaar, Arrow to Metro and Everyday to Hypercity. “Origami’s USP is the huge experience it has in making paper products and its diversified product mix, offering products at various price ranges,” points out Vaibhav Anand Gupta, trading head, non food, Hypercity. 

Now, the company also wants to build its retail business, which currently accounts for 22% of sales. Origami has three primary brands: Godya, named for the earlier proprietor of the business, is a popular brand of tissues in Bengaluru and neighbouring cities; the Klassic brand is reserved for wholesalers; and So Soft, its flagship paper tissues brand. While Godya will continue to remain a regional brand and there are no plans to grow Klassic (since it is a tissue paper product aimed at the lower end of the spectrum), Origami wants to expand So Soft’s reach and portfolio and launch party products such as plates and paper table covers under the Origami brand name. 

The million dollar question here remains, how it will go about popularising the brand, considering that Origami currently doesn’t spend on advertising at all — its branding and marketing efforts so far have been through in-store promotions and displays. “The paper products market in India is underdeveloped and per capita consumption is still under 100 gm, compared with 24 kg in America and 18 kg in Europe. So, advertising doesn’t make too much sense for Origami at present,” says Pachisia.

Going forward, though, the game changer for the Pasichias and their peers in the paper products business will be the government’s decision to allow 100% FDI in multi-brand retail. “Currently we serve the top 10 cities in India and are not there in tier 3 cities. This move will allow us to have a presence in many of the tier 2 and 3 towns in India,” says Pachisia. Pudumjee’s Leekha, though, sounds a note of caution. “While the FDI move will certainly spur thing, the absence of established brands could pose a hindrance,” he says. 


For now, Origami is concentrating on expanding its reach to more markets in the North and West of the country, and get more aggressive on selling wet wipes and paper cups. That’s what helped it grow at 30% a year in an industry that’s clocking 25% growth. The path ahead is challenging for Origami, as its reluctance to advertise negates its biggest advantage against competition — there isn’t a single established brand name player in the paper industry. If the company manages to capitalise on this advantage and popularise paper products enough to raise per capita consumption figures, its growth figures may be noticeable enough to leap off the page. As it stands, however, its business is as good on paper as it is in life.

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