MNCs are a Big Challenge – Anish Shah
-Incense industry needs to diversify
-Sanjay Chemical Works Unit-A also works on the non-appearing results of the GC/MS report
The MNCs stepping into the incense and fragrance industry are going to become a major challenge soon unless the homegrown industry brings substantial changes in their work and business culture. A friendly warning was issued by the head of Ahmedabad-based Sanjay Chemical Works Unit A. Anish Virendra Bhai Shah, in conversation with Sugandh India, remarked, “Homegrown incense companies are at the greatest risk. They need to bring changes to the quality, production, technology and marketing along with updating the overall industry.” He added, “Manufacturers should know the ins and outs of what their perfume and raw material suppliers are providing. If it’s not then the manufacturer is playing a risky game as the supplier might reduce the quality of the material or discontinue it. This can drastically affect a hit brand. The manufacturer should have complete knowledge of his supplier and also the end consumer.” Established in 1975 by Girish Shah; Sanjay Chemical Works Unit-A is a Natwarlal Nathalal Group company. The Ahmedabad-based group has faced countless ups and downs in the past. However, Anish Shah, the present owner has skillfully sustained this 50-year-old family business in a better view of his stakeholders and customers at large.
Anish Shah in a conversation with Sugandh India said “initially our perfume became a hit in the Mazaa agarbatti of Shashi Industries. Over the time Sanjay Chemical Works Unit-A witnessed sweeping changes amidst highs and lows. In 2002 we retained the goodwill and label of Sanjay Chemical Works. In 2019, I entered the market with a new vision. Things were just settling down and COVID arrived with a bang!” Continuing with his remark, he said “, bogging down was a luxury. I installed a Hitech automatic blending plant as per the nature and demand of the market. We always had a good grip on incense perfumes. Besides making agarbatti perfumes, we also started diversifying to fine fragrances, cosmetics, soap, detergent, attar and aroma etc.” In response to a question, Anish said, “Today’s generation wants something new all the time. Innovation is the key which is why Our company is also working on; aroma, fusion fragrance, candles, hanky perfumes and deo.”
On the question regarding the challenge of multinational companies in the Agarbatti industry, Anish Shah said, “there are 3 types of companies here. On the top tier are the multinational companies, which are doing on huge investments and working on advanced technology and vast network. In the middle are companies like ours, whose growth gets stuck after reaching a certain level. In the lower tier are the companies, which are new in the industry and come and go, but increase the competition in the market. Multinationals are pressing us down on the strength of their power and the lowest-rung companies affect the market. In such a situation, we have to prepare according to the market. Multinationals are rapidly setting up their units. Big companies from other states are setting up their unit here to build a fast supply chain in the market. That’s why I am working with this vision.”
In response to a question, He said, “the agarbatti industry has been drastically affected by the heavy credits.” He added, “This industry needs to switch to advance payments, use of high-end technology, better quality and upgrading their ways from time to time in order function optimally.” He further remarked, “MNCs have; capital reserves, technology and vast supply-chain network. We need to prepare accordingly, otherwise, we can’t expect much!” Apart from these, such mid-sized manufacturers have to tackle inflation. Raw materials cost 10% more by the start of the new fiscal year whereas; turnover remains the same or even less. Company owners have to constantly deal with increasing fuel and food prices over ever-shrinking profit margins.
Talking further to Sugandh India he informed that his company has over 5000 clients pan India for retail and bulk buying. He said that he’s been taking care of manufacturing and research for the last 20 years. He said “, being a chemical engineer, my approach towards chemicals and curation of perfumes is different. This industry depends on GC/MS machines. The Gas Chromatography/Mass Spectrometry machine has been used by MNCs for the last half a century. My focus lies on the 10-15 per cent non-appearing results. Others are happy with 80-90 percent of whatever the GC/MS shows. By working additional on that 10-15 per cent, my innovation gives an entirely different product—That’s my USP. Getting back to “, Why a manufacturer should know his supplier in and out. Manufacturers work and are dependent on machines. However, taking extra care of what’s been left out, changes the game altogether. That’s the reason why Sanjay Chemicals Works Unit-A is in demand. For example, no one can copy the fragrance of Zed Black or Cycle. Similarly, no one else can have a copy of my product.”
With a production capicty of 4-5 tons per day, Sanjay Chemical Works Unit-A dispatches around 2-2.5 tons daily. Distributors take care of their marketing across the country. Delhi, Nagpur, Rajkot, Surat, Vadodara, Kolkata, Jaipur, Ajmer and Bikaner are their primary markets. He informed Sugandh India that, they are going to add distributors in many states including Bihar. On principle, they don’t keep distributors within a 200-300 kilometre radius. Distributors must have in-depth knowledge and experience of the agarbatti industry and raw material supplies. According to a new company policy; any distributor building a team and a network for marketing shall enjoy half of the expenses shared by Sanjay Chemical works.
Informing about the product he said that five to six hundred products that his company makes are in high demand. Eight to ten new varieties are added every week. Many such products that are custom designed for big players and special clients are trade secrets. 75% of their product lines are hot sellers. Price ranges from 300-5000 Rupees. None of their products can be copied. Since they operate on thin margins and huge volumes, they can sustain and grow. He suggested incense stick manufacturers venture into other areas like; candles, fine fragrances and cosmetics to counterbalance the ever-changing markets. Companies should also do job work and understand the mood and needs of the market. India is a huge country with numerous markets to make a product hit. On the other hand, it is also said that anyone can become an incense stick manufacturer with just Rs.500, but this way one cannot survive longer.
