Business Daily from THE HINDU group of publications
Tuesday, Sep 30, 2008
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Business Daily from THE HINDU group of publications Tuesday, Sep 30, 2008 ePaper | Mobile/PDA Version | Audio | Blogs |
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Marketing
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Strategy Web Extras - Personal Products States - Tamil Nadu Areca leaves products company Magnus plans expansion L.N. Revathy Coimbatore, Sept. 29 The Magnus, manufacturers of eco-friendly products from areca leaves and supplier of areca products manufacturing machines, is planning to widen its product range with the launch of eco-friendly calling cards, invitation cards, table wares, menu card and gift articles. The company, which had hitherto been concentrating on disposable plates and cups, has proposed to launch the newer range by Diwali. It is planning to introduce 20 new products within the next 5 years. Its proprietor, Mr C. Nandha Kumar, told Business Line that Magnus had already executed the menu-card order for a renowned hotel. “We have received orders for the areca greeting card and invitation cards. The response is positive, but I am apprehensive about meeting the requirement,” he says. He started The Magnus five years ago, with a seed capital of Rs 50,000. “At start, we were unable to get financial support from a bank or financial institution. My brother, Mr Satish, and I, along with our friend, Mr Ramesh Babu, pooled our savings to start this venture.” “We designed a machine and produced about 250-300 pieces of areca-plates per shift of 8 hours and marketed these locally.” The company has installed about 8 machines. Its monthly sales volume is about five lakh pieces. “We produce only against demand and even then, are not able to meet the entire requirements. So we source some quantities from our customers (from a select few to whom it has sold the machines).” Magnus sources its raw material (areca leaves) from areca plantations in Thondamuthur, in and around Poondy near here, Mettupalayam, Salem, and from the Anaikatti – Mannarkaadu stretch. “There is no constraint in getting the areca sheet (dry leaf), but since the industry is not organised, we do not have the facility to store the inventory. The dry leaf will not be available during wet weather conditions,” he explained. According to Mr Nandha Kumar about 750-900 trees could be raised in an acre, and each tree would shed 12 leaves every year. About 300 plates can be produced from 150 sheets, he added. Magnus, meanwhile, has started to export the areca plates and cups to the US and France. “The demand is for one container load (comprising 1.5-2 lakh plates every month. We are unable to meet the demand. We have so far sent three container loads.” Besides making value-added products from dry areca leaves, Magnus has also ventured into designing machinery for manufacture such items. The company has supplied over 100 machines till date. “We have now developed an automatic machine using hydro-pneumatic concept and propose to commercialise it.”
Meeting demand The company plans to accelerate its production with the automatic machine. “We will now be able to produce 500 pieces a shift/machine. With the increase in production volumes, we can also start looking at meeting the demand on the export front,” he said, adding “Turkey is emerging as an important market for us. We are in the early stages of negotiation. It will be known within a month or two.” Magnus has set up its own store at Gandhi Park in Coimbatore to popularise its range of eco-friendly products. The company is clocking a monthly turnover of Rs 6 lakh at present. “We are targeting a monthly turnover of Rs 40 lakh within the next five years. We have approached some banks with our project report. Our working capital requirement is about Rs 20 lakh. If we are able to get the necessary financial support, there will be no looking back,” he said. More Stories on : Strategy | Personal Products | Environment | Tamil Nadu
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