PrintWeek India: You started as a retail paper trader and then moved to commodity paper trading and finally into fine paper and cards. These are two different segments… why this shift?
Sanjay Suneja: Yes. We took our first step into the paper market way back in 1966. It’s been a long journey. It’s true we established ourselves as one of the most trusted paper merchants with our association with mills like BILT, ABC Paper Mill, JK Paper Mills among others. Over a period of time though, commodity papers market got overcrowded.
All along we have been observing that while fine papers are being used world over, we in India were facing a chronic problem of inconsistency and unavailability of fine papers. This, teamed with the growing need of fine papers, led us to explore the possibilities of entering this market. We had the wherewithal in terms of marketing and sales from our commodity paper business, and the confidence that we could create a niche for ourselves in fine paper business. Thus, we asked our European partners to supply papers with different properties, and committed that creating a market for that product is our responsibility. In this segment, you reap the benefits of your efforts.
From a single brand trader in 2003 to multi-brand trader in fine papers, we have a pan-India presence and some of the finest paper brands in our extensive portfolio. We represent brands like Cordenons (Gruppo Cordenons of Italia), Lenza (Lenzing Papier, Austria), Mont Blanc & Ensemble (Honsol Paper, Korea) and Munken (Arctic Paper SA, Sweden)
PWI: Have you stopped catering to the commodity paper market?
SS: Very negligible percent of our business is into commodity papers.
PWI:In terms of tonnage, what is the size and your share in the paper market?
SS: According to a report, the total market for art paper is estimated to be around 8-lakh tonnes. Fine paper is still at 1%; that is, 8,000 tonnes. I think we should remember that the fine paper market began to take shape in 2000. At present, we are contributing a lion share of total volume in India. The rest of the pie is a scatter among other organised as well as fragmented segments of paper distributors.
PWI: Fine paper is a niche segment, how do you cater to this market?
SS: Yes, we serve a very niche segment of the market. To cater to the market of fine paper, you need to have a good grip, understanding and knowledge about the market and the products per se. Even if one can afford to use fine paper it is unlikely that he would buy fine paper until he is aware of the benefits he would derive out of it.
That’s why we impart awareness and knowledge about these papers across the nation. Two reasons govern this move: one, we are in business, and we need to concentrate on proliferating in it. More than that, we want to create a market for fine paper . People invest millions in buying printing machinery but when it comes to selecting paper, they usually don’t invest in buying fine paper . The same ordinary paper is utilized for both low-end and high-end printing presses. To achieve better results, usage of fine paper is what we advise.
PWI: Fine or premium commodity paper… where do you draw the line?
SS: Whenever you add value to the paper, it comes to the grade of fine paper . No doubt the ingredients of such paper would be fine. In India, people have a misconception that if they "touch" or "see" fine paper it should "feel" different than commodity paper. It’s like wearing a Rolex watch. If you are wearing one, it should look very different from other watches in the market. That is not the case with fine paper.
Fine Paper shows its attributes only when it has been printed upon. We advise the mills about the characteristics we require in the fine paper. In India, unfortunately, we don’t have many mills, which are technologically advanced to produce such papers. So we have to depend on European mills, which have a long-standing culture of using Fine Paper. They have a history of 400 years of using fine paper. Here in India, very little is fine paper
PWI: At Drupa, there weren't many paper mills. Why was that?
SS: Out of the 18 halls, only one (Hall 7) was assigned for paper manufacturers and distributors. There are over 1,000 companies engaged in this business. While, some believe that participating at Drupa is an investment, there are others who feel that it is an avoidable investment.
I also felt that the footfall at Drupa was less this time. However, for me, it was still a good experience. Landa’s nanotechnology is an amazing technology. Interestingly, he will not only use commodity paper but fine papers as well. Fine papers run on Landa’s nanographic printing technology would be a deadly combination. I am told that a team from Landa will be visiting our mills.
Though the Landa machines were up on display, we hope to see their first commercial production machine soon.
Overall, I felt digital was the way to go. Every other manufacturer of presses had a new digital printing machine to show, mostly as a prototype, few almost ready to be shipped.
India is moving towards digital. If you happen to visit Bengaluru, it has a large number of digital printers.
PWI: But for you, an offset printer would drive more volumes...
SS: Offset has volumes, but digital is an opportunity. According to my guess, it is also possible that the volumes of digital and offset might converge one day. We are fortunate that the companies we are representing have a wide range of products that can suit the needs of the customers. Even a small screen printer who does specialty work is a customer for us.
PWI: The cost variation between using Art Paper and Fine Paper is huge. So when your small-volume clients switch to use fine papers, aren’t they worried about the wastage and cost associated with it?
SS: Yes, every commercial printer is prepared to bear wastage of some odd percentage. This wastage, in terms of costs, when using commodity papers would sound negligible in comparison to fine papers. A wastage of odd percentage of fine paper sheets can actually send the costing of a print job for a toss. Hence he can't afford that kind of wastage.
On our part, we try to dispel this fear from the printer’s mindset by providing a few free sheets for trial and dummy purposes. We also provide assistance during the course of printing, as the process of handling Fine Paper is different from Art Papers.
PWI: As a supplier of Fine Papers, you are in a unique position. On one side, you have an opportunity to cater to a niche growing market; on the other hand, it is a big challenge selling it.
SS: For us, this business is a passion. When one starts a business, one expects the return on investment (ROI) to start rolling in least six months after. But that’s not the case with fine paper business. Here it can take up to three years. The marketing cost for fine papers is very high. You have to consistently educate the clients, whereas in Art Paper, price governs sales. Clients normally don’t demand for fine papers; their jobs can be completed even without it. It's like deciding what to eat for breakfast, pastries or breads. You will not have pastries daily but only during celebrations. Similarly, you need fine paper when you want to celebrate the print.
PWI: Are there specific printing directives that have to be adhered to when using fine paper ?
SS: There are few products that require certain procedures to be followed while printing. These directives are provided along with the product. We have a team of technicians with more than a decade's experience in printing technology and paper production. They attend to all queries. Apart from that, the paper mills have R&D departments, which tests the paper under various conditions before coming to customers.
PWI: Does the paper enhance the quality of the print or is it the other way around?
SS: Both. Paper supports the printing technique. If the paper is not chosen appropriately, the print will not achieve the gloss required for the image to come alive.
PWI: The packaging market in India is growing at 15-18%. Are you planning to cater to this segment in the near future?
SS: We are working towards catering to packaging segment. While commercial printing and newspaper printing are inching towards saturation level, packaging, on the other hand, is currently pegged to grow for a long time, and is also being considered as a safe bet.
Another sphere that has been boosting the demand for fine paper is printing of annual reports. Post the directive by the government that doesn’t make it mandatory for companies to print annual reports in large numbers; several companies are increasingly printing lesser number of reports. However, the limited-editions of reports are now being printed using fine paper, as they are supplied only to the elite faction of stakeholders.
In addition, there is a high traction among companies to use paper that is FSC certified. Companies today are voluntarily opting for green initiatives. While there are no laws to make it compulsory for them to opt for such CSR measures, I have heard that the government is working on a bill to make it mandatory for companies to shift to FSC certified paper. At least 30% of total paper use in companies would have to be recycled or FSC certified paper.
PWI: Has sustainability always been part of your growth strategy?
SS: Yes. We are the first multisite FSC certified paper merchant in India. In fact, all the products introduced by us have by default been eco-friendly products. All our partners too, in the last couple of years, have been with mills, which produce eco-friendly papers and have FSC certified mills.
PWI: You have several international tie-ups, and we believe there are more to come. Can you elucidate?
SS: Today’s customers are intelligent and informed. They are demanding more and more variety. Hence to meet their growing demand we should strengthen our product basket. This is a continuous endeavor on our part to bring variety and establish new brands of fine paper in India.
We have also appointed a channel partner in Bangladesh last year. Similarly, we have appointed agencies in Sri Lanka and Mauritius. We are looking for credible partners for Africa & other part of Middle East. UAE is also a strong international market for us, albeit a very tough market to penetrate. We are on a growth path there since we entered the market only three years ago.
PWI: How different is the Dubai market from India?
SS: The market there is really strong. In fact, stronger than India. It is a quality driven market; price is secondary. There are many international brands already operating in the country but there was no Indian player. The cost of running the business is very high, and the compliance processes are also stringent.
PWI: Would your company be adversely affected by the European crises, considering your suppliers are mostly European paper producers?
SS: Indirectly, we will be affected, but not directly affected. As the pressure builds up in Europe, our clients, be it in automobile, banking or any other sector, they would be affected. This would affect the volume of business. However, we have been trying our best to keep the prices in control.
While the prices of fine papers have gone up across the globe, we have been successful in convincing our European suppliers not to increase the prices in India. On the other hand, the cost has increased for us since the Rupee has weakened against Dollar. Therefore, the prices of the products already launched have remained untouched, while the new products that enter the market are being supplied to our clients at the exiting global rates.
PWI: You said the fine paper is still at 1%. Where do you foresee it growing?
SS: I believe the fine paper market will grow. The consumption of art paper is estimated to grow at 12-15%, and the fine paper at a compounded annual growth of 30%. Therefore, in next five years, that is by 2017-18, the market for specialty paper should touch 40,000 tonnes. Our neighbours like Sri Lanka have been into fine paper from several years; in fact, the Sri Lankans have been using fine paper much before it came to India.
PWI: Where do you see Sona five years down the line?
SS: Our vision is to make Sona as the most preferred name in Fine Paper business, by offering wide range of fine paper and we are working towards it. That is why we are trying to be associated with several brands as sticking to a single brand will restrict our growth. Our aim is to bring value through variety, customer service and quality.
PWI: In the end, what is one major contribution by Sona to the industry?
SS: The industry is so huge that we are small one to make a contribution. That said, I feel, we have tried to educate and empower the industry with a fine graphic communication media.