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"It’s important to bridge the gap between a design and scaling it up to commercial use"

By Rahul Kumar, Dibyajyoti Sarma,

12 January 2018

Established in 1995, Delhi-based Kanodia Technoplast has come a long way to become one of the biggest and most integrated flexible packaging companies in India. Now, the focus is on new product development. In this exclusive interview Dhruv Kanodia, the second generation of the family owned business, tells Rahul Kumar how the company does it

dhruv Dhruv Kanodia of Kanodia Technoplast

Rahul Kumar (RK): How did you enter into the business?

Dhruv Kanodia (DK): Kanodia Technoplast was established by my father Chetan Kanodia. We entered into packaging in 1987 with a stack type flexo printing machine, made in India for large-format bags. We started with printing multiple types of carry-bags. A few years later, we invested in a rotogravure press. Kanodia Technoplast was born in 1995.

The secret of our success was my father’s dedication to work. Even today he is the biggest motivation for all of us at Kanodia Technoplast.

I did my graduation from Delhi University and did a couple of courses from London School of Economics and other universities of London.

I was involved in the business practically from my childhood. We used to spend our weekends in the factory. After graduation, I joined the business full-time and gradually, responsibilities kept increasing.

My passion is new product development. This is one of the reasons we have won multiple awards for innovations in packaging. For the last three years, it has become part of our core strategy to develop more and more new innovative products. Since we are in the industry for the last thirty years and have gone through all the cycles, it’s not very difficult for us to develop new products. We had realised that we have expertise and experience. It was time to create a niche for ourselves in order to create more value for our partner-brands. Today, we are a one-stop shop for all requirement of the packaging industry.

RK: Which are the segments to be precise?

DK: We are in CPP films, metallised films, holographic films, rotogravure cylinders, printing inks and conversion of films into packaging material and pouches. Packaging manufacturing is our prime focus. We do not sell printing inks outside. We sell metallised CPP films, metallised paper and film, holographic paper and film outside.

RK: Please elaborate.

DK: Eleven years back, we started making rotogravure cylinders and from the beginning more than 50% of our cylinders were being sold to our peers and competitors. Even today, we sell around 60% of our production to our peers and competitors in the industry. Around the same timewe started manufacturing our own printing inks as part of our backward integration strategy.

Couple of years ago, we also started manufacturing cast polypropylene (CPP) films. It is again a separate business unit. More than 50% of our production goes to our customers all over the world. We do fair amount of export for CPP films. Our films manufacturing facilities are in Kundli, as after 2010, we did not have any space for expansion in our Wazirpur, Delhi facility. In any case, it’s just 30 minutes drive from Delhi.

RK: What do you do in Kundli?

DK: We have two facilities in Kundli dedicated to packaging printing and films manufacturing. The converting unit is fully equipped with imported printing presses and blown film lines like Windmöller & Hölscher (W&H). The film manufacturing plant is equipped with 3.1m Germanline for CPP film extrusion and 3.25m metaliser from Applied Materials, Germany. We are the producers of the best quality of cast polypropylene (CPP) films in the country.

We also have a holography facility here and produce holographic paper and films, which are in high demand. We also manufacture our own blown films and we have four plants to produce blown films. The latest plant is from W&H and it is one of the largest plants in India.

All facilities under one roof give us a better grip over materials and processes in terms of quality assurance and as well as supply chain management.

RK: Let’s talk about new product development…

DK: While I also look after business development, new product development is close to my heart. We have a fairly large team comprising experts from multiple segments.

At Kanodia, we approach new product development in two ways. First, we keep an eye on new products from different industries which can be integrated with flexible packaging, something not yet attempted in flexible packaging, especially in India and neighbouring countries.

In the second approach, we work with our customers closely and on regular basis and discuss their problems. For example, if they are facing anti-counterfeiting, we discuss how we can stop it with the help of packaging. If someone is tampering with their packaging, we try to find a way to stop it. Those are the good starts. If we know the pain points of our customers, we can work with them and add value to their products. 

Sometimes our customers approach us with their ideas and marketing campaigns and we develop and offer the solution. We offer solutions to different industries and exchange implementation of these practices in different industries. This also helps us in new product development.

For example, detergent and rice industries work in different silos. Since we have the know-how of both the industries, we can implement the best practices of one in the other. Since we also manufacture printing inks, we are aware of ink behaviour on multiple substrates. This helps in a big way.

 

RK: When did you start printing inks manufacturing?

DK: We started printing inks manufacturing around a decade ago. We have two converting units and both are equipped with separate printing ink manufacturing facilities.

RK: What about R&D for new product development?

DK: Our designing team comprises nine professional designers for new designs and new products. Except designing, we have people in all departments, such as ink, converting, film and others, who are responsible for new product development.

RK: Your Baba Elaichi Kanlock pack recently won the World Star Award.

baba-elaichi

DK: It was a combined effort of the product development team, the marketing team which worked closely with the brand owner and the production team who made it possible.

It is very important to bridge the gap between developing something and scaling it up to a commercial level.We always want to produce packaging solutions for large volume. Quantity may have multiple variables – size, brand, geography and others.It is a task for the development team to create a bridge between development and scalable production.

The Baba Elaichi Kanlock pouch is a good example of bridging the gap between development, marketing, production and brand owners. Earlier, the Elaichi manufacturing company was importing the packaging from overseas. We started working with them on this project and developed a pouch with special features complimenting our strength.

RK: What made the pack stand out?

DK: Baba Elaichi is the market leader in silver coated elaichi. They had to maintain their brand value.We designed the package keeping its superior brand value in mind. It is a fairly valuable pack. That’s why they spent substantial time and resources on the pack.

One key point of the package is a convenience, especially for customers who want to consume it on regular basis, as it can be opened and closed extremely easily. You get the same elaichi in Rupee 1 sachet as well. So, if the consumer is paying ten times extra for the product, then its packaging must also be up to that level.

RK: You also won an India Star Award for WPP bags…

DK: We won one India Star Award and two SIES Star Awards for WPP bags. We did spot, matt and gloss on the bags. We won awards for special features in addition to window metalised film on WPP bags. WPP rice bags always have a window.

The WPP bags manufacturing is largely unorganised. Most WPP bags manufacturers have expertise in bag making but not in printing and converting. As our specialisation is printing and conversion, our WPP bags stands out in the market.

RK: Your investments/ developments in the last three years?

DK: We are growing at CAGR of 17-18% annually. This requires a huge amount of investment and focus on all our divisions. In the last three years, we have invested in new blown film plant from W&H, and many lamination and coating machines to increase the overall production capacity and offer value-added features to our products.

Our CPP film is also doing well. Before we came in, no one was doing an organised bulk production of CPP film. The existing organised players were not producing enough to feed the market. We came in an organised way and thanks to the quality of our films, the product took off immediately. Today, we have exceptional CPP products, like 15 micron metallised CPP film, which is not available anywhere else.

Recently, we developed a holographic CPP film. We could develop the film because we have CPP film manufacturing and wide web holography under one roof.

We have also developed low SIT CPP film. Normally, SIT of CPP films is 120-130 degree but our CPP film’s SIT is 95 degree. The reduced temperature required to seal increases the speed of the packaging machine. For example, if we use CPP films in candy packaging and if the speed of candy packaging machine is too fast, say 1,000 candies per minute, we need a film which seals very fast, within a fraction of a second. The low SIT CPP film comes handy in such a situation. 

Couple of months ago, we developed extrusion grade metallised CPP films. Up till now, CPP film was not successful in extrusion lamination. There were delamination and bond issue but we developed specialised CPP film, which is doing very well in extrusion lamination.

RK: How do you provide complete solutions, especially concerning filling and sealing machines?

DK: We do not manufacture such machines, but we have a couple of partners who do it for us. You have to be a complete solution provider. Otherwise, the blame-game on variables would never stop. There are too many variables in the printing and packaging process. You have to consider the machines as well. For example, if you provide world-class laminates and if those laminates run on the low-quality machine, then it’s of no use.

RK: Any plan to manufacture these machines in-house?

DK: No. We are not thinking in that direction for the moment, at least for the next couple of years.

We will only consider manufacturing such machines if we can develop better products compared to existing ones in the market. If we are doing the same things others are doing, then what is the use? Our forte is packaging, not machinery at the moment. Our concentration will be in two individual segments and I would not be able to do justice to either. One should do what one is good at.

RK: Your best practices as a converter?

DK: Let’s talk about rotogravure. We have the complete set-up and supply rotogravure cylinders all over the country. We have the complete control on the cylinders, especially in terms of designing. We eliminate all outsourcing. Since no design goes out, there is no chance of a breach of trust. If someone gives us a design, it is never out of our ambit.

RK: In printing particularly?

DK: At the moment, we have all European machines. We have a lot of integration between the cylinder team, printing team and ink team, which is not possible unless you have everything in-house.

Every new job requires close coordination among the three teams. Integration of all the three teams is our USP.

Our printing presses operators are all printing graduates. Since a couple of years, we are going to best institutions like IITs and IIMs and othersfor hiring, not just for technical but for commercial teams as well.

Hire best minds from the market, train them and they will be the frontrunner for the company five years down the line. We believe that building talent in-house is more valuable than hiring someone from outside.

RK: Your plans for 2018?

DK: A Lot. 2018 is going to be an exciting year. We will be launching twice the amount of new products we launched in 2017. Last year, we have successfully launched eight new products and this year we are planning for atleast 16.

We will add more capacity and customers to our portfolio. We aim to increase the share of new products in our turnover and business by around three times in 2018 as compared to 2017.

RK: What do you do when you are not working?

DK: Packaging is not my work; it’s my passion. I am living it from my childhood. When I don’t work, I think and link about new developments in packaging, brainstorming on how we can use packaging in other industries. Or I survey the market to see the scenario, consumption pattern and talk to the people.

I travel a lot and see developments all around the world. I travel to at least two new countries every year. I have travelled to more than 35 countries for new business and product development. You can get ideas absolutely from anywhere. The idea of Baba elaichi struck me when I was travelling.

RK: Talking about brainstorming, what do you think about industry cooperation?

DK: There is no platform where we can sit and discuss the growth together. Everyone is growing independently. If major players of the industry come together and work, we can easily grow more than five times as we are growing right now.

We need to trust each other. We need to stop worrying that others will take away our business. The market is full of business.

I have seen this in other countries where big players sit together and discuss their ideas to take the industry forward. It helps you grow fast as an industry. We could share raw material, facilities, technologies and ideas in a way not affecting anyone.

RK: And about the issues concerning the industry…

DK: Sustainability is one of the biggest concerns at the moment. As a packaging manufacturer, we seriously need to think about it. It can be done collectively. Industries, governments, societies and local authorities all have to come together.

For example, consumers must be aware where they must dispose what kind of plastic. Organisations speak against plastic packaging but they do not understand that plastic is the most energy efficient and lowest carbon footprint method to save food wastage and allow preservation of food beyond preparation. We can develop the material and mechanism to recycle it or even make it biodegradable.

Other packaging materials like paper, glass and tin all require more fossil fuels or natural elements, more energy and produce more carbon footprints in the manufacturing. Plastic is the least polluting and power consuming compared to other substrates. It gives more shelf-life to the packaged food products and reduces the requirement of preservatives.

RK: What environment-friendly steps have you taken in your plant?

DK: Since we are a ISO 9000:14001 certified organisation, we follow all the directions. In all our plants we use gas for power; it’s a non-polluting source.We are also working on a project to extract energy from waste plastic. It is still early to comment on its viability and commercial aspect but we are working on it. We recycle the plastic waste we generate in our plant.

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