Creating new business with smart ways

Rahul Kumar visits Accurate Labels in New Delhi to find out how Pawan Sharma, CEO of the company is maintaining a growth rate of 30% in his label business for the last three years.

28 Oct 2014 | By Rahul Kumar

Pawan Sharma, CEO, Accurate Labels has been associated with label printing since 1993. After a ten year stint as a trader, he realised that it was the opportune moment to start his my own venture. Thus, he started a label printing company, Accurate Lines, with screen printing units. Later with the advent of automation in the industry, he installed an automatic printing machine in 2003 in Madhu Vihar, Patparganj, New Delhi. Few years later, the company was renamed as Accurate Labels.
Today, the facility has Weigang Machinery (formerly Ruian Donghai Machinery) six-colour all UV printing press with a web width of 13 inches from Global Graphics India (Indian representative of Weigang Machinery) and has ordered for another similar narrow web flexo printing press and rotary die-cutting machine for plain labels which will double their converting capacity. Accurate has also installed a Mark Andy 830 narrow web flexo printing press. In finishing segment, the self-adhesive label printing company has three flatbed offline die-cutting and slitting machines. 
Accurate outsources flexo plates for its two printing presses and its in-house designing team is capable of handling any design issues that a pressroom faces. “We use plates which are made on 150 dots, a lot to do in flexo pre-press but in Indian conditions and inks its a totally different proposition. Substrates are also a major factor. Together, the printing presses convert around 70,000 sq/m of labelstock per month.
Sharma says, “We are growing at a CAGR of 30%, and we see growth as a continuous phenomenon for us. Demand is increasing day-by-day, so we have ordered one more printing press. After few months we will be have three printing presses under one roof.”
The company has a long standing relationship with Global Graphics India. Sharma feels that if a company is capable of matching the demanded quality by its customers then what kind of setup it has, does not matter. “The return on investment (ROI) is the main concern in tough economic scenario. We find that you can recover your investment fastest on Chinese machines as compared to European and American. I agree, these narrow web flexo printing presses are weaker in production speed as compared to others but the investment is lesser in multiple folds. We are running the printing press at a speed of 40 metres per minute.
Cost of real estate is a big issue. Being a vertical printing press, it requires lesser area of land. The running length of the paper in this machine is only around 15 metres. In other machines it is around 45 metres,” Sharma adds. Presently, the company has a belt of customers from pharma, auto and stationary industry but aims to extend its arms to liquor industry. 
“Big customers always demand for a standby printing press so that their supply is not hampered. After installing the second machine we will be able to meet even this parameter of our customers. Indian label printing industry is growing at least at a growth rate of 20% per annum. 70% of Indian label market is catered by wet glue labels but slowly the demand for wet glue labels is being replaced by self-adhesive labels. If the rate of conversion remains the same, the growth will be huge,” he says.
“In self-adhesives labels you can put the labels through applicator to maintain hygiene and accuracy. Prior to adoption of automation, a team of 20 people used to apply one lakh labels a day. Today, an applicator can apply one-and-a-half lakh labels in a day. Cost-wise self-adhesive is expensive but labour too is not cheap. Availability of labour is also scarce. Digital is new technology for label printing but is in its inception. Printers are using digital equipment but the running cost is still not a viable proposition. India being a highly price-sensitive market, it is slightly difficult to get premium prices for jobs,” he adds.

Fact File

Accurate has been growing at a CAGR of 50%.For the last three years, the rate of growth is around 30%. 
After the installation of new printing press, we will expect to maintain a growth rate of 30%. A reason for this is that we have also started focusing on product labels. Earlier we used to concentrate only on blank labels – Pawan Sharma.
The company reports that it has achieved Rs two crore turnover in the last financial year, and is targeting an increment of another one crore this year. Around 18 people work in the 3,500 sq/ft facility.