Let your channel partners be your profit sharing partners,’ this is the mantra for success in Laminate trade
says Mr. Vishal Dokania, Director, Durian Laminates
Cedar Decor Pvt Ltd, maker of Durian Laminates brand, has maintained its decent growth rate year-on-year, despite the market registered over-supply scenario due to huge capacity
addition in laminates. Among a number of brands in HPL category, the company is expanding its Distributors network in small and big cities offering win-win situation for company and channel partners with long term consistency policies, good quality product offerings, prompt and better services, timely updating of catalogues and enhancement of product range, and attractive catalogues with larger size displays which helps in easy selection at retail counters as well. During One 2 one interaction with The Ply Reporter, Mr. Vishal Dokania, Director of the company shared his market strategy, policy and future growth plan. Edited excerpts..
Our transparent policies and operation system has built confidence with our Distributor network which has helped them to operate with much ease with our company. When forming our policies, one of the most important things we consider is how we can maximise our Distributor ROI and profitability. This helps us create a win-win situation with our esteemed channel partners.
Q. How was your HPL manufacturing business in FY 2017- 18? How much was growth and capacity utilization?
A. FY 2017-2018 was the best year so far for our HPL vertical. We say a sharp increase in appointment of new distributors PAN India in unrepresented areas for the brand. YOY Growth was close to 15% in terms of volume sold. Overall the capacity utilization with our company was 93.7% (adjusting breakdowns and other delays).
Q. In present competitive market scenario, do you think that margins/realizations are shirking. If yes, then what is way-out?
A. This is the rule of economics that when supply exceeds the demand, the market turns buyer-centric and in this situation, there happens to be acute price sensitivity. However, since we operate in various segments of the market we have been able to achieve higher margins than last year. A big factor for this was the price support of primary RM like Phenol.
Q. How would you plan to keep away yourself from crowd?
A. Since inception of our company, we have set our policy framed and operated, which are Distributor centric and very friendly with them. We stick to our Quality and Service policies which has helped us to appoint over 30 new distributors last year. We are sure that in market, people from our trade have confidence in our brand and quality, owing to which we have succeeded in launching two new products last year as well as new distributors for our existing brands at unrepresented areas. Our transparent policies and operation system has built confidence with our Distributor network which has helped them to operate with much ease with our company. When forming our policies, one of the most important things we consider is how we can maximise our Distributor ROI and profitability. This helps us create a win-win situation with our esteemed channel partners.
Q. Would you think that more brands will add larger sells to company? What are the advantages of so many brands in laminates, because it seems a costly affair to manage in HPL?
A. Today with Globalisation the technology is within the reach of every hand, the market has turned very smart and fast. With new smart cities and small metros booming up now, the rural markets have escalated to semi urban. With new generation entering the ancestral business, families are becoming nuclear, new Distributors are coming up from the same family even. Apart from this, medium size Dealers are opting for Distribution of smaller range catalogues. In last one year you must have seen not less than 100 new brands in the market with smaller and smarter range. Though more number of brands is difficult to operate at Company level, it definitely has more advantages than drawbacks, if managed well. Division of Risk, Greater presence in the market, Optimisation of the Company Assets (Plates & Papers), Optimum utilisation of Sales Staff Cost, Faster inventory turnover, Lesser risk of huge outstandings, Fast rotation of Finances are few of the advantages of having more number of brands at Company level. In order to handle the work load or managing multiple folders, we
have recently moved into a bigger corporate office and have also doubled our product/folder team to offer better service to our customers.
At present we see no adverse effect with 0.92mm range. At Global level the lower thickness of material been used so skilfully. So thickness is just set of mind, if you have your substrate material calibrated and well surfaced a lower thickness material also generates similar result.
Q. What is your focus area, as you have many brands in Laminates?
A. As discussed, our only focus is to have our Distributors associated with us to earn from our brands. We set out policy that our Distributors get newer things to sell in market at minimum risk. We have a multi-year strategy for each of our brands/folders when it comes to product development or market penetration. From the Ground Space to Operating Software we have equipped ourselves to handle multiple brands effectively.
Q. What are the specialities of your recent 1mm (Romania) range?
A. Our Romania range consists of Designs all imported from Europe and Japan. Today in Industry there are very few brands, who have their range with European and Japanese prints and we are happy that we are one of them. We have designed and introduced our Romania master catalogue focusing on Dealer and Retail segment. Now our next step is focusing the Architects and Interior Designers (A&ID) segment and for that we are going to launch a special catalogue of Durian Romania which will be A&ID centric.
Q. What are the advantages for dealers, who are selling Cedar Laminates’ products?
A. Long term consistent policies have helped Cedar Dealers to have confidence in our brands and promoting our catalogues in the first leg of the Retail segment. Consistent good quality, prompt and better service, timely updating of catalogues and range, Attractive catalogues with larger size display which helps in easy selection at retail counters as well. Distributor network spread Pan India also help in inter-distributors exchange of materials, Clubbed loading of material for single destination, etc. adds strength to our Range and Network. To service our Distributors, recently we have added 14,000 sq ft of space to our finished goods stocking area, where we stock finished goods for faster and prompt deliveries.
We have also deployed a dedicate team and created complex SOPs at our plant to service urgent supplies via roll-service. We are seeing an 8% month-on-month increase in roll-service dispatch volumes for the past 6 months.
Q. Besides 1mm, what are the performances of your other value added products range? How do you promote these?
A. The market of 0.80mm and 0.92mm is expanding and growing. We have witnessed since last few months that growth patterns in these segment is more than 1.00mm. Our initial study says that the growth in this segment is owing to introduction of attractive catalogues in this segment too. In 0.8mm and 0.92mm laminate ranges you will find the designs and textures which are almost at par with the 1mm range. Even at furniture making, with better equipment’s and skill these lower thicknesses also give the same look and feel which you get in 1mm. So, we
feel that at Retail level the customer is being educated about the same. With cost saving in this lower thickness segment, the demand for the category has increased. At our company right from our premium 1mm range to the lowest Liner grade, we put equal efforts in developing and promoting our range of products and brands. We have same quality standards set for all our brands.
Q. Would you plan to spread you brand awareness through ‘Display Gallery” what is your opinion?
A. In coming month we are setting our second display gallery at Ahmedabad. as well our Display Gallery at Panchkula too. We are promoting our Distributors to set the display gallery as we have our policy of sharing cost to that. To operate independent display gallery is very costly affair which subsequently adds to the cost and selling price of our products. As a result we are very selective as to where we invest in Display Galleries. escalated to semi urban.
Q. Seeing the growth competition, which is the best selling model for decorative laminates in India?
A. Let your channel partners be your profit sharing partners, that is the success mantra in our trade. We have witnessed that Distributor sales model have worked well with our Company. Since we have our infrastructure and policies set keeping in mind our Distributors, we have Distributors associated with us since the day we started out factory and who they are happily working with us. We keep our Distributors in confidence whether is product or range development, selection of plates & papers, designing of catalogues etc, and this all help to have our Distributor more confident in our brands. Every suggestion from their end matters with us and is given due consideration and action.
Though more number of brands is difficult to operate at Company level, it definitely has more advantages than drawbacks, if managed well. Division of Risk, Greater presence in the market, Optimisation of the Company Assets (Plates & Papers), Optimum utilisation of Sales Staff Cost, Faster inventory turnover, Lesser risk of huge outstandings, Fast rotation of Finances are few of the advantages of having more number of brands.
Today with Globalisation the technology is within the reach of every hand, the market has turned very smart and fast. With new smart cities and small metros booming up now, the rural markets have escalated to semi urban.
Q. What is your opinion about growing numbers of 0.92 mm range, would you see any adverse effect or it will help in growth?
A. At present we see no adverse effect with 0.92mm range. At Global level the lower thickness of material been used so skilfully. So thickness is just set of mind, if you have your substrate material calibrated and well surfaced a lower thickness material also generates similar result.
Q. What is your plan for next 2 years for your HPL business?
A. We will optimise all our range and production facilities in coming years. At present our focus is on appointing distributors for all our brands covering the unrepresented areas. If we find the growth level in the industry we have plans to go for EOU with larger size of HPL for international markets.
Q. Your opinion about “Ply Reporter” magazine.
A. Ply Reporter Team has every bit of nerve of the industry. Well connected with all levels of the trade. It is a medium to express views to target audience and they do this work very efficiently. We are very happy working with this magazine.