Alstone, a one of India’s leading brands of Aluminium Composite Panels (ACPs) seems to be easily sailing through the alleged current ‘slowdown’. Alstone is known to be successfully utilising their production capacity by offering latest quality products using strict payment terms. Ply Reporter tried to decode the company’s winning philosophies and determined beliefs amidst a recent tête-à-tête with Mr Pawan Garg. We’re sure his great business acumen, pragmatic thought-processes and ideas would help others in the industry to ACT accordingly – while boosting their business prospects instead of just longing for the “acche din”! Read on
Q:- The current market sentiment is projecting a sign of recession in panel product segment. What is your observation on the same?
A:- We regularly come to know that there is intended recession coming-in in the market, however we also must be aware that the ‘recession’ is a word not suitable for the social and economical structure of the country we are living in. It is a European concept. We have lack of resources, yet are rich resourced, as every year we observe 2 cr people getting added into population growth. How can we define that there is a recession? There comes a cycle of ups and downs in life; in the same manner sometime we used to sell our products on Rs 100 and today we are providing the same for Rs 70. However in future, it will be only us who would sell that for Rs 125 – most likely. Apparently, it’s only a humane to pretend to be in dearth of money. We are selling the products for over 25 years and still the story is same, people say they do not have money.
Q:- It means everything is on track as before and no slowdown in the market?
There is no slowdown at all, in fact many opportunities are there. We are lacking at our management level and approach towards observing opportunities. There was a time when we had a lot of private projects in India, and we were very happy working with them – realizing that there is growth in the sector. But, time today has changed and now our approach should be at the government initiatives. Today a lot of government projects are being launched. The government has a lot of work and the payment from there is secure as well.
Q:-How many times we would say that there is recession?
A:- Doing so will only disturb the market sentiment an extent. We have to keep ourselves positive. I believe after two years everything will be good in all terms.
Q:- We’ve been noticing a stagnancy in the flow of payments which hampers the sustainability of the players as their expenses are fixed and, they are not able manage their operations comfortably. What is your opinion?
A:- There is a little problem from the banking system for funding the market, otherwise in general there is no big issue. You should keep your payments on time that will bring a flow in the market and a fearwhich has been created will come down. Today many people are misusing the term as by having money in their hand they are intended to gain time anyway. Thus, we need to be careful of such people. I advise to make your payment terms sterner. Those who need the material definitely want to gain money out of it, but they have kept your money on hold.
Market players will have to think about quality parameters and making it durable, as the market is vast and demand is voluminous which is deepening with time. It’s high time the ACP producers have to resort to quality parameters while putting focus on Government projects.
Therefore, you have to fix your terms and conditions, start receiving money on time and also give timely payment in the market so that the sentiments change towards positivity. It is we who have created the problem by preaching ‘wrong statements of recession in the market.’ Actually there is not such condition or even if it is there, it is very miniscule that will automatically correct itself in an year or two.
Q:- You said there are lot of government projects, hence the possibility of the government fulfilling the needs of huge population in absence of private players. Secondly, can the government consume our built-in production capacity?
A:- One thing is very clear that the demand for basics of building materials like cement, plywood, iron rods, sand, remains the same till date. Yes, but the high-end products, the government do not use like a private builder, therefore the problem of demand and supply would be there in this segment.
Q:- Do you think that these private builders will observe the corrective major? What is your advice for them because there is a lot of inventories are not being sold?
A:- The private builders were playing using the market money, but today the government policies have become stricter than before. Now the builders have to invest their money in compulsion. Now those who have enjoyed the time with market for over 15 years will take time to adjust in present scenario of stricter norms. Today as well the real builders who are willing to deliver their projects on time are not facing any problem. Those who never used their money in business and always survived on others are in problem, because they’ve spent their money on different belongings and when they have to deliver their projects they are not able to perform well.
Q:- What is your message to the ACP industry on the scenario?
A:- ACP industry does not have any problem in terms of market demand except one – according to us. We are knowingly or unknowingly bringing the market down by supplying lower quality products which will ultimately harm the players by losing their confidence. For example, ACPs are supplying to the metro stations across the country since last 15 years, whether it is Alstone or any other brand. But in a short meeting with a Chief Architect of Metro recently, he said that we have lost faith on ACP. Not very simply the industry can afford to lose a customer, demanding huge volumes. The official reasoned that the companies do not talk about quality and are only concerned about price. The official indicated that they want to use long lasting products in construction, but the present product quality of ACP is likely to get damaged in a few years. Hence, the market players will have to thinkabout quality parameters and making it durable, as the market is vast and demand is voluminous which is deepening with time. It’s high time the ACP producers have to resort to quality parameters while putting focus on Government projects.