GOKALDAS EX­PORTS Geared TO DEFY TOUGH TIMES BY RE­DEFIN­ING STRATE­GIES

EX­PAN­SION Of CA­PAC­I­TIES & HIGHER OP­ER­A­TIONAL EX­CEL­LENCE CUR­RENT FO­CUS

Perfect Sourcing - - Face To Face -

A TETE-E-TETE WITH

SIVA GANAPATHI, MAN­AG­ING DI­REC­TOR, GOKALDAS EX­PORTS Gokaldas Ex­ports, that has over 22 fac­to­ries in and around

Ban­ga­lore and has a turnover close to Rs 1000 cr., is draft­ing plans to re­al­ize prof­itable growth.

Gokaldas Ex­ports, In­dia’s ap­parel ma­jor com­pany is in the news once again. The group that was ac­quired by Black­stone in the year 2007 has been through a lot of ups and downs. The PE firm took a hair­cut to exit its decade­long in­vest­ment as they could not bring the com­pany to the tra­jec­tory of growth and de­vel­op­ment it was used to in pre­vi­ous years. The prof­its of the com­pany were dwin­dling and there were many ru­mours go­ing in the mar­ket re­gard­ing the fu­ture of com­pany.

To get the in­sights, Team Per­fect Sourc­ing re­cently got into a face2­face con­ver­sa­tion with

Siva Ganapathi, who joined the com­pany as the Man­ag­ing Di­rec­tor around a year back. Siva has led sev­eral high-growth busi­nesses in di­verse in­dus­tries across sev­eral coun­tries in Asia, North Amer­ica and Europe. Com­ing with a back­ground in fi­nance, IT and tele­com in­dus­tries, Siva, who was last as­so­ci­ated with the cel­lu­lar busi­ness of the Aditya Birla

Group as COO, is quite con­fi­dent about the turn­around of Gokaldas Ex­ports.

He is now busy fine tun­ing the pro­ce­dures, stan­dards and strate­gies at Gokaldas to bring it back as a strong en­ter­prise with sta­bil­ity on all fronts. “I see tremen­dous in­trin­sic ca­pa­bil­i­ties in terms of de­sign, man­u­fac­tur­ing, sup­ply chain and cus­tomer re­la­tion­ships, which au­gur well for Gokaldas to be a leader in the ap­parel in­dus­try and serve its clients well,” he shared.

On be­ing asked how has been the tran­si­tion from Tele­com to ap­parel, he re­verts with a smile and says, “I have had the for­tune of work­ing in sev­eral dif­fer­ent in­dus­tries, run­ning busi­nesses in dif­fer­ent coun­tries, see­ing busi­ness cy­cles and turn­ing around un­der­per­form­ing busi­nesses. So a new in­dus­try is not daunt­ing. My ex­pe­ri­ence in other in­dus­tries will def­i­nitely be an added ad­van­tage.”

He ex­pressed that even though he does not have the do­main knowl­edge of fab­ric and ap­par­els, it can be ac­quired. How­ever, what is crit­i­cal is the abil­ity to un­der­stand how you make money. “I hope to bring many of my in­sights and ex­pe­ri­ence to GE and set it on an ac­cel­er­ated growth path,” Siva said.

When asked about the ini­tial chal­lenges that were faced af­ter join­ing the com­pany, Siva replied, “Of course there were many chal­lenges, as I came at a time when draw­back rates had just dropped, cur­rency was fluc­tu­at­ing and there was a pres­sure on mar­gins. GST blocked ad­di­tional work­ing cap­i­tal. It was def­i­nitely a tough sce­nario.”

Gokaldas Ex­ports, that has over 22 fac­to­ries in and around Ban­ga­lore and has a turnover close to Rs 1000 cr., is draft­ing plans to re­al­ize prof­itable growth. Siva high­lighted sev­eral fo­cus ar­eas, i.e op­er­a­tional ex­cel­lency, higher pro­duc­tiv­ity, re­duc­ing wastage, ef­fi­cient sup­ply chain and get­ting right quan­tity at right price and time. Af­ter fol­low­ing new meth­ods the com­pany saw an in­crease in in­cre­men­tal pro­duc­tiv­ity that came at 10% and re­duced wastage also. “Even if we re­duce 1% wastage and 1% in­crease in pro­duc­tiv­ity it means sav­ing a lot which would even­tu­ally bring long term ben­e­fits,” he elab­o­rated.

Gokaldas Ex­ports has been work­ing with top notch in­ter­na­tional brands and has a loyal base of cus­tomers. It was im­por­tant to gain the con­fi­dence of buy­ers and thus a ma­jor thrust was on cre­at­ing con­nect with cus­tomers and im­prov­ing re­la­tions with those who have been as­so­ci­ated with the com­pany for many years. “The team did a good job, as we were for­tu­nate to add some new clients while re­tain­ing ex­ist­ing ones,” he ex­plained.

Siva also pointed out that one of ar­eas of con­cerns is that most of the fac­to­ries of GE are lo­cated in and around Ban­ga­lore, which is quite ex­pen­sive due to which the com­pany will look at adding ca­pac­ity in low cost ar­eas where the Gov­ern­ment is of­fer­ing land, labour and other fa­cil­i­ties at sub­sidised rates. “We want to start build­ing long term ca­pac­i­ties which will stand for next 10-15 years,” said a con­fi­dent Siva. He is clear of hav­ing not just world class fac­to­ries for the com­pany, but also units which are much ahead of time in terms of the way they func­tion and per­form. “It is im­por­tant to work on sys­tems so that the units work seam­lessly,” he said.

“It is im­por­tant to work on sys­tems so that the units work more ef­fort­lessly and that is why we would like to work on in­fras­truc­tural ex­pan­sion of the com­pany in terms of man­age­ment,” he said. He ex­plained the same and said,

“We need sys­tems/ soft­ware that can han­dle order to cash, in­ven­to­ries, prod­uct man­age­ment, so that ev­ery­thing is sys­tem driven and the same process can be fol­lowed at all units of GE.”

Train­ing and HR are in­te­gral part of every or­ga­ni­za­tion and from hir­ing the best of the man­power to train­ing its em­ploy­ees the com­pany is work­ing on all fronts. “At­tri­tion is a big chal­lenge to­day. We have

The com­pany plans to in­vest around Rs.50 cr on mod­erni­sa­tion in next three years and around Rs

150 to 200 cr for ca­pac­ity ex­pan­sion.

more than 20,000 peo­ple. We are work­ing on team en­gage­ments, man­age­rial train­ing, skill train­ing and many such ar­eas,” he added.

GE while han­dling fash­ion and men’s wear has now en­hanced its fo­cus on prod­ucts like work wear, uni­form, tech­ni­cal gar­ments and out­er­wear. In the com­ing year, the group plans to ex­pand its ca­pac­i­ties and mod­ern­ize its units also. “We have raised funds for the same and will be in­vest­ing in mod­erni­sa­tion and ca­pac­ity ex­pan­sion through eq­uity, debt and in­ter­nal ac­cru­als,” he in­formed. The com­pany plans to in­vest around Rs.50 cr on mod­erni­sa­tion in next three years and around Rs 150 to 200 cr for ca­pac­ity ex­pan­sion. Fur­ther­more, work­ing on prod­uct cat­e­gories that has higher value and can fetch bet­ter mar­gins by adopt­ing tech­nol­ogy which is durable, can per­form mul­ti­task and in­volves less man­ual ap­proach is what the group in­tends to achieve.

An ob­vi­ous ques­tion that comes to mind is that, what would Siva like to bring in from his past ex­pe­ri­ence in tele­com to ap­parel sec­tor. He said, “Tele­com was a more process and tech­nol­ogy driven sec­tor where all stan­dards were pre- de­fined. I would like to bring the same stan­dards here as well.”

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