 "Ma Foi helping SMEs connect the dots, rise to next level")
A Rs 20-crore safety match manufacturing company, based in Sattur, in the Virudhunagar district of Tamil Nadu, which has been in business for the past 12 years, has now set itself a target of reaching a turnover of Rs 100 crore in the next three years. This will make it one of the top ten match manufacturing companies in India.
The size of the safety match manufacturing industry, largely concentrated in Sivakasi, also in Virudhunagar district, is around Rs 3,500 crore. The industry is currently in transition mode, with more and more automation entering. However, there are not many Indian match manufacturers that have crossed sales revenues of Rs 100 crore.
Ma Foi Connecting Dots Advisory Private Ltd, a subsidiary of Ma Foi Strategic Consultants Pvt Ltd, a company which made its name in HR consulting, plans to change all that. It is now engaged in helping small and medium enterprises (SMEs) transform themselves and rise to the next level. It will also focus on the automotive, aerospace and general engineering spaces. The Sattur-based match manufacturer is one of Ma Foi's clients.
"Almost 80 per cent of our 50 clients must be in the SME sector. We define SMEs a little broadly and their sales can go up to Rs 200-250 crore. Government policy for MSMEs has changed to accommodate the service sector, and we follow the same definition," said Pandiarajan.
Ma Foi assesses where the SME is currently, what potential it has, and where it could be three years later. "We do mission assessment, strategy development, market assessment and adjacency studies at the time we start and then we tell them, 'at the end of three years you can be here, if you do all these things,'" said Pandiarajan.
The typical problems that he expects to help SMEs resolve are "mental blocks" about growing beyond thresholds like Rs 10 crore or Rs 100 crore; unimpressive bottomlines; poor access to funds and weaknesses in managing them optimally; low awareness about the need for technology; low awareness about the value of their brands; and transitions from one generation to another that act as bottlenecks to smooth growth, with various family members having different ideas about the direction a company should take.
The assignment for the Sattur safety match client involves some diversification, new territory mapping, entering new territory, identifying export options, and setting up a dealer network instead of selling direct to retailers (as the company has been doing so far). Pandiarajan says, "They have been professional. Unlike a Sivakasi company, they have built a brand in their 12 years of operation, and developed intellectual property."
Ma Foi offers what it calls its vendor management technology to the automobile value chain. As part of this it is planning to set up eight 'mother centres' across the country - at Chennai, Bangalore, Hyderabad, Pune, Mumbai, Ahmedabad, Delhi and Kolkata - and 40 vendor clinics, which will cover 95 per cent of the 48 towns where the auto component industry in India is located, spread across 20 states.
There are around automotive 100 OEMs in India and according to Ma Foi, there are 600-620 tier-I suppliers, over 10,000 tier-II suppliers and over one lakh tier-III suppliers in the automotive supply chain.
"We intend to set up the mother centres and vendor clinics in two years. We already have three mother centre locations and one vendor clinic location. Each of these clinics will have three people - one technical person, one managerial consultant and one marketing person," Pandiarajan said.
The company plans to set up seven of the eight mother centres and five vendor clinics by March next year. It will connect the vendors in various tiers and monitor their work, to report any problem or delay (and its cause) to the tier-I or OEM client.
"Our aim is to have at least 50 per cent of the OEMs and one-third of the tier-I suppliers as our clients," he said.
The size of the safety match manufacturing industry, largely concentrated in Sivakasi, also in Virudhunagar district, is around Rs 3,500 crore. The industry is currently in transition mode, with more and more automation entering. However, there are not many Indian match manufacturers that have crossed sales revenues of Rs 100 crore.
Ma Foi Connecting Dots Advisory Private Ltd, a subsidiary of Ma Foi Strategic Consultants Pvt Ltd, a company which made its name in HR consulting, plans to change all that. It is now engaged in helping small and medium enterprises (SMEs) transform themselves and rise to the next level. It will also focus on the automotive, aerospace and general engineering spaces. The Sattur-based match manufacturer is one of Ma Foi's clients.
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Ma Foi works with SMEs across the country, acting as an extended arm of its client companies over a period of time rather than giving them a one-time set of recommendations. The aim is to enable them to gain in size and reach preset sales revenue targets over preset periods of time. The execution of the strategy is left to the client, said K Pandiarajan, chairman and managing director, Ma Foi Strategic Consultants Pvt Ltd.
"Almost 80 per cent of our 50 clients must be in the SME sector. We define SMEs a little broadly and their sales can go up to Rs 200-250 crore. Government policy for MSMEs has changed to accommodate the service sector, and we follow the same definition," said Pandiarajan.
Ma Foi assesses where the SME is currently, what potential it has, and where it could be three years later. "We do mission assessment, strategy development, market assessment and adjacency studies at the time we start and then we tell them, 'at the end of three years you can be here, if you do all these things,'" said Pandiarajan.
The typical problems that he expects to help SMEs resolve are "mental blocks" about growing beyond thresholds like Rs 10 crore or Rs 100 crore; unimpressive bottomlines; poor access to funds and weaknesses in managing them optimally; low awareness about the need for technology; low awareness about the value of their brands; and transitions from one generation to another that act as bottlenecks to smooth growth, with various family members having different ideas about the direction a company should take.
The assignment for the Sattur safety match client involves some diversification, new territory mapping, entering new territory, identifying export options, and setting up a dealer network instead of selling direct to retailers (as the company has been doing so far). Pandiarajan says, "They have been professional. Unlike a Sivakasi company, they have built a brand in their 12 years of operation, and developed intellectual property."
Ma Foi offers what it calls its vendor management technology to the automobile value chain. As part of this it is planning to set up eight 'mother centres' across the country - at Chennai, Bangalore, Hyderabad, Pune, Mumbai, Ahmedabad, Delhi and Kolkata - and 40 vendor clinics, which will cover 95 per cent of the 48 towns where the auto component industry in India is located, spread across 20 states.
There are around automotive 100 OEMs in India and according to Ma Foi, there are 600-620 tier-I suppliers, over 10,000 tier-II suppliers and over one lakh tier-III suppliers in the automotive supply chain.
"We intend to set up the mother centres and vendor clinics in two years. We already have three mother centre locations and one vendor clinic location. Each of these clinics will have three people - one technical person, one managerial consultant and one marketing person," Pandiarajan said.
The company plans to set up seven of the eight mother centres and five vendor clinics by March next year. It will connect the vendors in various tiers and monitor their work, to report any problem or delay (and its cause) to the tier-I or OEM client.
"Our aim is to have at least 50 per cent of the OEMs and one-third of the tier-I suppliers as our clients," he said.