Growing the pie

In the year 1994 a biscuit manufacturing unit was established at Dankuni, West Bengal. In the next 4 years, a second unit was added to the same plant and by the year 2008, it became a well-known brand name in many states and cities- Anmol Biscuits, a legacy of Choudhary and Brothers. The proud legacy holder, Gobind Ram Chaudhary, MD, Anmol Bakers Pvt. Ltd, during this interaction offered many facets that went into making Anmol Bakers one of the fastest growing companies in biscuits and confectionary business in India. “Our core emphasis is on healthy, fresh & delicious food,” as he firmly says will take the company to newer strides as they gear up to expand their presence pan-India and subsequently taking on the globe. Excerpts…

How has been the journey of Anmol Biscuits so far? What does it take to establish yourself among the giants?

The journey of Anmol Group began three decades ago, with a sheer grit and determination of Mr. Choudhary to produce quality biscuits at affordable prices. It is a task to establish ourselves amongst the giants and as a part of the same we are aiming high to become a national player now. We are already working on the same strategy; we had started with a single plant in Kolkata, and now looking forward to stupendous expansion with infrastructure and production facilities growing multi-fold with factories in West Bengal, Delhi, Bihar and Orissa. Starting with two varieties, today we manufacture over 50 variants of biscuits, cakes and cookies. Today Anmol is a fast-growing company. With big dreams and aspirations, Anmol is continuously and seemingly changing the market, changing products, changing processes, changing the consumer's expectations and changing mindsets at an amazingly rapid pace.

What is the USP of your business that set you apart from your competitors?

Anmol Bakers enjoys three decades of relationship with its customers. With more than 34 variety of biscuits, Anmol Bakers provides its customers a wide range of biscuits. To produce quality biscuits at affordable prices across all sections of consumers is the biggest USP of our product that has taken Anmol to new heights.

As you are mainly centred in Eastern part of the country and now have started expanding in North & West as well. What were the logistical challenges that you faced and how did you overcome them?

We aim to have a strong presence pan- India. With this vision, we are expanding our reach to niche northern markets also. We started our journey in Northern FMCG market in 2001. At that time, our distribution network was limited. It took us three years to make our presence felt. 

Since inception, Anmol Bakers has seen several ups and downs. Before setting up a plant in Greater Noida, Uttar Pradesh, I was running a bakery business in Kolkata with my father and three brothers. Shifting to the north, however, proved to be quite challenging as the company faced many challenges. First, the business skills that I had learnt in Kolkata were of no help due to the different nature of the two markets. For instance, the attrition rates are much higher in the north. Also, the company's demand for staff was three times more than in Kolkata. Then, the consumption patterns of biscuits were different and so the competencies required for sales, marketing and distribution functions varied between the two regions. Furthermore, both markets are different in terms of product preferences. In the east, the per capita annual consumption of biscuits was almost double that of the north's five kg.

So, for the first four years, Anmol Bakers grew at around 25% but in the following years, the growth began to taper off. As a result, the company turned its focus on reducing production costs to protect profit margins. Initially, we hired consultants to fix the problems that existed in the sourcing and inventory management. But it didn't work. Later, we only started looking for solutions.

We shifted to a lean manufacturing process. Anmol changed its raw material sourcing methods. Take the sourcing of milk powder, for instance. About five years ago, the company would order 10tonnes of milk powder every fortnight. This was changed to five tonnes a week, thereby reducing the working capital requirement and also the overall interest cost that Anmol would bear on bank loans. Historically, we used to follow this practice of placing large orders assuming that buying in bulk was cost effective for us. But when I analysed, I could see no benefit in it.

The next target was to rework inventory management systems for finished products. Earlier, the company's sales team would make predictions about demand and production planning was done accordingly. This resulted in retailers getting products with a time lag. Today, Anmol maintains a minimum stock level at all its warehouses. We used to store finished products worth about Rs8 crore at our warehouses. This has been brought down to Rs5 crore now. We were able to free up capital that was stuck in our warehouses. In addition, the retailers get fresh products and the amount of wastage has been reduced. We cannot predict sales. None of our products at the retailers' level would be older than two months as against four months before.

How complex is the food supply chain and how are you managing it efficiently?

Our food supply chain is very strong. We use fresh material to make our biscuits. You will not find our material stale. Our core emphasis is on healthy, fresh and delicious food.

According to you, in order for a product to be successful, what are the ingredients that need to be taken care of?

The company is focussing on the freshness quotient of its biscuits. We have increased the cycle time of our stock to 80, which means the biscuits the retailer have are made by us at the most 2-3 days ago. The advantage is that, taste of the biscuits is appealing to the customers and there will be fewer rejections from the marketplace.

You cater to the international markets as well. How different are those territories and what supply chain models have you adopted for distribution in other parts of the world?

Beyond geographic boundaries, Anmol exports a wide and exclusive range of Biscuits to Asia, Africa, Europe, Middle East and Caribbean Islands. Anmol is certified with FSSAI, GMP, HALAL, APEDA and Food Safety Management System - ISO 22000: 2005. We are also a Government Recognized Star Export House.

You have stepped into your father’s business legacy. How difficult it has been to carry on the same mettle?

There have been challenges in carrying forward the legacy. During my father’s time, technology was not that much advanced but the growth was actually very high. At this moment when technology is there, our growth is slow. With a loyal customer base, distribution network and channel partners, we are trying our best to keep increasing our market share. There was a time, when we realized our sales are not matching up to our targets and then the company arrived at the decision to mend our marketing strategies or else the company would be in jeopardy. Our marketing team started working on making our presence on the social media platforms more visible and vibrant. We created a corporate video that reached millions of people and is a testimony of our world-class quality and hygiene. We worked on content designing and developing. The company had its makeover done and we are back in the safe zone, thankfully!

What are the crucial learnings and experiences you have gained throughout this journey?

I have learned a lot from everyone whether competitors or digital world. Earlier we did not concentrate on the media but now we are spending our money on advertising and brand building. We are keeping a close tab on the changes happening in the food industry so that we can align ourselves accordingly and gear for the growth times ahead.

Highlight some of the packaging innovations incorporated in your business?

Every step of the manufacturing process is quality controlled and cautiously taken care of. Best care is given to procurement of best quality ingredients like flour, sugar, refined vegetable oil/palmoline oil, slimmed milk/powered milk, butter and flavouring agents. Each Process is automated to ensure least human intervention and highest standards of hygiene. Also, there is a complete control and monitoring on the raw material preparation, dough mixing and sheeting, cutting moulting, baking & cooling and packing process. Logistics and handling is given special care because that’s one of the crucial elements of the entire value chain.

With the government’s recent policy announcements, how do you perceive Indian economy as far as business conducive environment is concerned?

Biscuit Industry faces a few challenges such as government regulations, demand supply chain, rising prices of flour maida, the major ingredient, and other raw materials such as oil, fat and eggs, and the price sensitivity of the market. The biscuit category has seen rapid growth in the last few years. Along with this, the implementation of packaging standardization norms appears to be the big challenge.

How has demonetization impacted you and what are the measures to opt to weed out the challenges?

Demonetisation has impacted almost all the sectors; we also suffered due to that. Our production is 25-30 per cent less as consumers are spending less on bakery item purchases. We had to resort to cut production at that time.

How has the recent Union Budget 2017-18 fared according to you?

Finance Minister, Arun Jaitley has announced the 6% increase in FDI flow; forex reserves at $361 billion. On allowing foreign investors to invest in India will be very positive for India’s Capital market as it will open up a big opportunity for the global citizens to participate in emerging markets and take advantage of the India growth story. Rebate of 10% to 5% on income tax would give a rise to personal disposable income, this is an attractive feature of Union Budget to stimulate investment and boost economy. However, it has failed to abide by the government’s earlier fiscal deficit target. Now the Fiscal Deficit target for next three years has been pegged at 3.2%. He further stated that Infrastructure remains a vital sector for India’s growth story. Total investment of Rs3,96,135 crore for infrastructure in budget 2017 is a right initiative as it will reinforce the industry.

What are your expansion plans and strategies for future?

We have just inaugurated our Bhubaneswar plant last month. We are trying to capture pan India. We are doing well in West Bengal and UP, so we want to give our best to whole world. With a firm hold in the market, today Anmol is heading towards becoming one of the top-most biscuits and confectionary producers of India. I feel your present shows you the direction towards your future. We are working every single day to improve our production, technology and popularity in the market, the amount of hard work our entire team is doing cannot be explained in words – from regular training to technological upgradation, from quality check to daily R&D and continuous innovation, well, you name it.

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