Techno Trade Links MD Speaks To GB About COVID-19 Pandemic, Its Effects
On Glass Business
As the industry reels under the effects of the second wave of COVID-19, Glass Bulletin spoke to Arora about his thoughts on the current crises facing the sector, what to keep in mind to tide over these uncertain times and steps he has taken at Techno Trade Links.
You are in the glass market of India from the last over 35 years, what are your thoughts on the situation the industry is facing today.
There is a deep sense of uncertainty and the fear of the unknown in the glass industry. The industry is very worried about frequent partial or complete lockdowns. Adherence to COVID-19 appropriate norms, staff and employees getting infected, migration are other matters of concern.
This is very difficult and unprecedented time. There is confusion around what is right or wrong to do to avoid COVID-19 infection to self, staff and employees.
This pandemic is new for doctors also. Travelling for business, meeting customers, conferences and exhibitions has almost come to a halt. Situation looks to be grim and future vision is very hazy. How many more waves of COVID-19 will affect India and will be of what intensity is still being debated and predicted. These are grave circumstances to cope with. Economics and health both are a cause for worry. Going slow and being watchful is the only thing glass industry is doing now.
The situation in the industry is unprecedented today as the crisis has worsened. What do you feel the industry ought to do now as it plans for the future?
It is righty pointed out that this is both an unprecedented and an unpredictable problem being faced due to COVID-19 not only in India but all over the world. All types of industries which are directly or indirectly associated with glass industry are being economically affected. What Indian glass industry must do at this hour is to try to be self-sufficient and self dependent.
Transportation of goods to various states due to different rules and regulations imposed by every state is most affected. The solution to this is to open more depots or warehouses all over India to store material near to the end user. This will help movement of goods faster to end consumers by moving the material from the nearest warehouse with ease. When the situation is favourable, like the short period between the first and second wave, such time should be used for maximising production and distribution of material to cater during the adverse situations.
Facilities for migrant labour and work force should be increased to avoid their return to native places.
COVID insurance for employees will reduce their fear and that will result in increased efficiency and productivity. Provision of isolation beds with basic facilities in the factory will be a good move. Strict implementation of COVID norms like wearing masks, washing hands and use of sanitizer will help. Several small deliveries rather than one bulk delivery should be done in this unpredictable times.
Purchasing adequate quantity of raw material is a wise step when the future is grim and unpredictable.
What will be your suggestion to people who are willing to join the glass industry as processors?
To my understanding this is not the right time to start a new glass processing unit. Right from the civil construction stage which can be delayed due to frequent ban on construction, shortage of labour and raw material, meeting the deadlines will be very difficult. This will result in higher cost. Shortage of glass will be a major hurdle at the initial stage of the project. Import of machinery is both costly and time taking during this pandemic time. Let the things settle down before starting new ventures.
Glass industry is facing very big unavailability of glass and especially glass processors are affected as glass is the main raw material for them.
We can understand this in one sentence. What oxygen is to our body, glass is to glass processors. Non-availability or shortage of glass will result in closure, slowing down (multiple shifts to single shift working), labour lay off and delayed delivery by the processing units.
Import of glass machines and allied products from abroad is not easy. What do you see the potential of machine spares availability in India in the near future?
We have many problems related to import of glass machines from abroad. The exponential increase in exchange rate of EURO and USD has resulted in machinery becoming very costly. The freight charges are very high due to reduction in number of flights and cargo carrier ships.
The European machinery has strict engineering standards, so the spares are also standardised. Frequent change in models is also not undertaken. Thus there are large number of machines of a particular model. Also as the life of machines is more the requirement of spares is less. In India, due to higher initial cost, the population of European machines is reducing year by year.
The requirement of spares is low and manufacturing not so lucrative. It is also a known fact that spares are sold at very high price by the machinery manufacturers. We should think of import substitution of frequently required spares only.
For Chinese machines, there are no rigid standards. Most of the machines are manufactured by reverse engineering of popular European machinery models. So to manufacture spares for Chinese machines, you need large inventory due to many models and many different versions of the same part. Frequent change in models and short life of machines makes it difficult to bear the initial cost of manufacturing spares. Manufacturing of spares requires reverse engineering of parts, making of moulds, jigs and fixtures, inventory management and much more. This results in manufacturing being uneconomical. In addition you have to compete with Chinese price.
We should venture into manufacturing fully indigenous long life machines in India than concentrating on manufacturing of spares for sub-standard Chinese machinery.
The processors who are not financially strong or have bank debts are facing problems to run the unit. What will you suggest to them?
This is very difficult time for these processors. The interest on loans and debts accumulates even during the lockdown or slowdown of business.
The foremost step to be taken by such units is to cut down on the working cost as much as possible. They should concentrate or switch over to manufacturing high profit, low labour requirement, low energy requirement products. They should plan product mix to maximise profit. They must plan stocks of raw material, optimise use of machinery and manufacturing capacity. That is the advice to overcome and sustain in this tough phase.
How are you managing your business amid the outbreak of COVID-19?
As the Indian glass industry is aware, we deal mainly in tools for glass, glass cutters, glass drills, accessories, glass machinery and machinery spares.
The data of consumption of tools acts like a barometer to know the output of the glass processors. The more you work on the glass, the more is the consumption of tools and consumables.
Due to shortage of glass, intermittent lockdowns, restriction of working hour, migration of labour and scarcity of raw material among other factors, production is largely affected. Our business is directly proportional to production. That is why our turnover is also affected and business is slow.
To manage our business, we have reduced our profit margins to keep the existing prices even when we are paying higher exchange rate and high freight cost. We are wisely planning our buying from overseas.
We are monitoring our product mix and quantities to be bought while purchasing to reduce buying cost.
With the new wave emerging and the crisis taking a turn for the worse, what steps are you planning to take for your company and are these different as compared to last year?
The situation arising due to the pandemic are alarming. Nobody has the experience to handle this situation. We need to balance between economical activities and safety of health of self and staff.
The circumstances caused by pandemic are also new for us as are for everyone else in the industry. We are also learning and implementing solutions as the problems emerge. We have reduced our travelling. We are no longer visiting our customers.
Most of the business activities are done online. Our products are available for purchase online. Usage of social media platforms has increased manifold. Extensive use of logistics companies is envisaged.
We guide and advise our esteemed customers to make economical combination of tools while purchasing.
Be strong, have high will power and courage to overcome the challenges of business.