Blaise Costabir on 25 years of his entrepreneurial venture, GMI Zarhak Moulders Pvt Ltd
Blaise Costabir is a first generation entrepreneur, who heads GMI Zarhak Moulders Pvt Ltd, an Indo-French joint venture, manufacturing well known brand of water tanks SHAKTI; and custom moulded technical parts. He has been involved with various industry bodies in Goa like GCCI and Goa State Industries Association. He was former Chairman of the CII Goa, former President of Verna Industries Association; and former Director of Goa Industrial Development Corporation.
Blaise got into the rotomoulding business 25 years ago. “I had decided to start a plastic manufacturing venture in Goa, because plastics were a sunrise industry and then Finance Minister Dr Manmohan Singh had, at that point in time, liberalised the economy. Goa, at that time had incentives to start manufacturing units; and it would enable me to go back to my roots. I met Ashraf Chitalwala, who was a supplier to my previous employer. When I discussed my plans with him, he immediately offered to back the venture because he believed I had the operational experience and he could provide the financial backing. One reason he mentioned later was that while dealing with him, I had gained his trust because no unethical means were ever used. He introduced Anand Mehta, at that time MD of Fiora Cosmetics in Goa.”
Rotomoulding a Dream
Anand’s role was to balance the trading and operational experience of Ashraf and Blaise respectively. Blaise’s wife, Clare, was involved with the business a lot in the early stages and then again in the last few years. In between she took a sabbatical to tend to home and hearth.
The original idea was to get into injection moulded engineering plastics. Both, Ashraf and Anand were partners of a supplier whose other business was manufacturing rotomoulding machines, a new line at that time. Blaise continues, “They asked me to study this process which at that time in India produced 99% water tanks. My own view was that, outside India, out of a 100 rotomoulded parts, 99 were others – toys, fuel tanks, industrial water tanks, etc and only one was a water tank. So we decided to start making water tanks with a vision of getting into non tank areas subsequently. Today, 70% of our products go to original equipment manufacturers (OEMs) and in many cases, we are the sole suppliers.”
It was with this in mind that the company decided to partner with GMI (Group Maillard Industries) in 2004. France-based, GMI were leaders in Europe in custom technical rotomoulding.
While Blaise has been the face of GMI Zarhak Moulders Pvt Ltd, Ashraf Chitalwala, Anand Mehta, Clare Costabir, Eric Maillard and Francois Maire are the team behind the scenes.
Challenges Met
Blaise faced many challenges when he started his venture 25 years back. “Over the years there have been many challenges, COVID has been the most serious one and unimagineable. But like all challenges they have been faced and we have emerged stronger. I am sure there wil be more challenges going forward, but we are confident we will see them through. If not for MSFC, who played a hand holding role in our fledgling years, we would have been still born like many other ventures.”
Another challenge was accessing funds from banks, all the norms were in place but bankers are loath to fund MSMEs. Today, Blaise with says that things are much easier. However, he says that bankers need to look at the fact that MSME defaults are low, they are the backbone of the Indian economy and they need support.
Blaise continues, “We could have done with quicker permissions. Today there is lot of focus on ease of doing business and simplification. GST was a huge positive and has eliminated lot of paperwork.
Employees were easier to recruit in the early days, today it is not easy. We used to be 100% local employment; today, it is a struggle to find local employees.” Having said that, he considers that his unit is blessed, having had very good employees over the years and they have been the bedrock for writing the success story of GMI Zarhak and SHAKTI.
Building Blocks
The organisation started production in 1996 and their first milestone was becoming an ISO Certified Company in 1997, and continue to be certified till date. Along the way they added ISO14000 and ISO 18000. They exported their first consignment of pallets by 1999 and were exporting till the great economic downturn in 2008. The company had added two small machines which they shut down in 2003. In 2004, the organisation tied up with GMI of France and went into a joint venture. This was specifically for technical custom moulded parts.
Later, the company expanded their Verna factory in 2005 and added their first imported CNC controlled biaxial machine. In 2010, they started a new factory in Pune with a bigger machine. In 2019, the company was allotted a new plot in Verna. “We then focussed on developing our industrial customers and in early 2021,
we added a second machine in Pune which is under commissioning, delayed due to the issues caused by the second wave of COVID. Plans for the building on the new plot in Verna, have been sanctioned and we expect to start construction shortly.”
Management Ideas
Over the past 25 years, there are certain attributes of entrepreneurship that Blaise has adopted which have stood him in good stead. “An entrepreneur has to see something in the future and then work to it. In the case of GMI Zarhak we focussed on custom rotomoulding right from day one, even though we were making a retail product. We started a Just-in-Time (JIT) delivery model for water tanks which was unheard of. Dealers give us an address and we deliver directly to their customers.” This enabled their water tank dealers to reduce their inventory to zero and became an automatic entry barrier to the competition.” Before we arrived, the dealer had to order a truck load at a time.
We focussed on quality through systems and developed software in-house, from order taking to delivery. We have a unique Serial No for each and every product, unheard of at that time for water tanks, but very important for industrial customers as traceability is a key requirement.”
The other important aspect Blaise says is customer focus. One may have the best machines, systems and material, but if there is no customer it is no use. At GMI Zarhak Moulders, the customer being key is not just a cliched statement; it is the most important aspect of day to day operations. Their manufacturing processes are tuned to operate as per customer requirements and not as per what is convenient or cheaper for operations.
Blaise continues “Paying suppliers on time is an underrated aspect of business, but its value in the long run is immeasurable. Delayed payments may be a cheap source of funds but very expensive actually. Right from the start, we ensured this was a priority and our suppliers appreciate this very much.”
Marketing Strategies
In order to build his brand, Blaise’s company has mostly been into direct selling. “When selling water tanks initially, we realised that dealers do not have time to convince customers about the merits of a particular brand, so we decided to sell the brand directly to end users, who then went to dealers asking for the same. We initially used two large hoardings with an actual tank fixed to it, highlighting the features. This was and remains our strategy, direct selling. For OEM customers also have to use the same concept as for development that you cannot speak via an intermediary.”
Initially, GMI Zarhak Moulders focussed on developing products which they could sell, water tanks, pallets, bins. Later, they developed products like a septic tank for which they have a patent, biodigester to convert wet waste into methane gas, composter, grease trap, water harvester. These products helped reduce enviromental damage. “Our own products are marketed under our well known brand name SHAKTI.”
On the other hand, the company has worked with OEMs to develop customised parts, water tanks, fuel tanks, doors, fenders, consoles etc. Their customers include MNCs and top corporates like Volvo, John Deere, Atlas Copco, Pai Kane, Putzmiester, VST Tractors, Doosan, Amman Apollo, Writgen, Dynapac, Ford, Kohler, Godrej, Kits & Karts, and Epirock. The development process includes designing mould and parts suitable for rotomoulding, manufacturing of mould and then production, testing and assembly.
Further Blaise maintains, “We would like to add that the Asian Institute of Management Manila uses three cases studies based on our efforts in marketing the water tank brand. That is a huge honour and indicates we did a few things right.”
Regarding the survival of businesses in a post Covid era, Blaise is confident that his organistaion will not be affected in the long run, at least from the demand point of view. “However, depending on the situations which unfold we can get affected by lockdowns, closure due to infections, supply shortages etc. These have to be managed as they unfold, one cannot plan too far ahead or too much.”
Industry Insider
Alongside managing the business, Blaise has been actively involved with various trade and industry organisations. He elaborates on the key takeaways from this as an entrepreneur. “I distinctly recall battling with myself in the early days. C K Pralhad, the management guru had a different take, one which has stood me in good stead. He said that a CEO in an organisation is outward looking; he has to look at changes in environment, competition etc. A divisional manager looks inward, quality delivery supply etc. A CEO of a MSME wears two hats, inward looking and also outward looking. Hence, it is imperative that a CEO involves himself with trade associations so that he is abreast of what is happening outside, he can also discuss with his peers which may not be possible inside his organisation. The take away is a better understanding of the environment. Two, almost anyone who is a decision maker knows that for tanks you can contact us, it is much better than cold calling. So my unabashed recommendation is any entrepreneur should be involved with trade associations’ right from day one.”
When asked if he would do things differently 25 years back, Blaise says, “When we created our joint venture, the then Chairman, late Gilbert Maillard sent an email detailing his plans for adding another machine. This was without any official market study etc. It was a big blow when he passed away within a few months of the joint venture taking shape. What I learned from that was one has to be ahead in the game and not just be a follower of a trend. Looking back, if we had added a machine according to his vision we would have been much ahead. We added the machine five years later in Pune. So if I have to do it all over again, I believe that is what I would do – add the machines earlier.”
As an individual, Blaise has always been vocal and fortright with his views, often criticising the powers that be through various media platforms. When asked whether this has created hurdles for him in his business, Blaise replies, “I recently completed my term as CII State Chairman. My team members were relieved I had gone through a tough period and without upsetting the powers that be, yet accomplishing our goals. So, it is important to note that none of my criticism is directed at any person for any personal gain to me or my company. As Verna Industries Association, President or as a member of Government appointed committees, the same focus is used to work in the interest of the State and industry. People in power have accepted this and thus I have not faced till date any hurdles in business,” says Blaise with a smile.
