Raymond Apparel at the end of the engagement

The successful launch of the Park Avenue brand and entry of the company into the ready to wear segment was a game changer in many ways. It increased the company’s margins and changed its business paradigm as it represented a vertical integration. Before the launch of the Park Avenue brand, 100% of the company’s revenues came from the sale of fabric. The success of the brand increased the percentage of revenue generation from the value-added garments segments here on here

From Apparel to Engineering

The manufacturing process was largely manual, with labour amounting to a significant component of costs. The company had a robust export market, but it was under threat from Chinese products that enjoyed a natural wage and material cost advantage. Hence, optimization of cost was imperative for growth. Akshaypat Singhania kept a close watch on costs by analyzing the process and outsourcing parts of it to ancillary units, while overseeing the quality of output. This led to the reduction of costs as well an increase in productivity.

Proactive measures to boost growth and improve top and bottom line

The twin efforts at reducing the labour component and increasing productivity paid off and the company was able to improve its domestic market share to nearly 80%, and the global market share to 35%. As supply requirements increased, he set up the company’s 4th manufacturing unit in Pithampur, delivering twin benefits of lower labour costs and proximity to the source of its main raw materials. The company consistently won awards as the Best Exporter.

From Engineering to Cement

At the beginning of this engagement, the cement unit had a production capacity of 0.4 million tonnes and a host of handicaps The plant suffered from an inadequate supply of electricity, a key input for the manufacture of cement. Establishing normalcy in operations was the first challenge, and it had to necessarily precede growth initiatives.

Akshaypat’s action plan and way forward

To address the people's challenge, Akshaypat commissioned and built a state of the art township within the 4000-acre plant complex. The complex was capable of housing 600 - 800 families with amenities such as a clubhouse, swimming pool, badminton courts, a full sized cricket ground and more. To counter the challenge of transport and connectivity, the company built 40 km of railway sidings to connect the plant to the nearest railhead.
The company was amongst the first in the country to invest in Own Your Own Wagons scheme as per the Indian Railways. In this, the company had the first mover advantage and it no longer had to depend on government allocation of wagons, a process that was at best uncertain.

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The company also installed a 15 MW captive power plant to ensure access to reliable power.

With the people, transport and power situation under control, Akshaypat focused his attention on debottlenecking and rightsizing the plant. He rationalized the use of available infrastructure and increased capacity with select brownfield expansion. The company marketed its cement under two brands MultiGuard and DuraGuard, a strategy that enabled it to move to a higher price point.
It consistently won the Highest Exporter of Cement Award and the Most Energy Efficient Producer of Cement in India Award. By the year 2000, when Akshaypat Singhania moved on to another assignment within the group, he had been instrumental in increasing the production capacity of the company from 0.4 million tons to 2.25 million tons - a growth of over 5 times! In the year 2000, Akshaypat Singhania was instrumental in divesting the cement business at a considerable profit to Lafarge.

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From Cement to Denim

In denim fabric, its raw material, cotton, accounts for nearly 65% of the cost. Hence managing the procurement price of cotton was critical. Akshaypat's first focus was to streamline the purchase process of cotton and pare down the price while keeping a tight vigil on the quality of the material. He formed a dedicated team of cotton buyers who kept vigil on the price and availability while ensuring the procurement of good quality cotton at a competitive price.

Proactive measures to boost production and value realization

After ensuring the steady supply of quality cotton at competitive prices, the focus was on debottlenecking operations and increasing capacity as well as productivity. Akshaypat was also instrumental in building design competencies and began supplying denim to world famous brands such as Hugo Boss, Guess, Zara, Mango, Gap etc. By the time he completed his stint at Raymond Denim, the capacity and output of the Denim unit had increased by over 4 fold in 3 years and it emerged as a successful, profitable business, ultimately contributing to the Group turnover and bottom line.