increased. We also gained expertise in crane technology. I studied theory of structures, applied statics and dynamics, particularly, used in crane building. The range of capacity and size of the cranes also increased.
But, as ill luck would have it, differences amongst the partners started cropping up. As a matter of fact, the investment in the project had considerably gone up. My investment in the business was also disproportionately low. More over, there were loans from private parties, which were taken on the strength of the credit worthiness of the other partners, which was a reputed group of the city. They started thinking that when they had a bigger stake in the business why to give so much importance to a partner who had the least stake. Moreover, the younger brother who attended the business was immature and egoistic. He was a little proud of his social and financial back ground and status and, over the years, he developed some prejudice against me.
In 1965-66, a big tender was floated by the Rourkela Steel Plant for overhead cranes in which we participated, as there were no bars. With great efforts and technical competence, we could steer clear of their inspections etc. and succeeded in getting a letter of intent for an order worth about Rs. 58 lacs.
That was a very big achievement for a concern of our status, in those times. But, as ill luck would have it, the other partners made it an issue, declaring that the prices were underestimated and would bring colossal loss to the firm, if the order is executed.
A hot debate ensued. As I was the main person responsible for the project from A to Z. they made me a scapegoat and I was put on the defensive. Instead of entering into detailed discussion on the project, re-estimating the costs and examining its feasibility etc., they out right refused to execute the order. That created the rift between us but in my heart of hearts I concluded that they were out and out to oust me from the partnership. But since they could not undertake compliance of the order, on their own shoulders, there was no option but to refuse the order. Naturally the partnership blasted.
But the greatest shock of my life came to me when they re – estimated the net worth of the whole firm and halved the value of the assets, including the land and buildings, the value of which had more than trebled over the years. They bluntly gave me the offer to take it or leave it at half the price, very well knowing the fact that I could never be in a position to take it in
any case, because I could not muster the requisite resources to pay them off. Naturally I had to leave it to them at half the net worth and left. I could have raised objection to the deal and claim the right price but that was a thorny path which my self esteem and self confidence could not allow. Moreover, I being a sentimental man and remembering that once upon a time, the elder brother had obliged me by taking me in - to his fold, when my expartner had let me down and left me in the lurch, I accepted the deal in good grace and did not raise an accusing finger at that time.
But my heart ached at my miserable plight and financial loss that I suffered at their hands. I was again left as a resource less man on the cross roads of life. When ever I remembered the old words of the elder brother that ‘you will be our fourth brother’ tears welled up in my eyes, even at that ripe age. But I took up courage in both hands and decided to do something on my own. First of all, I took a solemn pledge that, hence forward, I would not enter into partnership with any one in my life, come what may.
Around 31st March 1968, I got whatever money they offered me and started in search of new pastures. I had neither the experience nor inclination to start any business except a small
engineering concern. To start crane manufacturing single handedly was out of question due to paucity of working capital. I, therefore, decided to start manufacturing of agriculture implements, which was a roaring business at that time. Somehow, I managed to get a plot of land allotted in my favour in Govt. Industrial Estate, Partapur. With the help of loan of UP Financial corporation. I constructed a small building and purchased a few necessary machines required. On 8th August 1968. I performed the mahurat of the new proprietorship concern under the name and style of ‘AGROMEC’.
Initially, disc Harrows and cultivators were manufactured and sold to tractor dealers & farmers. The difficulty was that while I insisted on quality products, substandard products were available in the local market at cheaper prices. The farmers were not quality conscious and bought cheaper implements. Another disadvantage was that our competitors were already very well established in the trade, but we were quite new and did not know the tricks of the trade. Moreover, we were working on money borrowed from the bank. Our cost of production was, therefore, higher. Very soon, therefore, we realized that unless we introduce some new innovative products in the farming sector, we shall not be able to survive in the market. I made a survey and seed cum fertilizer drill was
such an item which could be technically a little complicated and could be profitably manufactured. I, therefore, got the design and started manufacturing this item. This gave us a good name in the market & yielded profits too. We also introduced a reaper (small harvester) alongwith the seed cum fertilizer drill. This was a dream of the farmers, as it solved the problem of hand harvesting to a great extent. But here again the problem of shortage of capital came in the way. The harvesting season lasted only for a period of maximum one month, which was the only selling season in the year. In our case, this restricted the scope of our total sales, irrespective of the price.
Another snag was the seasonal nature of the use of this equipment. Since it was a new machine and the farmers were not accustomed to its mechanism, there was a huge demand for service personnel by every user, which we could not cope with. In fact, we should have trained many mechanics in servicing the reapers, so that, in case of complaint, a mechanic should have rushed to the site of harvesting and attended the machine, which we could not ensure. In this way, the machine could not be popularized.
In the meantime, I revived my contacts with some Voltas executives who were my old acquaintances in their material handling division. They suggested that there was a good demand in the industries for hand hydraulic pallet trucks, which they were so far manufacturing in their Thane Works but had recently stopped its production because they found it uneconomical due to their high overhead expenses. I got one sample piece from them produced a prototype and got it approved by their technical head. Then a formal agreement was signed according to which, we were to manufacture the machine for Voltas who would sell them in the market under their own Brand name at their own price. The dealings were to be on principal to principal basis.
This proved to be a turning point in the progress of ‘AGROMEC’, Voltas flooded us with orders. They had fourteen Branches in the country, which started booking orders from Industrial Units and passed on the same to us for compliance. Although the price that we got from them was not very attractive but due to bulk production, we could get a reasonable profit margin. Hence, we continued to manufacture the pallet trucks for four long years. But from our experience we found that complaints about their quality continued to pour in Voltas offices, who forwarded the same to us. After serious in house research, we
concluded that some changes had to be made in the design of the machine to make it fool proof.
We represented to Voltas that to make these changes we would have to make some additional investment in the plant and incur more cost of production per piece. In principle, they agreed to the proposal but insisted that we should meet the additional cost from our own thin margin, which we declined. The dialogue continued for some time, but, ultimately, reached the breaking point. As we were convinced that, after making the desired changes, our pallet trucks would become very popular in the country and we would be selling at a better price, though in smaller numbers. But the overriding consideration was that, so far, these were sold in Voltas Brand name but now we shall establish our own brand which shall go a long way in establishing ourselves as a good manufacturer. Hence, we took the plunge and parted company from Voltas in 1980.
We made the necessary changes in the design and introduced them in the market as our own products under our brand name ‘AGROMEC’ As expected, the product was well received by the industries, as they already knew that voltas were selling them earlier. But, naturally, due to poor marketing out lets and
facilities, the sales in terms of numbers dived but the increased profit margins more than compensated the loss. We felt happier, because now we had the satisfaction that the product was our own and once fully established, the sales would also would get a boost. Over time, we started getting good results.
Meantime, my son Nipun Jain after having passed his BSc exam, joined business. We started looking for greener pastures , as we had already established ourselves in material handling equipments line. I still had some senior executives in Voltas who were, by now, in senior positions, as my friends, who suggested that with my back ground in the manufacture of overhead cranes, I ,may start manufacturing hand operated overhead cranes, which did not involve heavy investment and Voltas will be willing to sell them on a regional basis to beg in with. I agreed and we signed a loose arrangement with Voltas Ltd. We started manufacturing small cranes and supplied them through Voltas to various Govt. & semi Govt. departments. This business also flourished to some extent for quite some time. But Voltas lost interest due to a major reshuffle in their organization and we, too, dropped the line, because we could not carry on in this capital intensive project without support.
In the year 1990, when we were well established in material handling line and there was a good demand for other small items, which our customers used to procure from other sources, we thought of a plan to manufacture other material handling items viz. Scissor Tables, Stackers, Floor Jib Cranes and Small Trolleys. We had a separate plot of land lying vacant adjacent to ur own. We made a project report and presented it to our Bankers. The State Bank of India, who accepted the same in toto and advanced us the needed funds for the construction of building, purchasing machinery and working capital. The unit started production in 1991 under the name and style of M/S TECHNICAL ENTERPRISES. We built certain proto types, tested their efficacy and floated them in the market. By the time, the products became popular and we reached the breakeven point of sales. The bank interest mounted and the unit got sick.
We submitted the rehabilitation scheme to the bank requesting to grant certain concessions which were permissible under the RBI guide lines. But the bank could not agree to our proposal. Meanwhile, one time settlement scheme was introduced by the bank and one of our banker friends suggested to take advantage of the scheme by arranging money from outside sources and pay off the bank, once for all. As our unit had started giving good result and our own resources had also
considerably gone up, we decided to make a final settlement with the bank.
We offered certain amount of money to the bank in full and final settlement of dues, which the bank accepted, after certain amount of bargaining. We arranged the required funds and paid off. The bank gave us the NO dues certificate.
The reader would be amused to learn that, as soon as, the loan was cleared and the incidence of interest ceased, the unit became viable and started yielding profit. Meanwhile, my son Nipun Jain had gained considerable experience in the trade. We added many more items to the range of our products in the material handling line like high rise scissor table, high capacity stackers, floor jib cranes, drum lifters etc. We also started advertising our products through Industrial magazines. By and by, we became popular and our products were well received by the Industry.
In the Year 2004, Nipun Jain came in contact with Chinese suppliers of material handling equipment, who had, by this time, become quite famous throughout the world for their cheaper Prices and reasonably good quality material. He insisted for importing the equipment from China, while I was |
