A Japanese word meaning continuous improvement, ‘kaizen’, is a main ingredient in Panache International’s business model and a key to its success, the company says. The leading manufacturers of disposable products optimize flow and quality by constantly searching for ways to streamline and enhance performance. Put more simply, it is about thinking outside the box and making small changes to generate big results.
Established in 2005 across UAE, the company has now expanded strategic footprints across 14 countries in the GCC, Africa, Europe, Australia, Pakistan, Russia, Nigeria, Tanzania, Libya, Ghana, Angola, Sudan, Ethiopia, Madagascar and South Africa. So, what factors helped the company in translating an inspiration into a sustainable business? In a candid chat with the Intelligent SME, Vishaal Shah CEO of the firm, concludes that uncompromising product quality, being as efficient as possible and consistent innovation have been their drivers for success. Below is the condensed and edited version of the interview:
ISME: Could you take us through Panache International’s beginning in the Middle East?
VS: Our firm was established in 2005, with the production unit set up in Fujairah (UAE) to manufacture cups and plates for the UK market. On a trial basis, the first batch of production was sold locally before exporting to other countries. The product was a success in the local market as Panache was the first in the region to make polypropylene cups. This success led the business strategy shift to both-export and local distribution too.
Q: Why did the company decide to set up a plant in the UAE? Is it because the country is considered to be a safe haven from geopolitical tensions?
VS: The firm was set up here due to two main reasons: Firstly, the raw material used is locally produced in the region. It is a by-product of petroleum and thus gives us an advantage of pricing and shorter lead times on the materials. Secondly, the geography of UAE being centric to all countries made it much easier to operate and export globally, with efficient logistics and port services.
Q: What range of plastic goods do you manufacture, and which of these has the highest value?
VS: We manufacture cups, plates, container, trays as well as customized cups and containers for the ice cream and dairy industry. For us, the customized cups give us the highest value due to continuous consumption and value addition.
Q: Who are your major clients? At what rate is growth expected in this specialized sector?
VS: Our major clients are in the dairy industry and food distribution channel. Our growth forecast is 60% and above annually.
Q: Besides the Middle East, which are your key export markets?
VS: Besides the Middle East, our key exports are in the UK as well as North and East Africa and our volumes with each of these regions have doubled annually with more product penetration and brand loyalty.
Q: What would you characterize as a proud achievement?
VS: We have grown from 30 to 160 people team in last 3 years with four times production capacities as well as product penetration in more than 27 countries across the globe. We are proud of achieving this feat! And yes, this just the beginning of much more to come.
Q: If you had to define one quality that separates you from the rest, what would that be? How do you tackle competition?
VS: Customer focus and customer delivery are two things that puts us apart from the rest. It’s not only that our production operates 24hours, 7days, 365 days a year, but our support teams also action and operate in that manner to facilitate our clients’ needs.
Q: You follow the KAIZEN manufacturing system-How helpful is this mechanism, or, technique in increasing productivity and making your products globally competitive? Please elaborate.
VS: Kaizen in Japanese means continuous improvement. All of us have engineered the culture in our DNA, which includes the boy serving coffee, the driver delivering the products and even the machine operators. Every single person endeavours to improvise the execution and the end product of the tasks assigned. And that in itself brings benefits of efficiencies, low cost of production and high quality of products. When we pass these benefits to our customers, we become their preferred suppliers.
Q: What kind of sales numbers have you registered in the past one year? What is your vision you going forward?
VS: We have crossed the 13million USD mark last year, and we target to achieve 50 million USD in 2020. That’s a stipulated growth of over 25% every year.
Q: Tips you would like to give a young manufacturing company trying to establish itself in the region?
VS: To become successful in manufacturing business, the key is being lean and flexible. The leaner your organization is, the more quickly it will be able to adjust to the consumers changing behaviours and the markets which will keep you ahead of the game.
1. Ensure cash is always there in the business. Keep inventory to the lowest possible in terms of number of days and value.
2. Consider the major inputs of costs in your business model such as energy, labour, space and logistics. UAE is not the cheapest when it comes to space and labour, but it has an upper hand when it comes to logistics and energy costs.