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Nov, 03 2012

Welding steel to profits

Viewed as one of the largest manufacturers of international quality steel bars in India, Kamdhenu Ispat Limited, is all geared up to set standards in the construction business. In a tête-à-tête with Amanpreet Kaur, Satish Kumar Agarwal, Chairman and Manag

Viewed as one of the largest manufacturers of international quality steel bars in India, Kamdhenu Ispat Limited, is all geared up to set standards in the construction business. In a tête-à-tête with Amanpreet Kaur, Satish Kumar Agarwal, Chairman and Managing Director, Kamdhenu Ispat Limited, talks about adding a vigorous network by associating with franchisees.

Share with us your entrepreneurial journey. What led to the formation of Kamdhenu Ispat Limited?

After completing engineering in 1970, I joined the family business of manufacturing sugar machinery and agricultural equipment. Thereafter we set up a rolling mill and refractory unit at Muzaffarnagar in Uttar Pradesh. In order to expand the business horizon, we set up Kamdhenu Ispat Limited in 1994 and started production in 1995 in Bhiwadi (Rajasthan) with the aim of initiating brand concept in structural steel products of HSD bars/TMT bars. We are mainly engaged in the manufacturing, marketing, branding and distribution of steel and paints. Today Kamdhenu symbolises the best quality product at reasonable prices for the ultimate consumers; Kamdhenu implies the best quality at best prices.'

What has actually spurred the growth of the steel industry? Do you think it will turn out to be a profitable business avenue for franchisees/distributors?

Being a developing economy, the continuous thrust on the infrastructure, construction and real estate sector, under various policies and projects, by the government and the private sector and ever-increasing housing demand are major steel industry propellers.

Our franchise business model is always a profitable business avenue. Under this model, we undertake the study of the market trends and identify the companies manufacturing steel products and we offer them our brand's strength and assistance in technology, quality consistency and marketing of Kamdhenu products. This model offers benefits to both: the franchise units have the leverage to enjoy Kamdhenu's premium and strong market network, while Kamdhenu itself earns royalty from being associated with the franchisee. The model has also given a unique identity to the franchise units and allows them to sustain and face the rising competition in the steel sector.

What had actually clicked in your mind to get started with franchising?

The demand for Kamdhenu steel was growing manifold but owing to the limited capacity and financial resources, we thought of producing Kamdhenu brand's products under our supervision, along with quality parameters, for nourishing the product as per our market demand. This thought gave birth to the idea of the franchise model. Today, we have more than 40 franchise units spread across the country offering quality products at the best prices.

For supporting the franchisee, our plant at Bhiwadi is being used as a training centre for all technical staff deputed at the franchisee's unit. Before deputing the staff, we train them on various technical, qualitative and commercial aspects.

Presently, we have more than 3,500 dealers and distributors dealing in Kamdhenu steel products which are well connected with the nearest franchise unit in order to reduce the delivery time and freight cost. We are targeting expansion both through the franchise as well as the network of dealers and distributors . We are also in the process of identifying a similar model for our business in paints where Kamdhenu has 31 sale depots catering to 6,000 dealers of Color Dreamz.

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