Business

10th February 2002

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  • American "bunis" is big business
  • Ensuring food security in Sri Lanka
  • Problem of unemployed grads
  • Indian Cotton Textile Show
  • Informatics in software deal with Australian firm
  • Tea trade divided over liberalising imports
  • Dialog GSM announces GPRS - first in the region
  • American "bunis" is big business

    Buns provide a delicious mid-morning snack to apparel workers

    What is a bagel?

    A bagel is a doughnut-shaped, yeast-leavened roll that is characterised by a crisp, shiny outcrust and a dense interior. It is a fast but nutritious snack, which can be eaten with a topping of your choice. Made from the basic bread ingredients of flour, yeast, salt and sugar, the high gluten flour gives the bagel roll its spongy, chewy texture.

    Traditionally, the bagel dough is shaped by hand into a ring, boiled for a short time in water and then baked in an oven. But in modern production the rings are machine made and steaming is substituted for boiling.

    The origin of the bagel is not known but it has been long regarded as a Jewish food item.

    By Naomi Gunasekara
    As a young science graduate of Vidyodaya University, Sri Jayawardenapura, Mahinda Ranasinghe, Managing Director of Finagle Lanka (Pvt) Ltd, may not have dreamt of venturing into a partnership with Martin Trust, a multi-millionaire chain-store owner and the second largest shareholder of US-based The Limited (a Fortune 500 company), to transform a family bakery into a world-class baking facility.

    But today, Ranasinghe, among the first engineers employed by the Ceylon Timber Corporation and a one-time powerloom factory owner, has his thoughts while asleep or awake on making his joint venture, Finagle Lanka (Pvt) Ltd, a complete success.

    "We started in a very small way. The credit should go to my wife, who started baking in a Baby Belling oven," said Ranasinghe, recalling how his wife, a home science teacher at that time, started baking cakes as a hobby for his father's hotel.

    "She mixed the ingredients with a hand mixer and sold the cakes at my father's food outlet, Ranasiri Hotel," he said. His father has been operating a small hotel at Kottawa since 1943 he added. "That is how we came into baking. Gradually we moved on to bigger mixers and ovens as we increased our clientele. At that time we had a fairly large clientele and my wife used to bake 600-700 cakes during the Christmas and New Year season."

    Though there has been a big demand for the cakes, they have not been marketed under a brand name. "They came to be known as Nona cake, because they were baked by my wife," said Ranasinghe with a sense of nostalgia as he went down memory lane.

    As the demand increased, the Ranasinghes' decided to expand the production at Ran Ovens, their home bakery. "We thought the best thing would be to go for a conventional type of oven. Hence we got a diesel operated second-hand German oven in 1994."

    Low-key
    According to Ranasinghe, they had started with a couple of girls on a low key and moved on to other products like maalu paan and kimbula bunis. Their road to success has not been an easy one. "We went through a lot of ups and downs. Sometimes we didn't have adequate working capital and my wife was compelled to pawn her jewellery to provide the capital. This wouldn't have been possible if not for her faith, perseverance and hard work," said Ranasinghe proudly.

    He added that he would not have achieved the desired success without support from Phoenix Ventures, one of the leading conglomerates dealing in yarn and textiles under the name of Firoze Ltd in Sri Lanka, and his partner in the powerloom business, Mr. Ashroff Omar.

    Joint venture
    When they reached the zenith of their baking business Ran Ovens was approached by Martin Trust, the second largest shareholder of The Limited and former President of MAST Industries, with a proposal to start a joint venture baking plant.

    Finagle Lanka (Pvt) Ltd, situated at the Industrial Estate in Ekala, Ja-ela, was then launched as a joint venture between the US-based Finagle a Bagel, Phoenix Ventures and Ran Ovens. According to Shyam Dissanayake, General Manager of Finagle Lanka (Pvt) Ltd, the joint venture is the brainchild of Martin Trust, who purchases over 50 percent of Sri Lanka's garment exports for The Limited.

    "Trust operates a bagel operation in Boston called Finagle a Bagel and Mr. Trust wanted to introduce it to Sri Lanka even before the bagel operation covered the whole of the United States. They operate a large-scale operation in the US. They have a fully computerised baking facility for making bagels and this produces over 96,000 bagels in an eight-hour shift," he said. Bagels are similar to buns but with a hole in the middle.

    After Finagle Lanka (Pvt) Ltd was established, Ran Ovens was purchased by Finagle Lanka (Pvt) Ltd. "We had our bakery at Kottawa, adjoining my house. As the demand increased we started expanding. But we did it in a very hygienic way. We tiled the floor and the walls and got the workers to go through a foot-bath before they entered the bakery."

    It was these hygienic standards maintained by Ran Ovens that led to the joint venture. "When we were requested to send photographs of our bakery to Mr. Trust we included pictures of the foot-bath. He had inquired what it was and when he realised the emphasis we have placed on hygienic conditions he expressed his willingness to join us immediately." said Ranasinghe.

    Apparel industry
    Trust has over 34 joint ventures in Sri Lanka and a workforce of over 25,000 girls. "His sole aim in setting up the joint venture was to provide his workforce with a decent meal. A research study carried out in these factories indicated that most of the girls came to work without breakfast because they were provided with lunch. Their efficiency levels drop around 10.30 am (due to lack of food). So Mr. Trust wanted to provide them with a snack to revive their spirits," explained Ranasinghe, who had been feeding the apparel industry through Ran Ovens even before the joint venture was established.

    Once Ran Ovens was chosen to work in partnership with the Trust and Phoenix Ventures, Ranasinghe was requested to visit Mr. Trust to negotiate the terms and conditions of the joint venture. "Mr. Trust had said, 'choose the best equipment' so we selected Italian equipment for three of the four lines of production. He insisted that we use the same equipment which are being used in their US factory for the bagel line," explained Ranasinghe.

    Following the discussions, his powerloom factory has been transformed into an ultra-modern baking facility with Italian technology. "The land and buildings were here. We just had to remove the powerlooms and move them to the other side of the factory," he said revealing the reasons for establishing the bakery in Ekala.

    "When this project was mooted we decided that this was an ideal location because we are close to the Katunayake and Biyagama free trade zones. At Katunayaka there are about 60,000 workers and Biyagama has 20-30,000 workers. Our main target is the factories in and around this area," explained Ranasinghe. "You find that a lot of factories want to give their workers at least a snack if not a full meal, especially the apparel industry. That is what we are aiming at."

    Workforce
    Having closed down his powerloom industry, Ran Fabrics, by 1995, Ranasinghe has utilised some of the technicians who were employed at the powerloom factory as machine operators at Finagle Lanka (Pvt) Ltd. "We absorbed the whole workforce we had at Ran Fabrics and some of the technicians from the powerloom factory. We also recruited one of the best bakers in Sri Lanka, Tissa de Silva as DGM (Deputy General Manager). He is in charge of staff training and introduction of new products. We sent him to Boston for specialised training and as for the workers, it was just a matter of learning how to handle the machines."
    Equipment 
    The bakery, which mainly targets the apparel industry, has four lines of production, which include the bread line, bun line, pastry line and the bagel line. The bread line produces sandwich bread, normal bread and "kade paan" in order to reach the diverse segments of society.

    According to Dissanayake, Finagle's bread line caters to all markets. "Although we have the best technology we are not trying to confine our bread line to cater to the elite. We even have a loaf for Rs. 11 called the kade paan."

    Their bun line utilises sophisticated equipment, which is used in the South Asian region for the first time. The equipment is linked to a master computer in Italy, which receives signals whenever there is a problem in functioning.

    Everything in the bakery from flour mixing to baking and packing the finished product is done by machines and human intervention is required only in filling the buns and sprinkling sugar over products that are ready to be baked.

    Bagel line
    "We have just started our bagel line. Some Americans were here recently on a visit to the MAST office and we sent them some cinnamon and raisin bagels to taste. They sent me an e-mail later saying that there is absolutely no difference between the Boston bagel and the Ekala bagel," said Ranasinghe who was elated over the success of their new line of products. "You can make it sweet or savoury. 

    It's the filling that makes the difference. The combinations you can have on the bagel line are endless - you can even have a seeni sambol bagel!" he said, as he took The Sunday Times journalists to the baking area.

    Workers were busy opening oven doors and loading products to be baked while others unloaded golden-crusted bread in dozens. "We work on two 12-hour shifts. The baking industry has a peculiar timing. You have to deliver the loaves early in the morning before people leave their homes and in the evening in time to enable people to buy them on their way back to their homes," he noted.

    Challenges
    Finagle Lanka has over 135 workers today. Having started operations last June, the company has still a long way to go, according to Ranasinghe; "We're growing but still incurring millions in losses. At the moment our machine utilisation is about 18-20 percent but our capacities are big. If we utilise the machines up to 50 percent of its capacity then we will have reason to smile," he said.

    However, complete success takes time to achieve, Ranasinghe said. "When we were at Ran Ovens we produced about 8,000 pieces but now we have gone up to about 30,000 pieces. It took us about 4-5 months to grow. It will take a little more time for us to make a profit," he said.

    Their bread line can produce approximately 30,000 loaves per day and if it is only hamburgers and hot dog buns that it has to produce, then the bun line will do about 170,000 pieces per day. "The speed comes down when you have to do a filling. Sri Lankans prefer a bun with a filling, like malu paan, because a plain bun like a hot dog bun will cost more. But when the filling is involved the production rate comes down. So if we can produce about 80,000 buns per day we will be very satisfied. At the moment we are producing about 15,000," explained Ranasinghe, detailing the problems that beset the company in carrying out operations.

    "There were swarms of flies when we started operations. We employed some persons to eradicate this menace. 

    They said the problem originated from the drain that ran through the industrial estate and that it was an ideal breeding ground for flies. We spent over Rs. 20,000 to clean the entire drain. We disinfect the area once in two weeks because we consider hygiene an important factor," he said.

    Having established a world-class bakery in the Ekala industrial estate, Ranasinghe intends to expand the business by operating a bagel chain in and around Colombo and thus make optimum use of the machinery.


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