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"MyCola"
takes on Lanka's beverage giants A. R. Sarma Mahalingam, a CIMA professional, 10 years ago floated PET Packaging Co (Pvt) Ltd to produce bottled drinking water under the brand name "Crystal". The product has captured more than 20 percent of the local market share and large quantities of this bottled water are also exported to Maldives. Buoyed by the success in bottled water marketing, and to mark 10 years of a very successful business, Ramalingam launched another industry - the manufacture of beverages, which appeared to be riskier than any other industry as there is stiff competition not only from locals but also often, ruthless multi-nationals. PET cautiously diversified into a selected beverages market, producing a convenient product at a reasonable price. While clearly realizing the difficulties the brand would encounter, he prepared the taste of the products to suit the tropical conditions of the local market. The company expanded its water packing factory complex at Gonahena Road, Kadawatha to produce beverages. Production commenced at the beginning of January this year to coincide with the company's 10th anniversary and the product range was marketed under the "My" brand. These beverages come to the market in four different flavours, "Cola", "Orange", "Lemon" and "Soda" in three different sizes - large and mega, 330 ml and 200 ml, respectively. The bottles in which "My" brands are packed are unique as the plastic used to manufacture the bottles are internationally accepted food-grade material and is biodegradable. The other advantage is unlike other beverage brands packed in glass bottles, the buyer need not keep a deposit as the plastic container is free. The consumer is with an added advantage, as PET has increased the standard 300 ml quantity to 330 ml and the advantage is 60 percent for the consumer. The company began distributing its products in February with a production capacity of 5,000 dozens per day. They are being distributed among the super-markets and to their bottled water customers. Mahalingam said while there was absolutely no planning whatsoever for expansion into the beverages market, the consumer acceptance of the product has been "stupendous" with demand rising. The water-bottling factory employed only 100 employees but with the beverages manufacture coming in, the employment capacity has increased by another 200 and now stands at 300. Mahalingam said that they got the machinery from China and local people were trained in the job. In the PET Beverages industry there is no foreign collaboration or multi-national involvement. He said that his company has been very successful in the bottled water business and proceeded smoothly except on one occasion when they had a problem relating to exports. He then went to Scotland and underwent expert training on water quality maintenance. Today, PET is leading in the local market in the sales of bottled water. Mahalingam said that their bottled water sales would increase much more, if not for unauthorized, uncontrolled bottled water available in the market. He said that they take the water from Meda-Mahanuwara in maintaining purity and quality standards to be consistent and to be in par with intricate international standards. In some cases some bottled water manufacturers used water from their backyards of Colombo. He said that they have been lobbying since 1996 with the Food Ministry to make quality standards for bottled water mandatory, but the issues are still dragged on. Officials at the Sri Lanka Standards Institute (SLSI) told The Sunday Times FT earlier that compulsory standards and the SLS mark for bottled water that was to be effective from January 1, 2004 had been postponed due to delays in getting the legislation through the Legal Draftsman and the Justice Ministry. PET has its own microbiology laboratory to test various conditions of the water and the beverages. In the production line no human 'touch' is involved as the entire process once the raw materials are introduced is mechanized with the bottles coming out from the production line with the seal. The machines and the production area are sanitized several times a day, to ensure a germ-free factory adopting the CIP principle (Clean in Place). Unlike most of other such food products manufacturers, PET manufactures its own plastic bottle requirements. Virgin Plastic granules are imported from India. They are heated and first turned out to small bottles like test tubes. They are then sorted out to ensure quality, rejecting the ones that are below standard. These test tubes like bottles are further heated and blown up to the required shapes. The bottles and labels are of an international class and standards. PET has been exporting bottled water - since 1994 - to the Maldives while exploring markets in Taiwan, Brunei and Singapore. Mahalingam said that during 1998/99 they were exporting bottled water to Taiwan in a big way but stopped due to stiff foreign market competition. Flourishing local industries -featured many times in The Sunday Times FT - have succeeded locally- to a point. There is a need for some state incentives to keep these industries afloat in the face of powerful multinational companies with massive financial resources. In the beverages industry for example, one of the tactics used by multinationals is to buy hundreds of empties of a competitor and destroy the bottles. That's how tough it is for local firms to enter the beverages industry with - at the moment - Elephant House firmly ahead of Coca Cola and Pepsi. The newest PET products have entered a stiff market environment which - local industry analysts hope - would succeed in capturing a niche market segment and not get wiped out like many local industries. |
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