Rank TIS: How did you choose this area of operations? Would you call yourself a niche business?
AA: My father established this company along with my brothers and myself after his experience of working in the Middle East in the oil sector. In the beginning, we contemplated on the kind of business to invest in, and the plastic industry seemed very interesting. My father had the technical acumen from an earlier investment of an unsaturated polyester resin comay. We started the company with the help of highly technical people with experience in the business and focused on establishing a high standard company to supply colorants and additives in the region; back then, it was predominantly being imported from Europe. We found that this would be a niche that would give us an advantage, being a local manufacturer. We could support customers logistically, and Dubai was a great location to export from. Also, it was important to identify a niche business that does not become too repetitive. Even today, we don’t have much competition in the UAE. There are others who make similar products, but they are not specialists in colour and additive, they are more into the commodity side of the business. TIS: How was your company
affected by the onset of the economic crisis?
AA: Before the recession, we were focused so much on the growth of the company that we did not look inward to see where the real value and profitability came from. So, towards the end of 2008, we were holding onto a very large high-priced inventory, and no longer was the market ready to absorb those prices and with the slowdown they didn’t want the products. One of the advantages of being an SME is that we can sit at a table and make instantaneous decisions that can be implemented,
especially during a crisis. We contacted our suppliers, most of them being large multinational companies, and negotiated successfully with them. They were pleased with our transparency and honesty and agreed to take back much of the over stocked and high priced raw materials.
TIS: Did you make any other changes internally?
AA: We started 2009 with a clean slate, and one of the things we did in that process was start looking more carefully internally. We reworked our business model based on our product mix, concentrating on more of a value-add approach rather than a volume-based one. We were quickly able to generate the highest profits in 2009 as compared to all the other years from 2000 to 2008. We, actually, benefited from the crisis because instead of trying to grow the volume of sales, firefight the growing requirements of customers, we focused more on value addition and the core competency. Our business is now strong and till now we have been seeing better profits than what we made during the ‘booming’ years of Dubai. TIS: Being a family owned business, how do you ensure targets are met?
AA: We are an SME and the benefits of an SME is that the board can meet up and take decisions, in this case, my father, two brothers and an external director sat down and took the decisions. My father and our external director have the technical experience. My brother Ahsin Aman, who is the CEO of the company, has a great deal of financial expertise, while my second brother has experience in the procurement and production side. We wear two hats, as a board member and an executive. TIS: What challenges have you faced in the course of your business?
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Akhtar Aman
COO, Enerplastics L.L.C Operations:A B2B manufacturing company, which produces raw materials in the form of colorants and additives for the plastic industry. The UAE accounts for a small share of the operations. The company was established in 1999, and manufacturing began in 2000. crunch in their companies. We hadn’t faced that before, and for at least six months in 2009, we faced a lot of delayed payments. Luckily, we had year-on-year growth and banks supported us. A lot of our customers were in the construction business and manufacturing plastics for this sector. There were severe economic problems predominantly in East Europe, and our customers in these areas stopped buying completely. Therefore, our market shrunk for about six to eight months. In fact, in the GCC the effect was much less.
TIS: How did you overcome this situation?
AA: I believe small is beautiful, and we made more money in a shrunken, lower capacity sales than we did previously, so we realised that it wasn’t a number game, but rather the product mix and the value addition. We decided we would refocus our direction away from the commodity sector within our product range and focus more
AA: There were a lot of customers who delayed payments due to a cash
The Intelligent SME
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