Interview with: R Varun Karthikeyan, RMCL: Aiming at all-round Growth

Early this year, R Varun Karthikeyan took over as the Managing Director of Roots Multiclean Ltd, India’s leading manufacturer of mechanised cleaning equipment. Having been trained over the years under his father, K. Ramasamy, Chairman of Roots Group, and also worked as the Director-Operations in RMCL, the transition to the pivotal role was rather smooth for him. Talking to Editor-in-Chief Mangala Chandran at his Coimbatore office, Varun Karthikeyan stated that he was still learning but was confident of mastering all the business aspects quite fast.

Getting trained early on

I am a mechanical engineer from San Diego State University, California. I started working in Roots Industries India Ltd as an apprentice and trained for two and a half years. I went on to do my MBA from G.R.D. Institute of Management. I returned to join RMCL 10 years ago and have been here since. Being from an engineering background, marketing is new to me but I am now slowly getting to understand it.

Growth of the company

Roots Multiclean has been growing consistently on an average of 25% for the last eight years. Last year with the slowdown in the economy, our growth was limited to eight to nine percent. This year we are again looking at substantial growth of 25%. Previously companies were going for small machines. Today the demand is for both small and big machines. The scenario has changed and a lot of big machines are sold in India.

We have started manufacturing our own truck mounted road sweepers. Selling strategy for these machines is different and we have a team focusing on government bodies.

Imported machines are very expensive with high level technology. But very rugged and easy to use machines are the needs of the Indian market. Our focus is to cater to this demand. The Roots machines are designed to work in Indian conditions. Other than our launch in Hyderabad, we have sold these machines in Kochi and Chennai, where they are deployed to sweep the highways. We also have small sweepers; they are petrol driven motor rickshaw sized sweepers. It has a high dump and can be used in small industries.

Being an Indian company, RMCL has an advantage of good network of branches and easy availability of spares. We have dedicated servicing teams in our 13 branches taking care of the inventories for the clients, especially the FM companies who have a penalty clause in case of breakdown of machines. We make sure that spares are available at all times and prompt service is rendered. Certain components of big machines are imported. Manufacturing and importing of equipment are done in 50/50 proportion. We have also launched a range of scrubber-driers and introduced ride on, walk behind scrubber-dries that are completely designed, developed and manufactured by us. The equipment are mostly battery operated, but we offer petrol driven ride-on machines too. We have 25 design engineers, who work at Roots Engineering Research Centre (ERC).

RMCL is strong in the industrial cleaning sector as well

The market for industrial vacuum cleaners is growing. We have a tie-up with Delfin, Italy and a portion of manufacturing is done here with some components used from Delfin. The special products projects division specifically caters to the demand of these vacuums that is used in different industries. Vacuums have different turn key and different solutions have to be offered based on the requirements. I am planning to visit various industries on a pan India basis and look into the marketing segment of the machines. Previously, my focus used to be only on technically evaluating the equipment.

Superior standards are met in certain aspects of localised manufacturing, with other aspects being on par with the global standards. Our superior standards come from the fact that we specifically design equipment to meet the Indian conditions and requirements. This is not done by the global machines which face conditions other than the ones in India. The machines used in India have to be rugged and be able to withstand extreme conditions. SAP implementation has also been achieved very smoothly by us recently.

All our marketing strategies are really doing well; we just have to speed up the process. All branches are in key locations apart from that we also have our dealer network.

Future plans

We will be concentrating on both marketing and manufacturing aspects of the business. Marketing is critical in this industry. We are trying to build a green building which will house a corporate office, ware house and a service centre in Bommasandra, an industrial area of Bengaluru.

In manufacturing segment, RMCL has invested hugely in the machineries. Bringing down the cost by manufacturing locally is the only way to get a competitive edge. It is very difficult to import machines due to the high duties levied on them. The customer is unwilling to bear the burden of the cost , so the only way out of this is to cut costs by manufacturing locally. We want to invest in our factory and in R&D and do substantial manufacturing in the future.

The newly introduced eco-friendly Nano Ceramic Pre Treatment Coating process ensures that all the sheet metal components are of highest quality and well protected and presented. The new process gives a uniform coating thickness. It has a very high corrosion resistance and also a very high paint adhesion. Moving from a batch process to a continuous process has enabled us to have a tight control over all process parameters and deliver good quality parts consistently.

In the marketing side, we want to reach out as much as possible. Presently, majority of the businesses come from the branches and a small part from the dealers. We are trying to promote our dealers and go for a right combination of dealers and branches as an effective marketing strategy. The strategy is decided depending on the area to be targeted.

Growth of the cleaning industry

In the cleaning industry, the level of growth is very high. The facility management sector is also growing really well. However, cleaning is not given a preference; it is not considered a necessity but a luxury in India. Many companies have the FM personnel coming periodically and maintaining selected areas. They have the option of either buying the machines directly from us or employing the FM company. With the labour crunch, many companies are leaning towards mechanisation. The number of people engaged in cleaning related work is huge; it is difficult to manage such a large number of people. Introducing mechanisation can drastically reduce the headcount. In India, society looks down at people engaged in cleaning. This is also one of the reasons for the labour crunch. In mechanised cleaning, there is a pride attached in operating the equipment.