Suguna Institute of Poultry Management

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Employees saved us from difficult times

Employees saved us from difficult times

The 5,500 crore rupees conglomerate, Suguna Holdings, started with seed money of Rs.5000 in poultry business during the 1980s faced difficult times in 2000, but made an astounding recovery after employees of Suguna Poultry raised Rs.12 crore and gave it to the company.

B Soundararajan, Managing Director, Suguna Holdings, with The Weekend Leader - VIT
Amazing Entrepreneur Award at VIT Vellore ( Photos: H K Rajashekar)

“The employees took the risk, because they had faith in the company,” remarked B Soundararajan, Managing Director, Suguna Holdings, addressing students of VIT Business School after receiving The Weekend Leader – VIT Amazing Entrepreneur Award at VIT Vellore last week.

Suguna Poultry, later rechristened as Suguna Foods, registered rapid growth, and today is the flagship company of Suguna Holdings, contributing 98 per cent of the group’s revenues.

Dr. S K Sekar, Dean, School of Mechanical and Building Sciences, VIT, presented the award to Soundararajan, who was one among the top entrepreneurs featured in The Weekend Leader’s Amazing Entrepreneurs series.

Dr. S K Sekar, Dean, School of Mechanical and Building Sciences, VIT, Presenting the award to Soundararajan. Also seen are P C Vinoj Kumar, Editor, The Weekend Leader and Dr. Kalyani Rangarajan, Dean, VIT Business School

Felicitating Soundararajan, Sekar said the Suguna success story was inspiring and urged the students to become entrepreneurs.

Soundararajan made a PowerPoint presentation on his entrepreneurial journey and revealed that in 2010 he had planned to exit from the business, handing over the reins to his brother G B Sundararajan.

But his brother prevailed upon him to reconsider his decision. Soundararajan then travelled to the US and UK and studied the best business practices there.

Soundararajan during an interaction with the students

He came back enlightened and with a clear vision to diversify the business. The result was the creation of Suguna Holdings, which was formed with the mandate of looking at multiple businesses.

The group has stakes in poultry feeds and vaccines, assets management, and gold and iron mining.

Sravanthi, MBA first year student, receiving the 'best question' prize from Soundararajan

As MD of Suguna Holdings, Soundararajan does not involve himself in operations of the group’s businesses, but is focused on exploring new opportunities.

“In the Middle East, there are families running as many as 30 businesses,” said Soundararajan, who has set himself a target of starting one new business every year.

Soundararajan at the customary selfie session with the students

Soundararajan later interacted with the students in a lively Q & A session that was moderated by The Weekend Leader’s Editor, P C Vinoj Kumar. Kalyani Rangarajan, Dean, VIT Business School, also addressed the students. – TWL Bureau

Source : The Weekend Leader
Date : 18-sep-2015

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Our Management Team

B. Soundararajan          -          Chairman
G.B. Sundararajan        -          Managing Director
G. Subramaniam           -         Vice President - International Business

HR Team

A. Albert Sahayaraj
V. Samuel Jones
S. Dinesh Babu
M.S. Arun Krishnaa
L. Madhan Prasath

Finance Team

K. Karthikeyan
M. Varadaraj

Governance And Compliance 

R. Hariram

Cost Analyst

S. Manikandan

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Happy Independence Day

          Let's Indulge ourselves in the beautiful colors of India
          Happy
          Independence 
                                 Day

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The chicken and egg story

B.Soundarajan’s contract farming model in poultry has turned Suguna Holdings Pvt Ltd into a Rs 4,200 crore enterprise. At the same time, it has provided an assured livelihood to hundreds of farmers across India. K. Jeshi reports

Fresh out of school, B. Soundarajan, along with his brother B. Sundarajan, set up a poultry farm in 1984 at Ganapathypalayam in Udumalpet, about 70 km away Coimbatore. “My father, a school teacher, pushed me into it. After my schooling he wanted me to opt for business. We had a vast expanse of agricultural land, so we started a poultry farm,” he says.

Six years on, he introduced contract farming, redrafted the business model, and changed the face of the industry. From three farmers in Udumalpet, the business now has a whopping 18,000 farmers across the country. “We cover 8,000 villages in 13 states,” says Soundarajan, the managing director of Suguna Holdings Pvt Ltd. Their business is worth Rs. 4,200 crore. And, hundreds of farmers are smiling. “Business runs independently. We just sit back and relax now,” he jokes as we settle down for a chat at his tastefully done-up residence. Recalling the beginning of his journey he says, “Every one knew about country chicken; the concept of broiler chicken was new.”

The farmer was dependant on 14 cost centres — from retail distributors, brokers and chicken feed suppliers to medicine suppliers and veterinary service providers. “The farmer is always dependant on many hands for his survival. This happens even now,” he says.

But with ‘forward-backward integration', Soundarajan reduced the cost centres from 14 to three. Suguna now supplies day-old-chicks to the farmers along with feed and medicines. The farmers raise the chicks for 45 days and return them to Suguna. “We take the responsibility of marketing. The farmer becomes the producer with no investment or working capital. Bank loans are arranged to help them erect a shelter and maintain the poultry. Our hatcheries and breeding farms supply the chicks. We provide the feed (made from soya and maize), medicines and vaccines. This arrangement gives farmers a regular, assured income and a consistency never seen in agriculture, thus empowering them.”

From Sankaran Koil and Tenkasi to Rajapalayam, Madurai, Theni, Oddanchatram, Palani, Dindigul, Kudiyaatham, Vellore and Puducherry, you find a Suguna Poultry every 40 km or so. Their business model turned around the poultry industry. “Initially, there was scepticism about the scalability of the model. But we won over the farmers. They trusted us and we have grown together,” he says.

Reaching out

A farmer himself, Soundarajan says it has been an enriching journey. In 2000, the business scaled up to Rs. 100 crore and reached 4,000 farmers. The success story in Tamil Nadu prompted them to look beyond cultural and language barriers. The model is now replicated in 15 States. “A farmer is a farmer — he may live in Tamil Nadu, West Bengal, Punjab, U.P or Rajasthan, but his approach to life is the same. He needs a helping hand.”

In 2010, Suguna entered Bangladesh and Sri Lanka. It is now looking at South East Asia and Africa. A dedicated team of 5,500 employees is the company's backbone. The 250-odd offices across India are technology-enabled and connected to the central office in Coimbatore. Suguna Daily Fresh outlets (about 100 shops) promote a hygienic model of processed meat consumption. Soundarajan says more corporates should connect with farmers through a business plan that doesn't exploit them. “A farmer is confined to his land. To grow bigger, he needs help. The Government should protect his interests with a contract farming law. ”

The poultry industry, including eggs, stands at 40,000 crore and is growing at 15 per cent every year. Suguna commands 18 per cent of the market share, and expects growth from newer markets such as Bihar, Madhya Pradesh and Jharkhand. “India is an emerging market. The per capita meat consumption in Europe, West Asia and the U.S. is 65 kg. In India, it is three. We have to grow four times more to achieve the world average of 12 kg.”

What an idea!

He is happy that from being a backyard farm, Poultry has become a corporate set up. “Chicken is no longer a festive special, people have it more often now. About 80 per cent of poultry produce comes through contract farming and this has ensured affordability, quality and availability. We are not technocrats or management graduates, but we worked on the business model and it clicked,” he says with pride.

Soundarajan is proud about Coimbatore. “People in the western part of Tamil Nadu are calm and ethical. I like this conservative approach. And we have such pleasant weather here,” he smiles. When he is not working, Soundarajan treks in the forests near Siruvani, Parambikulam and the Velliangiri Hills. Or blazes the track on his Kawasaki. s“I always tell management students to start early, even when they are 21 years old. They are free to think independently, and can afford to take risks. Failure rates are high and not all of them succeed. But, it is still worth trying. Businesses are created through ideas and not money. Suguna was one such successful idea.”

Other projects

Under Suguna Holdings, the 50-crore Globion India Private Limited in Hyderabad manufactures poultry vaccines

Suguna Foundation Trust has planted 30 lakh saplings across India through its network of 18,000 farmers

Suguna Institute of Poultry in Udumalpet will offer diploma courses in poultry from August

Suguna Foods will extend its services to cattle, fish and pet food

The company also plans to enter the dairy segment

Farmer's Speak

S. Kanadasamy, SKS Farm, Pulankinaru, Udumalpet

“My father used to cycle around the farms. We drive around in cars now,” says S. Kandasamy. A regular income through contract farming has brought about noticeable changes in the lifestyle of farmers like him. “Contract farming has boosted rural economy in a big way. An assured income once in 45 days drew many agriculturists in Udumalpet to full-time poultry. And the results have been rewarding.”

The farmer who has been with Suguna since 1987 has branched into ‘parent bird breeding' (thaai kozhi valarpu) too, a 70-week cycle. “In parent integration, we maintain the chicks over 25 weeks, prepare them for egg-laying and supply the eggs to Suguna. Established farms go in for this parental integration as it extends over a longer period.” He maintains one lakh birds through parental integration.

His wife K. Sudha is also an entrepreneur. She and her team run Sudha Poultry Farm at Malaiyandipattanam in Pollachi. “We become the owners and there is zero risk.”

They add that corporates and the government should support such endeavours. “Government should offer loans for agriculture-based sectors at a nominal rates of interest.”

M. Neelavathy, Neelavathy Farm, Udumalpet

She started with 1,000 birds in contract farming on 3,000 sq.ft area. Now, she has over 10,000 sq.ft. “Poultry is our main source of income now. We are not able to depend on agriculture as water is scarce. Rains are no longer seasonal. Ground water has hit an all-time low. You need two or three bore wells to maintain a one-acre farm.”

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Starting with an investment of Rs 5000, he has come a long way selling chicken

Having started his poultry business with an investment of Rs.5000 about three decades ago and making a turnover of Rs.5500 crore today, you would think B Soundararajan, the managing director of Suguna Holdings, would have very little time for sleep.

But far from it, he is off to bed quite early, and has a good 8-hour sleep. He goes to bed around 8.30-9 pm and wakes up at 5 am.

Soundararajan and his brother introduced the concept of contract farming in poultry in Tamil Nadu in 1990

“It is important to sleep well to be fresh for the next day’s work. When I lie down on the bed I hardly remain awake for half a minute to one minute,” says the 53-year-old first generation entrepreneur, who hails from a village near Udumalpet, about 70 km from Coimbatore.

A self-made man, who likes to do anything he does “with perfection”, he quit his studies after Class Eleven to take up farming on the suggestion of his father, who was then a teacher in a government middle school.

“He encouraged me to do something on my own and I took up agriculture. He felt that if I joined college and took a degree I would end up searching for a job,” says Soundararajan, who cultivated vegetable crops for three years.

He lost Rs.2 lakh in farming, then worked in a furniture manufacturing company in Coimbatore for a year and a half without salary, and later moved to Hyderabad as a “one-man army” for an agricultural pump company looking after their sales and marketing in AndhraPradesh.

“I had no knowledge of Telugu or English, but travelled around the State and sold pumps. I gained experience in sales, marketing, and accounting.

“But the company was affected by strikes and could not meet the demand in the market. So I lost interest and quit the job,” says Soundararajan, who returned to his village and ventured into the poultry business with his younger brother, G B Sundararajan.

Three decades later, as MD of Suguna Holdings, Soundararajan sits in their head office in Coimbatore and steers the overall activities of the group’s subsidiaries, which includes their flagship poultry firm, Suguna Foods Private Limited.

“Suguna Foods contributes 98 per cent of the group’s revenues and is associated with the livelihood of 23,000 farmers around India,” says Soundararajan.

As the company’s website states: “We are energizing rural India and are proud to say that our vision has come a long way.”

Though involved in poultry business since 1984, it was in 1990 that Soundararajan and his brother introduced the concept of contract farming in poultry in Tamil Nadu.

By this method the brothers began to partner with farmers who would set up the infrastructure for the poultry in their land and they would supply the chicks, feed, and the medicines for the birds.

In those days, a farmer had to invest around Rs.1.20 lakh to set up a shed in 8,000 sq ft area for 5,000 birds with feeders and watering equipment. They would get back their money in two years.

Every 45 days or so they would buy the chicken from the farmers and sell it in the market. They used to pay 50 paise per kg of chicken at the time of harvest. (Now, they are paying about Rs.5 per kg).

“We started with 2-3 farmers in Udumalpet. Next couple of years was a learning process for us. We learned about raising good chicks, handling the farmers, and defining their responsibilities,” recalls Soundararajan.

Farmers were happy with the business model, as it gave them an assured income that supplemented their unpredictable earnings from agriculture.

“Now, the investment for 5,000 birds would be roughly about Rs.6 lakh. The payback period is usually three years in normal circumstances,” he adds.

Back in 1997, when about 40 farmers had joined them and the turnover touched Rs.7 crore, they turned into a private limited company.

“We felt this was a sustainable model, and we could scale it up. At that time there were around 25 persons employed with us,” says Soundararajan, who turned his attention to professionalising the organisation, creating separate divisions for HR, accounts, production and sales.

The company reached out to farmers across Tamil Nadu and soon spread its wings into 10 districts. Their chicken was marketed all over the State and their turnover touched Rs.100 crore in year 2000.

It was time to look beyond Tamil Nadu and they expanded into the neighbouring States of Andhra Pradesh and Karnataka. Chandrababu Naidu, who was the then CM of Andhra Pradesh, supported their expansion in the State.

From then on, the growth was rapid and they slowly expanded to other States as well.

At present, Suguna works in 9,000 villages, 18 States, with 23,000 farmers, who between them hold 10 crore sq feet enclosed area, and produce about 8 million chickens per week.

“We have 250 branches around the country. Each branch has 15-20 employees, and all branches are connected via internet. We implemented ERM (Enterprise Resource Management) way back in 2004,” says Soundararajan.

The company provides day-old chicks to the farmers. They also provide the feed, health care and technical support to the farmers, who hand over the fully grown chicken every 40 days.

On an average each farmer holds about 6000 birds, though some farmers in UP have just 500 birds.

“Poultry needs direct attention of the farmers. We do not encourage non-farmers who may look at poultry as a business opportunity,” says Soundararajan.

That way, he admits, there is a social angle to their business. He shares how the lives of many of the farmers who have been associated with them have changed for the better.

Soundararajan’s mandate now is to de-risk the group’s business model by diversifying into new businesses

“They can now count on some regular income and no longer need to depend on their agricultural income alone, which is unpredictable. They send their children to good schools and have the money to pay for their daughters’ weddings. This gives us great satisfaction,” he says.

Another benefit for the farmers is that the chicken litter from the poultry can be used as natural manure for their crops. “By doing so, input of chemical fertilisers is reduced and their agricultural output also increases,” he adds.

Suguna Foods controls 18 per cent of the poultry market in India. Through a network of 250-strong Suguna Daily Fresh outlets in Tamil Nadu and Kerala, they also sell processed chicken, but as Soundararajan observes, "Indian acceptance as on today for live chicken is 98 per cent."

Suguna has set up a poultry subsidiary in Bangladesh, but does not have big plans for export market. Currently their export is predominantly to the Middle East and it accounts for Rs 80-100 crore of their annual revenue.

“We cannot compete with the US and Brazil, who are the market leaders. In Brazil chicken production cost is low, because the price of poultry feeds, maize and soya, are 20 per cent less there,” he says.

As MD, Suguna Holdings, Soundararajan’s mandate now is to de-risk the group’s business model by diversifying into new businesses.

The group, which already has interests in poultry feeds and vaccines, and assets management, is now exploring gold and iron ore mining in Madagascar.

“We are looking at different markets and different businesses, new opportunities and new geographies,” says Soundararajan, who regularly attends programmes at reputed business institutes to update his knowledge of business and management practices.

Looking back, though, he has no regret of missing college. “Without a degree I was compelled to get into business, which was good,” he says.

Soundararajan lives in Coimbatore with his family. His wife looks after the home, his daughter is married, and his son joined the business after completing B.Com two years ago.

He and his family love trekking and take off for some place on the Western Ghats near Coimbatore. “We go trekking every month or so. All of us in the family love to trek,” he says.

Add to it his daily walking or swimming routine, and you get the picture of a hard working, fitness conscious, family-loving entrepreneur, whose best days are yet to come by.

This Article is Part of the 'Amazing Entrepreneurs' Series

Source : The Weekend Leader

By P C Vinoj Kumar

Coimbatore

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Kudos to Coimbatore!

Coimbatoreans were honoured at The Jaguar and Ritz Excellence Awards show

The Jaguar and Ritz Excellence Awards in Coimbatore reiterated the fact that there is much about tier-two cities that go unheard and unsung, in the face of the juggernaut of media coverage accorded to the big ones. But there are some wise enough to acknowledge that there is a world beyond the glitzy metros, where there are real people leading real lives. People who have not just made a difference to their own lives, but also to the towns and cities they come from.

Recognising this, Aruna R. Krishnan, Editor and Publisher of Ritz — described as South India’s premier uber lifestyle magazine — launched the magazine in the city at a small and elegant awards ceremony at Le Meridien. Aruna’s aim is to make Ritz a magazine that covers all of South India. She has just launched in Telengana and now her sights are trained on Kerala. “I picked Coimbatore because I know that the kind of things happening here is missing in bigger cities. When I spoke to our award winners, they came across as erudite and at the same time so grounded and real,” she said.

G.V. Prakash, N. Chandran, Shankar Vanavarayar, Vanitha Mohan, Narain Karthikeyan, B. Soundarajan, Jayachandran Anand, Anusha Ravi, Rajshree Pathy and Vikku Vinayakaram, who received the awards, have a distinguished track record straddling the world of music, conservation, industry, education and motorsports.

Vanitha Mohan has become synonymous with the city’s environmental concerns, be it greening, water conservation or waste management. She and her team of environmentalists have successfully involved thousands of men, women and children in the upkeep of the city. Remember how thousands of Coimbatoreans turned up to clean up the Big Tank? Besides being an industrialist to reckon with, Rajshree Pathy has brought art exhibitions to town and given people a chance to meet renowned contemporary artists and view their work. Textile technocrat N. Chandran put Tirupur on the map of global textiles and, in a moving acceptance speech, dedicated his award to the ‘small industrial town’ that made him. Shankar Vanavarayar and Anusha Ravi are constantly trying ways and means of keeping the spirit of inquiry and learning alive through their educational institutions. Everyone in Coimbatore is immensely proud of Narain Karthikeyan, the Formula One driver. He dedicated his award to the entire motor sport community. “Being recognised in your home town is always special and it was great to be part of the event. To share the accolades with my family, friends and close acquaintances is a rare opportunity for me.” Narain said that Coimbatore has been the home for motorsport in India for a long time, and with the right support and investment, it has strong potential to build on its historic past. Jayachandran Anand, the managing director of Jayem Automotives, also received due recognition. His company has been serving the automobile field and has contributed to the indigenous research and development of the engineering products for 60 years.

G.V. Prakash, the music director, was also one of the award winners. The youngster, who has completed a decade in Tamil cinema, has now forayed into the acting field. He received an award for pioneering new directions in the field of cinema and music.

Vikku Vinayakaram got a standing ovation when he finished a short performance with a flourish of his ghatam. Youngsters in the hall were so thrilled that they flocked around him for autographs and selfies after the show.

Beautiful models in elegant ethnic wear and ornaments sashayed down the ramp for the fashion show, featuring jewellery brand, Studio Tara and clothes lines such as Vrissa and Anavila that retail out of Amethyst. Page 3, the city-based salon, was the styling partner for the event. The evening came to a close with the award winners interacting with the crowd over a sumptuous dinner at Le Meridien.

Source: The Hindu

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