A star performer at Crompton Greaves associated with the company for more than 5 years started thinking of business one day. On one hand, he had a promising career which anyone in his place would be envious of and on the other hand, there was an unexplored ditch that could throw up anything. It is not easy to quit job when you have kids to take care of and when you do not have enough assets to sustain. Most people opined that he was digging over his feet. Moreover, 1997 was not a great year either. The industry was experiencing a slowdown and there was a cut throat price war to get new business orders. The passion in him won over his fears and Master Moulds & Master Components came out as a result. From running around for 2 months garnering an order for Rs 2600, today, Mudduraj Kulkarni doesn’t feel that he’s too awesome to have built a business that could be clocking a turnover of Rs 20 Crores in the next 2 years. I do.
After schooling at SSBJ, Muddu joined the Nettur Technical Training Foundation (NTTF) at Nettur, Kerala. The training center is the first of its kind to be established with Swiss technology collaboration. The students are trained intensively in the field of tool and dye making for 4 years followed by 1 year of industrial training. After completing his training from NTTF’s Bangalore training center, Muddu joined started working in a small industrial unit at Pune. After 2 months, Crompton Greaves (CG) offered Muddu to join them at Nasik and he was gung ho.
Within a year at CG, Muddu carved a name for himself through his dedication at work and excellent performance. In 1990, Muddu saw himself land in a lonely world. His mother expired and after a few months, all of sudden, his father collapsed with a heart attack. He was devastated. He could not even speak to his father for one last time. It was a terrible time. Time was his only companion and it did heal some pain as it passed. Muddu had been doing absolutely brilliantly at work. He was now handling various complicated products, molded components, assembly line manufacturing and in the process, interacted with many vendors across the nation. His initiatives were acknowledged and at times, people asked him, “What makes you work so much?” He would quietly smile and move on. He kept grabbing all the opportunities that came on his way and the responsibilities on him kept mounting. He was doing no different task from running his own company.
On one fine day, Muddu learnt about Vijay Idagal and Shivanand Kugotoli, both from SSBJ, who were running a company named Datar Switchgear. The company had begun operations in 1993 and was doing extremely well. Being Ajeets, they stroke an instant connection and started discussing further. On another fine day, Muddu thought, “Why not me?” the most critical question before the rising of an entrepreneur. He roped in Srikant Joshi, his course mate at NTTF Bangalore, to the discussion. CG is an industrial giant and Muddu was doing perfectly well. He was a rising star in the company and the company acknowledged that. On the other, Kulkarnis and Joshis are conservative families and the two, if the decision goes through, would be first generation entrepreneurs with bountiful risks. Everyone showed them how businesses failed and how they would have to struggle to live life without a secure job. “The only positive statement came from my wife, thanks to her family business. I knew that it was time for me to move out of my comfort zone and that my family was ready to support. With the Rs 10lacs that CG gave me as PF, Gratuity and other savings, I purchased a small plot of land, about 600sqm, with a shed. I started building a room that could accommodate machines and also started running from one company to another to get orders. I scanned the entire Ambad and Shahpur area to get some orders. Nothing happened. It was 1997, a recession period. From someone who hundreds of vendors approached, I had become a vendor approaching others in no time”, Muddu says. By pledging the property and machinery, Muddu also obtained a loan of Rs 28lacs from a PSU bank.
Master Moulds was incorporated. After 2 months of running around, the goodwill and contacts that Muddu built over 7 years at CG and living at Nasik worked. He received an order for Rs 2600, Rupees Two Thousand Six Hundred Only, which came to him more for encouragement and get his machine to start working. Muddu continued to seek work. His association with Vijay Idagal and Shivanand Kugotoli helped him begin on a different platform as they helped him understand what works and what doesn’t. In 1998, the construction was completed and the machinery was installed. Srikant Joshi left CG and joined Muddu at Master Moulds. The exploration began. They started travelling to industrial belts in Nasik, Pune, Nagpur, Aurangabad, etc.
The new business had brought about a tough personal life for Muddu. With his wife’s support, resigning from CG and getting into business was an instant decision. They had gotten married in 1993 and they had their first child in 1994. When he left CG in 1997, his wife was carrying the second child. It was a tough time to take a decision like this. The second son was born in 1998. Just then, his salary had dropped from about Rs 18,000 at CG to Rs 3,000 at Master Moulds. “All my course mates, except 4 of us, were sitting abroad counting dollars. Though I knew this, it never bothered me. It was incredible for me to see that we were able to live a happy life with Rs 3,000. It was just about enough to live for the day. All my LIC policies lapsed in the next 2 years. We were living on extremely minimal needs”, Muddu says, “At work, Srikant and I kept supplementing and complementing each other. We worked day and night. Whenever we were tired, we would just sleep on the table. There was no other go. We had all the will power, goodwill and knowledge but had no facilities. We campaigned with business introduction letters knocking every door that came our way”.
At a very tiny pace, the orders started flowing in. The first employee was hired and for a long time, he was the only employee at the company. The company kept growing steadily. The speed improved and the business started moving. The tremendous focus by Master Moulds on the unstated needs, and not just the stated ones, was playing a key role. There was also a tremendous focus on delivery. Muddu went around hunting for business while Srikant worked over executing and delivery of orders. The machinery was running at full capacity and soon, the company couldn’t take a couple of orders due to machine unavailability. It was then that Muddu realized that it was time to expand business further. In 2002, they decided to explore the opportunity of forward integration. All this time, they were manufacturing moulds for businesses. The moulds would be used by others to manufacture the parts and components. Now, the idea was to offer manufacturing of the parts and components as well to the clients. This would garner additional revenues and some orders would flow in quickly as it would save a lot of time, money and effort for the client. The company purchased a new piece of land, a larger 3200sqm one this time, and incorporated a new company, ‘Master Components’. Once the moulds are approved and deemed to be fit functionally and dimensionally for production, the company would use them to produce components. The auto industry was seeing good growth numbers and thus, the ancillaries like this had a good time as well. India’s economic story was getting stronger and SME businesses received tremendous encouragement.
There have been numerous occasions of financial crunches but the company has been able to overcome them due to diligent financial management. Most companies do not take any decisions in the months of Feb-Mar as the annual budgets are outlaid and various approval requirements come into place. The orders as well as payments get deferred. “On some days, I would walk into the office with heavy heart. There would neither be any order to execute nor would any company entertain us walking in to discuss new business. However, due to certain diversification over the years, things are much better today. In the initial years, paying the salaries for these 2-3 months was a great difficulty. We managed to pay it by managing funds from other resources”, says Muddu, “The value of commitment itself is higher than whatever has been committed. I have learnt it from my school days that we have to think twice before committing over something. However, once the commitment is done, there should be no further thought other than of fulfilling it at the right time”.
The school days have been the most beautiful days of Muddu’s life. His father worked as a Headmaster in the village school and thus, from day one, Muddu’s orientation towards academics has been higher. When he entered SSBJ in 1977, it was a big world for him. He was seeing a school standing at the size of his village. A very sentimental kid, Muddu would break down even if somebody got a little angry on him. “When I sat in the class at SSBJ for the first time, I remember, Samuel sir was taking the history class. I was keenly listening to him and making notes. However, while he spoke in English and I made notes of whatever he said in English but because I did not know English spellings, I was using Kannada script to write. When people around me noticed, they started laughing and I broke down. Samuel sir walked towards me and just placed his hands on me. Those hands of assurance that everything is fine, son, keep moving ahead, is something that sends shivers into me even today. It is one event that has encouraged me the most in life”, an evidently emotional Muddu says.
As days progressed, Muddu made immense progress at school. By 11th, he was an active participant in debates and declamations. He even spoke at an All India Public Schools Declamation at New Delhi. In the final year at school, he also held the position of the School Vice-Captain. He had progressed in sports and athletics as well. “The qualities imbibed in me due to such exposure and the Ajeet culture that holds us strongly and acts as a driving force have significantly furthered my life”, says Muddu as he recollects his school days. Muddu’s dream, like everyone’s at the school, was to join the Armed Forces. However, the SSB stood between him and the NDA. After completing 12th, his father told him about NTTF’s job oriented course. It was a strong notion in those days that one must study only such courses where there is a guarantee of job. He followed the advice and joined NTTF, Nettur with full scholarship. For the initial 2 years, Muddu kept regretting the decision as he had to stand for 8 hours a day and work on machines. It was a rigorous course and somehow, the belief that his father must have thought enough before suggesting the course, kept him from running away. Often, a little trust is all you need to kindle the magic of hope.
The Government has been doling out certain facilities to help small businesses. In Maharashtra, the State Government permits certain industries to collect the sales tax but allows them to pay to the Government treasury in 8 years period. While on one hand, this sales tax acts as a working capital for such companies, on the other hand, the Government indirectly ensures that all business happens with bills and taxes get collected and thus, discouraging black money market. At times, the State Government has already reimbursed up to 15% of the project cost in the form of a capital subsidy or incentive. However, the continuous spikes in the prices of power and water have been a major pain point for MSMEs’ growth in the nation.
Despite best efforts, the company was stuck at a turnover of Rs 60lacs from 2001. In 2004, Muddu and Joshi went to Singapore to study the latest innovations in the field of mould making. They decided to upgrade to CNC machines and placed an order for 4 machines that would boost the company to the next level. These upgrades would help the company foster more business. Soon, companies like Schneider and Siemens topped the client list of Master. With addition of an Injection Molding Machine and another 2 Wire Cutting Machines by 2006, MMMC had grown into a state of the art infrastructure premises. The additional capacities augured well and MMMC started working with clients from different industries like electrical, home appliances, consumer durables, etc. In a way, today, the exposure to multiple industries acts as a cushion against a slowdown in any of the sectors. Moreover, all product businesses are cyclical in nature and such diversification ensures order flow throughout the year.
New machinery is always purchased in anticipation of orders. At times, MMMC has purchased machinery and landed into troubles as the orders did not flow in. During these testing times, Muddu has stood strong to take a call over such machinery. In certain cases, they have been sold to others, some at loss while in some other cases; those machines remained with MMMC, even though they had no application. At these times, Muddu continued to focus on the core business activities and yielded more revenues from growing the business where possibilities existed. Quickly adapting to situation is one important skill that Muddu has learnt from the school days. Considering that the table tennis table would be used as a study table in the evening, Muddu would stay awake till midnight to play the game he loved the most. The physical training at school has helped him upkeep good health all through life. Discipline in every action and even the thought flow process has helped him make better decisions.
MMMC envisions to work along with the clients, adopting the best of manufacturing practices, to ensure client success. Another key factor for the growth of MMMC is the sound knowledge and understanding of developing moulds and dyes possessed by Muddu and Srikant, courtesy NTTF. When the clients know that they are working with experts, they are at peace in respect of the quality and delivery. MMMC has been the no. 1 supplier of certain plastic components to Lear Corporation, one of the largest global manufacturers of seats with presence across 140 nations, for the last 3 years. MMMC always ensures that there is no delay, no discrepancy and no defect. Sustaining efficiency with good practices at all levels with 75 employees, 30 at Master Moulds and 45 at Master Components, is a challenging task.
In years further, the business has been growing. Muddu has taken forward his business to such height that he garnered business from a couple of companies from Germany to supply tools and parts. The basic element of entrepreneurs is the continuous and dire need for growth. The reason that makes someone an entrepreneur could also become a hindrance for further growth in absence of the hunger to evolve. MMMC has been sketching a bigger plan to take on the business to a larger stage in the coming years. There has been consistent work in progress to put everything in place. Efforts are being made to implement lean management practices from Japan’s Lear Corporation, 5S business practices, maintaining finances at required levels, ensuring appropriate turnover ratios, leverage, etc. A large portion of this growth is being funded by a cooperative bank. Most entrepreneurs face difficulties in complying with the rules set by PSU banks. Even if they do, the process takes a lot of time and there are too many hassles. Small businesses are always hungry for working capital and it is a herculean task to get it sanctioned from bigger banks. With little hassle, the company has been able to get sufficient funding to expand its business in the coming years from this cooperative bank. MMMC saw a turnover of Rs 5Cr in the year ending March 2012 (FY12) while the estimated turnover for FY13 is Rs 9Cr. Muddu says that the company’s turnover for FY15 will be Rs 20Cr. “We cannot do much with our moulds business. It is a high precision technological work falling under niche category. However, with the parts and components business getting boosted with additions of newer machinery in a new location, this is not surprising.” says Muddu.
Skilled manpower is a scarce resource amid a growing focus on higher education and white collared jobs in our economy. SMEs face a tough challenge in recruiting people with focus on a long term career in the same line of work. The company doesn’t advocate micro-managing most tasks. “When we have assigned a task to someone and if we still continue to interfere, not only does it irritate but it also sucks the learning opportunity for the employee. We encourage action and do not focus on mistakes and mistakes get rectified with experience. We believe in taking employees from being naïve to becoming mentors at a quick pace. Employees are another important aspect at MMMC. The employees have shared a very healthy relationship with the company. Most employees who matured into MNCs after working at MMMC recognize how congenial and learning friendly the company has been. All those employees who have continued to be with us form a very responsible and happy team. We are grateful to their contribution. Building enterprise skills among employees takes a lot of patience, perseverance and hard work”, says Muddu. In a recent competition held by Mahindra & Mahindra for all its Tier-II business partners, MMMC has won the prize for best practices at work.
“It has been a wonderful journey. I have seen a total transformation of my personality, from managerial decision maker to a person with high risk taking abilities, great networking skills and a lot of humbleness. I could have never learnt these if I had not chosen to be an entrepreneur. Today, I read many books on management and entrepreneurship and MMMC is embarking on a new journey to scale and transform the business. Fulfilling every order before time and following ethical practices with utmost sincerity over the last 15 years has put MMMC on an invincible position in the business cycle today”, Muddu says.
With a clear map in mind, Muddu is planning to head into the next level of business growth and why not? After all, this young, dynamic and pulsating man is a glaring example of entrepreneurial hunger in the manufacturing sector, which is in a dire need of such men.
Disclaimer: The blog post is an outcome of my discussions and readings. Whatever is written is to the best of my understanding. The post is subject to errors, including factual errors. Any corrections, suggestions or improvements are welcome. Images, quotes, statements, etc. used on the post are the property of their respective owners. You may subscribe to the blog by entering your email on the option on the top right hand side of this page.