The Hindu Business Line : Turning business ideas into viable enterprises

Hyderabad, Dec. 17 Not all successful people have achieved their distinction by possessing new talent, but many of them did it by just developing the opportunity that they possessed. The same is true in the case of Mr Uyyala Ramu, proprietor of M.R. Plastics and also this year’s winner of The Prince’s Youth Business International (YBI) Entrepreneur of the Year 2008.

The YBI is a network organisation for 38 locally-based independent initiatives. It has so far helped set up 90,000 businesses worldwide since it was founded in 1999. This is the second time that YBI Entrepreneur award is being presented, the first was in 2006.

Mr Ramu’s company M.R. Plastics, established in 2006, recycles old plastic bags to make new ones and his raw material is procured from rag-pickers, via dealers. In his own small way, Mr Ramu, while supplying to the growing demand of plastic bags, is helping build a supply chain in the local area.

Business initiative

“I used to work as a machine operator in a plastic company earlier. But because of financial constraints left it and came to Hyderabad. Since the only thing I knew was to make plastic I entered into this business,” he told Business Line.

With an initial capital of Rs 70,000 — Rs 30,000 his own and the rest raised with the help of Bharatiya Yuva Shakti Trust (BYST) — he started the unit on the outskirts of the city.

BYST is a not-for-profit organisation that assists entrepreneurs develop business ideas into viable enterprises under the guidance of a mentor.

“We keep the cost of the raw material low by using recycled plastic, but then we use around 70 per cent of new plastic to ensure that the bags are of good quality. The material is processed to make granules, which in turn can be used to manufacture new bags,” he said.

According to him, the bags are thicker and that is why they are slightly more expensive, but can be reused several times.

“We currently produce around 1,000 kg of bags — carry bags, nursery covers and liners — a day. Also since we sell straight to vendors we help in eliminating the middlemen and this helps us to sell at a competitive price,” Mr Ramu said.

Today his turnover is Rs 36 lakh but by the end of the fiscal it is expected to be around Rs 1 crore. He now employs 40 people, but wants to increase it to 100 in the next six months.

“We now plan to take the business forward by expanding our capabilities to manufacture plastic thread and insulation tapes. We also want to invest in an injection moulding machine, which would be able to help us print and mould bags,” he said.

The total investment in this project, Mr Ramu said, will be around Rs 65 lakh, out of which Rs 15 lakh, will be from internal resources and “the rest will be raised from a loan for which we will seek BYST’s help”.

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