Making of A Construction Equipment Conglomerate

The metamorphosis of Universal Construction Machinery & Equipment Ltd into a multi-product equipment manufacturer has been a success story of a home grown CE company in the country. Backed by its forward looking business plans, it is today well equipped to tap new and emerging opportunities in the Indian and global construction sector, P. P. Basistha reports.

The recognition of the company as an assorted equipment variant manufacturer has its roots in 1974 when the company used to supply gear boxes, oil lubrication pumps for industrial applications. Year 1982, was a milestone year when an important initiative to manufacture concrete block making machines under the stewardship of Mr.Rohidas More, Chairman, Universal Construction was taken up.

Making of A Construction Equipment Conglomerate
Cutting down to the year 2011, under the second generation entrepreneurship of Mr. Ranjit More, MD, Universal, the company is today best defined as construction equipment conglomerate manufacturer offering myriad solutions. This includes: concrete solutions, vertical material handling solutions, bar processing solutions, sand processing solutions, reversible mixers, mini dumpers, work platforms, suspended platforms, batching plants with pan mixer, works platform, tower cranes and many more construction equipment all backed by requisite after sales service support.

But how did the transition occur? Mr. Ranjit More says, "it was all about sensing the right business opportunities the construction sector offered led by the demand of infrastructure creation in the country." He says, "already having a first hand market knowledge through manufacturing concrete block making machines, we took the first big opportunity in 1994, when Universal began supplying concrete equipment to dam projects across Maharashtra being developed by Maharashtra Krishna Valley Development Corporation. Earlier our presence was restricted to real estate projects mainly housing construction. The opportunity to supply equipment to the dam projects allowed us to get good insight of the equipment requirement that a core infrastructure project requires." A major breakthrough was made during 1995 by Universal when it set up 15 sales units across Maharashtra.

The boom period for Universal which began during 1994 when Mr.Ranjit More took over the reign and set its first five year plan which came to an end in 2000 with over 90% target met.

A big opportunity came when Universal got orders to supply portable concrete batching plants for the Golden Quadrilateral road projects. There were new opportunities in real estate sector and business was also available from other core infrastructure projects.

Making of A Construction Equipment Conglomerate
"2001 was vital for us when we decided to create our brand as a precursor to expand our presence and we formulated our second business plan which was to run from 2001-2006.The plan was envisaged to make presence across the country. During the second business plan, we appointed dealers at 50 different locations, besides setting up our ten sales offices across the country. We selected dealers having local presence and sound technical expertise to provide appropriate after sales support for enhanced equipment uptime," says Mr. More.

For the company, the selection of dealers with strong local presence and technical background was quite significant for various reasons. "We kept a well placed selection matrix in place to select dealers. The matrix laid focus on development and graduation of dealers from one stage to another. The graduation process was fully facilitated through proper training. Following the upliftment of the dealers from junior to higher levels, they are given authority to select local sub-dealers. This altogether ensured our local presence. He tells, the company continues to follow its selection matrix for appointing new dealers."

During the second plan, Universal started promoting its mini batching plants, concrete block making machines, and materials lifting solutions which were produced at its plant at Shindewadi near Pune. The plant manufactures 10/7 series of concrete mixers, basic vertical material handling solutions, bar processing solutions, block laying solutions, block laying machines, sand processing machines, ground compaction solution and also the laboratory testing solutions. This flagship plant of the company was set up in 2006 with an estimated investment of Rs. 70 crores.

The other major plant of Universal is located at Shivare on the picturesque of Pune-Bengaluru National Highway, which caters to the equipment requirement of Southern and western India. This plant manufactures RM series of batching plants made by RM technology. The facility also produces on wheel type and in line stationary batching plants and also makes transit mixers. The company third plant which is located at Rudrapur equipped with all modern machineries, manufactures all products from Universal’s product range.

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"Our R&D team has been competent enough to design and develop the equipment according to the Indian site conditions. Though our machines have advance technical features, yet they are low on high end sophisticated features. We have cut down unnecessary sophisticated features keeping Indian operating conditions in mind." Mr. R.H. More - Chairman

Going Global & Customised Solutions

One of the major business exposures of the company Mr.More says, "was through our first participation in Bauma Germany in 2004.The participation provided us a requisite international exposure and an opportunity to have a look of customized construction equipment displayed and also allowed us to have a thorough understanding of various requirements of concrete equipment from visitors based on various job site needs.

In the back drop of the international exposure gained, Universal formed its third business plan to go global in 2007 which runs during 2007-11. Initially, it was decided to make an entry into Middle east and African markets. "Following our decision to enter into international markets, we started the process of making dealership queries. The sizeable amount of sum was spent on the exercise then selected best dealers in the regions based on their technical expertise, network strength, the ability to support the equipment. Universal’s initial entry into the global markets has been in ten countries of Africa, Middle east, Australasia and Asia- Pacific.

Making of A Construction Equipment Conglomerate
Pune Plant

However, it was the forging of supply and international distribution agreement with Tata International Limited (TIL) in 2010 that provided Universal a bigger international marketing mileage. In the first year of our JV with TATA we have exported the machines of worth `25 crore and have set a target to achieve 100 crore by 2014.

The large marketing network developed by Universal at home and in international markets is driven by the company’s product support.

Our mini concrete batching plants and mobile concrete batch plants are one of the best examples of our customized equipment support that have been designed and developed by our R&D team so as to suit the Indian job site requirements. The mobile concrete batching plants are flexible machines which have a maximum setting time of four hours at the job site and can deliver exact output as per the concrete requirement of the site," he mentions.

He adds, "our concreting machines, precisely the mobile concrete batching plants, have advanced technical features, yet they are low on high end sophisticated features. We have cut down unnecessary sophisticated features in all our concrete equipment, on the contrary to the other European concrete equipment manufacturers, who earlier held their sway in the Indian construction sector. Creating concrete machines akin to Indian job site requirements, today provides us with largest market share in concrete equipment in the country with over 50% market share in reversible concrete mixer. As far as the international construction market is concerned, it is our ability to provide customized solutions that takes care of our sales. "Mr. More claims, Universal has a customer base of more than 15,000 using its concreting equipment in the country. The company’s equipments also according to Mr. More has been working at job sites in Oman, West Indies, Ghana, South Africa, Brazil, Kenya, Tanzania, Indonesia, and so on.

Taking a cue of the requirements, our R&D team has been competent enough to design and develop the equipment accordingly." He informs, "we invested over `5 crores during 2010-11 which has now gone up to `10 crores for R&D. Our R&D centre is one of the few in the country certified by Government of India."

Universal’s equipment portfolio is quite immense. Under concrete solutions, it provides, concrete mixers, combo mixers and slab trolleys. Its vertical material handling solutions includes: mini lifts, see saw hoists, multi go, and tower hoist. The bar processing solution consists of bar cutting machines, bar bending machines, and bar straightening machines. The sand processing solutions are rotary sand screening machines, vibratory screening machines, sand screening cum washing machines.

Making of A Construction Equipment Conglomerate
Rudrapur Plant–Uttarakhand

Its other product solutions include, block making solutions comprising, hydraulic block laying machines, auto ramming block machine and manual block machine.

Earth compaction solutions, weigh batcher, needle vibrators, wheel barrows, concrete asphalt saw are the other product support offered by the company. In addition, reversible mixers from 4-20cum/hr batching plant with reversible mixer from 12-20 cum/hr, mini dumpers, accessories, passenger cum lift material, suspended platform, works platform, batching plants with pan mixers, boom scrapper batching plants, transit mixers are the other products from Universal’s product portfolio. Mr. More said, adding "the products are cost effective and suits various job site requirements well." The company is in the process of manufacturing flattop tower cranes under Chinese collaboration having German design. It is also conceptualizing to manufacture luffing tower cranes. The cranes will be promoted in domestic and international markets, initially in the Middle east and Africa. "The cranes will be more user-friendly as like our other equipment," says Mr. More.

Making Cost Effective Equipment

Making of A Construction Equipment Conglomerate
Satara Plant
Cost competitive equipment are manufactured by Universal’s three manufacturing units. According to Mr. More, "our production plants have advanced manufacturing facilities which make the products cost and quality competitive." He adds, "Shindewadi plant has been equipped with multi state-of-the-art manufacturing facility, undertaking jobs with high precision backed by advanced machines including an ultra modern paint booth, while Shivare facility is equipped with plasma cutting CNC machines. The plant has seamless work area and EOT cranes for easy movement of heavier parts and machinery." He reveals, "the plant also has a full fledged CIDC affiliated training centre for imparting training to the operators of the machines. The facility also has a library with updated study material for engineers, technicians and operators. Shivare also has a full fledged R&D department to make sure that the new innovations brought to use to produce quality equipment. Our testing and quality assurance facility keeps up 100% quality deliverable."

Quality manufacturing standard is also claimed to be offered for the products rolled out from Universal’s new plant at Rudrapur which is 250 kilometres away from Delhi and was set up in January 2010. The facility is self-sufficient and well-equipped with all modern machineries comprising CNC and advanced material handling equipment. It manufactures all products from Universal’s product range. Rudrapur facility caters to the construction markets requirement of north and north eastern states of India.

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"Though we were exporting our products since 2000 but took a strategic decision in 2010 to go global in a big way and tie-up with one of India’s largest conglomerate Tata’s group company Tata International Ltd. to distribute our products, which has paid good dividend. With Tata, we have been successful in competing with European andChinese playersand have marked good foothold in Middle-East, Africa, South East Asian countries." Mr. Abhijeet More, Director

Retaining market presence and expanding footprint is also important for universal that will ensure its future top- and bottom-line growth. Mr. More says, "we have formed strategic business units (SBU’s) that will drive our present and future business. We have five SBU’s and each of them will cater to a specific segment of construction industry so as to offer a holistic solution through the products. Solutions are offered according to the customized requirements which differ from one project site to another. The broader idea behind the SBU’s is to provide better customer services so as to make our each construction equipment business more profitable."

He points out, "the retention of business is taken care of by our SBU number 5 which provides service spares, spares and rental support for the equipment." The company offers after sales service support through its strategically deployed service vans that ensures reduction of equipment downtime. Spare parts availability is ensured through the company’s dealership network and own regional offices. It also offers annual maintenance contracts.

Looking forward to expand the business portfolio, Universal has recently started its Constore which is initially, being set up at 5 locations in Maharashtra. It will keep and promote multi brand tools required for construction applications comprising testing tools and survey equipment, power tools and so forth.

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"The RMC plant at project site is the only option to ensure quality andconsistency in India,asno one can guarantee to transport RMC on time even atshorter distance due to road congestion which may lead to deteriorating quality of concrete. Universal has come-up with a solution of mobile and portable concrete batching plant for on-site RMC of various capacity which can be easily erected and dismantled in just 4 hours. On-site RMC plant saves transportation cost and precious time as well." Mr. K. K. Taparia. Deputy Managing Director.

The development of Universal Construction & Machinery Equipment is a modest engineering entity to a construction equipment manufacturing conglomerate has been met with challenges. This includes intermittent spirals of slowdown in the construction sector and high attrition levels in the industry. Most significantly, rising inflation is pushing production costs at present. Mr. More says, "tackling the impact of rising production costs, we have introduced efficient building mechanism in our production systems on a sustainable basis. We have started using PVC covers, panels etc in place of steel where structural strength is not required to reduce the cost as PVC is much cheaper than steel. The use of PVC will also not let the problem of corrosion as steel get corroded. The focus on human resource development is one of our key areas." To strengthen its presence, Universal is now planning to prepare its 20 years long-term business strategy. It has recently embarked on its 4th business plan in 2011 that will end in 2016. The vital part of this plan is to appoint 75 dealers at 250 different locations across the country. All which is well expected to build up its market presence in the mid and long-term.

Universal's Construction Equipment Park: A Centre of Learning

The Universal’s Shivare plant is surrounded by picturesque that produces concrete batching plants and transit mixers. However, the facility has its own distinction as it houses a construction equipment park displaying range of construction equipment manufactured by Universal.

Mr. More says, "the park is one of its first in India and is extremely beneficial for contractors, construction engineers, trainees, and civil engineering students who can get a flair on the applications and functionality of the equipments.

The park also houses a library which provides information description of gradual mechanization of Indian construction sector and information on historical evolution of concrete equipment.

Making of A Construction Equipment Conglomerate
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