Corporate

DTI Paging

Plans of A Late Entrant

The newest and fifth entrant into the pager market foresees a challenging future, but is confident that it will make its mark

Kansal:Consultant Entrepreneur

With the Industrial Revolution, big countries of the West established themselves as developed countries, giving most Eastern countries the name of being under-developed or least developed. But now the information revolution has provided countries like ours with another opportunity to close in on the development gap, views Shashank Kansal, development director of DTI Paging, the newest entrant into the already seemingly crowded market of pager service providers. At a time when cell phones, e-mail and internet have become near basic necessary communication modes, where does the pager stand?

Kansal feels that although mobile phone is a very convenient portable communication equipment – very much like the pager – it is seen, especially in a developing country like Nepal, more as a luxury item because the expenses one has to dish out to acquire the services (and also pay monthly bills to an extent) puts the mobile out of reach of ordinary people. Not so with the pager, Kansal remarks. "Once the guy understands the utility value of the pager, Rs. 250 a month is nothing". Kansal has even coined a phrase to describe the pager: ‘smart people’s mobile’.

Set up as an alliance of Saloni Trade Concern and International Marketing Services, DTI Paging is a new player as opposed to Agni Paging, Nepal Radio Paging, KAT Easy Paging and City Paging. However Kansal does not feel that his company is at too great a disadvantage. His late entry into the market could actually prove to be an advantage, he reasons, pointing out that he may not be required to educate the people about the pager since the companies before his have already taken care of that. He admits, however, that competing with these more or less established players is not going to be easy by any means. At the same time he is confident that his company will not be edged out of the rat race and in the long run, he will be the one standing.

Because, he claims, he and his partners in this business (Technical and Finance Director Nawal Sawarthia and Administrative Director Ramji Shrestha) understand the service part of the business. Sawarthia and Shrestha have been dealing in mobile sets for a long time, while Kansal himself is senior vice president of WorldLink Communication.

To underline his point, Kansal explains that Kathmandu, as other parts of the country, has varying terrains owing to Nepal being a mountainous country. Which means that some areas in the Valley – like Jawalakhel and Dillibazer – are on a higher terrain than some other areas. Kansal claims that a pager user in the shadow area – which is the area behind a high terrain – will not receive any signal in his pager. It is necessary, he insists, that more than one transmitter be put into use to cover all shadow areas within the Kathmandu valley. And DTI Paging has actually done that, claims Kansal, adding that he could have chosen to ignore the fact like his counterparts. But he didn’t, because of his commitment to provide his customers the best service possible, boasts Kansal.

DTI is investing a huge amount from Nepali standards for its infrastructure. "The target is a nationwide operation, and the emphasis in on making sure that quality of the service does not suffer", says Kansal. According to him, besides the generator, DTI has battery back up for three days.

This attitude of putting service before business will put him in good stead in the long run he believes. It will definitely mean operating costs soaring up but it will ensure that customers get the ultimate service, expresses Kansal, who also says that his team’s motto is "service, service and service".

He claims that this is another reason for his decision to go outside the capital with his pager service in the very near future. Although it is obvious that Kathmandu is the most commercially viable city, Kansal believes that the telecom and the information industries are not basically commercial industries but development industries. "A person may not know whether he needs a pager. We will teach him obout the utility of the instrument, and develop our market", he says. As far as venturing into markets outside the valley is concerned, Kansal reveals that commercial towns like Pokhara, Biratnagar, Butwal and Birganj feature at the top of his plans because that would ensure that operating costs are met, if nothing else. It would then be easy to approach markets like Nepalgunj and Mahendranagar in the west and Jhapa in the east, views Kansal.

Asked about his involvement in DTI, Kansal says internet and telecom convergence is his main area of interest. Therefore, his involvement with DTI is short term, and is related basically in initial setup of the company.

Kansal’s opinion about the number of potential users within the valley varies from that of his counterparts’. While other companies believe that the pager market is only 20 to 25 thousand users rich, Kansal puts that number at 45 thousand plus. And unlike other pager service providers, Kansal does not target a fixed group as potential users. ‘I see everyone as users; the business community people, students, media persons, doctors, technicians – everyone", he says.

DTI Paging at the moment provides auto-paging service and alphanumeric paging, making DTI the only company to date to provide both services, Kansal claims. The signs from the very beginning have been extremely encouraging, he says, as 500 customers applied for acquisition of DTI service in the first 15 days. With plans of including numerous value – added services in the time to come and with emphasis on providing quality service, Kansal feels that the market is really unlimited.

DTI Paging, according to its development director, employs around 40 people at the present. As soon as it begins full-fledged service in Kathmandu, the company is to employ about 70 people. And once the business expands to other parts of the country, the number would go over 150. He opines that the indirect employment with the utility of the pager and his companies subcontracts shall soar hotling less than 500 people.

All said and done, Kansal views that it is the quality of the service that will ensure sustainability of any service provider in the long run. And he believes this is where DTI Paging scores over other pager companies.

-By Business Age Reporter

ATC Exim:

Remaining Small,
Yet Happy

While most of the business houses are diversifying into manufacturing, this Marwari family, one of the oldest few in Nepal, prefers to stay in trading

We were one of the first Marwari families to come to Nepal", relates Ashok Kumar Agarwal taking his mind way back to a century ago when his father and grandfather had moved into Nepal.

Agarwal reveals that his family had always been involved in trade, ever since the early days when, as per the government policy, licence for import were issued against export. Which led to businessmen, including the Agarwals, importing items that varied from spices to umbrellas and shoes to chemicals.

Times have changed and so has the policy of the government, over the years. Agarwal, however, is not too keen on diverting from trading. Not that he has never been involved with industrial ventures. He in fact had set up a unit – Himal Petro Chem - that manufactured parafin wax used in the making of candles and match sticks. The unit, however, had to be shut down owing to technological and labour problems, according to Agarwal.

Agarwal also claims that he has the capacity to assemble television sets here. The smallish market size has led to the shelving of the plans as of now, he reasons.

Agarwal’s flagship company – Ashok Trading Concern Exim (P) Ltd. (ATC) - basically deals in electronic items. Agarwal also has a number of computerized colour labs in operation under the name Peacock. He is also involved in trading eatable consumer goods under Maruti Trading. Besides these, Agarwal distributes pharmaceutical products under Unique Trade Link which is based in Birganj. The varied nature of Agarwal’s line of business becomes evident from the fact that he also runs computer and Internet related business – one in Biratnagar under ATC Communications, and another in Birganj under Cyber World.

In the field of electronics, Agarwal is the agent of South Korean giant, Samsung. He began with Samsung colour television some five years back after the earlier Nepali agent of Samsung had to discontinue the dealership for some reason. Two years down the line came Samsung refrigerators, washing machines, vacuum cleaners, micro-wave ovens and the like.

In the colour television segment, Agarwal claims that he now holds somewhere between 10 and 15 percent market share, which he believes, reflects a satisfactory growth.

Although Samsung PC monitors also were introduced here by ATC, Agarwal says that he had to stop dealing in them because Samsung monitors were, from time the time, coming from Singapore. While some other company has now taken up the distributorship of Samsung PC monitors, ATC is involved in distribution of DBM brand of PC monitors, informs Agarwal. "Samsung is a globally recognized company and manufactures articles ranging from needles to satellite, and it is also satisfied with us," says Agarwal. Which is why ATC is looking to market more of Samsung products in Nepal, he adds.

As far as growth of his group is concerned, Agarwal admits that it might be slow as compared to the growth of some other big business houses. He is however happy that he has peace of mind. He informs that he has preferred to take as little risk as possible, which is why he has chosen to stay away from bank loans. "Because", he reasons, "if the business succeeds, well and good, but if it doesn’t, then it is a question of losing reputation and integrity."

He also views that the industrial sector of Nepal is not looking healthy at the moment, with traditional industries like textile doing badly. He thinks that the problem is mainly due to limitations of the market. Likewise, the dearth of innovative ideas has led to a tendency among people to jump into any business in which other persons seem to be doing well, he points out.

Agarwal relates that there are problems also in border towns like Birganj where Indian markets play major role. The reduction of price of commodities in the Indian market has a telling effect on our own business, remarks Agarwal. He points out the example of colour labs, which he claims he was the first to set up in Birganj. Due to the price of inputs like paper and films in India going down as opposed to here, business has fallen, he relates.

Agarwal points out the example of the cable car business, which is a new idea and is also doing well. It is time people began to think in those lines, he says. Because as the situation stands now, where most business are not doing well, it is almost a case of unemployment of the business community on one hand and survival of the fittest on the other, he views.

-By Business Age Reporter

Group 4 Securitas :

Business of Security

Attracted by the traditional reputation of Nepalis for their loyalty, integrity and gallantry as security personnel, Group 4 Securitas came into Nepal in June 1996. In less than four years down the road, this Multinational Company (MNC) has established itself as the leader in the professional security service business in the country, winning most premium of assignments, the latest being that of providing entry passes to the Tribhuvan International Airport, Civil Aviation Authority Office

Number of MNCs coming into Nepal is growing in recent years, though there also are complaints that the environment here is not so conducive as in neighboring countries. While some MNC’s have entered Nepal just to register their presence, Udaya Bir Gurung, Managing Director of Group 4 Securitas Nepal (P) Ltd. says, his company is here with a long-term business commitment. In the process of fulfilling the commitment, this MNC is utilizing one of the competitive advantages that Nepal has – the traditional reputation of Nepalis as highly professional security men.

The story of Group 4’s entry into Nepal started with a trip here by Group 4 Secutitas (international) B.V. owner and Chairman, Jorgen Philip-Soresen in 1993. He saw the potentials here and thus decided to enter this market, recounts Puran Rai, the General Manager of Group 4 Securitas Nepal. When Philip-Sorensen visited Nepal later in 1997, he met the then Prime Minister Lokendra Bahadur Chand and promised him to carry out professional training activities for new recruits of the company to make them capable of taking up assignments here and where possible, abroad. Similarly, in February 1999, Philip-Sorensen was again in Nepal and he not only met the then Prime Minister Girija Prasad Koirala to whom he reaffirmed his company’s earlier commitment, but also oversaw the signing of an agreement between Group 4 Securitas Nepal and HMG’s Employment Promotion Commission. Under the agreement, Group 4 is to provide a month-long basic security training to 50 selected Nepali youths at a time, so as to enable them to undertake security jobs here and abroad.

The vision, according to Gurung, is to develop Nepali youths as professional security personnel required by the modern world, where the present day complexities have created a demand for well-trained security professionals. And the strategy that Group 4 Nepal has adopted is to train the Nepali nationals along these lines. Security business has now come of age on Nepal with about 50 companies registered to run such services. "Competition is high", agrees Gurung, but hopes it would bring better management practices and thus quality services. This would also create awareness of the need for professionalism in private security services, he adds.

Pointing out the required improvements in the legal framework, Gurung says that despite the outgrowth of security service providers in the market, the country still lacks proper definition of the authorities and limitations of a security company and its employees. Neither are the basic security equipment to be provided to the security personnel defined by the law.

That may be an indication that the number of registered companies notwithstanding, this industry is still in infancy stage here. Registered in April 1997, Group 4 Securitas Nepalis to provide its guarding services followed by its other technical services so as to provide a comprehensive and integrated security service in the market. Therefore, the strategy adopted by Group 4 in Nepal is to introduce more of its services here and, at the same time, to promote professionalism in this business. Therefore, the company’s focus is not merely on expanding its business alone but in developing professionalism in this sector, according to Gurung.

In this process, Group 4 has already introduced three additional services apart from guarding services. Though Cash-In-Transit (CIT) has been introduced recently, Technical Security System Services and training and consultancy have been there from the very beginning. However, the recently introduced CIT service has suffered some setbacks due to lack of government policy in allowing import of necessary equipment needed to provide full fledged CIT service, moans Gurung.

Guarding services have been the major source of revenue for the company in Nepal. Within less than three years of operation, the company has already occupied a hefty 45% market share in providing guarding services. Electronic Security market is an ever-growing sector in which the Group has contributed towards its development. And Gurung further goes on to add that the company has a market share of over 50% in this field. The reasons are the company’s strength in its professional team members and the technical and other support it receives from Group 4 Regional and Head Offices. These two strengths have certainly helped his company to bag and retain many prestigious assignments after its incorporation in Nepal. The first assignment it got was that of US Embassy and its associated establishments. "Group 4’s repution in security services means added value as our guards are trained on different aspects of security, safety and emergency procedures. The mobile patrol back-up with walkie-talkies supported and coordinated by our control room, help us to provide our clients many additional services free", Gurung says and recounts a story of how one of the guards helped the wife of a client to get to the hospital in time when she suddenly developed labour pain while there was no adult at home.

According to Gurung, the company has so far trained some 2100 persons, and about 1850 of them are presently with Group 4 in assignments within and outside the country. Group 4 Nepal has been training people in guarding profession with a blend of 70% ex-servicemen and the rest from civilian background.

Though both ex-servicemen and civilians have been made to undergo the training, Gurung accepts that the former have had some prior experience in security in their previous career. "However, private security service is different from those of armed services of the government and thus the ex-servicemen are also required to undergo our training." He further says that this is a service industry and it is a company culture for every one to undergo training prior to joining the Group.

Guards trained by Group 4 do not, however, get overseas assignment immediately after training. Unlike other foreign employment companies, Group 4 has not made it an important source of revenue. It has been using the overseas job opportunity both as an incentive as well as valuable exposure to the guards to improve their skills "The boys are sent on deputation to other Group Companies and on return are immediately observed by us as they are still working for us", says Gurung. So far, the company has sent abroad about 75 persons to the Middle East to Group 4 Sister Companies and it charges a one - time fee of Rs. 4,000 per person from the Group Companies which is to cover for the communications and other administrative expenses, according to him.

In guarding services, the company has now matured enough, as indicated by the fact that its corporate office no longer looks after management of this business. Two branch offices have been set up – one in Kathmandu and the other in Hetauda while a third one is coming up in Pokhara. "This is expected to help administer and monitor our services closely so as to provide effective service and support to our valued clients" says Gurung.

The company is making its training services a revenue earner, meaning to offer the service to other private sector clients who may send their security personnel to Group 4 for training. "It will not only help us earn some revenue, but also in fulfilling our commitment to Nepal in developing professional security personnel and services", views the Group 4 MD. Similarly, consultancy on security system, conducting security audit and installation of security equipment in the client’s premises are other sources of the company’s revenue. Several Group 4 companies around the world are producing specialized security system equipment, and the focus of the company in Nepal so far has been in installing Close Circuit TVs (CCTV), Access Control, Intruder and Fire Alarms.

Despite being a subsidiary of an MNC, Gurung calls the Group a Nepali company, pointing out to the fact that the entire management of Group 4 Securitas in Nepal consists of Nepali staff. Senior managers in Group 4 Securitas Nepal at the operational level are mostly those who are retired from senior positions of army and police services. However, the company also has its staff strength blended with ample number of civilians experienced in the field of management, system and marketing.

-By Business Age Reporter

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