Staying afloat amid pandemic is equal to making profit

Dated:

1 should focus on keeping the supply chain smooth by churning out products and rendering services instead of making profits in 2020 as people are facing a huge challenge to survive because of the coronavirus pandemic, said Syed Alamgir, managing director of ACI Consumer Brands.

"If you are alive and your business stays afloat despite the raging pandemic, this could be your best profit," he said in an interview over telephone with The Daily Star last week.

"If anyone wants to make huge profits now, they will be loser in the long-run."

Alamgir is a well-known figure in the country's consumer brands' segment thanks to his long career spanning more than four decades and he has been called a marketing superstar by the Bangladesh Brands Forum (BBF).

In order to ensure proper service, ACI has kept its supply chain up and running by maintaining all health-related rules so that its products do not spread the contagion and people can access them at affordable prices at the same time, he said.

"We are rendering services to the countrymen by supplying many hygiene and sanitary products needed at this crisis hour to safeguard their health and environment."

Alamgir thinks that ACI Consumer Brands, the maker of ACI Aerosol, Savlon, ACI Mosquito Coil & ACI Pure Spices and Flour, would make a huge contribution to the nation through their day-to-day necessary high-quality products at affordable prices.

"If we can survive and our business can survive in 2020, we would say in 2021 that last year was a good year."

The lockdowns and travel restrictions imposed by the country have led to a steep decline in business activity. Many people became jobless and their consumption and spending has been affected, hitting businesses and the economy hard.

About 15 lakh retail shops were partly closed all over the country. Around 60 lakh people were employed at these shops and all of them bore the brunt of the shutdown, he said.

Many companies supply products to these shops where day labourers are used. This poor people have been hit hard as many of them had no work during the period.

Impact of coronavirus on a densely populated country like Bangladesh would be more severe and it would take time to get rid of the pathogen, Alamgir said, referring to the World Health Organisation.

"The impact might be dreadful to our economy."

Remitters are struggling due to job cuts in the host countries. As a result, remittance would decline and this would hit the economy in the coming days, he said.

Around one crore people in the rural area are dependent on the remitters. So, the rural sector may endure a painful journey because of the sharp fall in remittance flow, he said.

The spending and consumptions of all affected peoples might drop and it will continue for a few years. "As a result, businesses will be impacted and the economic growth would decline."

Despite a rise in the price of the imported raw materials and transportation costs, ACI Consumer Brands has not increased the price of its products to keep them affordable for the consumers.

"In ACI, we have continued our production on the basis of a policy, that is "service is the first and foremost thing."

"Consumers need ACI products even during the lockdown. So, we have kept producing despite the huge risk posed by the deadly virus," he said.

Alamgir, who had previously worked for British pharmaceutical company May & Baker, Pegasus Shoes, Jamuna Knitting & Dyeing and Aromatic Cosmetics Ltd, has introduced many ideas in the fast-moving consumer products segment that shook the markets.

He shot to fame when he pioneered the idea of halal soap in Bangladesh in the 1990s as the marketing director of Jamuna Group of Companies.

The 'halal marketing' has kickstarted a worldwide marketing phenomenon and made him the first Bangladeshi marketeer to be cited in the 13th edition of the prestigious marketing book "Principle of Marketing" by marketing guru Philip Kotler.

He was also the winner of the first-ever Marketing Superstar Award in 2019, according to the Bangladesh Brands Forum.

In 1998, he joined ACI, one of the fast-growing FMCG companies in Bangladesh.

He has initiated many brands in the company. One of them is "Pure" brand. The brand was launched in 2005 and was awarded seven times by the BBF as one of the best brands in the country.

"We are running the business on two mottos now. One is ensuring safety for our employees and the other is to ensure product availability in every corner of the country."

"If we don't supply products, it will create problems in the market," said Alamgir, who completed his MBA from the Institute of Business Administration under the University of Dhaka and received PhD from the New Castle University in the US.

Alamgir welcomed the various stimulus packages introduced by the government to help people, companies, businesses, industries, entrepreneurs and farmers to stay afloat during the pandemic.

"If the stimulus packages are implemented properly, the private sector will get some relief surely."

He called for reconsidering the recent 60 per cent hike in bus fares as it would increase the cost of living for the people, who are already suffering because of the loss of livelihoods.

The government should not turn away from its focus on lowering the interest rate in the banking sector to the single digit, he said.

"A lower interest rate will give a big relief to the private sector."

He acknowledged that the banking sector is in trouble for high non-performing loans and for the new responsibility of channelling a majority of the funds under the Tk 101,117 crore stimulus packages.

"But a higher interest rate will not ensure profits for banks. Moreover, a lower interest rate may encourage the private sector to take loans and repay them on time."

The sales of ACI were affected during the shutdown and the production of some products was disrupted due to a lack of raw materials, he said.

 For instance, the supply of Savlon liquid, a household name, has failed to keep pace with the sharp rise in demand as people rushed to the item to stay hygiene as part of the efforts to keep the virus at bay.

"There was a dearth of the raw materials needed for the product as sourcing countries also faced lockdowns and they needed more sanitary products as well to meet the demand in their respective domestic markets."

Demand for sanitary products in Bangladesh surged suddenly and it was not easy to scale up production abruptly, he said.

Now some sourcing destinations are reopening their business, allowing ACI to import raw materials in large volumes.

The company is hopeful that it would be able to ramp up the supply of the product within a short period of time.

Savlon and Aerosol are the top two brands of the company where Savlon occupies 83 per cent share in the antiseptic category and Aerosol 94.6 per cent in the insect killer category.

Alamgir sees a silver lining in the pandemic.

"The pandemic has spread all over the world and prompted all countries to get to work to find a remedy to treat the disease."

This has not been the case in case of dengue fever although the mosquito-borne disease kills many people in Bangladesh, he said.

According to the Directorate General of Health Services, 101,354 dengue cases were reported in 2019 and the number of deaths was 156.