Accurpress takes shape in India

By Narayanan Madhavan

For Accurpress Tooling Systems Inc., based in Surrey, B.C., India has been a sweet spot right from the word go.

India is, no doubt, a huge and inviting market, but for a small- or medium-sized company looking at a different culture, size is not everything, and the hurdles can be many.

Accurpress, however, can knock on wood. The company’s India unit, Accurpress International Sales Ltd., reported sales of about $20-million in the year that ended last March, says its sales manager, Gaurav Srivastava. That is significant, considering the company entered the Indian market just four years ago.

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Mr. Srivastava, a vibrant 26-year-old, is one of the five-member team in India for the company, which makes a wide range of metal-forming machines that help industries craft machine tools. Its machines range in cost between two million and 300 million rupees (about $44,000 to $6.7-million Canadian).

Perhaps what makes the company special in India is that its goods cater to a wide array of industries. Furniture makers, auto makers, ship builders, aircraft makers, railroad manufacturers, electrical goods firms and even kitchen equipment makers are among the company’s 100 customers in India.

As Indian firms refurbish their machinery and the country builds infrastructure and new industries to match growth rates with China, the market is just right for Accurpress. The privately held company, which has decades of technological experience that give it an edge, currently imports into India from its overseas plants, including Canada, but mainly in China. It does have competitors, including one Indian firm and others from Belgium and Japan, but Mr. Srivastava said that Accurpress has a clear advantage because it classifies customers into tiers one, two and three, and backs up its technology with sound after-sales services.

“We do direct servicing and we send service engineers by air,” Mr. Srivastava said.

Air travel for service technicians is not really common in India – like Canada, a sprawling country, with a very cost-sensitive culture – but it obviously works for Accurpress.

“India being a developing economy, we expect 100-per-cent growth over five years,” Mr. Srivastava said.

“Earlier, the machinery sales were at a nascent stage. Now things are moving like anything, especially in southern and western India.”

Mr. Srivastava is based in Ahmedabad, the business town of the booming western state of Gujarat, which counts textiles, pharmaceuticals, ship-building and oil refining among its key industries. Addressing small “tier three” customers is a challenge, he admits. These are companies that are short of working capital. Accurpress holds their hands by working out letters of credit from the Bank of China. It takes 25 per cent of its price in advance and sweetens financing for the remainder by tieing into some smart bank deals.

The company also minimizes dealings with government or tender-related work to avoid getting caught in red tape. “We are not interested in government tenders. We are more interested in corporate sales,” Mr. Srivastava said.

Also, while its goods are imported into India, Accurpress lets its buyers deal with customs authorities, which are somewhat notorious for inefficiency and working ways that do not exclude corruption.

“You have no idea the trouble they [customs] can give,” Mr. Srivastava said.

Customers are increasingly willing to pay for the right stuff. The Accurpress approach is to help customers select the right machines, and develop or modify products, including some “reverse engineering,” to keep them happy.

“We eventually plan an assembly and then manufacture in India. But it will take more time,” Mr. Srivastava said.