Banks should lend without collateral

Harshini Perera

The economy today is a road paved with gold and what one has to do is to bend down and pick them up. The secret of my success was the dedication and resolution to become one of the largest exporters of gloves from Sri Lanka, Hands International, Chairman and Managing Director Graetian Gunawardhana told Daily News Business.

Following are excerpts of the interview with him

Q: What was the growth you had for the last few years?

A: During the recession period, we have had an almost 70 percent effect on our businesses. We regained our growth soon after that by 100 percent and beyond for the last few months.

The main reason behind our growth is the confidence the global market kept on us. Our experience and proven track record has been our strength throughout the period and our buyers therefore decided to invest with us.

Q: What are the future plans of your company?

A: Our plan is to be one of the best glove manufacturers in the world in five to ten years.

I have been involved in manufacturing fashion gloves, intimates and apparels as well.

Q: How do you see competition?

A: We need to be innovative to face the competition.

As a form of facing the competition, we do not buy fabric anymore. We do every product in yarn and do our own knitting.

All the functions are done in one place as the backward integration of the company. I think without that one cannot compete in the market.

Q: What are the new developments taking place in the glove industry?

A: Earlier we were doing different types of gloves but we have diversified from that to make fully knitted gloves. We currently have 500 machines and we expect to increase the number of machinery to 3,000 to cater to the current demand and to become one of the best companies in the world in manufacturing gloves.

The commercial banks in the country should help us in getting infrastructure to the company and we invite foreign investors as partners to the company. We need to have professionals recruited to expand our scope.

We have stepped into intimates and fashion gloves and we have to be innovative in catering to the international market. I am involved in many of the backward integration of the company.

There is a difficulty in finding the required workforce for the factories. The Government needs to provide facilities for the workforce to improve the industries.

We have planned to set up a factory in Kilinochchi soon but there are difficulties faced with transport at the moment. There should be proper loading and unloading facilities at the railway stations.

Q: What is the progress of the company that you will start in Kilinochchi?

A: I visited the place last week and met the party who will manage the place. People are available and the place is bubbling with enthusiasm.

We will try to start very soon. We need the Government to give us loading and unloading facilities at railway stations because it is too costly for containers to go by road.

Q: What is the support you request from the Government?

A: We need the Government to encourage Sri Lankan entrepreneurs. We should be given more support from the banks.

The interest rates for loans are too much for local entrepreneurs. Loans have become unbearable for entrepreneurs. Banks should lend to customers for good projects particularly tourist projects and export projects without asking for collateral.

Q: What are the emerging markets for gloves?

A: We are currently exporting to the whole world and we have seen a growing demand for winter gloves from countries such as India, North Russia, Czechoslavakia, South America, Africa, Ukraine and Hungary. India is the largest market we need to tap because just like in Sri Lanka, India does not use industrial gloves. So we have seen India and Africa as emerging markets for our products.

Q: What is your market share in the world?

A: We are currently contributing to one buyer who has a market share of 30 percent and 70 percent is divided within another 20 players.

Q: What will be your new investments?

A: We need to invest in a new dripping machine worth US $ 10 million. We need additional 500 knitting machines with an investment of US $ 15 million.

Q: What is your target for this year?

A: We expect to have a 50 percent growth for this year in terms of new products. Knit gloves will be the new products that we expect to promote.

Q: What are the new diversifications you have taken?

A: We have seen many prosperous opportunities in the tourism industry and I will be investing in eight hotels under the name of Lanka Leisure Resort and Tours (Pvt) Ltd.

I need to get into partnership with locals and develop these resorts with an investment of US $ 25 million. We have plans to set up hotels and resorts all over the country such as in Nuwara Eliya, Sigiriya, Uswetakeyawa, Ambalangoda, and an Airport transit hotel in Katunayake.

We will be investing in a Ayurvedic Resort at Katana soon. I have acquired 30 acres in Sigiriya and I have a plan to set up a palace in front of the Sigiriya rock for tourists. I went to Rajasthan to search for an architect who can build one for me.

Q: What is your advice to young people who are eager to climb the corporate ladder?

A: My advice to young people is to be dedicated and focused on what you do.

There may be many challenges and one who is eager to achieve higher goals should never discouraged by challenges. There are a million ways for one to solve problems.

Q: How do you spend your leisure?

A: I engage in card games and enjoy time with my two grandsons who play rugby. I spend my leisure going out shopping with my grandchildren.