In 1998, M I Siddiqui, a resident of Muzaffarnagar in Bihar, left for a trip to Bombay with his 19-year-old cousin. The latter was heading to the city to enroll in a computer hardware course, so Siddiqui decided to accompany him. What was supposed to be a 15-day trip turned out to be a permanent shift to Mumbai, and Siddiqui’s life changed completely.
Narrating his journey to The Better India, Siddiqui says he had just completed his graduation and took the trip before beginning to seek job opportunities in his hometown. On the trip, he found himself intrigued by the course, and decided to enroll in it. “My relatives in Mumbai, who we were staying with, told me that a career in the field would boom, as computer technology was entering various sectors at the time,” he says.
From here, Siddiqui struggled his way to become a multi-millionaire in the bag manufacturing industry. He began his journey from the slums of Dharavi by borrowing Rs 5,000 from friends, and has since grown Cosmus, his endeavour, into an entity with a turnover of Rs 35 crore.
A small start
After Siddiqui completed the one-year course, he joined a small computer company in Mumbai. “The work did not interest me, as it mainly involved installing computer hardware and software. There was no opportunity to implement what I had studied. Hence, when an opportunity arose to work with Coca-Cola in 2000, I joined a small firm to embed computer systems for their stock management process. A year later, a better proposal arrived from Cadbury’s in the marketing department, and I switched again,” he says.
He worked to increase the sales of the company by demonstrating penetration in multiplexes and supermarkets. Eight months later, he quit this job to briefly take on a path of spirituality. He changed his attire and grew out his beard. “I struggled to find a job in the corporate sector, as companies demanded a certain dress code and presentation skills. I remained unemployed for ten months, and realised no one would hire me with this new look,” he says.
Aware of Siddiqui’s plight, his friend Azad, who lived in Dharavi and owned a printing business, offered that they start a business together. “My father is a doctor and owns a pharmacy store in Bihar, so my family’s financial situation was stable. I dialled my father and requested Rs 5 lakh to start the business. But he scolded me instead, because he was upset with my continuous changing of jobs. He refused to lend me money,” he says.
With no other alternatives, Siddiqui turned to his friend to loan him the money. “Azad paid my share, and we set up a bag manufacturing business by the name of Flora Gift in Dharavi. We invested Rs 30,000 to purchase three sewing machines and raw material. We even bagged a contract for 300 bags, but incidentally, Azad received another offer in the printing business, and decided to wind up our store,” he says.
With his loan amount piling up to Rs 28,000, Siddiqui decided to continue to business. “I promised Azad I would repay the sum in the coming months, and convinced the landlord to extend the rent of the manufacturing unit for the next three months. I reached out to my friends to buy raw material, and borrowed Rs 5,000 to start Cosmus,” he says.
Beating the competition
However, the entrepreneur had only two artisans, three machines, and no knowledge of production. “I was a marketing person, and had to learn all aspects of producing bags. To get orders, I searched for potential clients on Google and traced them. I bagged the first contract from Orange, a mobile telephone company, by offering them a quote that was less than the competitor’s by Rs 40,” he says.
Quoting such a low amount also created doubts about the quality and delivery. “I explained that I work with low margins. My profit margin was Rs 10 per bag, and that is how I could beat the competition. Slowly but steadily, I reached out to other corporate companies like Cipla, Ultratech, and P&G to make bags for them as per their requirement,” he says.
Keeping his profit margins low, Siddiqui established himself in the corporate sector and started looking to enter the retail market. “I requested my younger brother, Irfan, to join me, because he had an MBA, as well as knowledge in the retail sector. He worked for a month and set up a retail store worth Rs 4 lakh. Unhappy with the unorganised operations of the bag industry, he quit and moved abroad,” he adds.
With his investment stuck, Siddiqui continued to focus on the corporate sector. Understanding the issues of the industry, he started streamlining his business. “I knew the sector was unorganised and lacked professionalism. I always fulfilled my commitment towards the client, but it became difficult to manage the staff, which had expanded. I introduced software and technology to streamline the inventory and manage staff,” he says.
High on quality, low on price
In 2008, Riyaz, a friend of Siddiqui’s who had been working with another bag manufacturing company, quit his job and turned to him for help. “He had experience in retail marketing and offered to clear the locked investment in the retail store made by Irfan. Riyaz expanded the retail market, while I managed corporate orders. The move increased the outreach and allowed direct sales to the customers,” he adds. Over time, the product range and quality of the bags also improved.
By 2010, Siddiqui also launched his products on online platforms. “To meet demands of online orders, I increased the workforce to over a dozen artisans, and made hundreds of bags per day. But I had no budget for marketing. So I priced the bags keeping zero profit margins. I made sure that the quality of the bags improved. The customers would review the product for its quality, which helped give the brand publicity. The products had ratings ranging from from 4.2 to 4.9 out of 5,” he says, adding that the effort paid off, as his sales escalated from Rs 5 lakh to Rs 25 lakh in four years.
As the business grew in the corporate, retail and online segments, his profits increased. From a small unit, Cosmus now has a five-floor factory in Dharavi. Siddiqui has been able to buy a flat in Bandra and hire over 150 employees.
Vijish Kurup, brand manager, says that all bags undergo 40 checkpoints before they reach the market. “We make and sell duffel bags, school bags, and laptop bags, among other types of products, which are priced 30 to 40 per cent cheaper than those of competitors. Assuring quality products at low prices has always been the philosophy,” he adds.
At the age of 41, Siddiqui says that people can excel in any field if they put their heart and sincere efforts towards it. “India has plenty of opportunities in all sectors. One can always achieve more than what they expect, provided they put in hard work,” he adds.
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So I recommend to go for it
Edited by Divya Sethu
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