“The market will get distressed with immediate effect. Packaging board, which is almost 50 percent of our total production, has good potential, as it is used for packaging essentials like pharmaceutical, food, cereals, etc.,” says Mr. R N Agrawal, Chairman & Managing Director, N R Agarwal Industries Limited.
Paper Mart: What is your plan for overcoming the impending workforce crisis in the coming months?
“The supply chain completely relies on manpower. It is the backbone of logistics. Absence of manpower in the system, as mandated by the government, has brought the movement in the supply chain to a halt.”
R N Agrawal: Because of this pandemic, workforce crisis is inevitable. We need to handle it with compassion and humanity. The phenomenon will be the same for everyone; we are not an exception. The key point here is that the paper industry is a highly skilled workforce’s domain and the operation and engineering teams are under direct payroll. There are also contractual workers for unskilled work, and that may get affected. We have to tackle the situation as and when it arises. Being located at the industrial hub gives the advantage of selecting from multiple options for contractual workers at the time of need. We strongly feel that this situation can be tackled with the increased efficiency levels of our team.
PM: Disruption in the supply chain might have caused trapped payments or finances for an extended period of time. What strategies or solutions are you looking at for mitigating the downward impact?
RNA: The supply chain completely relies on manpower. It is the backbone of logistics. Absence of manpower in the system, as mandated by the government, has brought the movement in the supply chain to a halt. Orders have been lying pending for quite some time, as factories, companies and warehouses are shut in a prompt response to the global health emergency. With no one to pick up or deliver and nothing to sufficiently deliver at all ends, it has weakened the smooth orchestration of trade. To combat the same, we have planned to rationalize our immediate expenses, including development activities throughout the company. Also, we are trying to get all receivables from our customers and only accepting the order with quick sale potential. All said and done, this interruption will have a downward impact on our regular cash flows. We need to handle them very carefully.
PM: What steps are you taking to manage the logistical disruption?
“Packaging board, which is almost 50% of our total production, has good potential, as it is used for packaging essentials like pharmaceutical, food, cereals, etc.”
RNA: We see this as a two-fold challenge. One of them is time due to congestion for the backlogs and the other is increase in price of logistic services due to sudden demand after the lockdowns have been lifted. A major share of our finished good is being transported through roads, and we feel that will also get interrupted due to sudden rush. We can make action plans as the situation emerges post-lockdowns.
PM: Business operations in the coming years will have to be run by SOPs like social distancing, hygiene, etc. What is your plan of action going forward as regards this issue?
RNA: The health and safety of our employees are of utmost importance. As we are operating partially now to continue the emergency services, we have already implemented the norms for social distancing, disinfection tunnels, distributions of masks and sanitizers to eliminate the possibility of infection.
PM: What kind of market trends do you foresee in the initial couple of quarters post-normalcy and beyond 2020?
RNA: The market will get distressed with immediate effect. Packaging board, which is almost 50 percent of our total production, has good potential, as it is used for packaging essentials like pharmaceutical, food, cereals, etc. However, grades like writing and printing and newsprint will see a decrease or no growth in demand as an effect of the ‘work from home’ practice, online education systems, etc., which have got accelerated because of the pandemic.
