COUNT YOUR CHICKENS BEFORE THEY HATCH

SECTOR :  AGRI BUSINESS

ORGANIZATION : SUGUNA CHICKEN

MAN BEHIND THE IDEA : R.SOUNDARRAJAN

SYNOPSIS :  Soundararajan borrowed Rs 5,000 from his parents to start a poultry farm. When the industry faced a glut, he refused to chicken out. Today Suguna is a Rs 2,000-cr company. It was a time when the Indian Poultry was in a glut when Soundarrajan thought why not to use a working capital to stabilize the uncertainity.Hence they supplied inputs and the farmers became the converters .From 200 birds and a few hatcheries in the ’80s, Suguna now has 15,000 farmers under its contract farming model across 11 states in the country and produces 80 lakh birds (out of the country’s 450 lakh birds) a week employing 4,200 persons.Soundararajan’s contract farming model eliminated middlemen and reduced the number of players in the poultry value chain to just three — farmer, company and the retailer. “Until then the middlemen took away around 10% as commission. As a result, costs increased by 25%,” he says.Realising that it had overgrown in T.N it smartly started to expand in all places of India with the recent take over off venkateswara hatcheries which was a monopoly. Operating profit margins are hovering around the 5% mark now.