Smeared with fake tag, Kerala-based Anand oil fights odds, revises ban on product
From shutting down his poultry business to re-establishing his oil factory and then fighting the case to revise ban on his product, Anand Oil's Aniyan has come a long way and has seen success as an entrepreneur
Due to skyrocketing prices, many adulterated coconut oil brands have flooded the market in the recent years, especially in Kerala. While the food safety authorities are cracking the whip on such fake products, a few genuine brands unfortunately have been caught in the storm.
Kottayam-based Anand Oil Industries also got tangled in this mess in 2015. The state food safety authorities had banned fake products bearing the same name as one of Anand’s products. While the fake product and its manufacturer remained anonymous, the stakeholder shifted the blame to Anand.
With no help from the authorities, TV Aniyan (55), Founder of Anand Oil, defied the odds to revise the ban and save his company from the brink of shutdown. He rebuilt the company, which is now seeing an annual turnover of Rs 35 crore.
The initial years
In 1989, Aniyan had invested Rs 15,000 from the Prime Minister’s Rozgar Yojana scheme (PMRY) into starting a poultry farm business. He started with 150 birds in his inventory. “Within three years, I developed my poultry farm to the capacity of 6,000 birds per month,” he says. “Then I stepped into the business of poultry and cattle feed.”
Kerasree product by Anand Oil
In 2003, Aniyan was forced to shut shop due to a poultry farming crisis. “I was left with no choice but to turn to a new business and I took help from my wife Noby Aniyan,” he says. “With the help of local authorities, we prepared and submitted a new project proposal worth Rs 22 lakh and named it ‘Anand Oil Industries’, a coconut extraction unit,” he adds.
With the support from the State Bank of Travancore (SBT), Aniyan started the unit in 2005 with a lease agreement of fifteen years. “Initially, we set up a small coconut oil extraction unit along with trading and distribution facilities. I gave job opportunities to fifteen people,” he says.
After seven years, Aniyan faced another shock. The landowner won a case to evict Anand Oil Industries from its compound. “At this stage, I could not close down the business as I had invested a lot of money in it. But I also had to obey the law,” he says.
Aniyan took this as a challenge. “I prepared a project worth Rs 1.5 crore to establish a new factory at Chemmanathukara in Thiruvananthapuram Panchayath at Vaikom. The SBT supported me again,” he recalls. “I established a modernised, fully-automatic extraction unit of 10,000 square feet while simultaneously running the existing business.” The new facility has a production capacity of 3,000 kg of coconut oil per day, he says.
The business flourished under ‘Kerasree’. “We crossed the golden line of Rs 30 crore turnover, and I planned to achieve a turnover of Rs 50 crore within the next five years,” he says.
Just as things were going smooth, the fake product case hit Aniyan like a “bolt from the blue”.
The fake product incident
“In April 2015, the State Food Safety Commissioner suddenly declared a ban order against an oil mill at Charamangalam in Kozhikode. Their fake product unfortunately was bearing the same name as one of ours - ‘Kerasree’,” he says. “The order did not specify the place and the name of the company. Anand Oil Industries and our popular product were grossly misunderstood by the public,” he recalls.
Due to this, the production was halted, sales fell and the company was into financial trouble. “The company was in a frozen stage for over a month,” he says. “However, I was self-inspired and did not get nervous. I told myself there was a way back and that I would not surrender.”
Anand Oil team
As an initial measure, Aniyan requested the food safety authorities to revise the order, but received no response. He then decided to take it up in the court and speak to the media and industry bodies about his predicament.
“I put a lot of effort and took it to the high court, news channels, newspapers, local industry departments, the KeralaSmall Scale Industries Association (KSSIA), and the Ministry of Micro, Small & Medium Enterprises (MSMEs),” he recalls. “Many well-wishers came forward to help us get out of this situation. Finally, the authorities took notice and the ban order was revised.”
“We were able to recapture the goodwill from the ecosystem, and now we are on our way to achieve our target of Rs 50 crore by 2020,” he says.
“We now sell our products through direct marketing, avoid agents and target an 80 km area around the company.”
Riding on this success, Aniyan has been honored with local industry awards, and has been selected as a faculty member of relevant trade bodies and a district planning board.
In the near future, Aniyan seeks to expand production and sales of value added products made from coconuts. “I hope my words and experiences will be an added motivation to young entrepreneurs,” he concludes.
(This story is published in partnership with the MSME Ministry to showcase success stories of SMEs)