Steelbird Hi Tech: How Subhash Kapur built a Rs 150 cr empire from helmets
I started research on the product in 1971, even imported a helmet from Germany. Two years later, I was ready to launch my company with a seed capital of Rs 2 lakh.
In the 1960s, a person died in a road accident in India every five minutes, and I recognised the crucial role helmets could play in lowering this statistic.
I was involved in family business—trading vehicle oil filters—having joined immediately after completing my matriculation from Delhi University, in 1959. However, I was ready to branch out on my own by tapping this new opportunity. So, I decided to manufacture helmets.
I started research on the product in 1971, even imported a helmet from Germany to understand how it was made. Two years later, I was ready to launch my company with a seed capital of Rs 2 lakh. This included my savings and some money from the business.
I also borrowed the name from the family business— Steelbird Industries—and decided to call my company Steelbird Helmets.
To begin with, I rented a 4,500 sq ft space at Ganesh Nagar, Delhi, paying Rs 225 a month. I installed a fibre glass shell, a furnace and other items like cutters and paint sprayers required to manufacture helmets.
Our first product was Mayur, an open-face helmet.
Finally, in mid-1973, my venture was up and running, manned by 20 people. When we started, we had a production capacity of around 150 helmets a day; today, the combined capacity of all our factories is 8,000 helmets a day.
However, it has been a slow road to success. The main problem was that there weren't many takers for helmets in those days.
Besides, there were only two companies, Lambretta and Vespa, which manufactured a total of 3,200 vehicles a month. Making matters worse was the low awareness level regarding the importance of helmets. So our sales were low despite the attractive price tag of Rs 70.40 per helmet. Still, against all odds, we had sold 115 units within a month of starting operations, making Rs 8,000, all of which was ploughed back into the business.
One key factor working in our favour was the network I had established while selling oil filters. These auto accessories dealers and shop owners now became a ready customer base for our helmets, and we soon rolled out three new helmet designs.
In the first year of operations, our turnover was around Rs 7 lakh. Since one of our objectives was to save lives, we organised several campaigns aimed at increasing awareness about wearing helmets. We also advertised aggressively on television.
I was involved in family business—trading vehicle oil filters—having joined immediately after completing my matriculation from Delhi University, in 1959. However, I was ready to branch out on my own by tapping this new opportunity. So, I decided to manufacture helmets.
I started research on the product in 1971, even imported a helmet from Germany to understand how it was made. Two years later, I was ready to launch my company with a seed capital of Rs 2 lakh. This included my savings and some money from the business.
I also borrowed the name from the family business— Steelbird Industries—and decided to call my company Steelbird Helmets.
To begin with, I rented a 4,500 sq ft space at Ganesh Nagar, Delhi, paying Rs 225 a month. I installed a fibre glass shell, a furnace and other items like cutters and paint sprayers required to manufacture helmets.
Our first product was Mayur, an open-face helmet.
Finally, in mid-1973, my venture was up and running, manned by 20 people. When we started, we had a production capacity of around 150 helmets a day; today, the combined capacity of all our factories is 8,000 helmets a day.
However, it has been a slow road to success. The main problem was that there weren't many takers for helmets in those days.
Besides, there were only two companies, Lambretta and Vespa, which manufactured a total of 3,200 vehicles a month. Making matters worse was the low awareness level regarding the importance of helmets. So our sales were low despite the attractive price tag of Rs 70.40 per helmet. Still, against all odds, we had sold 115 units within a month of starting operations, making Rs 8,000, all of which was ploughed back into the business.
One key factor working in our favour was the network I had established while selling oil filters. These auto accessories dealers and shop owners now became a ready customer base for our helmets, and we soon rolled out three new helmet designs.
In the first year of operations, our turnover was around Rs 7 lakh. Since one of our objectives was to save lives, we organised several campaigns aimed at increasing awareness about wearing helmets. We also advertised aggressively on television.
Looking back, it's hard to imagine that we were vying for eyeballs against just eight odd brands. In addition, we advertised in auto magazines and took the rights from Dutta and Dutta Company for 100 film insertions. Due to our efforts, in 1976, some state governments made it mandatory for two-wheeler riders to wear helmets. This reinforced and enhanced the product acceptability in the market.
Encouraged by the booming sales, in 1979, we purchased a 1 acre plot at Mayapuri, Delhi, for Rs 12 lakh. Here, we built our first factory-cum-office for Rs 18 lakh, the entire amount coming from company profits. Another milestone year was 1984, when the launch of motorbikes changed the market scenario, and with it my business plan.
We had to start creating accessories for motorcycle usage. For instance, I invented a safety guard, costing around Rs 3,500, which included a hand protector, an anti-glare mirror, a saree guard, an engine guard, a plug kick, and windsheet fairing.
In 1992, I registered a new company, Steelbird Hi Tech India Limited, and shifted the entire business to it. However, just when things were on a roll, we faced a huge setback. In 2002, our factory was entirely destroyed by fire and we incurred a loss of around Rs 23 crore since most of the machines were not insured.
I had to take a bank loan of Rs 1.5 crore against my house to restart the business, a debt that I am still repaying. It took a while, but we have since regained our footing.
Today, our 900-employee company comprises several factories and a footprint in nearly 130 countries. Practically 50% of our Rs 150 crore annual business comes from the export market. We have also expanded our product repertoire to include helmet components like buckles.
The business has a huge potential. At present, only two Indian states have made the helmet compulsory for bikers. If all the states do so, the demand would grow a hundredfold— and we will be ready to tap it.
Encouraged by the booming sales, in 1979, we purchased a 1 acre plot at Mayapuri, Delhi, for Rs 12 lakh. Here, we built our first factory-cum-office for Rs 18 lakh, the entire amount coming from company profits. Another milestone year was 1984, when the launch of motorbikes changed the market scenario, and with it my business plan.
We had to start creating accessories for motorcycle usage. For instance, I invented a safety guard, costing around Rs 3,500, which included a hand protector, an anti-glare mirror, a saree guard, an engine guard, a plug kick, and windsheet fairing.
In 1992, I registered a new company, Steelbird Hi Tech India Limited, and shifted the entire business to it. However, just when things were on a roll, we faced a huge setback. In 2002, our factory was entirely destroyed by fire and we incurred a loss of around Rs 23 crore since most of the machines were not insured.
I had to take a bank loan of Rs 1.5 crore against my house to restart the business, a debt that I am still repaying. It took a while, but we have since regained our footing.
Today, our 900-employee company comprises several factories and a footprint in nearly 130 countries. Practically 50% of our Rs 150 crore annual business comes from the export market. We have also expanded our product repertoire to include helmet components like buckles.
The business has a huge potential. At present, only two Indian states have made the helmet compulsory for bikers. If all the states do so, the demand would grow a hundredfold— and we will be ready to tap it.
Source : By Amit Shanbaug, ET Bureau
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