Starting with Rs 5,000, how Coimbatore-based Suguna Foods became Rs 8,700 Cr turnover poultry company

[caption id="attachment_5768" align="aligncenter" width="1014"] B Soundararajan, Chairman of Suguna Group. Picture: Collected[/caption]

Coimbatore-based Suguna Foods started with a contract poultry farming model. Today, it supplies poultry and related products to 20 Indian states and in countries like Kenya, Bangladesh, and Sri Lanka.

The emergence of the novel coronavirus in the wet market of Wuhan, China, stirred a great deal of confusion among meat-eaters. At the beginning of the pandemic, many feared that the virus would transmit through meat, especially poultry. The rapid decline in its demand not only hurt meat shop owners but poultry farmers, whose means of livelihood started diminishing. And, for Coimbatore-based poultry farming company Suguna Foods, the lockdown posed the biggest challenge. B Soundararajan, Chairman of Suguna Group, says that he was faced with one of the biggest dilemmas in his entrepreneurial journey. “We had never seen anything like this in the past 25-30 years. Things got so bad that after a point, the farmers told us to destroy the produce,” he tells SMBStory. Before the pandemic, the cost of producing a kilogram of chicken was Rs 80, but during the lockdown selling the chicken even for Rs 10 was a big challenge. However, the intervention of the Indian Council of Medical Research (ICMR) in May, saying, “We don’t see the novel coronavirus getting transmitted through any specific food. We eat cooked (food) to avoid other kinds of viruses… this virus (COVID-19) is not linked to food. People can eat chicken… non-vegetarian food,” gave the sector some breather. Soundararajan says, “This increased people’s trust and they started buying meat again, which, in turn, led to some recovery.” Having clocked Rs 8,700 crore turnover last year, the chairman says that the company’s liquidity played a major role in helping it ride over the crisis.  [caption id="attachment_5769" align="aligncenter" width="1014"] Feed Mill, Picture: Collected[/caption] So, how did Suguna Foods, which started with a meagre Rs 5,000, scaled to become a multi-crore poultry company in 34 years? Agricultural roots GB Sundararajan and B Soundararajan never received any formal college education. After graduating from school, in 1978, their father Bangarusamy suggested that Soundararajan starts something of his own.  Since the family already had 20 acres of ancestral agricultural land, Soundararajan decided to venture into vegetable farming instead of cotton, unlike the other farmers in the area. With some financial help from his family, he managed to run the business for three years, but eventually, it did not turn out to be profitable. With debt piling up, he decided to join his cousin's agri-motor manufacturing company in Hyderabad. However, his dream to do something of his own had not diminished. And, it all changed in 1986. The beginning of Suguna Foods In 1986, the brothers started Suguna Foods Private Limited in Coimbatore, as a small poultry trading company, wherein they supplied equipment, healthcare products related to poultry, feed, and chicks to other poultry companies.  Three years into the trading business, they realised that many farmers were giving up farming because of the large credit gap in the market. Find more... Source: Online/SZK