"The label market in India has been very unorganized," Goel says. "There have been no figures available about the size of the market, market value, and there's really been no reliable data available. The biggest label customers in India today are companies like Unilever and Proctor & Gamble." He estimates that big name companies such as these account for 35 percent of the market, but adds, "there are now a lot of small label companies in India, and that market is virtually unkown."
Yet Goel says that this is all changing. Major global retailers have arrived in India in recent years with names like Wal-Mart, Tesco, and Carrefour. This retail boom, he says, is the reason there are many up and coming private label companies, and why the market itself is growing as well as getting more organized.
Goel says that India's label market can be broken down into two parts, product labels and specialty labels like brand protection and RFID.
"The middle class is growing, credit is giving way to cash, and there are more point of sale purchases being generated. But one of the results of this is that smaller label companies are having trouble finding a place in the market in terms of selling product labels."
Goel is the director of Gopsons Papers Limited, located in Noida, a sub-city of Delhi, India, that lies just to the Southeast of the nation's capital. Gopsons is an enterprise consisting of multiple facilities in India as well as Sri Lanka. The focus of Gopsons' label printing business lies in specialty labels, and Goel feels its a good place to be, as it makes good business sense. "The competition is there, but it's not as tough as it is in the product label sector," he says.
Gopsons is not typical of an Indian label printer, and Goel believes there are few companies like his in India. "Our focus is always going to be on specialty labels and there are distinct reasons for this. Our strengths lie in innovation, executing the most complicated security jobs. We can integrate RFID with holograms, as well as print 'track and trace' products. We'll print product labels, but only where the order calls for a very long run. Short runs don't justify our capabilities. We're capable of converting 2 million product labels in a single day," Goel says. "I can say we cover about 5 to 7 million square feet of labelstock per month, and we're never running at more than 80 percent capacity."
While Gopsons is a successful label printer, it's important to note that label printing is only a part of the company's product portfolio. In addition to labels, the company prints books and magazines, security printed documents such as tax stamps, revenue forms, stationary, holographic products, and thermal paper rolls such as point of sale receipts, betting slips, and transportation tickets.
Having a diversified line of products has proven to be an effective way of generating sales and interest. Goel notes that there's quite a bit of crossover business within the product portfolio which works out well, especially in increasing the company's label business. "A lot of clients order notebooks, which is part of our stationary business, and then we'll also make variable information labels, like bar codes, to be placed on them. We get a lot of indirect business through our different products," Goel says.
While the company's top customers come from the international world of publishing, several market segments account for its label business. For example, its government customers order tax stamps, there are pharmaceutical customers with brand protection orders, and automotive labels for Hero Honda, the world's leading motorcycle manufacturer. In addition, Goel says, Gopsons produces security products for the music, textiles, telecom industry, and many more.
Mukesh Goel's grandfather, the patriarch of Gopsons, was a paper trader, selling paper to publishers. In 1982, Goel's father, Sunil Dutt Goel, along with his grandfather, decided to get into the printing business themselves. They opened up their first factory, in Noida, strategically located in the nation's capital region.
Mukesh Goel stands with a picture of his grandfather, Gopson's founder.
After gaining some security printing experience and a solid reputation, Gopsons became a certified security printer in 1991. The certification the company received was a major accomplishment as it was by the Reserve Bank of India/Indian Bankers Association. In India, this certification approves a printer to print checks, which, particularly at the time, was a huge milestone, as checks of all kinds were the most approved, secure form of payment in India, according to Goel. Gopsons now had some serious credentials.
Not resting on its laurels, another factory was opened in 1995 for book printing, dedicated to the export market. Then in 2001, what is now considered the main plant was constructed in Noida with the European and US markets in mind. This plant, which would become Gopsons' largest, was designed to cater to the printing of security products, books, and labels.
Having started its label business in 2001, Goel says it really took off in a relatively short period of time, just a couple of years, coinciding with the introduction of it's security labels product line.
"Gopsons became a true industry pioneer in India when we introduced holograms to our paper labels and other security products," Goel says. "The holograms were a compliment to our other products, combining two and three technologies together."
As far as label printing goes, Gopsons is anchored in what it does best. "Our specialties lie in security labels, brand protection and anti-counterfeiting. People know Gopsons. Our name is synonymous with brand protection. We specialize in long run jobs and our variable information business is very strong, and it's not just simple bar codes."
For its product labels business, the focus has been on long runs with minimum orders of 1 million labels, although Goel says the company is shifting with the market and taking a look at medium and small runs.
Deeply entrenched in security printing, Gopsons has a healthy lottery ticket business in many countries apart from the Indian state lotteries. Aside from lottery, the company manufactures thermal rolls, bingo, redemption, scratch-off and transportation tickets. Goel stresses the company's strong roots in any sort of printing involving variable data, holography, and brand protection.
"The areas where we focus are only growing and will continue to grow," Goel says, referring to the company's line of anti-counterfeiting and specialty labels. "As counterfeiting grows, which it is, our business is only going to continue to grow. We're especially seeing growth in the pharmaceutical segment of our anti-counterfeiting business. Counterfeit pharmaceuticals is a major issue in India," he says.
Gopsons label printing equipment arsenal consists of two Mark Andy presses, one a 12-color 4150 16", the other a three-color 830 7" machine. The company also runs two Muller Martini machines, both 20" six color presses, digitally equipped for variable information. "The equipment we have is very advanced for the Indian market," Goel says, "and we're always looking to acquire new technology.
"As far as quality control, we have an inspection at every process. A lot of our QC happens online during printing," Goel says. He also points put that in India, a lot of the work is done through the large labor force they have, whereas in the Western world, machines would be in place.
Goel says that Gopsons' turnaround time often depends on supplies. "If supplies are there, then we can print in 24 hours," he says. The company works hard, employing three shifts at the Noida plant, working round the clock in eight-hour shifts plus overtime, except on national holidays when the factories shut down.
A lottery ticket job being run on one
of Gopsons' Marky Andy presses
In addition to the five Northern India plants, there is a sixth in Sri Lanka and a seventh facility is on its way, as the company is actively looking elsewhere in India for a plant. Gopsons employs a total of 450 people, and the square footage of all its plants combined is around 400,000 square feet. The main plant in Noida is 150,000 square feet alone.
Gopsons annual sales are $US29 million, and Goel says that the company's goals include reaching $42 million in 2009-10, and $56 million the following year. As brand protection products become the trend in the Indian label market, Goel feels the company is poised to attain its goals, and an aggressive sales force is also a key.
"We have agents and representatives working for us all over the world. We'll go to quite a few trade shows and of course, word of mouth is very strong," Goel says.
While Gopsons grows, however, Goel recognizes the impact the global economy is having. "The area where we focus – security – is only growing and will continue to grow. But certainly, for the time being, the economy is having a negative effect."
While India seems to be lagging behind when it comes to sustainability and environmental issues, Gopsons is doing what it can, and its efforts allow for rewards of more business. "We're the only ISO: 9001 certified company in India that I'm aware of that has cleared the preliminary audit of FSC certification and is expected to clear the final audit by January 16, 2009. This will give us an advantage over our competitors in acquiring business in Europe and the US."
Gopson's export business is strong, particularly in Europe, and Goel acknowledges the difficulty in exporting labels from India to the US and Latin America. With that said, however, Goel is open to growth possibilities, both locally and globally. He says that Gopsons is looking into possible acquisitions and is always speculating in how to acquire more market share. The company has sales offices in Germany and California, USA, in addition to its multiple offices in India.
"It's difficult to predict where the market is going, due to this current recession. But if an opportunity presents itself, even let's say in the United States, then sure, 'Why not?' We are certainly open to the idea of perhaps a joint venture in the US," Goel says.
Overall, Goel feels good about the state of the labeling industry in general. He says, in India, the industry's becoming more organized, and feels this is a good thing.
In an industry that continues to evolve, and despite a struggling global economy, it appears that Gopsons has itself firmly planted in the right places.