How Varsani grew his glass company

There is no boundary to success in this world. A business mentor who had lived to experience it through his 20 years as a businessman once told me. Despite the losses and profits he made, he pursued whatever opportunity life presented him with. Such is the case with 46-year-old Vidon Varsani.

I am on Sixth Street Industrial Area in Kampala when I first meet Ramp Enterprises Limited managing director Mr Varsani. After an hour’s exchange, it is after leaving his office that I believe there is no boundary to success.
Mr Varsani grew up as a child of a construction labourer in India. Despite financial hurdles, he acquired a Bachelor’s degree in Commerce in 1992 and a Master’s degree in Commerce in 1994.
But after school, harbouring the thought of living unemployed, competing for few job opportunities and being unable to become a chartered accountant due to financial constraints, he migrated to Uganda.

“In 1994, India was not what it is currently. There were many challenges to finding a job. Job opportunities were not so many. So, to get the job as per my qualification was difficult in India,” Mr Varsani says.
A relative living in Uganda tipped off Mr Varsani about fresh vacancies for accountants in Uganda. Uganda was just going through economic transformation and he believed Mr Varsani could find a slot.
Four months after school, he got a job as an accountant in Kibao Group of Companies in Uganda. He did everything concerning accounts for the group that ran pharmaceutical and manufacturing household plastics among other businesses.

Mr Varsani gained experience working with the tax body, legal and immigration departments. This experience was what he later transferred to his first business venture in 2004.
“I had a job but to have a good life, you should have your own business and have another income. To depend on one income is not safe. Anytime, there can be an economic crisis but if I have my own business, I can survive,” he says.
With $100,000 (Shs360m) from a colleague, together with his brother in-law, Mr Varsani opened a computer company, PC Max Limited. Selling computers worked out well.

Five years later, another opportunity came knocking on his door. The director of Ramp Enterprises Limited, then, a part of Kibao Group, asked Mr Varsani to take over the operations. The company manufacturing aluminum products and dealing in glass since 1997, was sold to him, his wife Ms Bhanuben Varsani and relative Mr Yogesh Bhidia.
Mr Varsani invested $150,000 (Shs540m) and became managing director since he knew the business inside out.
Initially, Ramp Enterprises was buying its stock locally and selling to clients, a practice that kept its sales turnover as low as Shs500m. He wanted to aim higher.

“I thought if I can do Shs1b or Shs2b, it will be enough for me,” he said.
Mr Varsani found another strategy and importing his glass became the solution to building a higher sales turnover.
“I knew that if I could import directly from abroad, I would earn more profit because there was no profit in buying stock locally and selling it,” he explains.
So, he started importing float glass from China, United Arab Emirates and Saudi Arabia. Finding clients in construction was easy thanks to support from colleagues and relatives in the construction business.

Business growth
Speaking about business growth in the first three years, Mr Varsani admits he never made any profit. The business just survived. So, he researched the market and resolved to provide what the local market needed.
“I put my inventory in buying various types of glass because initially, I was only buying clear glass and I saw that in the market, they needed so many types of glass,” he explains.
He followed through with this plan. Today, Ramp Enterprises Limited imports 100 per cent of its glass from Saudi Arabia, Egypt, Singapre, Indonesia and China. As an importer, the enterprise buys about 15 to 20 containers of glass a month and supplies a range of products to wholesalers, retailers and construction firms include: clear float glass, tinted glass, reflective glass, silver mirror, aluminum mirror and laminated glass, among others
Previously, his sales turnover grew to Shs4.5b in 2015 and has since grown to Shs9.8b in 2016, a landmark he attributes to meeting the market requirements. He is now focusing on improving sales turnover and paying taxes religiously.

Tax on float glass is 10 per cent and 25 per cent on other types of glass. In 2014, Mr Varsani paid Shs1.5b for importation but still finds these taxes tolerable.
“Taxation is okay because there are not many factories in Uganda that can make the glass. Importation is difficult because Uganda Revenue Authority sometimes wants more duty and it increases the price,” he says.
Loans from bank, he notes, have been good for his business since he finds the cheapest interest rates.

Saving costs
Although he has 15 workers, Mr Varsani handles business operations personally to reduce his operating costs.
“I got a lot of experience before. I am not getting any assistance in relation to legal people, assessment with URA, I know how to deal with clearing imports. I am saving that money and investing it in the company,” he explains.

Challenges
The glass business is very sensitive. Mr Varsani says breakages from the shipping country to Mombasa then to Kampala is common. Around 5 to 6 per cent of the imported glass is damaged in transit because of unreliable transport means. He has invested in 100 per cent insurance to cover all types of damages.
Competition is high. Prices are always fluctuating globally yet Ugandans want low-cost glass, an issue that puts Ramp Enterprises in a difficult position of beating competitors.

Successes
Mr Varsani has achieved what he wanted years ago, contributing to the country’s growth.
Last year was difficult for players in the construction industry. However, Mr Varsani sailed through, selling up to 80 per cent of his stock upcountry. His clientele has grown with about 20 construction firms and 100 retail and wholesale buyers.

Uplifted by Ramp Enterprises

“He does not put pressure on clients, he allows them to pay cash later. He cares for his workers and does not segregate. In case you have a problem, he gives you a salary loan as long as you pay in an agreed period of time. I have built a two-bedroom house and pay school fees for children promptly,”
Gabriel Otaruko, driver

“Mr Varsani is a good director and an advisor. The company has grown big. It started as a small shop in Nakasero but has emerged to be a big importer. The business is not bad as long as your stock is there. The problem is sometimes high competition,”
Pascal Okwai, store manager

“Mr Varsani is a good businessperson and he is growing. He has been leading for about 20 years and has got so much experience on how to run the business. He is the king of glass, bringing in the right quality and quantity of glass,.”
Amin Niral, financial controller