Over the past 50 years, the biggest achievement was taking one small shop and transforming it into a diversified conglomerate, Group Managing Director, Sunshine Holdings, Vish Govindasamy said in an interview with the Sunday Observer.
Going down memory lane, he said that Sunshine Holdings PLC, one of the leading conglomerates in Sri Lanka was set up 50 years ago as a single pharmacy store by G. Sathasivam. It was then known as Lanka Medical (Pvt) Ltd and was situated in Gampola.
The business grew rapidly during its first ten years of operation and became the sole agent for the State Pharmaceutical Corporation for the upcountry area.
In 1977, they opened a ‘super center’ type of store in Kandy (Lanka Medicals Kandy) - where people could buy pharmaceutical products, home appliances, food items and cosmetics under one roof. It was the first of its kind in Sri Lanka at that time.
Then the founders moved to Colombo. They tied up with several partners which became agents at present. It also tied up with local and Indian agencies to facilitate a successful island-wide pharmaceutical distribution
Today, Sunshine Healthcare retains a substantial20% share of the private healthcare market, supplying over a thousand pharmaceuticals, nutraceuticals, medical diagnostic equipment and surgical products to over two thousand pharmacies, clinics and hospitals across Sri Lanka.
Plantations
“In the late 90s, we ventured into plantations when the government privatized the management of regional plantation companies. Today, Sunshine Holdings manages more than 12,000 hectares and employs close to 15,000 people through its subsidiary, Watawala Plantations PLC.
“WATA is a diversified company managing 15 tea estates and 4 palm oil estates in the Central and the Southern provinces, with 14 tea factories and the largest oil palm mill. This was achieved under my leadership.”
The turnover at present is Rs 19 billion and is aiming at that magic number of Rs 20 billion - with a workforce of over 15,000. Building all the brands under the Sunshine Holdings umbrella - The group’s Consumer business, Watawala Tea Ceylon Ltd has become one of the largest branded tea companies in Sri Lanka with the highest market share in the tea category of 35% with three brands: ‘Zesta’, ‘Watawala Tea’ and ‘Ran Kahata’ catering to three distinct market segments.
Recently, Watawala Tea was recognized as the most popular hot beverage brand of the year at the SLIM-Nielsen people’s Awards 2017.
The Healthguard brand - The Healthguard pharmacy chain was set up by Sunshine Healthcare to offer a range of pharmaceuticals, wellness and beauty products in a modern retail environment, and has established a benchmark for healthcare retailing in the country. Today, it has 24 pharmacies across the Greater Colombo area.
Promoting the concept of ‘Pharmacy Wellness and Beauty’ in Sri Lanka, Healthguard opened its newest full service store for the public in Thimbirigasyaya recently. The newly-established outlet is the 23rd of the country’s premier pharmaceutical retail chain.
Healthguard is a fully-owned subsidiary of Sunshine Healthcare Lanka (SHL) - the Healthcare arm of the diversified Sunshine Holdings conglomerate with interests in several key sectors of Sri Lankan business including agriculture, FMCG, renewable energy and consumer packaging.
Leading the market as Sri Lanka’s most modern retail pharmacy chain, Healthguard’s business model is focused on creating value, expanding choice and delivering superior service to customers.
Building on the immense brand loyalty and goodwill generated by Healthguard’s breakthrough business model, the Company plans to rapidly expand its footprint across the Western Province, extending its customer touch-points to a total of 35 stores within the next two years.
Sunshine Healthcare Lanka (SHL) established in 1967, is the partner of choice for international healthcare companies seeking to grow their business in Sri Lanka, in the areas of pharmaceuticals, surgical, diagnostic, medical devices and consumer health products.
SHL has a large specialized healthcare team, with over 300 medical marketing and sales personnel, 200 physical distribution personnel and a revenue of US$ 48 million for FY16.
Tata
“Tata Global Beverages is the world’s second largest tea brand in the world which owns the brand name Tetley and Wilmar International, and is also the world’s largest oil palm and edible oil company. They are also linked to the Shangri-La Hotel Chain as well.
“Today, Watawala Plantations supply tea to the second largest tea brand in the world directly. Recently, we became the exclusive tea supplier to Shangri-La chain of hotels, servicing 100 luxury hotels spread across 22 countries.
“When we formed the global alliance with Tata in 1997, most of the other plantation companies did not have a global partner. This partnership gave us lot of strength and we were able to gain knowledge in tea and modern business practices.
“They were the ones who pushed us to create the brands. Partnering with an organization like Wilmar created inroads into our palm oil cultivation and brought good value and systems into Sunshine Holdings.”
When asked about the future of the company, he said, “I can’t talk about the future but like in every good business, we will be looking at different opportunities in the next ten years.
“We will continue to invest in our healthcare and consumer brands. Our future will be in getting close to the customer and consumer. We will invest a lot in the whole consumer brands strategy.”
Innovation
As far as innovations are concerned, Sunshine Holdings has been the first mover in many instances. “As a group, we have never been afraid to fail. Our Board is such that they don’t restrict us from trying things new.
“When you look at a concept like Healthguard pharmacy, it has been a new concept for us to try in Sri Lank. We have recently gone into dairy business and not lot of people has invested that kind of money in going into a dairy business. We are continuing to do new things.
“There are many lessons as the management head I have learned. The first lesson is to be humble. You also learn to respect people and learn to appreciate leadership.
“You also learn to work as a team. Just because you are the head of the group, it means nothing without the help of your fellow employees. For me, it is always people, people and people. We work as a team, respect each other challenge each other every day to do better and win.
That is what I have learnt by being the leader of the group.”
“The management/business ideas applied to develop the company’s concepts so far are based on the founders’ vision. They are to be sharp in our business commitments, be conscious of our costs and respect the customer – look at what the customer wants, not what we want to build for customer. We always want to know from the customer what they want from us.
“Today we are the number one tea brand in Sri Lanka. Why did we get the People’s Award? People have selected us and believed in us. We greatly believe in the customer power.
“I see the plantation sector to be a challenge but at the same time, I feel there are so many opportunities we could tap into. The plantation sector pretty much has the most amount of land and people.
“We have to make sure that we take best use of this land. Unlike other countries, we have talented people in the plantations sector so we have to invest properly and make use of their talents in an effective manner. We need to find big investments to further develop the plantations sector.
“The Global Banking and Finance Review recognized the Sunshine Holdings as the Most Innovative Holding Group in Sri Lanka. I feel very proud about this.
“This is the second consecutive time the organization has been recognized with this coveted accolade. In its award announcement, Global Banking and Finance Review emphasized Sunshine Holding’s success in launching innovative brands, usage of high technology applications in Sri Lanka’s agribusiness sector and ensuring high standards of customer service and strong client relations with personal and client-focused services. The award actually belongs to my team. It is recognition of a company wanting to do new things.
“The Group’s future plan would be to add more value to share holders. It does not matter whether you are into consumer or plantation or healthcare.
At the end of the day, the shareholder of my company wants to make sure that his or her share is worth 10-20 per cent more than what they are worth today. When we meet as a team and look what we want to do, that is what we are aiming to do.
Dairy farm
“We acquired Lonach tea estate which was not doing well and transformed it into a viable dairy farm. This is a consumer product that has a good demand.
“The government spends a lot of foreign exchange to import powdered milk and we support the government’s efforts in popularizing liquid milk consumption. This project will help us to be a prolific nation-building company.
Profits
The Group’s sound fundamentals continue to be reflected in its financial performance for 2016, with Sunshine Holdings posting a 10.1% Year-on-Year (YoY) increase in consolidated revenue up to Rs. 14.1 billion during the nine months to December 31, 2016 and a 27.7% YoY increase in Profits After Tax up to Rs. 1.3 billion, bolstered by strong performances in its agri business which posted revenues in excess of Rs. 4.7 billion, up 2.7% YoY.
Healthcare revenue during the same period rose by 10.5% YoY to Rs. 5.6 billion while the Group’s thriving FMCG portfolio posted a 19.5% YoY increase in topline performance up to Rs. 3 billion.