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[ RAGS- TO-RICHES BUSINESS ].

Pastiwala's the wastepaper tiger


Vishal Dutta Gujarati word for wastepaper), employs Allaudin and ',,'
AHMEDABAD nine other radiwallas and sells directly to the paper re~! ';;
cycling mills, elimipating middlemen. ,\:-'~
. AIlaudin is today an assodate collector at 50rt In:';,'
laudin looks much older than his age. He has dia Enviro Solutions Pvt Ltd, the holding company
FORTY-Srx-YEAR-OLD Sheikh vendor)
been a raddiwala (wastepaper Mehaboob AI-
for the of Pastiwala.com. "The business model would
last 31 years, collecting old newspapers from Vado- probably revolutionise the more-than- 300~year-
dara households and reselling them at a tiny margin. old unorganised wastepaper business in India. The
living in a shanty with wife and three children, a de- business is still highly unorganised, unregulated
cent living was a far-fetched dream for AIlaudin. and has unaccountable human exploitation," says
But four months back, his world changed for the 35-year-old Parekh. While the US recycles 70% of
better. Allaudin started earning a monthly salary of its wastepaper - Germany recycles 73%, and
Rs 8,000 - with a Rs 21akh mediclaim and acddeht Japan 60% - India manages to reuse only 20% of
insurance - and the family moved to a rented house. agement business in the UK co-owning a waste man- its wastepaper, says R Narayan Moorthy of Indian
Today, he goes about the same business, but in a agement company, Total Waste, has brought the likes Paper Manufacturers' Association,
blue uniform. And that's all thanks to Paresh Parekh. of Allaudin into the organised umbrella. His Vado-
Parekh, who has spent 13 years in the waste man- dara-based start-up called Pastiwala.com (Pasti is a ~ A viable business model: P 14
A viable business model
~ From Page 1

Almost 50% of the country's wastepaper requirement is today met through


imports, and Parekh is moving into this gap.
Parekh says his model has clicked in the Rs 25,000-crore Indian paper in-
dustry that depends on three major raw materials - wood, pulp and wastepa-
per. The vendors lack a proper collection mechanism and a sorting and grading
system, and the company's expertise comes handy here. Pastiwala.comhas de-
veloped a network of wastepaper collection centres and has employed collec-
tors who go door to door for collection. The strategy is to enter into tie-ups with
companies as well as households at prices higher than what offered by other
raddiwalas.
The benefits of scale percolates to the households too. Against the Rs 8-9 per
kg offered by a regul:lrraddiwala, Pastiwala.com's collectors offer Rs 12-13, de-
pending on the international and domestic market prices.
Parekh has now earmarked Rs 16lakh for advertisements on private radio
stations, to inform the public about the company's.collection centres ..
Pradeep Dhoble, CEO of lTC's paperboards & specialty papers division, says
Pastiwala.com's is a viable business provided there is a'close check on costs re-
lated to collection, sorting (value addition), baling and logistics. Recycled fibre
plays an important role in Indian paper industry where demand for paper is
growing at 8-10% per annum across segments.
lTC's paperboards and specialty paper division uses close to 1,65,000 mt of
wastepaper per'annum, slated to go up by another 50,000 mt by end of 20 11.
Parekh wants to scale up his wastepaper collection network to 300 shops
throughout Gujarat, from 40 tonnes today to 2,000 tormes a day:
The next goal is to make Pastiwala pan-Indian.
"There is ever rising demand and supply gap in paper industry. In India,
the per capita usage of paper is in the region of 4 to 5 kg. This is expected to
rise as the economy grows so does the packaging industry and use of pack-
aged items," he says.
Taking the local wastepaper collection business to the international level, the
company has recently entered into agreement with a South-east Asian country
and would probably be the first to exPort wastenaner.