Precious Electronics is a proprietorship company founded by Mr. A.Venkateswara Rao. He is the original owner of the brand name ‘Servomax’. He is the sole owner of the coined name ‘Servomax’. He is the owner of ‘SERVOMAX’ brand name, Logo, design and the coined name of ‘Servomax’.
- I hereby inform you some of my close business matters. I am bringing to you some highlights about Servomax and my journey with facts about the organisation.
- I was the youngest awardee of “Pearl of Andhra Pradesh”, awarded by the Chief Minister of AP.
- I opened one savings bank account with SBH,Moula-ali in Industrial Estate, Moula-ali with a starting balance of Rs.100/- in personal account. Later I opened one current account with the same branch in the name of M/s. Precious Electronics .I enquired with the bank and requested them to sanction some loan amount, for which the bank asked me to show some transactions in the account to sanction a personal loan. The first bank transaction happened keeping in view of getting loan from bank.
- We started a proprietary firm in the year 1982 in Moula-ali. To show bank transactions I was in need of initial capital.At that time P. Jagan Mohan Reddy offered his help with a small finance of Rs.4000/-,using which we purchased one winding machine to manufacture transformers for emergency lights.
- Mr.P.Chandra Sekhar Reddy has helped me in assembling,packaging and some part of deliveries. In those days, he was working in some other place and he contributed a part of his earnings to me for business purposes.
- Mr.PCS Reddy’s core competence is in winding. The core competence is winding of toroidal transformers and rewinding of auto transformers. He used to wind the auto transformers for repair works. He continued his job outside for several months.Later,he left the job and continuously concentrated on rewinding of variacs. The rewinding of variac orders was procured from APDDCF,with the help of PCS Reddy’s friend Mr.Bhupal, who is an employee of the APDDCF. Thus, the income earned was sufficient to meet our daily needs and monthly livelihood requirements.
- I used to manufacture voltage stabilizers for TV and refrigerator applications. The Design, Testing, Manufacturing and procurement of materials is handled by me alone along with marketing and sales. Any and every small amount earned was used for all our needs.
- PCS used to assemble the voltage stabilizers, transformers and emergency lights. While carrying out works for government departments like APDDCF,Railways etc., I understood that in order to be accorded with good orders from any organization, a total of three quotations were required from different parties. In those days, i used to request some of the other companies to provide supporting quotations to obtain the orders for us. This has resulted in extra costing for us. Even for small jobs of above Rs.10,000 these departments were asking us a minimum of three quotations to be submitted.
- In 1982 we started manufacturing emergency lights under the brand name of “SPARKLIGHT”, in which new technology was used. These lights were being manufactured by us alone. The design, testing, procurement, financing, marketing, delivery and service of these lights were done by us alone. We have sold thousands of lights through which we made many friends, partners and financial partners, who exhibited their ill intentions by copying our design and technology of this product and started manufacturing it. They have stopped financing us for this product as well. Hence, the production was stalled.
- To earn our income and daily bread I took the help of my aunt, who was working in ECIL and got a number of job work orders from ECIL. To meet these orders, we have appointed employees. And the amounts received from APDDCF, ECIL, Kaparthi Traders were being deposited in SBH account regularly. After some time, I approached the bank for a loan and got sanctioned a loan of Rs.5000/- from SBH,Moula-ali Branch. This was our first loan.
In 1983, the bank has enhanced the limits to Rs.10,000/-. Later in the year 1984 they have enhanced the limits to Rs.15000/- , with a personal guarantee of Govt. Employees Mr.PJ Reddy & Mr.VS Rao. The money was not sufficient to meet our daily needs and expenses. To meet these expenses, Mr.PCS Reddy used to bring some loans with an interest of 5% per month. With these finances, we have cautiously and conservatively managed up to the year 1985.
- By seeing our struggle, the branch manager informed us that without collateral the bank cannot support us and asked us to bring the collaterals. Since we did not have any collateral, we informed the same to the bank. Then, the bank helped us by sponsoring my name to DIC Ranga Reddy under self employment scheme and they have conducted interviews .As i possessed abundant technical knowledge, they have selected my name for Gramodaya scheme, under which they have sanctioned us Rs.35,000/-.
- Based on the Gramodaya scheme, SBH had also sanctioned us an amount of Rs.35,000/- and they have also allowed us a temporary OD on personal account to the tune of Rs.15,000/-. This is in the year 1985-86 and we have registered M/s. Precious Electronics as a SSI unit. Provisional SSI registration was completed, as it is a mandatory for sanctioning of Gramodaya Loan.
- By seeing our performance,the bank has sanctioned 3 more Gramodaya schemes in the year 1987 and we got an extra finance assistance to the tune of Rs.1,00,000/- . So, the total loan in 1987-88 is about Rs.1,50,000/-.With SSI registration and with the help of Mrs V.Hemalatha , we got some orders for PCB assembling bunches and other job works,winding of transformers and orders for transformers were received from ECIL. This is the turning point to improve our sales.
- In the year 1986, we have purchased one TVS 50 and later we also purchased motor cycle for Mr.PCS for travelling purpose. Until this time we used to travel through bicycles.
- To manufacture various products, we require the following items :
- Boxes Fabrication.
- Screen Printing.
- Electronic Components.
- Wire bunches.
- PCB Designing Kits.
- Electrical Components, etc.
- In the beginning we operated in a small place. Here, we have purchased fabrication machinery, which is hand-operated to manufacture boxes. We have appointed four employees to take care of the fabrication work. Before this, we were dependent on various vendors, due to which we never got the boxes as required by us. Since we didn’t have a team to draw mechanical drawings, we used to waste a lot of money on fabrication of boxes. Moreover, no vendor is interested to manufacture small quantity of boxes for our requirement. After establishing our own fabrication unit, we used to fabricate the boxes as required for our needs with our raw mechanical drawings, due to which we used to complete our work in time.
- In similar way, we required transformers for the equipments manufactured in those days. The transformers are a special kind in nature, designed as per our use and requirements. In those days the transformer design was taken care of by me personally. We didn’t want to leak our design, which was specially designed to provide higher energy efficiency and lower losses, which was our unique selling point with customers.After understanding the sensitivity of the requirements, we have established our own winding section to manufacture transformers as per my design; sizes and quantities were our own. In a small space and with great difficulty we have accommodated mechanical division, winding division and PCB Mounting Division. The winding techniques were learned by me and I used to educate the team members on how to wind with care. Thus, the transformer division has been shaped.
- The PCB designing in those days was an unknown subject for most businesses due to which we used to waste a lot of time by depending on others. To reduce the time, i used to design a circuit and a prototype was developed, based on which the testing was done. I myself used to design electronics circuits, PCB layouts, component layouts and prepare drawings by hand, which were given to PCB manufacturers to manufacture PCB’s as per my design. Thus, the PCB division and mounting division has emerged.We hired female employees for soldering purposes in PCB division. The quality of PCB’s was monitored by me and I have also trained some engineers on how to test PCB’s in my absence. Thus, quality control team and PCB testing team have emerged. In 1985, we used to have an integrated plant to manufacture all major components required by us on our own.
- When orders increased I used to prepare a bunching system to manufacture bunches for wiring of controlling system, to speed up the work and to produce in bulk quantities. First , one sample was prepared on drawing board and I used to wire all the small wires into bunching and this bunching was again connected into the main box. Thus, the bunching division has emerged.
- Later, as the workplace became congested, it was moved to a larger space under lease to accommodate all these divisions. Ultimately, we found that each and every division has its own important role and we wanted to create separate divisions located at separate places.
- We have bought land in Cherlapally and constructed a building. We have moved all fabrication works and machineries into this building and purchased additional necessary machineries for fabrication. Thus, fabrication output has increased which in turn has increased the quality and quantity. The new fabrication division has earned good profits with good quality output.
- We used to manufacture a number of transformers for our requirements and also take orders for transformers from various parties. We specially designed unique kind of transformers for various industries, where I myself have core designing knowledge on how to manufacture and design a particular transformer for particular needs.After some years, this division became stronger as we invested in installing bigger machines, purchased land, constructed a building and shifted this transformers division to another locality to increase the quality output of the transformers from this division. All this was achievable through obtaining the bank loan.
- As the company was growing and demand was increasing, we had to hire new workers, increasing the employee count to more than 20 in a single place. Whenever the work load was minimal or there was a lack of monitoring all these workers formed a union and demanded higher wages along with other facilities.Then, I understood that there is a need to shift different activities to different places under different company names, in order to minimize the union threat and increase the discipline among workers and engineers, who will work together at a single place.So, a decision was taken to individually split the design team, bunching team, transformer division and fabrication division to different places. Thus the differentiation can be obtained, area- wise profitability can be monitored, the band-width of products can be increased and the threat of union-ism can be reduced. So, different companies were created for each and every division.
- The main core of my company is the design of PCB, transformers, specifications, boxes and maintaining the energy efficiency levels at maximum. I have kept the R&D division, Transformer designing team, Product design team, Testing team and Total Quality Control System team under me. Thus, my focus is always on high value added activities of the company. Through working closely with all the core divisions, I found that the maximum value can be created by developing new products and improving the existing products better than our competitors.The company motto is to provide energy efficiency and energy savings through our products, so energy can be saved for the nation and the customer through my products. Hence, the core technical activities of the company have been kept with me from inception till date.All production activities were mechanically manufactured as per the drawings and designs provided by me and my team on paper. This was called as mechanical documentation. Similarly, we have winding documentation and testing documentation. Through documentations like these, we made the units and divisions run separately but still together without knowing why, how or where the transformer is being used. I used to keep and hide all key important points of the technology at all places.
- Marketing is the key area for any success. Since our products have some plus points over others in the market, and as I alone know the importance of the our product quality, its usage, power saving and money to customer.Since, I am designer I can explain the core product qualities much better than any other. Hence, I used to take care of the marketing division as well. Slowly, this activity turned into a much bigger activity. In this division also, I used to employ new techniques, methodology, system and way of approaching customers. Thereby developing a need for the product. I used to read a lot of papers, articles, write-ups, books, magazines as well as visit a lot of exhibitions and seminars across India.
- New Designs have been adopted in regular line of products which proved that our products are the best among other manufacturers in India.
- I have also developed new segments and applications for the products. I had moved across the country and spent almost 6 months in a year, out of Hyderabad to generate new customers, market segments, and new applications, to create and cater to the market for the products. Slowly, I turned this division into an independent division and appointed many people across the country to start marketing of the products over entire India.
- We had developed various products for various applications. For example, in railways, we have manufactured various chargers, earth leakage monitors, earth leakage breakers and supplied them to various organizations. We have repaired a lot of battery charges for railways and others. Thus, I understood the importance of market potential for servicing of various products. I found that there is a demand for quality repairs and quality services.I generated income through servicing of battery chargers for railways and this has given me an idea to create a good service team. Thus, a service division has emerged.
- Later I focussed more on government orders with specific focuss on department of telecommunications. I catered to the market for all E-10B electronic exchanges and rural telephone exchanges.
- Servomax has got a very good name in department of telecom and we have catered to more than 50% of market share in department of telecom. For this department, I have developed various products including A/C Voltage stabilizers which are wall mountable, electronic timers for air conditioners, sequential electronic timers in telephone exchanges and power savers for dept. of telecommunications.After our success in department of telecom, these products were also marketed in many private industries throughout India. I personally monitored all Govt. department tenders and orders throughout India including the big corporate accounts.
- In the year 2000, A.Venkateswara Rao incorporated a Pvt. Ltd. company by the name of ‘ Servomax Precious Electronics Pvt. Ltd.’ under companies act 1956, wherein a part of the assets and liabilities have been transferred to Servomax Precious Electronics Pvt. Ltd. Further to, there is a definite agreement between Precious Electronics and Servomax Precious Electronics Pvt. Ltd. regarding license to use the ‘SERVOMAX’ brand, logo’s which were developed by Precious Electronics for a period of 15 years with some commercial charges.
- And as per the agreement ‘SERVOMAX’ can use the SERVOMAX brand and get registered on its name for 15 years and the brand has to be officially assigned to Precious Electronics. In the year 2013, Servomax assigned the Brand name back to Precious along with trademark registrations vide assigned deed dated 09.06.2013 and 27.06.2013.
- “SERVOMAX INDIA LTD. IS SUBSIDARY OF PRECIOUS ELECTRONICS“
- We have given license to Saveawatt Power Electronics Pvt. Ltd. , Tushara Energy Ventures Pvt. Ltd., Precious Powertechnologies Pvt. Ltd. and others to use the ‘SERVOMAX’ brand and logo’s for a certain period of time.And SERVOMAX INDIA LTD. has transferred back the Servomax Brand name and logos , both registered and under registration to Precious Electronics.’