Bashundhara LP Gas Limited: Safety, Security & Trust Runs in the Brand’s DNA – Says Jakaria Jalal

– By Anamika Sahu, Editor-in-Chief

Bangladesh ranks as the 32nd highest consumer of natural gas, globally. However, the country is facing an acute shortage of natural gas, which halted the new piped gas connections for nearly a decade. As of early 2021, the demand for LPG in Bangladesh stands at around one million tons. However, the supply is limited to just 825,000 tons, and nearly 95% of the supplies are imported making the entire industry dependent on the foreign market. 

Playing an instrumental role in strengthening the LPG market in the country is Bashundhara LP Gas Limited, an organization that leverages the three decades of experience of its parent company, Bashundhara Group. With short-term and long-term plans to strengthen the brand with Bangladesh and globally, the company is making all the right moves. Business Tabloid spoke to Jakaria Jalal, Head of Sales, Bashundhara LP Gas Limited to discuss more about its USP, offerings and future plans. 

Bashundhara LP Gas Limited is a well-known brand in Bangladesh. Could you highlight more about the brand, its USP, and positioning in the market? 

Bashundhara LP Gas is the top and the best brand in its segment because we have been in the industry for the last two decades – the first private sector investment in Bangladesh by Bashundhara Group. This is all made possible by Ahmad Akbar Sobhan, our chairman, who is an ambitious leader in Bangladesh. He emphasized on the energy sector business 20 years ago. 

Our USP is our heritage of serving our customers for over two decades. Today we are available in every nook and corner of the country. We have millions of happy customers whom we are providing convenience to their kitchens over the years. 

What makes the company a strong player in the industry? Please highlight the annual revenue generation of the organization. 

Over the past 5 to 6 years, Bangladesh’s LPG market has become more intensified, and investments are pouring in. Several new players are entering the market and hence the competition has become fierce. And in this fierce market, we enjoy a major market share, nearly one-fourth of it. I can proudly say that we are second to none in our category. 

This is due to the huge investment we received over the years. We have unparalleled logistics strength, right from upstream to downstream. We also have invested heavily in plant, cylinder and other sections of the company, which has strengthened our company’s baseline, thus making us one of the strongest players in Bangladesh’s LPG industry. 

All these efforts have resulted in substantial growth, leading us to annual revenue of $158 to $200 million. 

What plans do you have for the organization’s growth, in terms of employee and functionality? 

We have been leading the industry for the last 20 years, and have become synonymous with trust and reliability in the LPG segment. We have the best people in every department, whether it’s sales, operations, distribution, marketing or any other. 

Bangladesh’s LPG industry is worth nearly $3.2 million. The organization is largely driven by our Vice Chairman who is a true visionary leader who has invested massively over the years in logistics and we own very large gas carriers (VLGCs). The world has only 250 pieces of VLGC and we own 2 of them. This shows our logical investment in the upstream section, which ensures our supply source.

We have also invested in our plant, which is the second largest in the world. It can refill over 3,500 cylinders per hour, which is a kind of unimaginable number when we speak of the Bangladesh LPG market. 

We produce our own cylinders and hence have invested a huge sum in cylinder manufacturing too. Our capacity is about 2.4 million cylinders per year. We also proudly claim to be the number one operator, globally. We have aggressive growth plans, whether it’s geographical expansion or employee expansion. 

Could you highlight more about your manufacturing unit, which stands second in the world? Please explain about the various services that Bashundhara LPG provides. 

As I mentioned, we own two of the world’s largest VLGCs; one is called Bashundhara LPG Challenger while the other is named as Bashundhara LP Gas Warrior, both having a capacity of over 40,000 tons. We also have two ocean-going sister vessels – LPG Sofia and LPG Maria, whose capacity is nearly 3,000 tons. Our six inland vessels transfer products from Mongla to Dhaka and have a capacity of 600 tons each. 

If I talk about our plants, we have one each at Mongla, Dhaka, Chittagong, and Bogura, which together refill nearly 1,20,000 cylinders per day in one shift of work. This capacity can be multiplied several times if we work several shifts. Add to this our massive cylinder manufacturing capacity from our two plants at Mongla and Dhaka. Also, we have 50 road tankers and 200 cylinder carrying trucks plying across the country. Helping us reach customers at every nook and corner of the nation are our 400 distributors, and 40,000 retailers. 

The fact that we have nearly 7.5 million cylinders in the market means nearly 3 million consumers are using Bashundhara LPG cylinders per month in Bangladesh. 

That’s a massive number, indeed. Achieving this requires technology integration from the manufacturing process to the supply chain and others. How is Bashundhara using technology to its benefit? 

The world is moving very fast towards adopting IT. There is no second thought on integrating technology in our process too. We extensively use SAP software, which is one of the most renowned management software globally. It helps track numbers in our factory, whether it’s of sales, supplychain/logistics which has helped strengthen our supplychain department who manages thousands of tons of LPG every month. 

Our Dhaka plant is a fully automated factory. Cylinders are automatically filled, and even their weights are maintained without any human touch or intervention. We also have been extensively using CRM, which helps us track our cylinders, distributor’s stock and others, which can be monitored without any glitch. 

On the brighter side, Bangladesh is moving towards being a Digital Bangladesh and hence we are also moving fast towards adopting digital as a process. We have created our internal communication app too for smoother communication and management. 

The fact is that if we don’t run at the pace at which the dynamics of the economies are flying, we will be left behind. But all our efforts are paying back. Together they make us the number one in the industry.

How do you use digital as a process at Bashundhara? 

Brand Bashundhara is on top of the mind of every citizen of Bangladesh. This gives us some leverage to experiment. We have our own ordering system which enables people to call us home or order online, and we can deliver cylinders at every corner of the country through our distributors/retail chains. 

We are also leveraging mobile financial services (MFS), online banking and even the traditional banking system for payments. People can deposit money from the convenience of their home or anywhere, anytime.

Whether it is LPG manufacturing or distribution, each process requires deep-rooted security measures. How do you ensure the safety of your employees, people and consumers? 

We are highly privileged to have our own cylinder testing laboratory in our factory at Mongla and Dhaka. The laboratory can test nearly 1.50,000 cylinders a month. We can repaint the cylinders as per the local process and rules. We also own an X-ray machine, hydro testing machine, and every other requirement needed to ensure safe and secure production and delivery of cylinders. To ease the process, once the cylinder comes, the checker man checks them all and sends the required cylinders to the cylinder maintenance plant. Once the entire process is done, the cylinder is ready to again touch the market and enter the homes of our consumers. 

None of the organizations in the country has the same sort of capacity that we have in terms of maintenance. 

This seems unparalleled. Could you also speak about some of the benefits you provide to your employees? 

Our people get the most lucrative salaries in the industry, apart from great compensation packages and other benefits. Long-term facilities, to provident fund, gratuity, festival bonus, sales incentive plans, insurance plans and more, the benefits are numerous. For our people, Bashundhara is a lifestyle and not just an organization. Bashundhara Group has its existence for three decades now, and a lot of our people have been with the group for quite some time. 

Being a conglomerate, Bashundhara Group has several products, and our people use them all. From food units to paper, cement and others, there are multiple products to choose from. 

What are the future plans for Bashundhara LPG, like expansion, export & import and others? 

As a dynamic organization, we always look forward to a bright future. The dynamic decisions taken by the Chairman of Bashundhara Group and the entire management team have played a pivotal role in making our organization the champion in its segment. Being foresighted has its own advantage; they have made huge investments decades ago in the LPG segment and are already planning for the next decade. 

Right now we sell nearly 3,00,000 tons a year and we plan to make it one million in the coming years. We are also considering cross-border products, with a focus on northern and southern India markets. We can also leverage our VLGC to supply goods to Sri Lanka, Myanmar and Maldives apart from different parts of the Southeast Asia market. This also requires huge investment further in VLGCs.

In short, our near-term plan includes attaining one million ton capacity, and long-term plans include expansion to various markets and establishing a giant LPG plant in Southeast Asia. 

Are you in policy talks with the governments of these countries for business expansion? 

Yes, we are. LPG is an alternative fuel, and hence none of the markets globally has been propagated apart from the government intervention. The current Bangladesh government have been very positive about LPG and hence they have taken great decisions since the last decade straight. However, there exists a gap between the demand and supply of natural gas and hence LNG (liquefied natural gas) is the answer to it. 

In Bangladesh, the markets are maturing and stringent policies are coming up. We, as an active members of the LPG Association, are working together with an organization to find suitable policies to give a healthy environment to the LPG investors, businesses, consumers, distributors, and everyone else related to the LPG industry. 

Any CSR activity the organization is involved in? 

I would say that Bashundhara LPG is a humanitarian organization. Many of our employees have been contributing to social work and CSR activities in their own ways. As an organization, we also take care of them. No one at Bashundhara LPG has lost their job due to COVID. 

We serve food to nearly 3,000 people during this time of crisis as a relief fund. We also gave scholarships to our distributors’ son who achieved great results in his exam. We have also helped financially the distributors’ families who have lost their parents to COVID. We have also trained nearly 20,000 housewives on using LPG safely. This helps us strengthen our brand and seal confidence among our consumers.