Wednesday, September 2, 2009

Incense revenues set to light up

Posted by khmerboy at 3:41 AM


The Phnom Penh Post
Wednesday, 02 September 2009
Soeun Say

Kampong Cham

THE buildup to Pchum Ben festival of the dead is set to be a busy time for Leap Ly.

The 45-year-old maker of incense sticks says the Cambodian Buddhist holiday, in which people pay respects to deceased relatives by cooking meals for monks and making offerings to the ghosts of deceased relatives, is a peak sales time.

"We don't have any time to relax ... as we are producing as many incense sticks as we can to meet demand over Pchum Ben," he said. "The festival is the best time for incense makers to make money,."

To ensure the company maximises revenues over the period, Leap Ly is looking to hire two new workers to add to the three already employed at the factory in Sdav commune, in Kampong Cham province's Kang Meas district.

Employees earn from 150,000 to 200,000 riels (US$37.50 to $50) per month.

Leap Ly said the highest-quality incense sticks produced at the factory sell for 4,000 riels a bunch, with each bunch consisting of 40 sticks.

The factory can make between 40 and 50 bunches each day, but he is aiming to increase production to between 100 and 150 bunches daily from next year, if he can secure demand.

He sells locally as well as in Phnom Penh, Kampong Speu and Kampot provinces.

With raw materials - bamboo, leaf, and saw ash - costing around $150 a month, Leap Ly estimated he makes a profit of $300 to $400 per month.

Profits are higher in the rainy season, as supply tends to drop as manufacturers struggled to find enough sunshine hours to dry the sticks, he said.

The father of two learned the trade when he found a job at a Cambodian-Chinese-owned incense factory in Phnom Penh while he was in his 20s. In 1991, after working there for two years, Leap Ly married and returned to his hometown to set up his own three-employee business, which he named Ly Incense Stick Making.

"At that time I thought that I had enough experience in making incense sticks because I had worked in the job for more than two years," he said. "But it turned out to be very hard because although I knew how to make incense it was my first time running a business.

"My wife and I had to work hard every day to find ways to make higher-quality incense sticks and find new markets to sell our product. Our business eventually became successful, and we now have a lot of regular customers."

But the business is not without challenges. In a globalised world, even higher quality incense sticks from China, Vietnam and Thailand are eating into his market share. Leap Ly said he needed to expand to develop the economy of scale needed to compete.

"We had success in the first stage of our business, but now we need to move up a level to find new markets and increase the quality of our products further," he said. "If we cannot do this, our business will not be able to compete with our competitors from outside Cambodia."

 

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