Every startup and small business has a story to tell, for Diversatech (M) Sdn Bhd, it was founded during the Asian economic crisis back in the late ’90s. People might think it was a huge mistake however, Prof Madya Dr Syed Omar who’s the founder of the company and also Syed Amir’s father proved that it was the utmost right thing to do.
The story goes as Syed Amir’s uncle, Sidi Oraza who was a veteran actor that was looking into new businesses other than the entertainment industry due to the economic crisis and desperately need to find a smart solution for survival.
How Diversatech was founded
“My uncle (Sidi Oraza) contacted my dad who was then a lecturer in UPM specialising in agriculture asking if there are any products from the university that they can market. In the same time, my dad who has done numerous R&D in agriculture convinced him that there’s a technology that could help them to produce fertilizer. That’s how Diversatech (M) Sdn Bhd started in 1998,” said Syed Amir the second generation of the family who is currently spearheading the company’s operation.
Diversatech (M) Sdn Bhd started as a very small company. With only RM6,000 in hand, they managed to set up a small plant in a rented shop lot. “We started with liquid fertilizer because it was the cheapest setup, therefore we could do compared to what we currently have,” adding that his father’s occupation as a researcher and lecturer gave them the advantage to expand the business by collaborating with the university to develop new types of fertilizers.
A huge risk worth taking
The year 2006 was a turning point for the company when they secured a 4-year project with the Ministry of Agriculture worth RM130 million to provide fertilizer to help increase the paddy yields.
“If you don’t take risk, you won’t move forward”
However, they still produced fertilizer manually without having a proper plant. So how could they fulfil the project? Here’s where the story gets interesting, “With the current machinery that we had at that time, we knew we couldn’t execute the project efficiently. Thus, my uncle took the risk of buying machinery worth half a million even though we’re still not granted with the contract yet. It was a huge risk but thank god, we got it in the end,” adding that their revenue jumped from RM10 million per year to RM30-RM40 million per year due to the project given.
The only Bumiputera company in the industry
Diversatech is proud to be the pioneer in the industry and the only Bumiputera company that has its plant and factory in Tanjung Harapan, Port Klang and their latest plant in Pulau Indah, Port Klang. He also cheekily pointed out the reason why he brought us to the newest plant. “I wanted to show you our newest plant – build on a 6-acre land. This plant can double up our production capacity to 200,000 metric tons with a cost around RM65 million including all the machinery.
Evolution in a conventional industry
Diversatech has been producing numerous fertilizer with the latest technology. One of the product, Vita Grow has awarded them several recognitions from local institutions. Another product, ZAPPA won a bronze award in Geneva under a science division fair.
“We are proud to be the pioneer in producing controlled-release fertilizer in Southeast Asia. Diversatech is a regional reference for anyone who wants to venture in fertilizer agglomeration technology. Our plant frequently receives visit from international and local to study our technology,” adding that they have an office in Pekanbaru, Indonesia where they supply approximately 20,000 metric tonnes of fertilizers which is 20 per cent from their total production.
Challenges in sustaining the business
Diversatech has adjusted their compass from merely focusing on oil palm plantation by 90 per cent to 60 per cent only. Fertilizer is a commodity product so they have to bear with the unpredictable fluctuation in the market demand. Syed Amir agreed that they are focusing too much on oil palm plantation – and that was their huge mistake.
“Passion is what drives you to succeed because you are completely dedicated to making your business work no matter how hard the process may be”
“When the oil palm price went down, our market went down too. This year is a bit rough for us so we are trying to diversify our market segment by penetrating neighbouring countries which is Indonesia and Myanmar. We are trying to supply for other plantations too to minimise our losses.
The future of agriculture
As the CEO of Diversatech which has been operated for more than 20 years, Syed Amir shared his visions for the company. “I want to have another factory in East Malaysia. Furthermore, I want to have another plant in Indonesia and Myanmar. Hence, we are aiming to have another 3 plants in total. I also yearn to see the younger generation to venture in this field. The infrastructure and market are there and the government has been greatly helping local farmers too, we are only lacking on information to inspire the younger generation in making agriculture visible and as a career option,” he ended.