Technology bites away at dry cell industry

TBS Infograph

Once a vibrant industry before the 20th century, the dry cell battery market has dried up fast owing to the rapid advancement of technology.

Dry cell batteries were mostly used in torchlights, radios, cassette players, emergency and camping lights.

But radios, cassette players, and torchlights have almost become obsolete now as most of these facilities are available on smartphones.

As a result, the demand for dry cell batteries has consistently been declining over the years, the sales having dropped to around Tk150 crore from Tk300 crore, according to industry insiders.

They say a small portion of dry cell batteries is still used in calculators, wall clocks, and various types of toys.

Against such a background, local dry cell manufacturers are diversifying their businesses to sustain their existence.

Two major local firms – Quasem Industries, and Olympic Industries – are engaged in making dry cell batteries.

Quasem Industries is the pioneer and the first ISO-certified dry cell battery manufacturer in the country.

Now it leads the industry by holding 70-80% of the local market share, followed by Olympic Industries.

In the domestic market, the annual sales of locally-produced dry cell batteries were around Tk300 crore more than ten years ago.

Quasem Industries and Olympic Industries reported revenue of around Tk100 crore and around Tk50 crore, respectively, in the last fiscal year.

Industry insiders say a small portion of dry cell batteries is imported every year. 

Local firms are forced to diversify business  

As the demand for dry cell batteries is on the decline, local manufacturers are being forced to diversify their business.

Olympic Industries has already diversified its business to cookies and branded biscuits, and currently it is one of the leaders in the biscuits industry.

According to its officials, the production of its dry cell batteries is running on a limited scale, but from this segment its revenue has declined.

The major dry cell battery maker, Quasem Industries, has also diversified its business to consumer products such as air fresheners, body spray, shaving foam, and aerosols.

To boost sales, the company has planned to come up with new products in the local market.

Quasem Industries losing business 

Quasem Industries started its journey in the 1980s, manufacturing dry cell batteries mainly to meet local demand.

As demand for the products started to decline, it planned to diversify its business in different segments early in the 2020s.

Officials said before 2020, the dry cell market was on an upward trend, but when technological advancement began, its business started to fall.

After that, some steps by the management helped the company boost its revenue but it witnessed a gradual fall in the dry cell segment.

When this correspondent called Tasvir Ul Islam, managing director and chief executive officer (CEO) of Quasem Industries, he did not answer the phone. 

"We have continued to market and seen growth in the products we released under our new WAVE brand," Tasvir Ul Islam says in the company's latest annual report.

"We anticipate that our collection of air fresheners, insect sprays, and other products will continue to show strong sales growth and serve our company's financial statements well in the coming year."  

Quasem Industries' main income comes from selling three types of dry cell batteries, named UM-1, the first dry cell battery produced in 1983, UM-3 in 1993, and UM-4 in 2006.

It has also engaged in making air fresheners under the brand names WAVE, SUNLITE aerosol, and shaving foam, and contract manufacturing of high pressure CAN for different companies.

UM-1, the D-shaped battery, was mostly used in torchlights, radios, cassette players and emergency and camping lights.

The company stated in its latest annual report for fiscal 2020-2021, "Initially, the market demand of UM-1 batteries was very high but gradually decreased over time due to technological changes. That resulted in UM-1 batteries becoming almost obsolete."

At this point, the major income comes from UM-3, which is mostly used in calculators, remote controllers, and cameras, calling bells, toys, and watches.

The production of batteries began in 1993 to meet growing demand in the country.

Currently, it produces four types of UM-3 batteries. It said in its annual report, "Although the company fulfills 70-80% of the market demand of UM-3 batteries, we have noticed that sales of UM-3 batteries have continued a declining trend for the last couple of years."

Olympic diversifies to cookies  

Olympic Industries – initially, engaged in making dry cell batteries – was incorporated in 1979 as Bengal Carbide Limited.

After diversifying its business, the company is now dominating the biscuits industry. 

In 1996, the company first diversified its business into biscuit and confectionery items.

In 2008, it acquired Tripti Industries and made its entry into the ball pen industry.

Owing to growing demand for its products, in 2019, the company launched its tenth biscuits line.

In the 2020-21 fiscal year, its revenue stood at Tk1,803.25 crore, which is a 13% growth compared to the previous fiscal year.

Of the total revenue, dry-cell battery sales accounted for 2.25% of the company's total net turnover in FY21 compared to 2.93% a year ago.

According to its annual report, dry-cell battery sales increased by 0.28% over the previous year.

In this fiscal year, the company sold 5.52 crore pieces of dry cell batteries, which was 5.50 crore in fiscal 2019-2020.

The revenue from this segment declined by 12.76% to Tk40.56 crore in FY21 from Tk46.49 crore in FY20.