admin
February 13, 2004
Devangshu Dutta, Chief Executive of Third Eyesight, a retail and fashion services firm, said. “Retailing in India is set for the next big leap – what began as forward integration for manufacturers such as Bombay Dyeing and Raymond in the 1960s, has almost suddenly reached a stage where even smaller companies, individual entrepreneurs and real estate owners are willing to build organisation and structure into their businesses.
“The availability of quality real estate in the form of shopping malls is probably the biggest enabler of the organisation of retail business. From small 300-400 sq. ft. outlets in disorganised high streets, one now has the option of opening a well-furnished store in the well-equipped environment of a mall.
Highlighting the challenges ahead, he pointed out that, “The biggest challenge for the mall owners is going to be to find enough different brands to fill the space, so that the differentiation between the malls is maintained. Otherwise the 35-40 million sq. ft. that is coming up will end up looking the same all over, and one can foresee a bloodbath in the mall business. The challenge for retailers, on the other hand is to develop people at all levels, from frontline sales staff to middle-rung and senior managers to run the retail business. Their skills need to be of global-best standards, to allow indigenous retailers to not only compete with foreign retailers in India, but also to enter markets outside the country.
“Indians have a long history of being merchants of fashion, and moreover, of being able to build powerful brands informally – we need to combine these capabilities to create a truly vibrant fashion and retail industry where innovative and uniquely Indian brands are created, that are world-class and globally accepted. Outsiders have long appreciated the Indian industry’s strengths – the industry now needs to realise these itself.
Speaking about malls presenting competition to high street retailing, he commented, “High streets need to reinvent themselves quickly. Unlike European high streets which had a lot of protection from urban planners, and some lead time to develop a competitive strategy against out-of-town shopping, Indian high streets are faced with the prospect of sudden demise with the entry of huge malls in their own vicinity. Local market associations must rush to making sure their members work together and recreate a vibrant and different shopping environment to retain their customers – otherwise independent shop-owners will fall prey to Indian organised retailers much before foreign retailers even hit Indian shores!”
admin
October 15, 2003
In the throes of two wars – Conflict in Iraq and the fight against SARS – Interstoff Asia went without a hitch although, understandably, attendance was affected , with a 25 per cent drop against last spring’s show.
Interstoff Asia welcomed 7000 visitors to the spring event, held from 25-27 march, and they weren’t disappointed because of the 266 exhibitors promised, only seven from Thailand and one from Taiwan decided not to take the risk of attending. An extensive programme of seminars, product presentations plus trend forum all added up to a strong show, which attracted buyers from international brands such as Burberry, Marks and Spencer, Adidas, Victoria’s Secret, Skechers and, of course, US designer labels Calvin Klein, Donna Karen and Ralph Lauren, who where out in full force.
Two of the 12 seminars looked at sourcing worldwide. As one of the largest and fastest growing economies in the world, India’s consumer market offers lots of sales potential for international consumer brands. Devangshu Dutta made a presentation on ‘India’s Textile and Clothing Industry Today and Opportunities to Partner’. The seminar highlighted the advantages of buying from India, from the lower labour costs in the world, to a long textile history and the convenience of English as its main business language. The figure for exports from India in 2000-2001 reached US$ 12.10bn. The government target is US$ 20.70bn by 2005. The US and EU account for 70 per cent of exports. However there are also disadvantages, such as a fragmented industry structure, inefficient infrastructure and lack of trade pacts. Devangshu Dutta’s advice to companies interested in India was to develop a well researched and solid stratergy.
‘ Global Sourcing and International competitiveness in the Textile and Apparel Industry’ by Dr. Gary Gereffi of Duke University, predicted that China would replace Hong Kong as a main product source for the US. However, Japan remains the most advanced of the Asian countries with regard to production of clothing, textiles, fibres and machinery. Mexico and Turkey are also keen to get in on the action. Without quota restriction, small exporting countries without an integrated manufacturing set up will lose out against the big integrated exporters.
Environmentally friendly, natural products will become more important in the future and Cargill Dow took to the Interstoff platform for the Asia launch of its PLA corn based product Ingeo. Tim Eynon and Dr.Jim Lunt of Cargill Dow described the advantages of the recyclable and biodegradable product and envisage a large amount of oil based PET will be replaced by PLA in the future. Cargill Dow recently signed an agreement with Far Eastern of Taiwan to supply Ingeo chips to make yarns and fabrics. India and China will also be involved in marketing development in the future. In Japan, Cargill Dow has been woirking with Unitika, Kuraray, Kamebo and Toray for quite some time, and in Hong Kong with Fountain Set since last year.
Another new natural product introduced at Interstoff Asia was Luobuma , a fibre with a 5000 year history, collected from the wilds of the Xinjiang Province. The plant has medicinal and health boosting qualities, such as breathability, anti-bacterial, UV protection, moisture absorbency, as well as stimulating circulation and far-infrared benefits for cell repair and arthritis relief. Luobuma also stands up to frequent washing very well, in fact, tests prove that the qualities of the fibre actually improve. The product is being promoted by the Xinjiang Green Health Luobuma Co. The company currently produces 30 tons a year, which makes up to 130 tons of product when mixed with other man-made and natural fibres. At the moment, the plant can only be harvested from November to March each year.
Bodywear Pavilion
In addition to the various international sections, the product pavilion featured the relatively new bodywear fabrics area. The programme was introduced a few years ago, but has grown considerably in size. This year the section boasted 30 exhibitors and its own trends display area. Hyosung of Korea – producer of elastane Creora – held court, exhibiting with seven of its customers and holding fashin shows throughout the days. The company used the show to promote its chlorine resistant Creora H-250, antibacterial Creora C100B, heat resistant Creora C-300 and fluorescent H-100F. As leading supplier of elastane in Korea, Hyosung holds more than 50 percent of the market share at home and is now the second largest supplier in the world. Due to high demand in China, the Shangai factory is expanding. Meanwhile, outside the ‘Hyosung zone’, 19 companies exhibited under the auspics of The Taiwan Textile Federation. Chifa Leather’s busy stand proved that despite a significant drop in the export of man-made leather from Taiwan, it has managed to survive by going upmarket, thus avoiding price competition with Chinese exhibitors. The company has also diversified into functional performance fabrics. Lower visitor figures were not an issue for another Taiwanese exhibitor, Ruentex, as it had already presented its new collection to main customers at Premiere Visionand Textworls last February; although the company did manage to find new business at the show. The collection incorporates UV protection, stain resistance, quick dry and antibacterial functions into fashion apparel fabrics, such as cotton, Tencel, rayon, ramie and linen.
Thai exhibitor figures diminished from 19 down to 12, due to fear of the SARS virus, but Nan Yang was undeterred, promoting its Dry-Tech Comfort System, in addition to stretch fabrics with a cotton hand feel for sports, body and underwear. The double layer Dry-Tech transmits, disperses and absorbs moisture, resulting in a 50 per cent quicker dry time than cotton. The Thai cottage industry is alive and well, in the form of Neoteric Life Ltd. Specializing in handwoven cotton and silk fabrics produced by villagers, the company offers advice and handles the sales and marketing side. As the Japanese are always looking for specialized, handcrafted items, it is the company’s main market at the moment.
It was only a decade ago that India and Taiwan were the largest exhibiting groups, but this season it was the 100 plus companies from China, which dominated the show. Technology, brought about through joint venture projects with foreign companies, especially those from Japan and Taiwan, have improved the quality of Chinese produced fabric and Chinese producers now attract buyers on the lookout for value-for-money items. Although most of the items were quite standard, there are some interesting products to be found. Meisheng Cloth & Garments of Shaoxing showed prints, bonding, embroidery and embossing on micro-suede fabrics and Zhejiang Youlong Enterprises offered woven materials with spandex. The company’s dye cut moleskin was very popular with European clients. Also from Zhejiang, Yong Tong Dyeing and Weaving Co., exhibited a large variety of fabrics from denim and flock to corduroy and embroidery. Japanese companies are known for their strength in new product development. Kuraray Trading carried a variety of new functional items, including Airmint. Introduced last year, it is 40 per cent lighter than polyester and is used particularly in sports, intimate and jeanswear. Cool touch Sophista is excellent for innerwear as the quick dry feature keeps the body cool; Space Master blocks harmful rays and Panapak is anti-pilling, quick drying and is blended with cotton in sportswear. Of the dozen or so European exhibitors, Miroglio was busy right up until closing time, although Hans Borrmann, area sales manager for Asia commented that it is usually even busier. Eurojersey of Italy was hoping to catch the European and American buyers, but not many came this time. Denim manufacturer – Gap Guneydogu Tekstil – the sole manufacturer from Turkey, returned again, as it found Interstoff Asia the best fair to make contact with Asian Buyers. In general, exhibitors who relied heavily on foreign buyers where affected, but many companies were still able to meet old, new and potential clients.
The next edition will be held 7-9 Oct 2003.
admin
September 15, 2003
In Europe as also in the West, the two textile giants, India and China, are often referred to as the elephant and the dragon respectively – India is, usually, the heavier, slower but a more patient elephant while China is portrayed as the faster, fire-breathing and market-usurping dragon which can occasionally run into problems because of its inability to cope with smaller details.
China may have emerged as the textile and apparel superpower because of its low-cost mass production capability. Nevertheless, India has been the quiet player which has been working backstage and making inroads into the global markets. India hopes that its ancient tradition of handicrafts combined with modern technology will enable it to assert its position in the world’s markets even after 2004 when restrictions on the textile trade, in the form of quotas, are eliminated as the World Trade Center (WTO) regulations are enforced.
Even as they admit that they face a threat from China, many Indian exporters maintain that Indian textiles are best woven by hand rather than by machines. That, they argue, ensures their survival.
Representatives of India Trade Promotion Organisation (ITPO), which organised the Tex-Styles India 2003 from February 28 to March 3 in Delhi, have been closely monitoring the breathtaking pace at which China’s textile and apparel industry has been making progress. They say that although India is the world’s second largest producer of textiles and apparel after China, India’s share of the overall global textiles market is only 2.8% and much smaller than that of China’s. India caters mainly to its large domestic market with more than a billion population.
However, India is a top global supplier of yarn accounting for 22% of the world’s trade in this commodity; it also accounts for 3.2% share of the global fabrics and meets 2.2% of the world’s apparel demand. Indeed, India produces everything from yarn to finished apparel.
Ambitious or just unrealistic?
India’s exports of textiles were hit during the last fiscal year ended March 31, 2002, and recorded an 11% drop to nearly $10.7 billion. However, India’s textile pundits are saying that exports will rise in the current fiscal year ended March 31, 2003, to the level of $13 billion. It has also set its sights on an ambitious goal of reaching $50 billion in the year 2010, which many critics describe as "unrealistic".
Unlike China, India thrives on catering to small volume requirements of buyers. This is true in the case of apparel and allied industries such as home furnishings where India can truly flex its muscles. This is particularly evident in the case of several Indian companies which supply small but highly specialised silk fabrics to Western countries, especially to the United States. Indeed, some Indians are even importing raw yarn for the manufacture of silk from China because, according to many Indian companies, the quality of Chinese silk yarn is superior to the Indian variety.
Many Indians, aware that they run the risk of not being able to compete against Pakistan and China in the international markets on grounds of cost effectiveness, weaker quality and designs, have begun to upgrade and modernise their production operations. A study prepared by McKinsey & Company under commission from the Indian Cotton Textiles Export Promotion Council also provided a forewarning of this future scenario.
Some suppliers, who run what are known as cottage industries, where traditional hand work is carried out, turned to other mechanised means of production because the traditional hand work has been turning out to be slower and more expensive. These suppliers have been using machines now and have discovered that they can, as a result, cut costs and pass down the benefit of low-cost supplies to the importers. Indeed, by using machines, such manufacturers have been able to supply not only upper-end buyers but the lower-end clientele as well.
Subcontinent hub
A business investment consultant in India, Devangshu Dutta,
suggests that when looking at India’s potential, one should
consider the growth of the subcontinent hub, taking into account
the combined forces of India, Bangladesh and Sri Lanka.
Total apparel exports from the three places are estimated
to grow to more than US$15 billion by 2005 and US$25 billion
by 2010 from about US$12 billion in 2000.
Mr Dutta says a direct comparison between India and China would
be unfair as India grows with the subcontinent and the region
has good potential in the future. The subcontinent is also one
of the largest and fastest growing consumer markets.
There are plenty of opportunities for raw material manufacturers and machinery makers while import duties are being brought down, he says, adding that in the textile and apparel industry, foreign direct investment is on an upward trend with manufacturing as the focus area.
However, Mr Dutta says that in addition to the dominance of small-scale production, the industry does not have a clear leadership and a true supply chain integration. Supply bases are spread out over a large geographical region, while the use of technology, especially information technology, has been insufficient.
Moreover, the Indian government still has to deal with its excise and other duty or tax imbalances, and modify the labour law which makes removal of staff difficult for employers, who therefore refrain from expansion.
admin
June 18, 2003
Despite its disadvantages ( outlined in Insight into India: part I ), India presents several opportunities as well.
Opportunities for sourcing companies
As India’s basket of production increases, retailers, brands
and importers can explore specific opportunities suited to their
business. A single-point of advice to them would be to “go beyond
the obvious.” Whether you have sourced from India previously
or not, do not be limited to your past image of what the Indian
supply base can produce.
Prompt your suppliers to show you something new in terms of
product type, fabric developments etc during each meeting. The
structure of the Indian supply base will certainly offer you
the possibility of flexible and small production runs, and the
possibility of experimenting with new products
admin
June 17, 2003
The Indian textile sector has its roots going back several thousand years. After the industrial revolution in Europe, this sector in India also saw growth of an industrial complex. However, over the last 50 years the textile industry in India has shown a chequered performance.
Today the industry contributes around 14 per cent to industrial production in the country, is estimated to directly employ approximately 35 million people (in addition to the indirect employment in allied sectors), accounts for about 27 per cent of the country’s exports, and is, in sum, an important economic engine for the nation.
In part, the very diversity, scale and spread of the industry which has been its strength, has also been its weakness. Most people’s experiences and actions have included only part of the industry, rather than its whole. Thus, even government regulations and financial policies have never been able to adequately fulfil the widely varied needs of the different segments of the industry.
However, during the last 10 years, the industry’s actions, government policies as well as market events have begun to converge, providing several growth opportunities for the sector domestically as well as in the global market. As the MFA quota-regime draws to a close, India presents many opportunities for buyers, suppliers and investors to partner with its textile industry, and to profit from the partnership.
Vertical chain and variety of products
To begin with, the Indian industry is one of the few in the
world that is truly vertically integrated from raw material
to finished products. It covers fibre-production, spinning,
knitting and weaving, as well as apparel manufacture.
Among fibres, although cotton has the largest share (around 58 per cent of mill consumption), Indian industry has over the years steadily diversified its raw material base to include manmade fibres such as polyester, viscose, acrylic and polypropylene (accounting for around 39 per cent of raw material consumed), as well as other natural fibres (including silk, wool, linen). In fact, Indian companies have built global scale even in non-traditional areas (such as Reliance Industries in polyester, and the Aditya Birla group, which is the world’s largest producer of viscose fibre).
While accurate statistics for a comparable period don’t seem to be available to compare between Indian and China, India certainly has among the two second largest spinning capacities in the world. Also, this is continuing to grow and modernise – the current strength is at around 38 million spindles and 400,000 rotors. Through a steady stream of upgrading, this has emerged as a globally competitive supply base for yarn of various counts and qualities.
Fabrics have been a traditional area of strength, not just through millennia-old traditions of weaving, but through a series of industrialisation moves beginning in the late 1800s. The Indian weaving and knitting base today includes products as diverse as fine dress fabrics, shirting, worsted suiting, denim, fleece, jersey, flat/woollen knits, technical fabrics etc. Much of this diversification of fabric product base has occurred in the last 10-20 years as domestic consumption patterns have changed as well.
In apparel, far beyond the embroidered, beaded or sequinned dresses in women’s wear and bleeding madras shirts in men’s wear that so typified India’s image in the past, the country produces active sportswear, weatherproof outerwear, foundation garments, suits, socks, infant wear and a whole host of other products for all ages. Production of made-ups includes a wide variety of bed, bath and table linen, kitchen accessories, etc.
Competitive capabilities
Certainly, an abundant low cost labour base has been one of
Indian industry’s advantages. Various studies by consulting
firms such as Kurt Salmon Associates, Werner, Gherzi Textile
Organisation as well as other bodies have highlighted India’s
cost advantage, as well as the long-term sustainability of this
advantage.
What is more important is that, among this abundant workforce, the fabric or garment-making skill is very high as entire communities have participated in the trade and sustained and refined workmanship. In fact, workers in the Indian industry are often referred to as “kaarigar” (artisan or craftsman), even though recent trends of increasingly automated equipment have emphasised deskilling of the worker into an “operator”.
It is this existing needlecraft base that has enabled the Indian industry to retain its position as one of the key suppliers of apparel and textiles, and also add new products to its portfolio by rapidly learning the techniques.
In addition to this, Indian industry has consistently remained flexible in terms of production quantity and lead time. While typical production runs are governed by fabric colour minimums, India presents the possibility of producing quantities as low as to a few hundred pieces. This capability is especially critical in an unpredictable market where retailers and brands are looking to source ever-smaller quantities of product, increasingly closer to the season.
During recent years there has also been qualitative improvement in management assets. This is especially critical: as retailers and brands consolidate their businesses, they expect their suppliers to become more sophisticated and take on more roles that were previously done by the customer. Therefore, suppliers need to become more sophisticated in their management practices, processes and technology, which can only be built if the senior and middle management are well-educated and technically qualified.
So, building on top of the textile engineering base which began in the 50s, the 90s saw growth in “fashion management” studies, including marketing and merchandising, garment manufacturing technology, design management, fashion communications management etc.
Simultaneous growth of the organised branded market within India, as well as the entry of larger companies sourcing from India, has given these fashion management graduates the playing field on which to further hone their skills, and provide a pool of management talent to Indian as well as global companies like Gap, Nike, Reebok, Tesco, Next, Asda, Wal-Mart, Limited etc.
The policy environment that was unfavourable to large-scale manufacturing in the past has also created an unintended strength – a base of design, product development and merchandising capability.
Due to restrictions placed upon the size and composition of manufacturing capacity that could be invested in, from the 60s until the early-90s a number of companies grew their business solely on the basis of “merchant exports,” ie, trading. This business model needed strong marketing and merchandising capabilities, as well as an eye for design and skills in product development. Over time this has built up into a sustainable strength and competitive advantage of the Indian industry. Buyers also recognise this skill as a key element of sourcing from the Indian industry, as visible from the frenetic rate of new sampling that goes on every season in factories around India.
Geographic spread and concentrations
The size and diversity of the Indian industry becomes immediately
clear from listing the various geographical locations where
the industry exists and their skills-sets.
Yarn, fabric and apparel manufacturing takes place practically across the country. There are over 1,500 organised spinning units of significant scale, and over 280 composite mills that are vertically integrated from spinning to finished fabric. In addition, there are over a thousand smaller spinning units, around 200 exclusive weaving units and an estimated 375,000 “powerloom mills” which operate in the small-scale sector.
However, there are certain concentrations of skills and product type that have developed over the last 30 or so years.
Western India, including the states Gujarat and Maharashtra, have a number of spinning units as well as composite mills. Also in the west, the Surat belt is known for polyester fabrics, gaining from the proximity of large polyester yarn suppliers. Surat’s industry has been a fast-growing supply base for the domestic market and, starting with the Middle East, it has steadily grown its exports also.
The south, including the Salem-Erode belt, is a hub for cotton fabric. While it dramatically grew in the 1980s and 1990s as a belt of small-sized “unorganised” mills, many companies here have recently become more sophisticated in their technology and product development.
In the apparel sector, Ludhiana, Tirupur, Delhi, Bangalore, Mumbai and Chennai are all remarkably unique and dynamic centres of production. For example, Tirupur in south India, formerly a small town, is today a stronghold of cotton knitwear with annual exports of a billion dollars. Ludhiana, in the prosperous northern state of Punjab, originally built its strengths in woollen knitwear through exports into the former Soviet Union. After a brief hiatus in the early 90s it regained its dynamism, and is now a supply hub for sweater knits to some of the largest fashion brands in the US and in Europe.
Delhi, the leading export centre for apparel in volume and value, leads also in design and merchandising skills, with smaller and flexible production quantities. Chennai (Madras), on the other hand, is more geared towards large and well-established factories producing large quantities of basic products, while Bangalore is growing in more engineered products including tailored clothing and foundation garments.
Obviously, this gross generalisation is only indicative of the relative strengths of the various locations, as individual companies with comparable or greater strengths do also exist outside these concentrations.
India as a regional sourcing hub
India is being seen by more and more customers as a hub, rather
than a stand-alone sourcing opportunity. Standing alone, India
exports about US$13 billion of textile and apparel products,
and this figure is slated to grow to over US$20 billion by 2005-06.
However, even more interesting is India’s position as a regional hub, including sourcing from Bangladesh, Sri Lanka and Nepal. In apparel alone, India, Bangladesh and Sri Lanka already export around US$12 billion to global markets, and are growing further.
Already companies such as H&M and Karstadt-Quelle manage their sourcing from these three countries together, with the regional headquarters based in New Delhi. Gap has taken it further, including its Middle East sourcing within this umbrella. Many others are following suit. The reasons for this are many and varied, including the fact that many companies in Sri Lanka, Bangladesh and the Middle East (and even as far as South East Asia – including Indonesia and Thailand) actually employ Indian professionals in various management positions. Other than that, business and cultural linkages have existed in the past and provide a platform for regional business cooperation.
Certainly, India’s size as a potential market is an important factor in its role as a hub, and many of these companies are looking to grow their sourcing base in and around India as a precursor to selling within the Indian market.
Challenges faced in India
Before listing the opportunities that India presents for various
types of companies, it is wise to acknowledge the deficiencies
and problems as well. These can be broadly classified into three
heads: gaps in the industry, regulatory disadvantages and disadvantages
India faces as a country.
A major gap in Indian industry is its fragmented structure with a dominance of small scale. Even though the government policies that created this distortion have gradually been removed, their impact will still be felt for some time.
One of the greatest implications is that since most of the companies are small, there are very few clear examples of leadership and reference points that can be aspirational or inspirational for the rest of the industry. The ones that are – Arvind Mills, Reliance or Raymond – far exceed the scale of most of the industry players, and do not provide a clear “roadmap to growth” for the rest of the industry. Having said that, apparel exporters such as Ambattur Clothing, Shahi Exports and Gokaldas have grown in an entrepreneurial manner, and can be role models.
Small scale also brings with it the problem of productivity. Various authors and researchers have placed the current productivity of Indian factories at half to one-third of levels that might otherwise be achievable. Smaller companies often do not have the resources to invest in appropriate technology or retraining, or in the re-engineering of processes. While skilled Indian labour is inexpensive in absolute terms, due to lower productivity levels, much of this advantage is lost by small firms.
Fragmentation of the supply base also creates barriers to achieving true integration between the various links in the supply chain. This creates issues of lack of control and lack of consistent or reliable performance. The huge geographical spread further complicates this issue.
Among regulatory disadvantages, one of the most insidious is the historical reservation of manufacturing for very small companies. While the original political intention might have been to spread self-reliant industry across a large population base, this reservation has created the fragmentation that shackled the competitiveness of Indian industry. Most of the sectors have now been de-reserved, and entrepreneurs and corporates are investing significant sums of money in setting up new, large factories, or expanding their existing manufacturing plants.Secondly, the government has, in the past, also kept foreign investment out of textile and apparel manufacturing. It has gradually removed these restrictions, and has also brought down import duties on capital equipment, creating grounds for foreign investors to set up manufacturing plants competitively in India. In recent years, when India has started becoming a global manufacturing base for products such as cars (Ford, Hyundai), power backup systems (APC), chemicals (Clariant) and fast-moving consumer goods (Unilever), it can certainly provide a competitive base for textiles and apparel companies to invest in.
Some other problems remain, such as excise and other tax imbalances. The political diversity of India’s 35 states and Union Territories, and a coalition of ruling parties has led to slow progress in rationalising these imbalances due to debate and discussion. However, a VAT framework is being put in place, though in fits and starts, which will clear these imbalances once it is implemented fully, and create a truly unified economic space.
Labour laws are still seen to be relatively unfriendly to business, with companies having less than ideal flexibility to follow a “hire and fire” policy. To avoid any potential trouble with labour unionisation, companies have often broken their business down into small units, which have, in turn, lost the efficiencies of scale. In recent years, there has been movement towards labour reform, and it is hoped that this will make the business environment even more conducive.
Finally, there are certain macro-level disadvantages that India faces as a country. For one, it has a global logistics disadvantage due to its geographic location. Unlike its competitors Mexico (for the US), Turkey (for the EU), and China (for Japan and the US West Coast), India is distant from all the major markets. Therefore, the cost of shipping is high and shipping time adds to the disadvantage. Cost of shipping is also affected by the fact that inbound freight traffic has been low – therefore, container movement is not at its most cost-efficient. This is changing as India imports more products and inbound freight traffic increases.
India also lacks any serious trade pact memberships, and therefore does not receive preferential access to the major markets. This leads to quota and duty disadvantages, which depress the sourcing volumes from India far below their potential.
The second part of this article outlines the opportunities for sourcing companies, consumer brands, suppliers and investors to form profitable partnerships with the industry ( click here to read it ). .
This article is based on a presentation made at Interstoff-Asia Spring 2003. The author, Devangshu Dutta is a retail and fashion industry professional. He has had the chance to work with companies globally and across the entire supply chain from consumer back to raw material.