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Varietal
production of Indian garment industry - II
M
K Panthaki
The
recession-hit economies of the West has taken its toll on supply
chains which are closing down numerous outlets in the West to shift
to Asia
Garments
included under the non-restraint category are high-value items,
requiring skill and good quality fabrics. The growth in production
of these categories is a pointer towards a gradual improvement in
technology by the industry. It also speaks well of the resolve of
the industry to move away from restraint categories in possible
preparation for a non-quota regime after 2004. Special mention needs
to be made of spurt in production of babies garments, track suits,
and underpants/briefs. Another redeeming feature is production of
swimwear which has had a modest beginning. Production of swimwear
is not expected to catch on very fast in India owing to social inhibitions.
However, as an item of healthcare, it is expected to cater to the
upper class of society which has no inhibition on this score.
Competition from foreign brands:
Shift from manufacturing to trading
Many well-known Indian textile and garment houses have tied up with
well known foreign brands in the US, Italy, UK and other countries
in the West to manufacture all types of garments ranging from shirts
and trousers/jeans to men and ladies/underwear. The fruits of the
joint ventures are being tasted now.
Yet again, quite a few erstwhile garment manufacturers have found
it more lucrative and less irksome to take up dealership of well
known foreign brands.
The “foreign invasion” is now creeping into supply and
retail chains. Having already set up malls in prominent areas in
the business cities of India with an air-conditioned ambience and
extremely courteous and helpful staff with light, lilting music,
it will be extremely difficult for any customer entering such an
ambience to walk out of the store without a loaded carrybag. The
customer is aware of the high price that he pays for the purchase
but considers it as a premium for the attention bestowed on him
in the store. These high prices will quickly neutralise the high
cost of overheads. It is natural to expect that, consistent with
the quality of the merchandise, attempts will be made to reduce
margins with the object of carving out a bigger niche of the market
than at present. That will be the true test of resiliency and competitiveness
of the domestic industry. The domestic industry has only another
three to four years to achieve this. If it fails to do so, its activity
will well have to shift from manufacturing to trading. But even
for this, the community cannot rest with its present skills. These
will have to be honed and made more sophisticated to stand up to
these forces. If and when this transformation takes place, the industry
will become more compact with only selected manufacturers who have
upgraded technology, surviving this holocaust, while the rest will
have to concentrate on trading activities. This undoubtedly will
mean loss of several jobs but then that is the price the industry
will have to pay for its lack of technological competence.
Discount stores
The recession-hit economies of the West has taken its toll on supply
chains which are closing down numerous outlets in the West to shift
to Asia. Bombay and Delhi will be shortly witnessing the setting
up of discount stores and shopping malls. Prices at discount stores
will prove attractive to Indian consumers who will be pampered by
the availability of several items of necessity in the consumer’s
list. This, thus, is a pre-view of the likely future changes in
the marketing strategy in the Indian domestic industry. Domestic
industry should beware of this trend.
(Concluded)
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