The session titled “Denim Club: Overview of the Indian Denim Business” on the first day of the ongoing InFashion 2012 at Mumbai focussed on how to maximise the denim business and maintain a steady market growth, while chalking out a plan for the future.
The participants were of the view that though the Indian market is currently fragmented, consolidation is not the answer to its growth. This is because in the more developed markets such as Europe and USA, consolidation happens in case of market stagnation or negative growth. In contrast, the Indian market is seeing a robust growth of 15 to 20 percent in recent years, and there is ample space for all players to grow.
The panellists said that though the Indian denim market is flourishing, the country still has a lower consumption of the fabric compared to the production. This has lead to a considerable surplus available for export.
With import duties coming down and stiff competition from countries such as Bangladesh, the speakers said innovation has become a necessary condition to ensure further growth and profitability for the Indian denim companies. They said the need of the hour is an effective collaboration between countries such as India and Bangladesh, where the respective strengths of the two countries in abundant raw material and cheap production facilities can be combined to create a winning proposition.
The “Textile Retailers Profitability Conclave” that followed the session shared the success stories of small and medium sized retailers while advising them to adopt better measures to improve their profitability. The panellists pointed out that the established and bigger retailers were not the only ones making good profits. Small and medium retailers from villages and towns all over India have also been on a steady and profitable growth path in their businesses.
As proof, participants mentioned a modest Marwari retailer in Ahmedabad with two stores and over 100 workers that was doing a business of an impressive Rs 18 crore every year. Another retailer Pakeeza in Indore, which is a family-run store, did a record sale of Rs 90 crore last fiscal.
The session moderator Ramesh Poddar, President, FAITMA, and Vice Chairman & MD, Siyaram Silk Mills, called these small retailers as hidden “diamonds” of the industry. The panellists were unanimous in their view that to make a business grow, the entrepreneur needs to keep a strong personal touch with the employees as well as with the customers. Keeping a track of the inventory and product consumption patterns came across as the key to growing one’s business and profits.
-Madhumita B Sinha