Business

Why Is The Indian Textile Machinery Industry Performing So Below Potential?

The story of Indian textile machinery industry is intriguing to say the least. With Indian textile industry ranking second in the world in most avenues, one would have thought it must be a fertile ground for a strong machinery base for catering to the huge demand. However, for some reason, few explainable and some not, Indian textile machinery industry has not been able to capture major market share or reach the growth pinnacles macro factors would suggest possible. This is not to say that there are no bright lights in the industry. Spinning, particularly led by LMW has been a torch bearer and set global standards in some areas of the spinning cycle. Processing is a half way story. Some good performers but still not to potential. Weaving remains a weak area, especially in the higher technology and generation machines. Some thoughts on where we missed and what we can do. The issues that hold us back Waiting - There is no demand Somehow typically Indian textile industrialists seem to think it is the customers’ responsibility to create demand, then wait for them to set up their plants to cater to it. Best part is that this has happened. There was a surge in modernisation, compressed into a short time frame due to various factors including TUFs. As was bound to be, there were no quality domestic suppliers who could supply the specified equipment in sufficient volumes at the right price point. Yes, there is an argument that permitting second-hand machines probably contributed, but is a point that only partly answers the question. The second-hand machines did not come free. Even if those machines had not been permitted, there were practically no manufacturers at scale or those who could have ramped up production to the thousands of numbers required. We were, and even today, barring few, are not ready for high demand. Mindset - They don’t buy Indian Come again? For any true professional setting up or assisting in setting up a project, the racial profile of the machine is secondary to performance and commercial returns. He will not buy Indian out of pure patriotism, at the same time he does not hate Indian. The decisions are made on the basis of design, productivity and yes, his confidence in performance of the machine to match that on paper. The machine manufacturer has to realise, they don’t buy from ‘him’. That he is Indian is not the failure point. Business placement - Neither original nor imitation In my opinion, Indian textile machinery manufacturers could never really decide the strategy or their USP placement. Unlike China, where they unabashedly went ahead and imitated successful models down to the colour and covers, simply focussing on reengineering and economics of scale to bring costs down, delivering 75% performance of the original at 50% of the cost. That made it attractive for the textile industry to buy from China. We were either too image conscious to follow that path or simply did not think the scale and volumes to make things price effective. Of course, there is practicality zero in terms of researched and originating from India in textile machinery designs and equipment. So probably this confusion of business placement still continues. Lack of Marketing Here again from an overview of an outsider, there seems to be a confusion. Seeing aggressive budgets and spends in marketing is rare. We neither seem to go whole hog expenditure in marketing with fixed salary staff and our own offices at the various important clusters, like the Europeans would do, nor do we go the other end of Chinese method appointing numerous agents that have a local hook into even the smallest of the concentrations of manufacturing. That Chinese can come into Surat and inspite of all the handicaps of language, etc still be able to sell 27,000 rapier weaving machines within the last few years is tribute more to their marketing in addition to the product. Lack of professional marketing teams and/or associations with other pure marketing companies has kept volumes low and in the trap of costs being higher due to same and vice versa. Shrugging off responsibility I know most of the owners of textile manufacturing units are not going to agree about this. What we mean is not intent, but commitment. The usual approach of the technical team servicing the machine is to check mechanical parameters and shrug their shoulders beyond that. Truth be told, many of our MSME machine suppliers do not have training centres or any formalised training programs for operators. Let alone related to making a better produce in terms of SOPs and the intangible aspects of quality. So left to mercy of untrained operators or technicians it’s no wonder that soon machines do not perform to best of capability and get an undeserved reputation of being troublesome. In summary the issues with Indian textile machinery seem more business and management related issues rather than lack of know how or capability. Can they be addressed and solved? Of course. Looking to cover that in the next part.