Mr. Vikram Rao
Group Executive President Madura Garments
Madura Garments is a part of Indian Rayon and Industries Limited a flagship company of the Aditya Birla Group. India's leading apparel and retail company owns/ have perpetual license for premier brands like Louis Philippe, Van Heusen, Allen Solly, Allen Solly Women's Wear, Peter England, Byford, Elements and SF Jeans.
What is your reaction to the Budget proposals for the textile industry?
"Continuing the focus on development of the textile sector in the past budgets, the proposals of Budget 2005-06 have paved the way for long term growth of the textile industry. Reduction in the duty on textile machinery & capital subsidy for the textile-processing sector would speedup the capex plans of the textile manufacturers by reducing the funding costs while reduction in excise duty on Polyester Filament Yarn & duty on textile fibres, yarns & intermediates would make products cheaper & competitive in the export markets. The textile industry would see world-class capacities being set up in sectors which have been freed from the reserved category which would be catering to the increasing demand from the global market.Overall, the measures would enable the industry to gear up to grab the vast opportunities in the global scenario."
In the past, apparel manufacturers set up their own outlets because of the dearth of retailers. As various retail formats now comes in, would manufacturers continue to expand their own retail outlets?
Yes. Every brand has to cater to its brand promise as regards the personality it caters to & the retail experience to match that personality. This promise can be best demonstrated through Exclusive Brand outlets. This would also fuel growth in the Multi-brand outlets. As such, inspite of new retail formats coming in, the apparel companies still have to expand their own retail network. However, there is obviously scope of learning from the new retail formats.
Madura Garments is considered to be the first company in India to implement ERP in inventory-specific solution called 'Apparel and Footware Solution.' Can you tell us the IT history of Madura Garments?
The IT infrastructure of Madura Garments is one the best available in the country and is a result of constant endeavor to be in the league of international players in terms of IT systems. Until 2002, we were running legacy systems at the corporate office, warehouse and factory. It was a challenge to integrate all the systems from the heterogeneous to homogenous environment. We decided to implement an ERP solution after doing a BPR and implement SAP in July 2002 as they had a solution for the apparel and footwear industry. It was risky as it had not been implemented anywhere in India but driven by our commitment to remain technologically ahead of our competitors, we took the plunge. Since then, we have gone ahead and implemented solutions like advanced planning and optimization tool and the demand planning modules. We have also put in place a business intelligence solution. In coming years, our focus is on retail and we are in the process of implementing a CRM solution. We are also planning to carry out a proof of concept on RFID.
What is your outlook for the domestic readymade garments market, after 2005?
The readymade domestic readymade garments market in India is expecting a boom with RMG segment increasing its share in an increasing apparel market. The Indian apparel market is estimated at Rs.80,000 Crores at the end of year 2004 and had witnessed a growth rate of 13% year after year. The growth in the RMG segment would be retail driven with organized retail touching a base of Rs.30,000 Crores and increasing its share to 4% of total retail. The apparel companies are all geared up to grab a share of this pie and are increasing their capacities. The market would see better products at better prices from the apparel companies. The share of premium & super-premium categories has been increasing at a much faster rate as compared to the overall apparel market and would continue to do so as the base is still very low. But the trend is encouraging and is a reflection of growing prosperity in the economy. The domestic market would also see many international brands coming to India in the next few years and offering similar range as they offer in the developed countries. Overall, the domestic readymade garments market is having a very positive outlook after 2005.
What would be your company's main focus in the next couple of years?
Our company is looking to consolidate its position in the domestic market and increase its presence in the international market in both branded exports and contract exports. We are looking forward to have a profitable growth in all the segments we are present in. Our brands have been growing at a rate of 20 - 30 % and we foresee the same to continue for the next few years. We have plans to achieve this by strengthening our retail presence. Organized retail is increasing its share and with more brands coming to India offering world-class retail experience, retail has become one of the critical growth drivers of the company. However, we see great value in retaining a multi-channel distribution structure. Our company is also focusing on making innovative product offerings to the market. IN addition to our premium brands Louis Philippe, Van Heusen, Allen Solly and SF Jeans, we expect great value to come from our popular brand "Peter England"
What do you think is the future of the Indian textile industry?
The future of the Indian textile industry seems promising with the domestic players building world-class capacities & moving up the value chain. Backed by the support from the Govt. through the budget proposals, the players have prepared themselves to cater to the increased demand from the global market as well as from the domestic ready-made garment manufacturers This would enable the industry to increase its share in the global textile trade. De-reservation of products related to hosiery & knitting products would enable this sector to grow to a different playing field with large capacity building made possible enabling cost competitiveness with international players & progression to higher end of the value chain. The industry may also witness consolidation of the existing players in the textile belts and a diversification of the portfolio which is skewed towards cotton as of now.
There is a growing demand for brands at lower price. What impact does this have on your brands that cater to the upper segment?
The growing demand for brands at lower price is a result of a growing readymade apparel market and would be having a positive impact for our brands catering to upper segment in the long run. In the Indian apparel market, the trend being witnessed is that people is migrating from unbranded products to economically priced branded segment and from economically priced branded segment to premium segment. The premium & super-premium men's-wear market has grown at a rate of 20% as compared to overall menswear market growing at 12% (KSA Technopak study).
Published on: 26/07/2005
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.
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