How the New Year Will Pan Out for the Innerwear Industry?

The new year is upon us and what a start to the new year in Mumbai, particularly for the Mumbaites, a twin tragedy at Kamla Mills Compd just before the New Year celebration was quite a dampener. Well businesses have picked up quite well I would say in the week following the New Year and looks like the folks want to put behind the memories of the demon and GST behind them and concentrate on building blocks of trade and there is ample opportunity on the horizon for everybody. There are lots of gaps after the implementation of GST in the market place, which a smart strategist can easily identify and tap into almost immediately.

Today the game is becoming much stronger with marketing and sales acquiring a full-fledged option for the brand to get the product made by a third party and they concentrate on pure marketing and brand building alone. Same goes for manufacturing as well. So with the onset of GST and pan India market we will have specialised marketing and brand shops who will concentrate on creating conceptual marketing and build product storylines.

The same would go for manufacturing set up which would be place where many brands or a dedicated brand would go to get their product lines developed. This will lead to a lot of standardisation and quality issues being resolved and a QC parameters being built into the system. Compliance both domestic and international and third party inspections which were only for the export industry will be a standard practice for the local manufacturing as well. A lot of the smaller players will now have to converge into manufacturing hubs for the larger brands and players in the market in many product categories and especially in the RMG sector in India. 

Going ahead we will see a lot of consolidation in the market place and there will be an atmosphere of investments by fund managers and investment bankers to acquire stakes in mid-level companies wanting to stakeout and capitalise on their book and brand value. So M&A, JV’s, Capital infusion and Equity participation for capacity enhancement, brand building and production development will be the norm in the coming year or so.

This will be the golden period for the RMG sector more so for the green field industry like innerwear in India, which is the focus of many brands and countries worldwide who see the innerwear market of 3 Billion USD with 500 million middle class upwardly mobile population hungry for products and brands which no country can offer on a platform.

We shouldn’t in a hurry to lay the red carpet for them. We shouldn’t forget for a moment to put India First like Trump is doing for America with America First philosophy. Because always remember we exist as a market because we exist as a nation and that's what attracts everybody as India is a big Market! Let’s not be exploited! We should be sound enough to not let ourselves be exploited in the bargain.

As we rush this issue to the Press I get the news that the Govt has announced 100% FDI in single brand retail through the Automatic route, something that was on the back burner for the last 15 years or so. What consequences it will have we will debate it soon.