garment industry

1. PRESENTED BY:
SHWETA GARG
GARMENT INDUSTRY
MBM 104: INDUSTRY ANALYSIS

2. Contents
INTRODUCTION
HISTORICAL BACKGROUND
EVOLUTION OF THE INDIAN
TEXTILE SECTOR
GROWTH OF GARMENT
INDUSTRY
MARKET SHARE
BACK-END VALUE CHAIN
GDP CONTRIBUTION

3. Contents
EMPLOMENT IN INDIAN TEXTILE
AND APPAREL SECTOR
REGULATORY BODIES
MAJOR SEGMENTS
CONCENTRATION RATIO
PESTN ANALYSIS
SWOT ANALYSIS
PORTER’S FIVE FORCES MODEL

4. INTRODUCTION

5. Indian textile industry is one of the
leading textile industries in the
world. Though was predominantly
unorganized industry even a few
years back, but the scenario
changed after economic
liberalization of Indian economy in
1991.
The opening of the economy gave
up the much needed thrust to the
Indian textile industry, which has
now successfully become one of
the largest in the world.

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462250 Crore

7. HISTORY

8. The history of apparel in India
dates back to the use of mordant
dyes and printing blocks around
3000 BC. The foundations of the
India's textile trade with other
countries started as early as the
2nd century BC.
A hoard of block printed and
resist-dyed fabrics, primarily of
Gujarati origin, discovered in the
tombs of Fostat, Egypt, are the
proof of large scale Indian export
of cotton textiles to Egypt in
medieval periods.

9. During the 13th century,
Indian silk was used as barter
for spices from the western
countries.
Towards the end of the 17th
century, the British East India
Company had begun exports
of Indian silks and several
other cotton fabrics to other
economies.

10. These included the famous
fine Muslin cloth of Bengal,
Orissa and Bihar.
Painted and printed cottons
or chintz was widely
practiced between India,
Java, China and the
Philippines, long before the
arrival of the Europeans.

11. EVOLUTION OF THE
INDIAN TEXTILE SECTOR

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13. GROWTH OF GARMENT
INDUSTRY

14. The industry has already given
ample hint of ingenuity, as is evident
from the revival of consumer
enthusiasm in the seemingly
stagnant menswear segment,
besides remarkable growth in
categories like sports wear, casual
wear and party wear.

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Source: The Fibre Year , The Textile Intelligence, UN Comtrade,Secondary
Research ,Techopak Analysis

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17. CONTRIBUTION OF
INDIA TO THE GLOBAL
MARKET (% SHARE)

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Source: The Fibre Year , The Textile Intelligence, UN Comtrade,Secondary
Research ,Techopak Analysis

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Here

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21. TOTAL APPAREL
MARKET

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23. BACK-END VALUE
CHAIN

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Source: company, CRISIL research estimate

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SUPPLY CHAIN

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27. GDP CONTRIBUTION

29. Textile and apparel sector is the
2nd largest employment provider,
next only to agriculture.
Contribution of this sector to the
total factory industrial workforce
stands at 19%.
Contribution of readymade
sector to total employment
sector has improved from 17% in
2006 to 25% in 2011.
Source: Technopak Analysis

30. EMPLOMENT IN INDIAN
TEXTILE AND APPAREL
SECTOR

31. • With over 45 million people, the
industry is one of the largest source of
employment generation in the country .
Source : www.ibef.org

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Source: Technopak Analysis

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Source: Technopak Analysis

34. An increasing number of
international brands across
formats shall foray into India to
leverage the potential.
Keen competition is driving
international brands to adopt
‘made for India’ models leading
to higher acceptance and thus
increased share from around
18% in 2011 to 25% over the
next five years.

35. TEXTILE AND APPAREL
HUBS

36. Your Topic Here

37. REGULATORY BODIES

38. AEPC
CCI

39. MAJOR SEGMENTS

40. Apparel industry has been broadly
classified into three segments:
1. Men
2. Women
3. Kids
The size of the Indian apparel
garment market is Rs. 1,90,300 crore
out of which organized sector is Rs
38,060 crore.
The unorganized sector which
comprises of 80% of the market is
excluded.

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Source: technopak Analysis

42. CONCENRATION
RATIO

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Your Topic HereMajor players % Market
share
madura fashion and lifestyle 5.55
Raymonds’ suitings 3.69
Koutons 3.16
Arvind mills 2.28
Itc wills lifestyle 1.78
Spykar Lifestyle Ltd. 1.61
Indus league clothing 1.44
Zodiac clothing pvt. Ltd. 1.12
Kewal Kiran clothing Ltd. 0.61
Alok industries 0.13

44. CR4 = S1+S2+S3+S4
MEN’S MARKET
2.2+1.47+1.26+0.91= 5.84
So this market has
PERFECT COMPETITION
WOMEN’S MARKET
1.94+1.29+1.10+0.80= 5.13
So this market has
PERFECT COMPETITION
KIDS’ MARKET
14.3+11+7+5 = 37.3
So this market has
OLIGOPOLY COMPETITION
CR4 = S1+S2+S3+S4

45. Your Topic HereCR6= S1+S2+S3+S4+S5+S6
MEN’S MARKET
2.2+1.47+1.26+0.91 +.0071 + .0064 = 5.8535
So this market has PERFECT COMPETITION
WOMEN’S MARKET
1.94+1.29+1.10+0.80 + .0056 + .005
= 5.1406
So this market has PERFECT COMPETITION

46. MEN’S MARKET
2.2+1.47+1.26+0.91 + .0071 + .0064
+ .0057 + .0044 = 5.8636
So this market has PERFECT COMPETITION.
WOMEN’S MARKET
1.94+1.29+1.10+0.80 +.0062+ .0056 +
0.005 + .0039 = 5.1507
So this market has PERFECT
COMPETITION.
Your Topic HereCR8= S1+S2+S3+S4+S5+S6+S7+S8

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48. PESTN ANALYSIS

49. POLITICAL FACTORS

50. In the textile sector, 100%
foreign direct investment
(FDI) is allowed under the
automatic route.
Implementation of 51% FDI in
multi brand retail is expected
to improve supply chain.

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• Under the Apparel Parks For Export
Scheme, 12 projects are sanctioned
with the GoI’s share of ` 1.9 bn and four
projects completed at Bangalore-
Karnataka, Thiruvananthapuram-
Kerala, Tirupur-Tamil Nadu, andTronica
City-Uttar Pradesh.

52. ECONOMIC FACTORS

53. Cotton yarn prices have
declined five-seven per cent on
(7 OCT), owing to high
inventory and low demand.
Apparel companies are
strengthening front and back
end operations through
mergers and acquisitions.

54. Traditional centres like
Tirupur and Jaipur, units in
Delhi, Noida, Ludhiana,
Bengaluru and Chennai are
doing well. The units in
Mumbai are moving
towards south especially to
Bengaluru due to high cost.

55. SOCIAL FACTORS

56. Indians are taking tips from social
media before shopping online.
30 apparel manufacturers from
across India are showcasing their
readymade garments to American
buyers at a two-day Fashion
Buyer-Seller Meet .

57. Kids and youth are influenced by
icons & characters and desire to
possess them in their everyday
life. India has become an
important market for character
licensing specially in apparel .

58. TECHNOLOGICAL FACTORS

59. Indian garment producers are now
installing new technology not only for
production but also for design,
commnication and integration of the entire
supply chain.
Technological transfer is beginning to take
place at a higher speed after de-reservation
of garment sector.

60. Information Technology plays
a crucial role in apparel
manufacturing. Global
partners in the clothing
supply chain are exchanging
information electronically.

61. NATURAL FACTORS

62. Worldwide surge in demand
for organic and eco-friendly
products. Organic cotton, the
most popular eco-friendly
fibre finds its way into
international apparel
brands.

63. SWOT ANALYSIS

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STRENGTHS
•Abundant Raw Material
•Low Cost Skilled Labor
•Presence Across Value Chain
•Growing Domestic Market
WEAKNESSES
•Fragmented Industry
•Effect Of Historical Govt. Policies
•Lower Productivity And Cost
Component
•Technological Obsolescence

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67. Porter’s Five Forces Model

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Conclusion and
implications

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•The 2006 trade relaxations in retail sectors
have opened a gamut of opportunities for
new entrants, who can enter the Indian
market via greater control entry modes.
•The overall assessment of the five
competitive forces indicates that the Indian
apparel retail sectors pose a relatively low
level of threats of entry with a fast industry
growth rate and a growing income and
demand for western brands

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Moreover, as Porter points out, a high growth
rate may not drive up profitability if substitutes
are attractive to customers. Our assessment
indicated that, among other forces, the threat of
substitutes in the Indian apparel industry is
substantial due to the availability of various
substitutes at lower cost at more convenient
locations in a more culturally familiar way
Lastly, increasing industry density and the
regulated retail environment have put pressure on
the profitability of the Indian apparel retail
industry as the rivalry between domestic and
foreign retailers is growing.