Apparel Online India Magazine May 2nd Issue 2018 | Page 9
MIND TREE
all factors matter. So long
as the promoter is sincere,
even the odds may turn out
to be an advantage for the
business. Take for example
our case; even though we
are a small garment factory,
we have always questioned
the prudence of operating a
dedicated sampling unit to
support our factory. Ideally
a garment factory of our size
would surrender to a larger
exporter. Though its future is
sealed, the sampling and office
overheads are much smaller.
However, due to our direct
export ambition, we stayed
committed to our sample room.
This always left a huge hole in
un-serviced overheads during
the off-season each year.
Some of the most serious
challenges faced by the Indian
garment export industry are the
lack of adequate infrastructure
and an inefficient banking
system. China has a pegged
exchange rate mechanism
(Chinese yuan is 6 times
cheaper than the USD even as
China has multifold trade surplus
over the US). Chinese bank
NPA rate is 68% (read as 100%
state subsidy for businesses).
China also has a state-of-the-
art infrastructure. There is not a
single port that can harbour a
mother vessel that we can use,
this means that nearly 10 days
will be wasted in each Europe-
bound shipment in hopping
over Colombo. Bankers too are
partial, and crystallize a sticky
bill on the very 181st day of
NEXT MINDTREE QUESTION
In the current difficult scenario, the entire supply chain associated with apparel
exports, is under pressure. Being a buyer representative or buying house, what
steps are you taking to cope up with this situation? So far, how much growth or
downfall have you witnessed in the current fiscal?
What are the changes in sourcing strategy that you brought in to maintain
your business?
overdue even as they debit
ECGC premiums from our
accounts every month. They
will not pass even a Rs. 2,500
cheque under temporary
overdraft (TOD) in spite of
having collected crore of
rupees in interests over the
years. What is worst, there
are about 18 unannounced
automatic debits of bank
charges which the account
balance will have to
survive before servicing an
issued cheque.
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