LEAD STORY
Delhi-NCR still relying on value addition for business
• The region is the most expensive among the apparel manufacturing hubs in India .
• Embroidery , prints , sequin work and other value-added techniques are the specialisation .
• The export industry is now exploring the domestic market to tide over the lean period .
• Athleisurewear is a new category that many companies are looking at ; most are testing the waters in the domestic market .
• Expansion plans , if any , are mostly in other states .
Among the oldest garmenting hubs in India , the Delhi-NCR region has been known for its strength in womenswear , mostly because of the wide value addition options available and the small run factories that make fashion garments . International buyers understand this edge and place orders accordingly . However , of late , many other hubs have also upped their game and are offering techniques and quantities that previously were only possible in Delhi- NCR . The competition has increased significantly and factories in the region are searching for new ways to stay relevant . From going deeper into the niche category to consolidating the operations and exploring new markets , the region is in the process of revaluating its growth avenues and potentials .
Delhi-NCR , home to thousands of small exporters …
There is a segment of exporters and industry watchers who believe that nothing has changed in this region … The big exporters are still growing ; the middle ones are stable and investing in ways to stay relevant , while the small ones are struggling for survival . But , there is also a segment that believes that this slow phase has actually been good for the industry as a whole and for Delhi-NCR , in particular , as the region is home to a large number of small and medium companies who are thriving with importers / wholesalers and small boutique stores , which have withered the slowdown that has affected the bigger brands and retailers , in a much better way , though prices have been hit .
These small- to medium-level players are the backbone of the garment export industry and a majority of them are predominant in the Delhi-NCR region . Many of these players , particularly the smaller ones , have either closed shops or have reworked their strengths as global economies continue to put great pressure on prices along with several policy changes , in particular GST , which has really hit these small players hard . “ The bigger exporters have the resources to follow-up on the GST procedures and documentation , as also the power to pressurise the Ministry for refunds . If you check , none of the small exporters have got the refund yet , while the bigger companies have received their refunds ,” says Anil Varma , President , Delhi Exporters Association . He further points out that overall GST refund is about 7-8 % of total turnover and from a small exporters ’ ( Rs . 1-5 crore ) perspective , that is actually his margin .
Value continues to pull in the buyer …
It is no secret that this region has the highest wage and cost of production , yet buyers still come searching for uniqueness . “ The NCR is very important to garment trade and even today , when other centres are coming up strongly , the region accounts for nearly 40 % of total garment exports from this country ,” shares HKL Magu , Chairman , AEPC and MD of Jyoti Apparels , one of the stalwarts of the industry and the Delhi-NCR region . He adds that the industry as a whole has seen some difficult times , but singling the NCR as having the biggest impact is not fair . In fact , exporters in the region are the most flexible in design and quantities , thanks again to the small- and medium-level players that buyers find very creative to work with .
Players in the region understand that just giving value addition is not enough and they are giving buyers compelling reasons to come back season after season . “ Buyers come to us because our product is more of niche than mass . If price is a concern , we can change fabric depending on target prices set by buyers . We start with at least US $ 8 / 9 and it goes up to US $ 20 per piece . Majorly our business comes from the product that varies from US $ 12 to 16 . Buyers come seeing the product . We have everything in our product right from embroidery , print to other value addition ,” shares Arjun Sehgal , Director , Mariko Plus . To be even more niche , the company has developed skills related to embroidery
18 Apparel Online India | OCTOBER 1-15 , 2018 | www . apparelresources . com