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With good growth Indian denim sector faces tough competition

"The evergreen fashion icon of all seasons, denim has sustained itself in the ever expanding apparel segment. Riding on innovative experimentation with fits, colours and styles, denim has been a consumers’ delight. And R S Singh, Business Head, Blue Blends India points out the Indian denim industry will grow continuously in the years to come. “This is supported by the fact that denim is best suited for the Indian climate. There are other fabrics like polyester, viscose etc but denim is the best in the cotton segment for fashion,” he opine."

 

 

Blue Blends With good growth denim sector faces

 

The evergreen fashion icon of all seasons, denim has sustained itself in the ever expanding apparel segment. Riding on innovative experimentation with fits, colours and styles, denim has been a consumers’ delight. And R S Singh, Business Head, Blue Blends India points out the Indian denim industry will grow continuously in the years to come. “This is supported by the fact that denim is best suited for the Indian climate. There are other fabrics like polyester, viscose etc but denim is the best in the cotton segment for fashion,” he opines. Within cotton, denim is vastly accepted, versatile and most innovative fabric. This is reason demand for denim would continue to grow. “Currently the Indian denim industry stands at 1.2 billion metre per annum. It is still growing and growing at a very fast rate. The future is not very easy to predict, but one thing is certain, there is enough growth in demand and supply both. The demand for denim products is growing anywhere between 12-15 per cent per annum. It is likely grow in the same pace,” he explains.

Tracking demand trends

Blue Blends With good growth denim sector faces tough competition

 

Sing says denim has created space for itself by replacing existing products and this caused a dramatic growth in the sector. Especially, in the last 10-15 years, denim has gained a momentum. “If we break this 30 years’ period into two halves, growth rate was far better and faster in the second half compared to the first. In the first half, growth was not much because people were not aware about the product, technological advancement was low, and sources of information were scarce. In every respect, it was a phase of less advancement. Then the markets were also warming up to it. So, these 30 years can be summed up by describing the first half as period of consolidation and second half as period of growth,” Singh explains.

Surmounting challenges

The challenge for the industry he says is the demand-supply gap. The industry is facing oversupply issues. Demand is growing but supply has been growing more than that for the last 5-6 years. Production is constantly growing for the last 15 years. The second reason is government policies on technological upgradation and advancement, which speeded up the pace, though the demand is the primary reason for growth, growth has always been followed by demand. Demand supply gap has caused profitability issues and competition increased. But there is a bright side to competition as it helps improve practices in the industry in every respect and fosters innovation and creativity. “About a decade ago, very few mills would try to tap overseas markets, especially new ones. Because supply gap was so big that it was much more profitable to sell domestically. There was hardly any motivation to go overseas,” Singh avers.

Added to that, Singh informs, labour and pollution norms are very stringent in India. Sustainability is important but the approach is not correct. Nowadays, a person starting his business ends up spending more on following norms compared to actually putting the business together. The government can identify a space or a hub for the particular purpose, with the entire infrastructure and eco-friendly measures in place. Singh agrees feels policies are there but how effective and efficient they are is a key question. The market is still immature and is not demanding. If one offers quality, customers will ultimately come to you. “India is still at fashion infancy and we are learning by experiments,” he sums up.

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