The culture of commitment and delivering on promises should be paramount
Indo Count is a specialised end-to-end bedding provider that is solely focused on creating all-encompassing sleep experiences. Its passion and global vision have allowed the company to enter more than 50 markets with the objective of continuing to add more every year. It is also the preferred partner for some of the best-known retail, hospitality and fashion brands in the world. In an interview with Fibre2Fashion, Executive Director & CEO Kailash K Lalpuria provides insights into the Indian textile industry, and sheds light on Indo Count’s contributions to the sector.
How has the Indian textile industry evolved over the past few decades, particularly in comparison to its global competitors?
In recent years, India’s textile industry has assumed a pivotal role in the nation’s economy, and the government has introduced a range of initiatives aimed at bolstering its growth. One such initiative is ‘Make in India’, which champions domestic manufacturing and endeavours to position India as a global manufacturing hub. Significant emphasis has been placed on skill development programmes, technological advancements, and infrastructure development to enhance the industry’s competitiveness.
Labor law reforms, measures to improve the ease of doing business, and relief packages for MSMEs (micro, small, and medium enterprises) have been implemented to mitigate the impact of the COVID-19 pandemic on the textile sector.
Moreover, several announced schemes, including the Production-Linked Incentive (PLI) scheme, the establishment of textile parks, and the Rebate of State and Central Taxes and Levies (RoSCTL) scheme, are expected to further propel the growth of the Indian textile industry in the future.
Furthermore, recent Free Trade Agreements (FTAs) with countries such as the United Arab Emirates and Australia hold the potential to benefit India’s textile and garment export industry, making it more competitive in global markets. These initiatives collectively underscore the government’s commitment to fostering the growth and global competitiveness of the Indian textile sector.
With over 39 years of experience in the textile sector, what would you say has been your most challenging experience, and how did you overcome it?
With over 39 years of experience in the textile sector, reflecting upon the challenges and lessons learnt is insightful. Those 39 years were invigorating, continually motivating me to anticipate more decades in this industry, if God permits. The textile industry has always been at the heart of India’s growth, especially after the country embraced liberalisation post-1991, when exports became pivotal. We witnessed numerous export-oriented units emerging and achieving success.
However, the real challenge was cultivating an export-oriented culture within organisations. In exports, you make a commitment, a promise to your clients. I have always believed that it is this unwavering determination and commitment that fuels the drive to honour the promises made, especially in customisation, which is my primary area of expertise. There are two main types of exports: ‘made to order’ and ‘made to stock’. In ‘made to order’, personalisation is crucial. This demands an organisational culture where everyone is resolute in their commitment to timelines, quality, service levels, post-sale services, and the adaptability to the ever-evolving global demands.
Once an organisation enters the global market, it must be nimble, adapting rapidly to meet the demands of the international clientele. Such agility is especially essential as there are many stakeholders involved in the export process – like customs, the DGFT, the RBI, banks, overseas market organisations – over many of whom one does not have direct control. Flexibility becomes the key.
In my 39 years, the cornerstone of a successful export venture has been the commitment culture. This ethos differentiates the global outlook from the domestic one. Cultivating this culture, where there is a genuine pride in delivering quality products on time, has been both a challenge and a learning experience. Too often, I have witnessed a lackadaisical approach in organisations. It is essential to instil a sense of pride and passion in every employee, ensuring they view their product with esteem, especially when dealing with large global corporations with systematic working processes.
These international entities are not just clients; they are partners. Every business transaction with them aims for a mutual commercial success. Treating them as partners ensures a win-win outcome. Failing to see this mutual benefit can jeopardise the very essence of the commitment. So, the overarching lesson from my journey in textiles is that the culture of commitment and delivering on promises is paramount.
Indo Count has a focus on both domestic and overseas markets. Can you discuss the strategic considerations that guide your decisions on market diversification and entry?
Indo Count, our company, exports to over 50 countries, and through this vast experience, we have gleaned the importance of adapting to the distinct requirements of each market. Every country possesses its own culture, fashion trends, product preferences, transactional systems, and business methods. Therefore, ensuring our organisation remains flexible and adaptive is paramount for successful market diversification.
Strategically, while the US remains a prominent market for us – bolstered by our efficient operations that cater to large customers like Walmart and Target – we have also established a significant presence in other markets. We have a showroom in the UK and have expanded our reach to the European Union, Japan, South Korea, Australia and the UAE, among others. These developed nations, with their high per capita consumption of home textiles, are vital for our diversification strategy.
Beyond the well-organised US market, we have tailored our operations to cater to smaller, fragmented markets. Despite facing challenges such as the imposition of a 10 per cent duty in the UK and European Union, which our competitors from Pakistan and Bangladesh are exempted from, we have managed to hold almost 25 per cent of our business in non-US markets. We aspire to grow this segment further, targeting a 60-40 split between US and non-US markets.
Recent trends, like the surge in e-commerce, have been beneficial. Nearly 14 per cent of our revenue now stems from online sales channels. Furthermore, our domestic brands, Boutique Living and Layer, have been making steady inroads into the Indian market, a nation poised to become a $5 trillion economy. Even though India’s demand landscape is diverse and fragmented, our dedicated team has succeeded in strategising distribution across various channels, including large format stores, MBOs, and private labels.
Looking ahead, while we are poised to seize more significant market shares once FTAs are established. We also recognise the growing demand from countries which are pivoting from their traditional suppliers. The prevalent strategies of ‘China plus one’ and now ‘Pakistan plus one’ open avenues for Indian textiles and our company to capture more significant market shares in non-US markets.
What are Indo Count Industries’ forthcoming plans for growth, particularly in terms of new product lines, markets, or business segments?
Indo Count Industries has consistently recognised the potential in the home textiles segment. To break it down, bed linen is the primary value driver in home textiles, accounting for approximately 50 per cent of its value. Within bed linen, there are four significant categories: sheet sets, fashion bedding, utility bedding, and institutional bedding, each targeting different market segments and distribution channels.
Historically, our primary focus was on sheet sets, which consist of a flat sheet, a fitted sheet, and two pillowcases. It is a fundamental commodity for consumers. However, about four to five years ago, we began expanding into the other categories. Fashion bedding pertains to decorative filled products like comforters and quilts. Utility bedding encompasses essential items like pillows, mattress protectors, and pillow protectors. Institutional bedding caters to hotels, hospitals, and cruise lines.
To provide some context, the US market for home textiles stands at approximately $32 billion at retail value. Out of this, bed linen alone constitutes $16 billion. The remaining $16 billion is spread across other home textile products, such as towels ($2.5 billion), rugs ($1 billion), carpets ($1.5 billion), table linen, kitchen linen, curtains, upholstery, and accessories. Previously, by focusing only on sheet sets, our target market was limited to about $5 billion. By venturing into fashion, utility, and institutional bedding, we have expanded our target market by almost $10 billion.
We opted for this strategic direction instead of diversifying into already crowded smaller segments like towels or curtains. This was especially when considering the market dynamics, where China dominates the fashion, utility, and institutional bedding segments holding almost 70 per cent market share, while India possesses only 10-12 per cent. Thus, the ‘China plus one’ strategy becomes even more relevant in these segments.
Moving forward, our growth strategy is two-fold. On the backend, we are looking to ensure supply chain security, especially concerning cotton. On the front-end, we aim to connect with more distribution channels, like furniture stores and mattress companies, to broaden our product offerings. This dual focus ensures we expand both our market and product diversification, all while remaining committed to our core competency in bed linen.
Can you shed some light on your personal involvement in the sustainability initiatives at Indo Count, such as Project Gagan, Project Avani, and Project Anant?
Post-COVID, we recognised that supply chain reliability is paramount for a successful export-oriented organisation. Previously, cost was the primary focus, but the current decade demands an emphasis on supply chain security.
With this understanding, we decided to delve deeper into our supply chain, particularly on the cotton side, by connecting directly with farmers. By doing so, we could address multiple challenges such as fluctuating cotton prices, quality issues due to pests like ball worms, ensuring continuous yield, and preserving the soil’s health. If these concerns are not addressed, the long-term stability of our business might be jeopardised.
Another pivotal aspect is traceability. The modern world demands knowledge about the origin of cotton, down to specifics about the farm, the area, and the quality levels. Ensuring the genuineness of the cotton we consume was one of the main reasons we established a direct connection with farmers.
We initiated three projects, reflecting our commitment to these challenges:
• Project Gagan focuses on Better Cotton Initiative (BCI) cotton.
• Project Avni concentrates on organic cotton.
• Project Anant is dedicated to extra-long staple cotton.
We started these projects a few years ago on a modest scale, and today, we are connected with nearly 50,000 farmers. Through blockchain technology, we have established a system that traces the cotton from its source, ensuring quality and authenticity. This ensures that the cotton we use is genuinely Indian and maintains consistent quality.
Furthermore, recognising the vital role seeds play, we have partnered with Partec, a company with 30 years of experience in seed research. Together, we are researching superior seed varieties to offer farmers, ensuring better quality crops.
For Indo Count, sustainability is not just a buzzword; it is deeply ingrained in our ethos. True sustainability means safeguarding every aspect of our business, from the farmer’s well-being to ensuring consistent product quality. Our projects reflect our commitment to not just our business but also our environment, ensuring a sustainable future for all stakeholders. We constantly seek opportunities to economise, streamline processes, nurture our workforce, safeguard the environment, and reduce emissions. In essence, these measures underscore our dedication to fostering a harmonious relationship between our business and the environment.
How do you keep yourself updated with the evolving landscape of textile retail, including digital transformations like AI, AR, and VR?
In today’s dynamic global landscape, it is imperative for companies to remain at the forefront of technological advances. Being connected to world-class retailers globally has given us insights into their evolving systems and expectations. To meet these demands, we have integrated robust IT solutions into our operations.
We utilise SAP in our organisation and are currently transitioning to SAP Hana, equipping our employees with a platform that facilitates superior results. As we bolster our IT team, our focus is on incorporating Artificial Intelligence (AI) into our decision-making processes. The value of data-driven decisions cannot be overstated. We believe in basing our decisions on clear, precise, and timely information rather than relying solely on instinct. This emphasis on data ensures that we measure, analyse, and control each operational activity effectively.
Additionally, we are exploring the potentials of Virtual Reality (VR) and Augmented Reality (AR) as communication tools for engaging with our customers. By employing these digital transformation tools, we aim to enhance our interaction with the global market and present our products and services more vividly.
Internally, we prioritise educating our team on these technologies, ensuring that they can communicate externally as the world expects. Ultimately, our commitment is to absorb, adapt, and leverage these digital innovations to enhance both our operations and customer interactions.
Could you discuss your involvement in industry associations and advocacy efforts, like CITI and TEXPROCIL, and how they contribute to promoting the interests of the textile sector?
The Cotton Textiles Export Promotion Council (TEXPROCIL) and the Confederation of Indian Textile Industry (CITI) are vital bodies in the textile sector, with all the major export promotion councils associated with them. For over 70 years, TEXPROCIL has been instrumental in fostering the growth of cotton textile exports from India. It has successfully aided the development of the spinning, weaving, and made-up industries.
These organisations provide invaluable support to exporters by offering a wealth of information and resources. They act as a bridge between the industry and the government, ensuring that policy measures are both timely and beneficial for the sector. By doing so, they help stimulate growth, facilitate employment generation, empower women (especially unskilled women), and promote the establishment of new industrial clusters through schemes like MITRA, PLI, and TUFS.
With a clear vision for the future, these organisations are working on a roadmap to achieve a substantial increase in India’s textile exports, targeting $100 billion by 2030. This growth aspiration is backed by comprehensive strategies to identify areas needing governmental support and areas ripe for capturing international market share.
Beyond this, these associations offer myriad opportunities for learning and self-education. They keep members abreast of policy updates, ensuring ease of business. Moreover, they facilitate interactions with government agencies to address any business challenges and ensure a conducive environment for the industry to thrive.
In essence, TEXPROCIL and CITI not only connect industry members with each other and the government, but they also play a pivotal role in influencing policy formation that benefits the sector. Their contributions have been, and continue to be, indispensable for the overall growth and evolution of the textile industry in India.
What role do your stakeholders and vendors play in achieving Indo Count’s mission and vision, particularly as you strive to become a billion-dollar company?
Stakeholders and vendors are integral to the success of Indo Count. Without their support and collaboration, achieving our ambitious goals would be unattainable. They serve as major pillars in our business ecosystem, consistently assisting us in maintaining desired quality and service levels.
Our stakeholders act as critical sounding boards, providing valuable feedback and posing relevant queries that push us towards continuous improvement and growth. Their insights are invaluable, helping shape our strategies and operational tactics.
Vendors, on the other hand, enable us to meet our production and quality commitments, ensuring we consistently deliver value to our clients. Their expertise and reliability directly influence our capability to fulfil our mission and vision.
In essence, both stakeholders and vendors are extensions of the Indo Count family. They are not merely external entities but crucial partners in our journey towards becoming a billion-dollar company. Our board of directors is fully aware of their importance, and as a policy, we ensure that their interests are always considered, aiming for mutual growth and success. We believe in fostering a collaborative environment where all parties move forward in harmony, ensuring the collective success of our endeavours.
What opportunities do you see for the Indian textile industry in the international market, especially considering the shift towards more sustainable practices?
First, there is a growing demand for sustainable and eco-friendly textiles worldwide. Indian textile manufacturers can capitalise on this trend by producing organic cotton, hemp, bamboo, and other sustainable fabrics. Certifications such as GOTS (Global Organic Textile Standard) can also enhance market access.
Second, consumers are increasingly conscious of ethical and fair-trade practices. Indian textile companies can promote fair wages, safe working conditions, and transparent supply chains, which can appeal to ethically-minded consumers.
Third, Indian textile manufacturers can focus on producing value-added products such as organic and sustainable clothing lines, high-quality handwoven textiles, and artisanal fabrics, which often command premium prices in international markets.
Fourth, leveraging India’s rich heritage of textile design and craftsmanship, businesses can offer customised and unique products to international customers. This can include traditional textiles like sarees, hand-embroidered garments, and block-printed fabrics.
Fifth, manufacturers need to invest in innovative and sustainable manufacturing processes, such as waterless dyeing technologies, recycled fibres, and closed-loop production systems, to reduce the environmental impact of textile production.
Sixth, there is a need to collaborate with international fashion and retail brands to supply sustainable textiles and garments. Many global brands are seeking reliable and sustainable suppliers to meet their ethical sourcing goals.
Seventh, textile producers can explore emerging markets and niche segments that have a growing appetite for sustainable textiles. For example, sportswear, athleisure, and activewear made from sustainable materials are gaining popularity.
Eighth, manufacturers need to embrace digital marketing strategies and e-commerce platforms to reach a broader international audience. Establishing an online presence can help Indian textile companies connect with consumers directly.
Finally, businesses should take advantage of favourable trade agreements and tariff concessions to access international markets with reduced trade barriers.
What are the key challenges currently faced by the textile industry in India, and what solutions do you propose?
Challenges
Global Competition: Indian textile manufacturers face stiff competition from countries with lower labour and production costs. This can make it challenging to remain competitive in the international market.
Lack of Technology Adoption: Many Indian textile mills still rely on outdated machinery and processes. This results in lower productivity and higher production costs.
Environmental Concerns: The textile industry is known for its high water and energy consumption, as well as the generation of significant waste and pollution. Compliance with environmental regulations is a growing concern.
Supply Chain Disruptions: The COVID-19 pandemic exposed vulnerabilities in the textile supply chain, particularly with regards to sourcing raw materials and disruptions in global logistics.
Skill Gap: There is a shortage of skilled labour in various segments of the industry, from design and technology to manufacturing and quality control.
Proposed Solutions
Technology Upgrade: Invest in modern machinery and automation to improve productivity, reduce costs, and ensure consistent product quality.
Research and Development: Encourage research and development efforts to create innovative textiles, sustainable materials, and production processes.
Sustainable Practices: Adopt eco-friendly production methods, such as water recycling, waste reduction, and renewable energy sources, to meet environmental regulations and reduce long-term costs.
Skill Development: Establish training programmes and partnerships with educational institutions to bridge the skill gap in the workforce and promote vocational education.
Supply Chain Diversification: Diversify supply chain sources to reduce dependence on a single region or country, minimising the impact of future disruptions.
Government Support: Collaborate with government agencies to develop policies that promote investment in the textile industry, such as tax incentives, export subsidies, and infrastructure development.
Market Diversification: Explore new markets and expand product offerings to reduce dependence on a single type of textile or market segment.
Digitalisation: Implement digital tools and platforms for supply chain management, customer engagement, and marketing to enhance efficiency and competitiveness.
Collaboration: Foster collaboration between industry stakeholders, including manufacturers, designers, and policymakers, to address common challenges and promote sustainable growth.
Consumer Education: Educate consumers about the environmental and social impact of their clothing choices to drive demand for sustainable and ethically produced textiles.
