Managing Director Global Ocean Group
When R&D is a process
The Indian fashion and textile logistics industry is growing fast. Though it is still to be considered a major portion of the fashion industry, it holds immense potential. Brijesh Lohia, MD of Global Ocean Group, shares some insights with Fibre2Fashion.com
What is the size of India's logistics industry? What share of that does fashion and textile logistics occupy?
According to India Logistics Expo 2016, the Indian logistics market recorded revenue of US$ 104.10 billion in 2014. It is likely to reach US$ 150-160 billion by 2020. Transportation accounts for about 60 per cent of the market revenue.
According to a study by Wazir Advisors and PCI Xylenes & Polyester in a report by IBEF in 2016, the Indian textile industry has the potential to reach US$ 500 billion. The growth implies domestic sales are to rise to US$ 315 billion from the current US$ 68 billion. Exports are expected to increase to US$ 185 billion from the current US$ 41 billion or thereabouts. The organised apparel segment is expected to grow at a Compound Annual Growth Rate (CAGR) of more than 13 per cent over a ten-year period.
These figures show robust growth in the fashion and textile industries. E-commerce firms in India are promoting a new concept in fashion, and establishing their presence in tier II and tier III cities. As Google's Director for E-commerce and other segments, Nitin Bawankule shared, India, with an aspiring middle class, is expected to see fashion business through e-commerce portals reach a turnover of US$ 35 billion by 2020.
The textile industry is also getting a boost under Make in India. As a result, it is expected to contribute a major portion to exports. Indian traditional textiles are gaining popularity through e-commerce. So, there is much more on-ground action happening on both fronts.
What is the growth percentage recorded in the fashion and textile logistics industry of India in the last two years?
There is no round figure available on fashion and textile logistics. Tremendous growth has been witnessed in the apparel and fashion segments, with both online and retail players trying to reach as many customers as possible. This is good news for the logistics sector which corresponds strongly with the growth in consumer demand.
What are the innovations in terms of speed in the textile logistics industry?
We believe the biggest breakthrough, in terms of approachability and speed in textile logistics, has been a shift from India's traditional selling model to an online marketplace. There are many leading online retail companies showcasing vast textile collections of even traditional handloom players. Then, there are traditional retail brands that have expanded their presence through online and offline channels. As a result, the market has become hyper-competitive. This means, it is hyper-active for logistics players. At times, customer satisfaction is measured in terms of same day delivery when ordered online. On the other hand, there is a spurt in demand for more brands with growing accessibility.
What positive trends are visible in the industry?
Several positive trends augur well for the industry.
1. The startup sector growth is here to stay. It will only expand, reaching deeper into India.
2. The organised retail sector is slowly and firmly gaining a foothold. It will only grow bigger in the next few years.
3. The biggest positive factor is the broad outline of the Make in India push by the present government. Any investment in the manufacturing sector is not just good news for logistics but the Indian economy as a whole.
Who are your major clients?
We are working closely with brick-and-mortar stores, and we are tapping e-commerce companies while we are actively involved with the manufacturing sector in India.
Which are your big markets? What new markets are you exploring?
We have a presence in all key metros and sub-metros across India. We plan to expand our presence in tune with the requirement of the logistics industry, which is to reach out to the consumer spread in every nook and corner of India to be able to deliver to them.
What major tie-ups or expansions are you planning in the coming two fiscals?
At present, we offer a complete logistics management solution to clients. However, since we are in an evolving consumer environment, we keep options open as we approach our next client.
What are your investment plans for the coming fiscal?
As we continue to expand business, we would like to approach our presence with more caution. Our investment plans will depend on exact market requirements, depending on consumer demand from each market for our key clients.
What is the budget allocated towards R&D?
As we continue to invest in more markets, we will deliver new solutions which are more accurate and on time. R&D, for us, is a process with the onus lying on us. The trigger comes from consumer psychology and behaviour. We are more focused on investing in e-logistics.
What growth percentage was recorded by the company in the last two fiscals?
We had positive growth, with many new clients. We also hold immense pride in the fact that we have had long-term and sustainable relationships with our clients. Some of them have actually witnessed our growth as we have grown.
Published on: 29/03/2016
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.