Bazaar Watch
By: Amit Bhushan Date: 2nd July 2014
The chorus for reforms amongst states in India is going up with a state moving to amend some labour related laws. Various reforms are being sought from state governments to pep up investment sentiments for the state. While its overall impact is yet to be assessed, the movement in markets seems to be in revival mode for light manufacturing and consumer goods marketing going on uptick. We may not see immediate flow of investments but certainly sentiments seems to be gearing up. The investors seem to be demanding more with yearning for land reforms, development of tourism, agri-market reforms going up. This is because entrepreneurs are looking to cash in upon opportunities to create product designs relevant for the local market and build upon brand values for their own products and valuation for the company. This is a high potential with manageable risk areas. The reforms sought are to bring down costs for doing business and look to shore up valuation for any M&A opportunity that may crop up in future. The other areas being examined are processed food brands and consumption goods where competition may be low.
Also since the manufacturing costs in China seems to be soaring, the investors wants to source components from other low cost destinations in Asia directly including from China and control design, manufacturing, branding, distribution and aftersales. This has become true for Electronics, Electricals and other consumer durables. The established brands getting jittery and maintaining relative silence in the face of a slew of launches in Smart mobile segment is a sign of changing trends in the markets. If a super hot segment like Smart mobiles is not being contested for, then situation for other segments cannot be far different for long. Strengthening of domestic technical/commercial standards and certification including penalizing units (as well as public reprimand) who fail to meet norms will push up acceptability for domestic brands. We also need to strengthen consumer courts to bolster confidence of the customers so that they can try new domestic brands. The established players had thwarted such moves since consumers have to flock to established brands in the face of lack of trustworthy institutional framework for certification and protection. Also, India’s small entrepreneurs have rarely cared for branding or brand development in a structured manner to have resisted such attempts by large corporates as something of a hindrance for their growth. They much rather join with corporate so cut their own operations costs but have suffered hugely as a result of negative perception associated with smaller companies and their product quality. But now the markets as well as entrepreneurs seem to be changing and lets’ see if such moves actually result in development of consumerism in India. A strong move to evolve premium quality certification with stronger consumer protection at behest of government agencies will help bolster market development for smaller entity’s offerings.
Although getting consumer patronage for new brand and building distribution for new products/ brands is a challenging area and requires loads of capital along with expertise. Similarly designing products that get lapped up by consumers requires investment in market study as well as engineering. However domestic and foreign entrepreneurs are identifying the opportunity and trend in market and plunging to take risks. What we also need to develop is protection for customers who exchange their data for services i.e. say when a customer parts away his information for availing services from Websites. Such service providers should be brought under the ambit of consumer courts and terms of agreement should be vetted by and approved by industry body followed by an amicus curie of customers appointed by consumer protection commission. This would help allay fears of a lot of customers’ especially first timers who may take on web subject of course to their choice services being made available under supportive conditions that can be understood by them. We should also have clear laws regards financial frauds should they hit consumers and the sites should be constrained to take protective measures failing which they should loose right to operations/access denial by regulation. The government gains a leeway to control while customers benefit due to smooth transaction processing and security. Lets’ watch how situation unfolds further….
By: Amit Bhushan Date: 2nd July 2014
The chorus for reforms amongst states in India is going up with a state moving to amend some labour related laws. Various reforms are being sought from state governments to pep up investment sentiments for the state. While its overall impact is yet to be assessed, the movement in markets seems to be in revival mode for light manufacturing and consumer goods marketing going on uptick. We may not see immediate flow of investments but certainly sentiments seems to be gearing up. The investors seem to be demanding more with yearning for land reforms, development of tourism, agri-market reforms going up. This is because entrepreneurs are looking to cash in upon opportunities to create product designs relevant for the local market and build upon brand values for their own products and valuation for the company. This is a high potential with manageable risk areas. The reforms sought are to bring down costs for doing business and look to shore up valuation for any M&A opportunity that may crop up in future. The other areas being examined are processed food brands and consumption goods where competition may be low.
Also since the manufacturing costs in China seems to be soaring, the investors wants to source components from other low cost destinations in Asia directly including from China and control design, manufacturing, branding, distribution and aftersales. This has become true for Electronics, Electricals and other consumer durables. The established brands getting jittery and maintaining relative silence in the face of a slew of launches in Smart mobile segment is a sign of changing trends in the markets. If a super hot segment like Smart mobiles is not being contested for, then situation for other segments cannot be far different for long. Strengthening of domestic technical/commercial standards and certification including penalizing units (as well as public reprimand) who fail to meet norms will push up acceptability for domestic brands. We also need to strengthen consumer courts to bolster confidence of the customers so that they can try new domestic brands. The established players had thwarted such moves since consumers have to flock to established brands in the face of lack of trustworthy institutional framework for certification and protection. Also, India’s small entrepreneurs have rarely cared for branding or brand development in a structured manner to have resisted such attempts by large corporates as something of a hindrance for their growth. They much rather join with corporate so cut their own operations costs but have suffered hugely as a result of negative perception associated with smaller companies and their product quality. But now the markets as well as entrepreneurs seem to be changing and lets’ see if such moves actually result in development of consumerism in India. A strong move to evolve premium quality certification with stronger consumer protection at behest of government agencies will help bolster market development for smaller entity’s offerings.
Although getting consumer patronage for new brand and building distribution for new products/ brands is a challenging area and requires loads of capital along with expertise. Similarly designing products that get lapped up by consumers requires investment in market study as well as engineering. However domestic and foreign entrepreneurs are identifying the opportunity and trend in market and plunging to take risks. What we also need to develop is protection for customers who exchange their data for services i.e. say when a customer parts away his information for availing services from Websites. Such service providers should be brought under the ambit of consumer courts and terms of agreement should be vetted by and approved by industry body followed by an amicus curie of customers appointed by consumer protection commission. This would help allay fears of a lot of customers’ especially first timers who may take on web subject of course to their choice services being made available under supportive conditions that can be understood by them. We should also have clear laws regards financial frauds should they hit consumers and the sites should be constrained to take protective measures failing which they should loose right to operations/access denial by regulation. The government gains a leeway to control while customers benefit due to smooth transaction processing and security. Lets’ watch how situation unfolds further….