This presentation covers the Macro-environment Analysis of the Indian Textile industry. I have performed Strategic group analysis and strategic group mapping for the industry.

1. Textile and Apparel Industry
Strategic Management – 1
Group A
Presented by:
Abhishek Kumar Pandey

2. Introduction
• India is the world's second-largest producer of textiles and garments.
• Textile plays a major role in the Indian economy. It contributes 14 per
cent to industrial production and four per cent to gross domestic
product (GDP).
• The fundamental strength of the textile industry in India is its strong
production base of wide range of fibre/yarns from natural fibres like
cotton, jute, silk and wool to synthetic /man-made fibres like polyester,
viscose, nylon and acrylic.

3. Evolution of Indian Textile Industry

4. Advantages in India

5. Segment of Textile Industry

6. INDUSTRY & MARKET ANALYSIS

7. MARKET PENETRATION STRATEGY
 To improve technical skills in apparel industry government
established 75 apparel training and design centers across India.
 National institute of fashion technologies playing as the role of
pioneer towards the growth of apparel industry and its exports.
 To promote apparel exports 12 locations has been approved by
the government to set up apparel parks.
MARKET SHARE
TEXTILE APPAREL
69%
31%

8. KEYPLAYERSINTHEINDUSTRY
Company Business areas
Welspun India Ltd Home textiles, Bathrobes, Terry towels
Vardhman Group Yarn, Fabric, Sewing threads, Acrylic fibre
Alok Industries Ltd
Home textiles, Woven and Knitted apparel fabric,
Garments and Polyester yarn
Raymond Ltd
Worsted suiting, Tailored clothing, Denim, Shirting,
Woollen outerwear
Arvind Mills Ltd
Spinning, Weaving, Processing and Garment
production (Denims, Shirting, Khakis and Knitwear)
Bombay Dyeing & Manufacturing
Company Ltd
Bed linen, Towels, Furnishings, Fabric for suits,
Shirts, Dresses and Saris in cotton and Polyester
blends
Garden Silk Mills Ltd Dyed and Printed fabric

9. Macro Environment Analysis
Social and Cultural Factors
• A small apparel manufacturer create styles that appeal to those of different cultures.
• Manufacturers avoid creating too many items that styles were prevalent long ago.
• Demographical factor like average age of the population also affects the styles in demand.
Authority Factor
• Government Introduced Integrated textile park in the 12th five year plan
• The scheme would facilitate textile units to meet international environmental and social
standards.

10. Natural and Environment Factors
• Pollutants released by the global textile industry are continuously doing unimaginable harm to the
environment. It pollutes land and makes them useless and barren in the long run.
• The industry is moving towards long-term sustainable options with new products like organic clothing
• Many textile manufacturers are moving towards sustainable growth.
Security Factors
• Have a high competition of eating up of market share from creation of counterfeit and duplicate products.
Technological Factors
• Institutions like NIFT , NID encouraging development of new technological processes in fibre and apparel
manufacturing.
• Development and Implementation of new human resource programs.

11. Economic Factor
• Economic factors can have both positive and negative impacts on the clothing industry. During economic boom periods,
people have more disposable income. Hence, they may buy more clothing, increasing sales for clothing manufacturers,
wholesalers and retailers. However, recessions have the opposite effect. Sales for these various clothing entities may be
significantly lower. Consequently, retailers may be stuck with large amounts of inventory.
• The middle class which currently forms up to be around 40% of the population is growing both in its income and also
size which is good for apparel industry as they the major target customer for this industry.
• As the labour cost raising in China major companies looking for alternate solution in other countries, which may prove
to be favourable for the India because it will make Indian industry more competitive in global market.
Political Factors:-
• Political and legal sectors includes the policies and the regulations of the government which the organizations need to
follow to be considered legal.
• Tax Policy
• Employment laws
• Trade restrictions

12. Porter’s 5 force model
1. Threats of new entrants
2. Bargain power of buyers
3. Bargain power of suppliers
4. Threats of substitute product
5. Intensity of rivalry

13. Threat of new entrants
• Economics of scale – High
- Large existing firms buy raw material in bulk so it reduces the average cost and they achieve
economics of scale
- So difficult for new entrants to enter the market
• Capital requirement – High
- Huge initial requirement in plant and machinery, land, raw material, advertisement
• Product Differentiation - High
- Must be high for new entrants in terms of brand identification, quality
- So competitive advantage must be high to overcame the threat

14. Bargaining power of buyers and suppliers
Buyer
• When customer buys in bulk bargaining power of buyer is high
• Low buyer to supplier ratio – high bargaining power of buyer
Supplier
• Many small suppliers are present in the market so bargain power of supplier is low
• Suppliers have high bargaining power when the supply is for unique product
Ex. Fur

15. Threat of substitute product
• Low cost substitute product from countries like China, Bangladesh
• Low cost incurred by buyer while switching to substitute due to preference for small local
stores and traditional wear.
• High propensity of buyers to substitute due to low prices, good performance of the product
• Overall threat of substitute product is high.

16. Intensity of Rivalry
• Extreme rivalry among established brand create the great threat to profitability
• Competitors include numerous apparel designers, manufacturers, distributors, importers, and
retailers
• Competition is high in textile and apparel industry due to high growth rate
• Like: Louies Philip, Allen solly, Peter England, Van Heusen

17. Strategic Group Analysis
• Strategic Group Analysis (SGA) aims to identify organizations with
similar strategic characteristics, following similar strategies or
competing on similar bases.
• Such groups can usually be identified using two or perhaps three sets of
characteristics as the bases of competition.

18. Strategic Group Mapping
• Strategic group mapping is analytical tool used for showing
competitive positions that rival firm occupy in the industry.
• Identification of close and distant rivals.
• Identification of attractive and unattractive positions of the firms
in industry.
• Identifying a strategic group a firm should consider entering in.

19. Trendy
Price
Mango
ZARA
New Look GAP
U.S Polo
Lifestyle
Big Bazaar
Pantaloons
Tommy Hilfiger
High
High