Innovation in yarn is at the centre of growth at Vardhman
In this process of change, adding value has to be balanced by viability, both from a practical and commercial angle. The changing needs of the market and fashion trend too have to be taken into consideration. As of now, functionality (comfort) has become very important for the consumer – be it stretch fabric, easy maintenance or wrinkle-free fabric, but things like these are just a percentage of the total demand and not yet a mass demand for bulk production, “Once we are in the process of development, we look at many aspects, but what actually gets to the market depends solely on how the demand moves; some of these developments gain success, while others remain in the R&D files; may be for future use. To get ideas for development, there is a lot of cross-germination of thoughts that happens between the organisation and the manufacturers,” says Neeraj.
The company admits that competition in the yarn segment has increased substantially in last 3-4 years, particularly in the basic qualities. Thanks to the change in policies that have increased subsidies for setting up spinning units in many states. Even in this tempting scenario, Vardhman decided not to expand their capacities and instead concentrated on value. “We have worked hard to study our systems and processes and check what internal changes we can make, what improvements we can bring to the system and what value additions we can do,” shares Neeraj. For the past 4-5 years, Vardhman has been diligently moving its product range from commodities to value-added products. As of now, 30 per cent of its yarn being produced is going into the value-added segment. Out of its total production of yarn, one third is used internally, one-third sold in domestic market and another one-third is exported.
Besides increasing competition in yarn market due to overcapacity, which has resulted in the customer getting a lot of choices, the trend of fast fashion is also impacting the textile value chain. Moreover, the changes that are happening in the trend-driven fashion industry have resulted in decrease of lead time along the supply chain, and what used to be an accepted delivery schedule of 150-170 days has now reduced to 60-90 days, which is expected to decrease even further. “These are issues with hidden opportunities, the critical differentiators are: how big organisations like Vardhman are looking to add value to their product; and how they are going to integrate it into their processes since the product range is also improving. So, on one hand, the number of days is decreasing and on the other, you need to add value to the product. Whichever company is going to balance this equation, will be the ultimate winner. I think it’s a wonderful and exciting time and we are looking at it very positively. At Vardhman, we are always looking at adding value to the product for our customers and this is our growth strategy also,” concludes Neeraj with confidence about the future.
Neeraj Jain, Joint Managing Director, Vardhman