Challenges and Opportunities for a
new Entrant in Home Furnishings
Siyaram Poddar Group
• Inception in 1954
• A family promoted group with diversified interests in auto & pneumatic
tires and textiles
– Govind Rubber Ltd.
– Balkrishna Industries Ltd.
– Siyaram Silk Mills Ltd.
• Total turnover of over USD 500 million
Siyaram Silk Mills
• Largest manufacturer of blended apparel fabric in India
• Over 30 years of textile manufacturing experience
• Vertically integrated manufacturing setup
• Own and operate multiple apparel and apparel fabric brands
• Recent diversification into Home Textiles
Textile Scenario in India
• Poised for growth in domestic sales and exports
Home Textile Market in India
Home Furnishing Industry
• Urban home furnishings retail market in India is estimated to be Rs.9,300
crore and is expected to reach Rs.20,000 crore by the year 2012
• Bed and bath furnishing products make up two thirds of the market
• Indian Furnishings market comprises 94% of the unorganized sector
• Shift in the industry toward branded products has become more
pronounced in the recent past
• Opportunity seen by international brands as Indian economy booms
Drivers for Growth
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Urbanization and Corporatization
Increasing incomes and purchasing power of the Indian consumer
Change in consumer attitudes
Organization of retail
Urbanization
• Over 300 million urban population in India
• Urbanisation in India is faster than any other country in the world
• Resulting in changing consumer behaviour across segments
Increasing Spending Power
Consumer Spending Pattern
Consumer Attitides
• Greater spending power as an economy
• Increased exposure to various international lifestyles resulted in the
Indian consumer evolving into a design and trend conscious citizen
• Today’s Indian consumer is beginning to prize aesthetics and elegance
• Indian home owners see their homes as an extention of their personality
and thus take special pride in doing up their homes
• Home is a status symbols
Observations on Consumer Behaviour
in Home furnishing
• Relatively price insensitive as compared to apparel textile prices
• Main focus on design and colour
• Diverse preferences geographically and culturally
• Majority planned and seasonal purchase
• Consumer largely unaware of fabric performance and quality at the time
of purchase
Cut Service
• For the retailer
• Reduced investment in fabric stock
• Greater variety in the showroom
• Newer colors and designs available
• For the suppliers
• Ease of production planning
• Lengthening of product shelf life
• Increased warehousing and logistics cost of fabric
• Ability to communicate with the consumer
Cut Service
• For the consumer
– Improved presentation and better shopping experience
– Possible to make price comparisons for the same article in multiple
stores
– Association of a fabric with a source apart from the retailer
Challenges and Opportunities
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Educate the consumer
– Modern tastes and styles
– Performance of the product
– ‘Real’ value for money
Inconsistency of price points across retail outlets
Maintain a robust supply chain to handle seasonal demand shocks
Move from unorganized wholesale to organized wholesale
Branding
• Change approach to that of a packaged product similar to bed sheets
and bed linen
• Develop ability to create a demand for one’s product by advertising a
‘Branded catalogue collection’
• Ability to educate consumers through advertising
• Establishment of MRP’s – will instill consumer confidence and brand
trustworthiness
• Emergence of brands across all price levels and consumer segments as a
strategy for product differentiation
Industry Vision
Educated and discerning consumer
Demand for Indian brands internationally
Evolution of large format MBO’s for home furnishings
Tightening of norms for Fire Retardant and other specialty fabrics in
hospitality and healthcare industry
• Entry of more branded players at all price points
• Competition leading to demand for innovation in product and
presentation
• Ultimately lead to more investment in the industry, leading to even
higher growth
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