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Trends In Indian Manufacturing Industry
The manufacturing industry of India has adopted various innovations, especially in the last decade. While it is the Indian IT industry that is known worldwide. Many Indian industry segments have updated their manufacturing facilities and processes in a very dynamic manner.
The goal of the Government of India is to increase the manufacturing industry’s contribution to 25% of GDP in the next two years. Apart from that, the ‘Make in India’ initiative of the Government of India aims to strengthen the country’s position as a leading manufacturing destination.
The Indian manufacturing sector has been on a path of growth in the last few decades. Many positive trends are observed in the industry, let us look at a few of the most important ones.
Increased Focus On R&D
The country’s R&D expenditure, when viewed as a GDP percentage, has not changed in the recent past. The corresponding figure keeps varying between 0.6 and 0.7 percent. Here, it’s interesting to note that there is a growth in both GDP and also the money allocated towards R&D. You have quite a few private players in the Indian market that have made a mark for themselves.
Even in the post-COVID environment, the Indian manufacturing industry has responded with both agility and speed in manufacturing personal protective equipment(PPE), ventilators, and testing kits.
In the two-wheelers segment, automobile companies have broken partnerships with international companies but still able to do in-house R&D design, market, and manufacture innovative products. Even in MNC companies, the R&D is happening within India.
The conventional approach of Indian manufacturers was to go with the business-to-business (B2B) model. Recently, there is an increasing number of manufacturers who are moving away from the old model and choosing the business-to-business-to-consumer (B2B2C) model. The B2B2C model is having many advantages. In the B2B2C model, instead of selling at wholesale prices, a manufacturer carries out sales based on manufacturer’s suggested retail price (MSRP), which contributes to better profitability.
The manufacturer can prototype, test, and sell the products in a relatively shorter period. In the older method, there is an abnormally long retail sales cycle. The B2B2C model facilitates businesses in gathering customer feedback without any filters, this feedback is vital for developing better products. This helps not just in improving the quality of the products but also in developing good and long term relationships with customers.
Adoption of automation is a thing that is slowly but steadily increasing in the manufacturing sector of India. There are a few factories where you can see industrial robots and workers involved in the manufacturing operations.
However, the usage of automation in India is still quite low, when compared with the manufacturing industry in developed countries. Yet, market experts predict that soon, there shall be a drastic increase in automation in Indian manufacturing entities. There are many advantages to automating production processes.
Earlier, the sole focus of manufacturing used to be on full utilization of manpower and machinery. The competition in many markets is very strong between the various companies. To sustain and thrive in the market place there is a need for a superior product. Manufacturing processes are now carried out based on embedded information to produce products of superior quality.
ERP (Enterprise Resource Planning) Systems
There is a consistent rise in the number of manufacturers using ERP systems. As a result, the entire business operations are getting done in a superior manner and there is access to crucial information in real-time.
Artificial Intelligence (AI)
Usage of artificial intelligence has begun in the manufacturing sector of India. But, there is still time before AI achieves its full potential. Abundant opportunities are going to be available for both consumers and also new players, in the sphere of AI.
In the not-that-distant future, technologies like the Internet of Things and Big Data shall be commonplace in the Indian manufacturing industry. Innovation and product superiority by one company is being matched by the competitors. Matching the quality by producing at a lower price had been the main strategy in the past. While this may be helpful with commodity products, for other products it is not helpful.
To be successful in the contemporary markets, manufacturers are constantly exploring new methods for manufacturing superior products
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