Raymond UCO Denim, one of the most respected names in the Indian textile industry and in the global denim space, recently completed two decades of its successful journey. With an annual global capacity of 50 million metres of denim fabric and catering to premium and premium plus segments, the company is creating a perfect balance between domestic and overseas markets with an almost equal share in both. Using 3 to 5 per cent of its total capacity on product development (PD), the company definitely has a forte in this area. While most of the denim mills across India or even globally are facing multiple issues of overcapacity and smaller order sizes, it is indeed remarkable to note that Raymond UCO Denim last year was able to increase its capacity by 15 per cent. In a candid discussion with Apparel Online, Arvind Mathur, CEO, Raymond UCO Denim, Mumbai and a pass-out from IIT and IIM, discussed about the company’s unique growth strategy that led to such a great success and other allied issues.
Raymond UCO Denim (50:50 joint venture with Raymond and European denim major, UCO NV of Belgium), which started with the goal of offering a versatile range for customers’ diversified needs and to be completely innovative, has made significant progress in its journey so far. Over a period of time, it has achieved a commendable track record of adding new things in denim. “If you look at the top 10 denim brands of the world, we are catering to 70 per cent of them. This is how we are placed and are able to compete in that space with the topmost denim fabric manufacturers of Turkey, China, Pakistan and other countries. Hence, we have a strong presence and are very much in tune with the global landscape. Raymond is one of the most respected names in the premium segments,” says Mathur, who as CEO, is responsible for the the overall success of the business. The company has state-of-the-art manufacturing units in Yavatmal (Maharashtra) as well as Giurgiu (Romania), though the major production happens in the Indian unit. It is also able to offer full package services with Everblue Apparel Ltd., Dodaballapur (Bangalore) which is a state-of-the art denimwear facility.
An Electronics & Telecommunications Engineer, and an MBA, Arvind Mathur dedicated his life to the textile industry as he worked for almost 3 decades, most of it outside India, for the famous thread company Coats. He proudly informed, “There has never been a dull moment in this industry. There was a time when people used to say that this is a ‘sunset’ industry, but I must say that there is a lot happening now, especially in the new era of technical textiles and digital technologies and processes. It is a thriving industry and there is no better place for this than India. When you go around and find people making things in a very different way, you always learn something new and this is what has kept me in the industry for so many years.”
Talking about the issues of overcapacity, adoption of buyers/brands’ system to have minimum inventories, Mathur believes that overcapacity, although existent in the market, is not really indicative of a recessionary trend. “Yes, globally the denim business is facing challenges but there is still low single digit growth. Europe was going through a difficult phase but now it has kind of stabilized. Some European brands are showing real recovery which is an indication that the denim industry would continue to grow. Large developing markets such as China and India are contributing to this too. And in these circumstances, the mantra that works for a supplier is how you can differentiate yourself from others.” He further adds that the other important thing is the way in which fashion and inventory levels are changing and the impact these are going to have on lead times, average order sizes and MOQs.
According to Mathur, “Now everybody is expecting shorter lead times. While we have become more nimble and flexible, we have seen the demand for quick turnaround growing and our average order size reducing with time. In fact, speed carries the highest importance for us whether in the area of new product development or sampling or delivering bulk. We have put our maximum efforts in reducing any bottlenecks and improving capacities, processes and decision making and have so far been very successful in these initiatives. We have many long-standing and loyal customers and we have to offer them our best.”
Raymond has announced an investment of Rs. 1,400 crore in a phased manner on its new plant at Amravati. Cotton shirts, linen and denim, among others will be produced at the plant, which is expected to be commissioned by the end of this year. The Amravati unit will create around 8,000 new jobs. Our greenfield project in Amravati is likely to start by the year end With an initial capital infusion of Rs. 200 crore. – Gautam Hari Singhania. CMD, Raymond Group
Mathur briefs that Raymond’s simple way of attaining an edge over others is to differentiate itself from them, be it in terms of product range, PD, processes or other such areas. Apart from being one of the leading companies in India with the best of technology, it is also credited for being the first company to have brought in ring denim. Highlighting Raymond UCO’s exceptional focus on PD, he shared, “3 to 5 per cent of our capacity is actually utilized to support PD initiatives. We have retained local and international talent and experts to manage the PD process effectively and are globally at par with the best in this sense. Both the Indian and International markets today demand a high level of PD support and it is growing. Throwing more light on this, Mathur avers, “When we look at the value chain from the yarn stage to the finishing, you can generate value addition at every step of the process, at the spinning and weaving stage in terms of construction of your fabric and, as importantly, in dyeing and finishing. It is this value addition across the chain that defines what the final value is, i.e. whether a product is mid-range or premium or premium plus. You could focus more on one process and less on another but it is the final look and feel that defines whether the sum is greater than the whole.”
Raymond’s vision, in the words of Mathur is, ‘To be the best in class globally’. He adds, “To maintain our competitive edge, we have to remain innovative and reliable in our offerings. Innovation is not rocket science. It is all about the choices you make in terms of the materials one uses, the processes applied and the attitude and belief system one espouses. We keep emphasizing internally the need to continuously observe, learn and enquire and not necessarily limit ourselves in this respect to the denim space. Our teams are always on the lookout for relevant technologies, systems and researches for learning and potential adoption.”
Detailing his future perspectives, Mathur stated, “In terms of manufacturing, we increased our Indian capacity last year by close to 15 per cent. It is now completely stabilized and filled up. Looking forward strategically, Raymond UCO will now be working on an asset light model as a means to support growth of sales with high ROI.” Mathur specifies on a concluding note that his company has to grow above the market growth and keep pace with swift advancements in fashion and technologies.
