PIONEER INSTITUTE OF PROFESSIONAL STUDIES
SWOT Analysis of Arvind Limited
INTRODUCTION
The Arvind ltd. was founded in 1931 and has since then grown into one of
the world's largest denim producer.
Arvind ltd. The flagship company of the lalbhai group, is one of the india’s
leading composite manufacturer of textiles. It manufactures a range of
cotton shirting, denim, knits and bottomweights (khakis) fabrics.
Key statistics about Arvind Limited:-
Industry – textiles
Headquarters- Ahmadabad
Employees – 2600
Website – [Link]
PROMOTERS
Anang lalbhai – MD, arvind products
Milind hardikar- projects
Sharad mehra- COO, knits garments
PD chawla - president lifestyle fabrics, voiles
Sandeep chablani – COO ,lifestyle apparel, jeans
Bala S. – COO , lifestyle apparel, shirts
Vision and mission
‘We will enable people to experience a better quality of life by providing
enriching and inspiring lifestyle solutions’.
PHILOSOPHY
WE BELIEVE
In people and their unlimited potential. In content and focus in problem
solving.
In teams for effective performance. In intellect & its power.
WE ENDEAVOUR
To select, train and coach people to obtain higher responsibility. To nurture
talent to build leaders for tomorrow’s corporation. To reward, celebrate and
activate all intellectual business contributions.
WE DREAM
Of excellence in all [Link] mutual benefit and prosperity. Of making
the world a better palce to live in. wemake things happen.
PRODUCT MIX
Denim
Shirtings
Khakis
Knitwear
voiles
Merger , joint venture, & take over
Jan 04 1995- Arvind Mills acquired in denim division (DD) from Lauffenmuehle
(LM) in the formation of a joint venture to be named Big Mill.
1979 - The group took over a sick company called laxmi cotton mills co. ltd. And
merged with arvind ltd. And unit was renamed as Ankur textiles.
2010- Textile and retail major arvind mills , entering in a joint venture with b. safal
group. It plans to form a 50:50 joint venture with B. safal group promoted by Mr.
Rajesh brahmbhatt.
Sep 01 2006VF Corporation , a global leader in branded lifestyle apparel, has
establish a joint venture with Arvind Mills, Ltd. to design, market and distribute VF
branded products in India. VF will own 60 percent of the joint venture, and Arvind
Mills, Ltd. will own 40 percent.
15 may 2007 The Italian luxury denim and casual fashion brand has entered into a
joint venture agreement with Arvind Mills to create a new company called Diesel
India Fashion Arvind Pvt. Ltd. It will be a 51:49 joint venture with Diesel having
the larger stake.
1996- Rohit mills ltd. Mergerd with arvind ltd.
Top Management
SANJAY LALBHAI – CEO
JAYESH K. SHAH - CFO
Location of Manufacturing Units
Lifestyle fabrics- denim, naroda road, Ahmadabad , Gujarat
Lifestyle fabrics- shirting & khakis, santej, PO khatrej,dist. gandhinagar,
Gujarat
Lifestyle fabrics- knits, santej, PO khatrej,dist. gandhinagar, Gujarat
Lifestyle apparel- shirts , 55 puttappa industrial estate, whitefield
road,mahadevpura, Bangalore
lifestyle apparel- jeans, 26/2,27/2 , kenchenhaili mysore road, Bangalore
Swot analysis
Strength
human resource:-
Skilled and Comparatively cheap labor.
Supportive government policies.
The new age creative and risk taking entrepreneurs
Labs accredited by:
Marks & Spencer
Levis-Strauss & Co.
NEXT
INVISTA.
HRD centers for worker training.
MARKETING
•Access to Export Market.
•Growing Economy and Potential Domestic and International Market.
•Brand endorsement.
•Brand extension.
•Forward integration.
•Large and diversified segments that provide wide variety of products.
•Huge Domestic Market consumption (due to its own population).
•Tremendous Export Potential (Indian products are in great demand among the western importers)
•Strong portfolio of domestic and international brands.
•Economies of scale through complete integration.
Wide geographical presence
PRODUCTION
Operational Efficiency and Fast Machines
Availability of large varieties of cotton fiber.
Abundant Raw Material availability that helps industry to control costs and
reduces the lead-time across the operation.
Focus more on organic denim production
Manufacturing Flexibility that helps to increase the productivity
IT SYSTEMS
Use of latest technology which produces high quality multi-fiber raw
material.
Latest manufacturing tools.
The Group has a strong team of highly qualified technical professionals
from India's leading textile institutes.
FINANCE
India is one of the largest exporters of Yarn in international market and
contributes around 25% share of the global trade in Cotton Yarn.
Knowledgeable top management
The company has a logo which is registered. They have not patented and
copyrighted any of their products.
certification :- ISO 9001:2000 from BVQI
ISO 14001
Oeko-Tex-100 from Shirley Tec
Certified Supplier for GAP
Lycra Assured Partners of Du Point
Weaknesses
HUMAN RESOURCE:-
Infrastructural Bottlenecks and Efficiency such as, Transaction Time at
Ports and transportation Time.
Lack of Trade Membership, which restrict to tap other potential market.
Higher Indirect Taxes, Power and Interest Rates.
The increased global competition due to WTO policies.
Lack of fresh ideas.
Inability to retain skilled personnel.
MARKETING
Not doing enough to build brand equity.
Inability to keep up with the changing market.
Presence in only big cities.
Inefficient supply chain management.
FINANCE
Business Concentration leading to increased risks.
Wrong Assumptions and Forecasts
Higher Indirect Taxes, Power and Interest Rates.
Less stability.
Changing government policy. FY09 was one of the worst years for the
Indian textile industry. It got impacted by a multitude of negative factors
such as: (1) appreciating rupee, (2) demands low down in the export market,
(3) inventory de-stocking by domestic retailers, and (4) higher depreciation
IT SYSTEMS
Use of outdated manufacturing technology from the low end suppliers.
Lack of Technological Development that affect the productivity and other
activities in whole value chain.
PRODUCTION
High Set-up cost of new plant
Highly dependent on Cotton.
There is Declining in Mill Segment.
OPPURTUNITIES
MARKETING:-
Arvind [Link] entering into a deal with the Italian fashion denim
maker-sixty group India to enter the men’s premium and super
premium denim segments
Ability and willingness in India.
Changing retail scenario.
Rapid growth in age group of 15-44 years.
Emerging Retail Industry and Malls provide huge opportunities for
the Apparel, Handicraft and other segments of the industry.
Increased Disposable Income and Purchasing Power of Indian
Customer opens New Market Development.
Market is gradually shifting towards Branded Readymade Garment.
By bumper cotton crop production in India, the Indian textile
industry will be in a favorable situation v/s other countries
particularly China, which needs to import a significant part of its
cotton requirements to meet high domestic consumption demand
HUMAN RESOURCE:-
Cheap Labor
PRODUCTION:-
Experts believe that the golden era of Chinese textile
and apparel exports is over and the production base of
global textiles is gradually shifting from China to
India, Pakistan and other low cost destinations.
Product Diversification
FINANCE
Price Competitiveness
Debt Restructuring
Greater Investment and FDI opportunities are available.
Possibility of strategic tie-ups or attracting financial investors.
Growth rate of domestic Textile Industry is 6-8% per annum.
Elimination of Quota Restrictions leads to greater Market Access.
Greater Investment.
Large, Potential Domestic and International Market
IT & SYSTEMS
Changes in technology and market that favor your products or
services.
Changes in social patterns
Population profiles
Lifestyle
Local, national, & international events increasing purchasing power.
Large infrastructure projects.
Threats
HUMAN RESOURCE:-
High employee iteration especially senior skilled managers
International labor and Environmental Laws.
Qualified labour lacking in vital areas
Coordination and communication problem.
MARKETING
Inability for the organization to forecast market conditions.
Low Market Share spread Increased global competition especially from
China
Competition from other developing countries, especially China.
Elimination of Quota system will lead to fluctuations in Export Demand.
Threat for Traditional Market for Powerloom and Handloom Products and
forcing them for product diversification.
Geographical Disadvantages.
Competitors like Raymond, Bombay dyeing, madhura garments.
Cheap imports from china, Bangladesh, Thailand.
Exice duty.
Tough competition from local and international players.
Competition adopting aggressive growth strategies as well as eyeing top
cities.
Contd..
Entry barrier like-
Health and safety measures: Many countries have specific rules regarding
health and safety regulations.
Existing competition in the market of those countries.
Rules and regulations like tarrifs and taxes and other policies such as WTO,
FDI, etc.
Political scenario and currency fluctuations.
FINANCE
Complacency of management due to earlier successes
Impact of NAFTA agreement on Tariffs
Elimination of Quota system has led to fluctuations in Export Demand.
Rising prices of inputs-raw material.
Absence of trade pact with major regional trading blocks i.e. EEC, NAFTA,
and ASEAN Result: higher tariff barriers and loss of competitiveness.
Adverse shifts in Exchange Rates & Trade Policies
Natural Disasters
Costly New Regulations
IT SYSTEMS
Establishment of strong competitors.
Lack of cash at household level.
PRODUCTION
Contamination and low productivity in cotton cultivation.
India’s textile industry has urged Manmohan Singh, the prime minister, to
ban cotton exports until January, complaining that local mills face serious
domestic scarcity and spiraling prices after excessive exports. India, the
second-biggest cotton exporter after the US, first restricted exports in April.
“If cotton is exported unabated, the industry will have to reduce capacity
and there will be large unemployment.
Continuous Quality Improvement is need of the hour as there are different
demand patterns all over the world.
To balance the demand and supply.
To make balance between price and quality.
BCG MATRIX
Khakis
Knitwears
shirting
denim voiles
Recommendations
In order to exploit the opportunities the company should focus its efforts on the
following:
Exploit its core competencies in organic chemistry for home and personal care
industry.
Greater participation in the value chain by structured business arrangements with
suppliers and customers.
Scaling up capacities to meet the regional growth needs and enhance global reach.
Participate and hold more events in order to project its products more effectively to
its Target Customers
conclusion
Arvind ltd. is good at a characteristic that is able to give a very significant
capability such as useful skill, valuable resource of the organization,
competitive capability, Training to the employees, good relationship and
the giving the firm the market advantage with the achievements.
