What lies in the manufacturing sector ahead and other top stories of the week
This week SMBStory covered the challenges and way forward for the manufacturing sector in India.
The manufacturing sector plays a pivotal role in India's economic development, accounting for approximately 16% to 17% of the GDP. With India gaining international attention as global companies explore diversifying their manufacturing operations in the country, there is a pressing need for further advancements.
In our recent exploration of the manufacturing industry, SMBStory delved into the profound impact of the China+1 strategy and the implementation of Standard Operating Procedures (SOPs) and data-driven approaches in fortifying this crucial sector. Here’s what we covered.
China+1 strategy
The Indian industry is gaining manufacturing momentum, benefiting from global companies rethinking their supply chains and diversifying production.
With low labour costs and business-friendly policies, India is positioning itself as a lucrative option for global companies looking to diversify operations by establishing an additional production base outside of China.
The China Plus One strategy, or C+1, has gained significance amid global shifts and concerns over excessive reliance on Chinese manufacturing. Triggered by the US-China trade war and COVID-19 disruptions, countries like Vietnam, Taiwan, Bangladesh, Malaysia, Saudi Arabia, and notably India are benefiting. India stands out due to Foreign Direct Investment (FDI) regulations encouraging local partnerships and joint ventures, according to experts.
The factories of future
Speaking at YourStory’s event TechSparks in Mumbai, Sonam Motwani, founder of Karkhana.io on talking about the manufacturing sector said that the dearth of managerial and technical talent as well as a lack of a data-driven approach is a significant hurdle in the growth of micro-enterprises in the manufacturing sector
She pointed out that over 80% of manufacturing establishments are micro-enterprises, yet they face resource challenges. Motwani underscored the prevalent aversion to a data-driven approach in India, where decisions rely heavily on experience rather than data. Despite the industry's aspiration for Industry 4.0, MSMEs grapple with basic data capture, impeding their comprehension of demand and machine productivity.
Other top stories of the week
Oorla
Earlier this month, Oorla, a sweets and savoury brand from Coimbatore, exhibited its products in Denver, Colorado. Visitors, most of whom were from India, said the product lineup made them feel nostalgic about the time they spent back home. For Co-founders Saravana Kumar Mohanraj, Prabhakaran Balasundharam, Arvindh Saravana Bhavan, this vote of approval makes their journey to entrepreneurship, which began in 2021, a success.
The concept of introducing South Indian delicacies to the global market originated from Gayathri Devi Ganesan, a resident of the US, who collaborated with the trio to launch the business. Mohanraj reminisces that the inaugural moment was during Diwali 2021 when they sent their first product, a combination of 10 distinct South Indian sweets and savouries, to Texas. The response was exceptional, with approximately 850 orders dispatched within 30 days, marking the outset of their venture.
To date, Oorla has dispatched over 50,000 orders. The company says it will likely close FY24 with a revenue of Rs 14 crore and that it has been profitable since the beginning.
Edited by Affirunisa Kankudti