Author: Nandani
Published on-
02 October 2024
The Ultimate Cheat Sheet on import and sourcing
In today's business world, companies that are successful recognize the value of product sourcing, which is the process of locating and obtaining suppliers for the commodities they require.
There are two options available to you when looking for suppliers to produce your items or give you materials. You either work with a company or you locate them on your own.
It is necessary to import items from other nations in order to grow business, take advantage of expansion opportunities, and open up new markets.
It goes without saying that including a manufacturer in your supply chain is essential if you are a product seller.
However, you've probably heard tales of innumerable foreign manufacturers who participate in unethical business methods.
Even though there is currently a strong public sentiment in favor of and use of Indian machinery, it is crucial to adopt a generally rational and grounded perspective when using local construction equipment rather than making an irrational decision that will ultimately impede the nation's development plans. The irony, however, is that every producer of construction equipment that sells in India is yelling #VocalForLocal even though they import the majority of their machinery, have foreign partnerships or investments, and import technologies from other nations. Gaining a deeper understanding of a few linked variables can help us make the best decision.
India's development story began significantly later than that of other European, American, or Asian nations because the country gained its freedom later. As a result, it was simple for developed country firms to export their goods to developing countries and to adapt their techniques. Following the economic changes of 1992, which made it simpler for these manufacturers to establish bases in India, there was a significant migration of construction equipment manufacturers into the country.
1) India was still using new technologies even though their countries' models were outdated or older.
2) No significant expenses or redesigns were required to produce the product for India. It was sufficient to simply make a few adjustments to fit Indian conditions.
3) Tax holidays and other perks for investing that increase returns
4) India was still a developing market with few legally enforceable regulations and little consumer demand. The market was "easy to tackle."
5) Less competition means higher volumes and margins
6) Consumers prefer foreign brands to Indian ones.
1)Proven trustworthy goods available
2) Capacity to operate more efficiently or quickly
3) A mechanical solution that lessens the need for manpower
4) Greater business/profits due to better productivity
But over the past 20 years, India's growth has been phenomenal, outpacing that of developing countries by a wide margin, thereby closing the gap with other industrialized nations.
Even though there is currently a strong sentiment among the populace regarding the use of Indian machinery, it is crucial to adopt a generally logical and grounded perspective when using local construction equipment rather than making an emotional decision that will ultimately impede the nation's development plans. The irony, though, is that every producer of construction equipment that sells in India is yelling in spite of the fact that they import the majority of their machinery, have partnerships or investments outside, or import technologies from other nations. Gaining a deeper understanding of a few linked variables can help us make the best decision.
India's development story began significantly later than that of other European, American, or Asian nations because the country gained its freedom later. As a result, it was simple for developed country firms to export their goods to developing countries and to adapt their techniques. Following the economic changes of 1992, which made it simpler for these manufacturers to establish bases in India, there was a significant migration of construction equipment manufacturers into the country.
The following were the advantages for these manufacturers selling in India:
1) India was still using new technologies even though their countries' models were outdated or older.
2) No significant expenses or redesigns were required to produce the product for India. It was sufficient to simply make a few adjustments to fit Indian conditions.
3) Tax holidays and other perks for investing that increase returns
4) India was still a developing market with few legally enforceable regulations and little consumer demand. The market was "easy to tackle."
5) Less competition means higher volumes and margins
6) Consumers prefer foreign brands to Indian ones.
1) A dependable and proven product is accessible
2) Capacity to operate more efficiently or quickly
3) A mechanical solution that lessens the need for manpower
4) Greater business/profits due to better productivity
But over the past 20 years, India's growth has been phenomenal, outpacing that of developing countries by a wide margin, thereby closing the gap with other industrialized nations.
Indian contractors nowadays are tech-savvy, educated, and aware of the latest developments in their industry as well as the expenses involved. Nevertheless, there have been a few lost opportunities for foreign equipment makers that were well-liked in India. These manufacturers include:
1) Currently, these producers are also tailoring their products to India; they have not yet begun creating and designing goods with Indian conditions and consumers in mind.
2) Because they haven't made the necessary investments in India to localize their products, their customers must now pay higher import tariffs and taxes because there are no longer any tax breaks.
The reason why their Indian customers only use their products when they have no other option and mostly not out of faith or gratitude is that they have not invested in increasing the profits of their Indian customers, instead focusing on increasing profits and higher remittances to their parent organizations.
4) They had guaranteed Indian manufacturers' capacity to produce high-caliber building machinery.
Today, from the perspective of the consumer, the goods made by these overseas producers are
1) Expensive and unprofitable due to increased costs
2) Causing losses as a result of problems with the availability of spare parts
3) Profit devouring due to increased replacement part costs
4) Difficult to sell or resell for the aforementioned reasons for a fair price and promptly
5) Not much more valuable than other local products that are currently sold in India 6) Almost same in terms of technology and way of life to a select few local manufacturers
difficult for neighborhood mechanics to maintain or fix, increasing downtime and repair expenses
Indian contractors of today seek the newest technology at competitive prices and increased profits; this is only achievable if products are "Made in India," "Made for India"
1) Steer clear of "Made in India" merchandise.
2) Lack a firmly established support system
3) Lack readily available, reasonably priced replacement parts and services
4) Continue to purchase motor graders from China or other nations
5) Since they are not based in India, they cannot confirm that they are serving customers in India.
Conclusion
Given the foregoing, it is evident that "Working with Imported Construction Equipment" in India today is not a choice but rather a result of a lack of high-quality local options. However, as more local manufacturers, such as Mahindra, are offering high-quality "Made in India" products with the necessary productivity at reasonable prices, users are switching to these manufacturers because of the benefits that these manufacturers offer, which clearly outweigh the advantages of using imported construction equipment.
