Sie sind auf Seite 1von 4

U​NDER​-D​EVELOPED​ M​ARKETS​ ​FOR​ ​PLY​ ​AND​ ​LAMINATE​ ​BASED​ ​FURTINURE

MAKING

U​NDER​-​DEVELOPED​ ​MARKET​ ​DEFINITION

This indexation is basis adhesive consumption in a market and the Market Potential Value (MPV) there.
Markets that have similar MPV but are significantly lower in adhesive consumption are said to be
under-developed. ​In a situation where the MPV is higher but adhesive consumption is lower, the contrast is
even starker​. It is an indication of consumption levels being divergent to prosperity levels for a market. In
other words, people have the income and the ability to pay but are not making enough furniture with
laminated and plywood thus buying and consuming lesser adhesive.

Basis the above definition, AP, Telangana and Tamil Nadu emerge as under-developed, when compared to high
adhesive consumptions states like Gujarat and Rajasthan. The table below brings out the contrast:

STATE Index (Per capita Vol) Index (Per capita MPV)

Andhra Pradesh 0.64 1.03

Rajasthan 1.15 0.87

Tamil Nadu 0.78 1.36

Gujarat 1.47 1.18

Pan India 1.00 1.00

H​ISTORICAL​ ​INFLUENCES​ ​DEFINING​ ​THE​ ​MARKET

There are certain broad influences that we see in the under-indexed markets that set them apart from the
rest. These influences are cultural, geographical, climatological and economic. Some have been there for
decades and some are more recent. Looking at these influences in a little more detail

A​TTITUDE​ ​TO​ ​AFFLUENCE

While both the under and over-developed markets are prosperous regions with better than average income
levels, their roots and cultural influences guide their spending and attitude & behavior towards furniture
making. Southern states, especially APnT and TN, typically spend on gold as a way to announce their affluence
to the larger society
(​https://timesofindia.indiatimes.com/city/visakhapatnam/ap-most-drawn-to-gold-real-estate-rbi-report/articl
eshow/60921516.cms​). For them, jewellery is the most important indication of their prosperity. The amount of
jewellery one wears and has is the key indication of wealth for an individual or family. Homes, décor &
interiors tend to be lower down the hierarchy of importance for this part of the country.

For the North and Western markets like Rajasthan and Gujarat, while gold is important, it is not the prime or
sole indicator of affluence. Homes and living spaces are important medium of wealth display. This translates to
more elaborate homes, more spending on interiors, more designs that are heavy on furniture & fixtures. For
them, having a great looking and luxurious dwelling is key in announcing their affluence to their circle of
concern

T​OPOGRAPHICAL​ ​INFLUENCE

For APnT and TN, a large part of the economy and the population is historically based in the coastal areas or on
the riverbanks (Krishna, Kaveri for example) for economic and livelihood reasons. Coastal regions or regions
close to water sources like rivers etc. are prone to termite infestation due to the higher humidity in the soil.
This has erected barriers to extensive ply and laminate usage, vis a vis markets like Rajasthan and Gujarat,
where the economic development and population spread is more dispersed. This also has led to earlier
adoption of plastic based boards like PVC and WPC that are unaffected by the termite problem. We also see
the adoption of stone slabs in cupboards & wardrobes in these states for the same reason.

A​TTITUDE​ ​TO​ ​DESIGN

For APnT and TN, functionality is the most important aspect of design. Aesthetics comes later, and in many
cases, not at all. Exception of course is jewelry, where one sees intricate and heavy designs. In other aspects of
their lives, homes or décor or interior spaces, they tendency is to have more minimalistic and functional
pieces. Furniture design too is basic, with focus on storage spaces, as opposed to ornamental fixtures. They are
also open to using substrates like aluminium, PVC etc. for their interiors as it saves on cost and is functionally
acceptable. The design has to do the job efficiently, looks come second.

In Gujarat / Rajasthan, designs tend to be flamboyant and intricate in most aspects of their lives, including
furniture and fixtures. Creating storage spaces, beautiful ornamental fixtures are at the center of interior
designs for most homes in this part of the country. The design has to be functional, and importantly, it has to
look good. Some examples are given below:

Kitchen / TV Unit /Bed Unit designs from Rajasthan / Gujarat


Kitchen/TV Unit/Bed Unit designs from APnT / TN
M​ARKET​ ​CHARACTERISTICS​ ​OF​ ​TODAY

CONTRACTORS

Migrant vs Locals – ​Both APnT and TN have migrant contractors from Raj/Guj. Due to growing competition in
their home-states and for better prospects they have left their home states for greener pastures. Their
behaviours and attitudes to furniture making is a mix of the roots they come from and the markets that they
have adopted. The local contractors are more driven by local ideals and tend to be very simple in their design
approach. They try and deliver functional designs that are not ornamental and flashy.

Mode of Contracting – Contractor labour charges are a % of total material cost in Guj/Raj. Hence, contractors
tend to promote more wood working area, hence more adhesive consumption. In AP/TN, material is bought by
the homeowner, contractor charges only for the labour, so he has no incentive to push incremental wood
working as the homeowner finally decides on the material requirement. Some migrant contractors try to push
% of material mode of contracting especially in Hyderabad, but it is insignificant today.

Time taken for site completion – Since more furniture is made per home, a typical Guj/Raj site takes 4-5
months to complete, a comparable site in AP/TN is turned around in half the time. The Users in AP/TN thus
depend on quick turnaround and higher number of sites to build their business, efficiency and resource
utilisation are key for him, while in Guj/Raj it’s the extraction per site that drives business and the aesthetic
output and skill levels are key.

C​ONSUMERS

Consumer profile – AP/TN has a higher proportion of migrant population who are not permanent settlers,
hence furniture preferences tend to be more functional, cost effective and quick to make, the time horizon in
their minds is at best 4-5 years. Guj/Raj is largely composed of settlers and they prefer durable and “high
quality” furniture, they see furniture making as a big, once in a life occasion.

Onsite versus Offsite preferences – Guj/Raj consumers prefer seeing the work happening around them as they
tend to get furniture made while they are at the site. With the large migrant population in AP/TN, more
households are nuclear with both members needing to step out to work. Offsite therefore is a more practical
option for such consumers

W​HAT​ ​TO​ ​SOLVE

Considering the historical influences and the current market practices:

a) What steps should Fevicol take towards developing these markets to come to the same level as
Rajasthan and Gujarat?
b) What steps should we take to try and influence the consumer mindset towards furniture making?
c) What steps should we take to influence the local contractor mindset? How can we help them increase
furniture made per site?
d) What tools can be provided to all contractors to showcase bigger, more elaborate designs to increase
their earnings per site and drive more adhesive consumption?

Das könnte Ihnen auch gefallen