Bicycle Industry - The Changing Market Scenario -: O P Munjal

We, therefore, see a healthy sustained growth of cycle industry. Presuming that growth of last 3-4 years is sustained for next 10 years i.e. the time we reach the year 2010, the Indian bicycle industry would need to produce about 1.75 crore bicycles to plug the demand and supply gap. However, there will be a change in the demand pattern linked with consumer changing aspiration and choice giving way to latest technology and newer marketing concepts. Industry is already witnessing this to some extent.

The new millennium has brought new challenge of opening up of import of Cycles. The manufacturers in India agree to the point that Indian Bicycle Industry does not foresee any problem as the product offered today by Indian manufacturers in the market are best suited to Indian conditions and are most economical and value for money products.

Indian economy is doing fairly well as the agricultural and industrial growth overall is showing favorable trend for last quite some years. Good monsoons and good efforts to give leverage to the trade has helped our economy boost. The developments made at technology front especially in software and electronic field has made every entrepreneurs quite enthusiastic about future. The benefits of these developments, technology coupled with favorable atmosphere has percolated to the consumer as well who now has a wider choice at very competitive rates.

The growth rate of Roadster bicycle is expected to slacken and the newer segments of the market like fancy bicycles will grow far more rapidly. It would not at all be surprising if by 2010 the fancy bicycles and roadster bicycles have almost equal market share against existing 20% market share of fancy bicycles. This switch over will not be easy one and will require a total redefining of industry to meet the new challenges. The fancy bicycle require for greater flexibility in manufacturing, much tighter quality management; being wide in rage and variety - require for more efficient supply chain management, far more improved after-sales-service to the increasingly demanding consumers and most important; change in retail ambiance.

In fact, the world over markets are behaving in similar fashion and product features have become alike all over. New segments are emerging and to cater such markets, newer models with world class features are being introduced in Indian markets at regular intervals. Hero Ranger Swing revolutionized the multi-geared segment and has created a niche for itself Ranger-M, Piranha, Queen, Active, Charmeleon and Hero Neon have been clear cut winners and have taken the market by storm. This increasing segmentation is Mantra for success in today's environment of high expectations and low brand loyalty.

We at Hero have taken into our stride to these impending change and are prepared to meet the challenges thus posed so that the benefits of these changes are reaped. The initiative for the change in durable consumer industry has to be driven by the manufacturers. This will be through investment in more flexible plant and machinery to produce more contemporary bicycles in much shorter turn around time. We have to look into the entire gamut of the market and help our retail outlets to improve their ambiance to the customer, to pull them to their shops.

On the whole the future for Indian industry including Bicycle will be challenging. The domestic market will be open to good and services from global companies with low tariffs. Protection will be a thing of the past. The companies that will survive will be those which successfully restructure and modernise to achieve global competitiveness in terms of both quality, cost and distribution system.