Tuesday, December 17th, 2013

Business Destination India: Organized Chaos, Plastics Growth

By Michael Taylor, SPI Senior Director, International Affairs & Trade

 Non-Indians who have visited India in an attempt to describe their experience of India to others have sometimes called it “organized chaos.” They go on to say that India is “in your face,” you are assaulted by sights, sounds and smells in intensity and combinations you have perhaps not encountered before. Some of my Indian friends who have spent significant time outside the country have even described to me how going back for a visit can be very draining to them, now that they have gotten used to less sensory overload. For those who crave differences and excitement, experienced at times at a frenetic pace, India is just the place.

SPI’s India Trade Mission included the Plastivision India 2013 trade show in Mumbai. (Image: Plastivision India)

SPI’s India Trade Mission included the Plastivision India 2013 trade show in Mumbai. (Image: Plastivision India)

Out of this organized chaos and SPI’s final trade mission for 2013 to Plastivision India in Mumbai came a number of truisms about entering a foreign market and conducting global business. One lesson was that nothing happens by chance to those who are awake—my iteration of a well-known saying.

For example, the All India Plastic Manufacturers’ Association (AIPMA) is the organizer of the Plastivision India show and our in-country partner. Among many things it did in treating the participating SPI member company representatives as VIPs was to provide us with food coupons that could be used daily at a designated food hall. For this trade mission, we actually worked a two-track approach to the B2B matchmaking, an approach that provided useful leads and meetings for our participants. However one participant relayed to me that perhaps his best connections came from randomly sitting down at a particular table in this food hall. In reality, any table would have presented him an opportunity, or multiple opportunities, but this one paid off big because he was looking to maximize the experience facilitated by our strategic partnership with AIPMA.

An excellent example of nothing happens by chance occurred around the goal the same participant had about making a final determination over what to do with his distributor situation in India. Another trade mission participant detailed his previous experiences as to why he sells directly as opposed to using a distributor. A member of AIPMA offered his insights as well and also provided some alternative contacts. This participant then spent time with his current distributor and ultimately came away with the kind of information he required to move forward in this market.

Both of these examples clearly illustrate yet again how being there and seeing for yourself is so critical. Along with experiencing the cultural differences firsthand, you can learn how to conduct business effectively in the market. This is true for every market, not just India.

I have had the great pleasure to work very closely with Indians for a number of years, and I would say their acceptance, hospitality and passion are in many instances unequaled. Out of the “organized chaos” emerges a very dynamic business culture that explains a great deal of India’s economic success. It is little wonder that they understand the concept of an innovation economy and are in full pursuit of it, albeit at a somewhat erratic pace sometimes.

India is not an easy market, no market is, but it is a growing market with a lot of opportunity.  A recent report from the Plastindia Foundation said the Indian plastics industry is set to double its per capita plastics consumption in the next five years, driven by increasing plastics usage in automobiles, packaging and government spending on infrastructure. This report estimates that the demand for polymers will rise to 16.5 million metric tons by 2016-17 from 11 million tons during 2012-13, resulting in annual consumption increasing by 10.8 percent. Further, India is expected to be among the top 10 packaging consumers in the world by 2016, with demand projected to reach $24 billion.

The next SPI Trade Mission will reach another growth market for plastics: Vietnam. From 2000 to 2013, Vietnam’s GDP grew at an average rate of 6.2 percent per year. Manufacturing, including more than 1000 plastics companies, is a major part of that growth. Plastics exports growing on average 20-25 percent yearly are a major component of the country’s positive trade balance.

SPI’s Vietnam Trade Mission will take place March 4-6, 2014 in conjunction with the Plastics & Rubber Vietnam 2014 trade show in Ho Chi Minh City. On January 9, 2014 an informational webinar will provide more detail on the Vietnam Trade mission and what to expect while there. Click here to register for the webinar.

 

One Response to “Business Destination India: Organized Chaos, Plastics Growth”

  1. nice comments & study.

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