Vocal for Local! Are We Ready?

More than anything else Narendra Modi addressing the nation must have received maximum TRPs during the lockdown. The nation patiently searched for any word related to the lockdown in his speech. During one of his speeches, he spoke about the importance of GDP in a country's growth and what the citizens can do in order to contribute to its growth. "Vocal for Local" is the phrase he used to requested the citizens to prefer Indian products over foreign products. But the bigger question is, do we have enough ammunition to facilitate the choice-making?

Let us examine the grocery buying scene that we usually encounter in our daily lives. The first aisle, which is of malt based energy drink powders, is completely occupied by Boost, Bournvita, Horlicks and Complan. Boost and Bournvita belong to Cadburys, Horlicks is by SmithKline Beecham and Complan is by Danone. Though the Indian choices Patanjali Powervita and Amul Pro are available in some stores, they are limited to the least visible shelves. I compared the ingredients and the nutritional information of all these products, except for negligible differences all the products are similar. Also, the price of Indian products is much lower. Though we have a couple of Indian brands to offer here, lack of knowledge and awareness and  the hesitation to shift from a preferred brand could be the reasons for not picking up an Indian brand.

Next comes the section opposite to that of energy drinks, the soft drinks one. What products come to your mind when I say soft drinks? Coca-Cola, Thums Up, Mirinda, Sprite, Pepsi, Maaza and so on, none of these belong to Indian companies. I can't even name any Indian products in this section. The next aisle is of tea powders, popular in this section are 3 Roses and Taj Mahal from Hindustan Unilever Limited, Red Label from Diageo. No popular brand to name in this section too. The sections that make me proud are the one with biscuits and noodles. Biscuits section is dominated by Britannia and Sunfeast and the noodles one is shared by Yippee and Maggi. Yippee's sales surge has kicked off only a couple of years ago when serious questions were raised about the ingredients used in Maggi noodles.

Let us come out of the super market and observe vehicles on the roads. In the four wheeler segment, Maruti Suzuki has been conveniently occupying the first position with 51% of the market share as of 2019. 56.21% of the stake in this company belongs to a Japanese firm, Suzuki. The only relief here is the decent domination of Indian firm Maruti in this. Second position is occupied by Hyundai, a South Korean firm. Third and Fourth positions can bring a smile on Indian faces as the slots are occupied by Mahindra and Tata Motors. The patriotic nerves can relax further when we check the two wheeler market. Hero, TVS and Bajaj dominate the market with 62% of the total share.

When you analyze the brand distribution, Indian firms are struggling in most product segments to find their feet. Where are we failing even to manufacture and compete in relatively low creative product segments. Don't the Indian firms have the capability or capacity to come up with a good tea powder? Don't we have the ingredients to come up with a good energy drink? Don't we have the brains to come up with a competitive soft drink brand? Are we technically challenged to come out with consumer preferred cars?

Mobiles segment is dominated by Chinese firms MI, Oneplus, Vivo and Oppo. Footwear segment is dominated by Nike, Asics and Yonex. Laptops segment is dominated by Lenovo, Apple, Dell and HP. "Let us prefer Indian brands", I love to do that and many other Indians too, but what are options available. Where are we lacking in producing great products. Are we investing enough in research to come up with products that can withstand the competition?

There is a popular opinion that Indians are hesitant to pick local brands. Tata, Hero and ITC proved that wrong. The major area to address is lack of encouragement for research investments. Tremendous effort goes into research even at university level in countries like USA. We need leaders who can reward companies spending time and money in research. Indian spend on R&D is at 0.7% of GDP, far lower compared to that of Japan, South Korea, Germany and USA. No Indian company has found a place in 2018 top 50 companies by research and development spending. We need to address the issue from the grass root level before looking for positive results at the top level.


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