TRADE RECEIVABLES

A decade before… in Textiles.

China adopted Mass Production.
India into customization.
i.e Walmart and Zara.

Indian Mills
Arvind, Lakshmi, Vardhman…
Century old Quality Mills.

Chinese mills, 30 to 40 years age, relatively younger;
Set up in rural areas;
By farming peasants and
Secondary pass outs.

There is a saying:

For items,
Under30$, leave it to China;
Above 150$. Leave it to Europe;
In the middle, give it to India.

The result,
China’s textile exports are at 120 billiom $;
6 times than that of India.

Then came,

India’s Mass Producers;
Chiripals, Jindals, Aarvees, Etcos, Alps, Sintex ….

Perceived by Garment Manufacturers as NBMCs;
Non-Banking Merchandising Companies;
Giving extended Credit without collateral;
Rather than Fabric Suppliers.

On the other end,
There are Indian Retail giants,
Aditya Birlas, Future Retails, ITC, Westside, Yes Arvind;
Adopting JIT, means no orders in lean seasons.

For Garment Manufacturers,
Exporters make payment 3 to 6 months;
Stare at all along AW;
Stare at all along SS.

Trade receivables stretched;
All along Supply Chain.
From Yarn to Retailers.

Many went Burst,
Receivables become Non Receivables.

It is the Indian Culture;

Will Covid-19 make it worst for the better?
With New Supply Chain terms for
Indian “Kanban” System.