The Indian bicycle industry –the pedal for a green earth, seeks government support to expand itself to meet new challenges posed by global slowdown, said Narayan Jee, Deputy General Manager- BSA Toddlers- TI Cycles of India.
An eco-friendly mode of transportation, bicycles are being revived across the world and the Indian government must take steps in encouraging commuters to pedal their way to their destinations.
Excerpts of the interview…
Please tell us something about your group
Narayan Jee: BSA is a Murugappa Group of companies actually. Murugappa Group has 29 different companies and BSA is part of one of these companies — Tube Investments India. Tube Investments has five different units: one is TI Cycles, which has two popular brands — BSA and Hercules.
Five years back we have thought that we are manufacturing bicycles, but bicycles generally used by over three years age group so we had a gap of 0-3 years. Then we thought that we should offer some products for those customers who are just born or ready to start cycling. Now from beginning itself we are providing range of products like stroller, pram, baby walker, tricycles, etc. And for three years onwards we have bicycles.
Any new development in BSA, which you would like to share with us?
Narayan Jee: Yes . . . we would be very strong in retail sales. We have more or less 800 different outlets across the nation in different forms of retail. Now we are launching kids stores, where people will have these kinds of products. So this is the whole package coming soon from our side.
How many stores you have planned to open? And where?
Narayan Jee: For this year we have planned 15 kids stores across the country mainly in metros and A class cities like Delhi, Mumbai, Kolkata, Bangalore, Pune, Hyderabad, and all.
You are the first bicycle manufacturer in India. What are the challenges that bicycle industry is facing nowadays?
Narayan Jee: For bicycle industry the main issue is the infrastructure problem. The industry is not growing very fast; the growth rate is only 2-5 percent because of infrastructure. If you see nowadays walking on the roads itself is a difficult task; so where is the place for cycling? If the government wants cycle industry to grow, they should provide a good infrastructure. It is required not only to help the bicycle industry, but a good infrastructure is required for the growth of humankind and for the growth of each and every industry. We are not demanding extra, but just seek infrastructure development keeping in mind the health of people and environment. If the government develops infrastructure keeping in their mind that people can communicate via bicycle then it will save health of the people, save fossil fuel, and will also save environment too. There should be a cycle lane in all the roads; many of the countries are doing so, and this is good for growth of bicycle industry. Also there is 12 percent tax on bicycles, which is very high to meet new challenges posed by the global slowdown. At present, cycles industry attracts a total of about 12 percent duties, including 5-7 percent local sales tax.
There is a number of small players manufacturing bicycles and tricycles for kids. And even bulk of the parts and components are manufactured in the small-scale sector. On behalf of them what would you like to say?
Narayan Jee: In India there are four major players in bicycle industry BSA (TI), Hero, Atlas and Avon. So if good infrastructure is there then the industry will grow and so the small players will grow. And even more small and even foreign players will join the industry.
You are in exports too? Now the rupee is depreciating so how you see the export conditions right now?
Narayan Jee: We are in exports too, but we export only some of our bicycle models to some of the global clients only. See. . . export has a different scene. Exports need consistency in currency that is one major thing. There was a time, when the rupee was appreciating and we received lesser orders, and on the other side now the currency is depreciating and we have orders, but again recovering our previous losses. At that time we were loosing and now we are gaining, so its a matter of time only. That hasn’t impacted much.
How you see the impact of global slowdown, especially the impact of slow demand in western markets?
Narayan Jee: There is a major slowdown in demand, not only in the western world but in the domestic market too. People are not buying products as they have fear of another big recession. Even though they are planning to buy new product they are not purchasing and rather holding for quite some time. For last two quarters there was a slowdown in demand and I’m not sure how long it will go.
Now the things may improve as recently our Prime Minister has taken over the finance ministry also. We hope that in coming days his good decisions will improve the market conditions, and our sales will improve.
How many times have you participated in this expo? Do you think B2B exhibitions are helpful in getting extra growth?
Narayan Jee: We have been participating in Toy Expo for last three years, and regularly participating in IITF also. Here (Toy Expo) we are displaying only kids products because this is a B2B exhibition on kids segment. Definitely a B2B expo like this helps very much in brand promotion and sales promotion.