Arvind Mills

THE ARVIND MILLS LTD. - A sneak peak into the U.S. markets

"Achieve global dominance in select businesses built around our core competencies, through continuous product and technical innovation, customer orientation and a focus on cost effectiveness."

- Vision -

A Brief History

In the year 1930, with the Indians' mass opposing of the fine and superfine fabrics imported from England, which was pioneered by Mahatma Gandhi, the Lalbhai Brothers discovered an opportunity in this area. Thus, the three brothers Kasturbhai, Narottambhai and Chimanbhai decided to put up a mill to produce this superfine fabric. In this regard, state-of-the-art machinery was acquired from England at the most attractive prices. In this way, The Arvind Mills was born in the year 1931, with the pioneering efforts of Lalbhai Brothers. It is one of India's leading composite manufacturers of textiles. Its headquarters is in Ahmedabad, Gujarat, India. It manufactures a range of cotton shirting, denim, knits and bottom weights (Khakis) fabrics.

Arvind Mills was started with a share capital of Rs.2,525,000/- ($55000). They aimed to manufacture the high-end superfine fabrics, and for this purpose they invested in very sophisticated technology. It was one of the few companies in those days to start with spinning and weaving facilities in addition to full-fledged facilities for dyeing, bleaching, finishing and mercerizing.

In 1987-88 Arvind entered the export market for two sections - denim for leisure and fashion wear and high quality fabric for cotton shirtings and trousers.

In 1997 Arvind set up a state-of-the-art shirting, gabardine and knits facility, the largest of its kind in India, at Santej. With Arvind's concern for environment a most modern affluent treatment facility with zero affluent discharge capability was also established.

Year 2005 is a watershed year for textiles. With the mulitifiber agreement getting phased out and the disbanding of quotas, international textile trade is poised for a quantum leap.

Arvind has carved out an aggressive strategy to verticalize its current operations by setting up world-scale garmenting facilities and offering a one-stop shop service, of offering garment packages, to its international and domestic customers.

With the Indian economy poised for rapid growth, Arvind brands with its international licenses of Lee, Wrangler, Arrow and Tommy Hilfiger and its own domestic brands of Flying Machine, Newport, Excalibur and Ruf & Tuf, is setting it's vision on becoming the largest apparel brands company in India.

Today Arvind Mills has become the world's third largest manufacturer of denim.

Product mix of Arvind Mills

Ð'* Fabric

 Denim

 Shirtings

 Khakis

 Knitwear

 Voiles

Ð'* Garment Exports

 Shirts

 Jeans

Local and International Brands of Arvind Mills

Ð'* Arvind Brands (owned)

 Flying Machine

 Newport

 Ruf & Tuf

 Excalibur

Ð'* Arvind Brands (licensed)

 Arrow

 Lee

 Wrangler

 Tommy Hilfiger

Factors fuelling Arvind Mills' Global Initiatives

In the mid 1980s, the textile industry faced a major crisis. The churning out of vast quantities of inexpensive fabric by the power loom, made many large composite mills lose their markets, thereby bringing them on the verge of closure. However, Arvind Mills not only withstood this situation, but was also able to achieve its highest level of profitability. This scenario, made the management rethink the company's strategy. Thus, a new strategy was coined viz. RENOVISION, which simply meant a new way of looking at issues. Renovation also meant to see what was more than obvious and this went on to become the corporate philosophy of Arvind Mills. With this new strategy, there was now more focus on the nation wide operations of the company. This lead to a wider growth of Arvind Mills in the domestic markets. Thus, the national focus paved the way for international focus and Arvind Mills' markets shifted from domestic to global. The international markets was however, far more superior than the national markets. This market expected and accepted only quality goods.

An in-depth analysis of the world textile market proved to be an eye opener for Arvind Mills. It revealed that people the world over were shifting from synthetic to natural fabrics. Cottons were the largest growing segments. The conventional wisdom pointed to popular priced segments. However, Renovation pointed to high quality premium niches. Thus, in 1987-88 Arvind Mills entered the export market for two sections. Denim for leisure and fashion wear. And high quality fabric for cotton shirtings and trousers.

Product / Market selected for study

Product : DENIM

Market : U.S Market

Introduction

The Arvind Mills' Denim Division was established in 1987 and has since grown into one of the world's largest denim producer. With a turnover of US$ 180 million, Arvind Denim has a capacity for producing 110 million meters per annum. The denim is exported to more than 70 countries all over the world, besides catering to the Indian market.

Capacities

Total Capacity 110 million meters per annum

Slasher Capacity 70 million meters per annum

Rope Capacity 40 million meters per annum