Most indian firms find global marketing a difficult game


Indian firms are encouraged by the Government to export in a big way they have found this is no easy task. Most Indian firms lack the required global competitiveness in cost, quality, and technology. They also lack strong brands.

Lack of global size: Lack of global size is the first issues. Cost competitiveness can come only through such size. But achieving global size is by no means easy for most Indian firms. The technology gap also poses problems.

Low productivity: Productivity, another factor essential for cost competitiveness and this has remained unsatisfactory for many firms though ot is improving by adopting modern management methods.

Quality problem: Bridging the quality gap is another major problem. We had touched on this aspect earlier while discussing the challenges of the new buyers’ market. In the global context, the quality challenge is all the more formidable. Indian firms trying to go global have to offer quality that will meet the exacting demands of global buyers. Barring a few exceptions, the quality perception of global buyers about Indian products is generally poor. For a long time, producers in India had been lax in respect of quality and consequently they were unable to upgrade all of a sudden.

Lack of brand power: Lack of brand power is another problem. There is very little of branded goods in India’s export basket. Indian products are sold in the world markets either as a commodity or under middleman’s brand names. Brand is a must if Indian firms are to become major exporters. Brand power is the best means of high value realization. India’s exports did not fetch attractive prices and a major part of the value addition went to the importing middleman abroad mainly because they lacked strong brands.

India’s Lack of Competitiveness as a Nation

The fact that as a nation, India lacked competitiveness due to a variety of factors has compounded the difficulty of Indian firms in the matter of exports. As per ratings by agencies like the World Economic Forum (WEF), India is practically at the bottom in competitiveness among the market economies of the world. The WEF study on global competitiveness covers 20 industrial countries and 10 upcoming countries, selected on the basis of their impact on world trade. India is in the second group. The study places India lowest in the group, below Singapore, Hong Kong, Korea, Taiwan, Malaysia, Thailand, Mexico, Indonesia and Brazil. The study assesses a country’s competitiveness on the basis of a number of relevant factors; the countries are ranked under each and then given an overall face as well. It is only in science and technology that India has reasonable placing. In all the other factors, India figures in one of the bottom four ranks.

Lack of industries of global standards: Indian firms are unable to successfully play a global game for another reason too. India does not have any industry which can claim global standards. Though practically all industries have a presence in India, the country is not strong in any industry by world standards. And India’s potential to become a global shop floor for many products was not exploited at all, all these years.

Track record of the country: The track record of India in exports has been poor throughout. The country’s exports have always formed a negligible part of world trade. Also, they have never moved above 7% of the GDP. Ever since independence, India’s economy had been mostly inward looking. The compulsion to go global, coupled with the lack of global competitiveness of India as a nation, presents a severe challenge, for Indian business firms.

In this article we have given many constraints above. The actual situation is now changing and India is making rapid strides over coming all the aforesaid handicaps. The GDP and world rankings are fast changing for the better. Parameters like Productivity, GDP, and technology are showing upward trends.