All indications are that the liquid laundry detergent market is bright and is poised to grow by 13.5% (CAGR, compound annual growth rate) or even more in the years ahead. Principally the growth will come from dish and floor cleaning and laundry detergent segments because these are the areas that concern households. It is no secret that there is more awareness among Indian households and more disposable money making it possible to spend a larger share of their income on these products.
Liquid Detergent Manufacturing in India
It is increasingly evident that liquid detergent manufacturing in India is on rise and the reason for this is that consumers are able to see that liquid detergents have no filler materials and therefore don’t leave any residue on the cloths, compared against solid and powder laundry detergents that have a large quantity of fillers. It also requires more scarce water for a good wash experience that is hard to come by.
The industry for liquid detergent manufacturing in India is either in the organised or unorganised sector and significantly every year more manufacturers are entering the fray for a piece of the action, but importantly Indian consumers are beginning to realise the benefits of buying from a detergent company with a good reputation and brand image. It is vastly agreed that the future of a detergent company will depend on the range of cleaning products that they can offer. The days of one company one product are numbered.
Laundry Detergent Market Profile
One of the important points to note about the laundry detergent market in India is the segregation between rural and urban consumers. Urban consumers tend to be conscious about the brand image and mostly price takes the back seat when it comes to deciding buying a product. The rural market on the other hand is a bit more concerned about the price and brand image, though important, does not make a big impact. The possible reason for this is attributed to the lower disposable income that is available in the hands of rural consumers. Here is where the unorganised detergent manufacturing companies come in.
The unorganised sector leads in rural areas because their overall cost of manufacturing is usually lower, they spend lesser on advertisements and operate in local areas. But they instead face other problems such as: economies of scale, quality standards and poor packing materials. It must however be noticed that rural distribution business such as grocery shops prefer the unorganised sector for procuring cleaning products because they are able to negotiate better margins and longer credit period. It is worthwhile to note that there is sync in the objectives between unorganised manufacturers and the rural distribution channels in which both benefit substantially.
Opportunities in Laundry Detergent Business
A careful laundry detergent market analysis shows that the overall growth projection and the development of distribution channels in rural areas has thrown open a great opportunity for manufacturers as well as distributors. To this add the online marketplace and you have a never-before opportunity for new players.
If you are a budding entrepreneur or an established player in consumer products, setting up a detergent company is an opportunity on which you cannot shut your eyes. It can significantly improve your cash flow and profit margins as well. Since the distribution business is also better developed, you are less likely to face any insurmountable challenges.
Making a Beginning in Liquid Detergent Manufacturing
There are two ways to enter the business – test the waters by becoming a distributor or go for manufacturing directly. You cannot go wrong in either route. Technology is easily available for liquid detergent manufacturing and it is not rocket science. However, study the market potential in areas where you see great opportunities and has logistics support.
Have a mix of market areas that you plan to explore and don’t forget the online marketplace. The online marketplace is potentially the most promising distribution opportunity with minimum expenses to foot.