Is your excess product really worthless?

In my 5 years of experience of marketing and business development in the Indian textile industry, production of exact quantity of goods was a rare event. This could be due to various reasons such as the growing complexity in consumer demand, the uncertainties in the manufacturing and processing, inefficient quality control, defects in raw material, labour indiscipline, power failures, and a whole gamut of reasons. Although excess production or short packing was a routine phenomenon, both never receive strategic attention. Most managers realize that managing stocks or excess produce could very well reduce their cost of products and ultimately boost bottom lines; rarely do they think this as an important way of supplementing their targets. Most stay focused on delivering the parent order on time, as that itself is a challenge in many cases. And in the process, the stocks are sidelined, stacked in dark corners of a dingy warehouse, and forgotten about.

Are you excess produce really this worthless?

Here, I may be painting a worst case scenario. These stocks, which are revisited at the time of annual events such as auditing and stock clearance, are by then rotten, infected by fungus or found with completely worn out packaging.
In better cases, the stocks from all orders are accumulated at one place and records are kept without an action plan. In my experience, in the Indian context, following are some of the ways to clear stocks:

1) Excess produce forcibly shipped with the parent order to realize some value, sometimes at a discounted price

2) Stocks from all order are accumulated at one place and sold to local dealers by weight in which case it faces a far less value than its original price.

3) Storing them in a warehouse for future clearance

4) Used in making other products to be sold locally or internationally fetching far less realization than their actual value

5) In some case, sent as gift items to government officials. (Believe me, this was a common thing to do!)

In all the above cases, the goods are sold in markets they were originally not meant to be consumed. Why is it a wonder then that these goods fail to generate the value they were meant to generate?

In all cases, it is clear that with some focused effort, all the excess produce can certainly fetch more worth than their “disposal” price. The idea behind www.textilestock.in is precisely this. The stock need not be disposed. It can be sold at a good price to wherever demand is. This web based platform is aimed at matching the demand with the supply of stocks so that it creates a win-win situation or buyers and suppliers. We regularly update the stock details on our website so that clients can directly access product details rather than finding which suppliers may have stocks of their interest. We don’t promise that the stocks will achieve their original sale value, but it will be our best endeavor to realize values better than the disposal values on the excess produce.

It is also a green initiative. We are all aware the as human consumption is growing; the demand for resources is rapidly increasing and their supply constantly under stress. Why not then, let the consumer consume products that would otherwise merely sit in darkness?

Nidhi Saxena

Ways to protect your stock

Ways to protect your stock

Stocks are an integral part any manufacturing process be it industrial goods or fast moving consumer goods. Textile industry is no different and as long as your manufacturing company is selling to retailer, domestic or international, you know that you have a warehouse where stocks are kept and it is a painful reminder of lost value or as some managers may justify, it could be unrealized value. In any case, the money is not in your bank account.

How do you protect your stocks from depreciating, value-wise or even physically? How to protect stocks will emerge from determining what can harm them.
Quality of a warehouse is not of strategic importance in India. Most warehouses are compromised constructions which were not intended to be warehouses. A large number of them are frequently affected by flooding, humidity, pests etc. India is yet to develop high tech warehouses. Nevertheless, it is needless to say that packaging goes a long way in preserving what is inside. This is true for everything right from steel sheets to vegetables.

Simplest thing to do would be to hand the stocks over to professionally-managed warehousing facilities although some numbers will have to be crunched to judge the financial viability of the option. A good quality warehouse with installed security systems may be expensive.

As far as consumer textiles in India are concerned, sometimes goods are dumped in the warehouse as a result of excess packing or rejection in the same form at the time of packing. That packing is designed to withstand only about a month of shipping in protected and fumigated containers. Packaging is rarely designed to contain this contingency of having to store the goods in the same packing material for over 6 months. Hence in most cases, carton packing breaks down, deforming the goods inside. If the polythene wrapping is not strong enough, water, dust, humidity or insects spoil the goods which are then rendered worthless. Investing a relatively insignificant amount to repack or bulk-pack the goods to be warehoused may prove to be a good idea if the goods are to be sold at some point of time in future.
Financially securing the stocks is another way of protecting them. Paying for insurance for the stocks is also a good idea for their protection. Such provisions have been exploited in the past although off hand, I have no evidence to prove it.

Or better yet, how about simply selling them off? This is precisely what we are trying to achieve. www.textilestock.in is focused on selling stocks of textile goods present in India by providing high visibility on the web. We maintain a comprehensive and updated list of textile stocks that gets exposed when customer search for products or supplier. List your stocks with us and we will ensure that they are sold at the best value possible at the earliest.

Samarth Sangal