Corporate Results of over 2500 companies Friday, November 5, 1999
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Think Tank
This week we focus on a complete analysis of the
tea industry
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"Improving quality is a long-term capital investment" 

 
Goodricke Group Ltd managing director, KS David spoke about the company's plans to stay ahead in an era of relaxed tariff structures.
In an interview with Nandini Goswami of FE (Calcutta) he also spelt out the need to pursue quality amidst fierce competition.

On competitiveness
Those who produce quality products need not worry about free imports. However, only, there is a need to position oneself in the quality segment to remain impervious to global competition.

On Goodricke's positioning on quality parameters.
Improving quality is a long-term capital investment. Our company has taken a massive beating on crop deliberately in the Dooars almost to the extent of a million kg.

I believe that quality does not come cheap and hence if the tea industry has to withstand the onslaught of imports, it has to compete.

On brands.
Commodity trading has to give way to the branded product ultimately. For our company we have ensured that every single packet of tea that goes out of the country is an ambassador of Goodricke even if it goes out in bulk.

On Goodricke's targets for the future.
As far as the internal domestic market is concerned we would be eventually looking at every single kilo of our tea in packets. Meanwhile, we are also planning a relaunch of our Darjeeling tea namely Castleton and Thurbo soon.

On domestic consumption.
There is in fact a limit to exports. For example, the German market which has been a major buyer of Darjeeling tea has been stagnating of late. If the industry has to do well, it has to look at the internal market in a big way.

The Darjeeling tea industry has been planning generic promotion exercises for encouraging the domestic market. With surmounting costs of Darjeelings, only an effective marketing policy could improve its reach.

On the niche segment of organic tea.
This has been one of the most promising innovations in recent times. With Goodricke being the pioneer in this field, we have tried to retain our share in this category.

The rising consciousness towards good health and hygiene has placed organic tea in a niche category.

We have just introduced a variant called organic green tea for the German market.

On free import of tea.
There is nothing to fear if Indian tea is priced competitively and quality is maintained.

As far as Darjeeling tea is concerned,there is competition from Nepal. Clones of Darjeeling varieties grown in the hills of Nepal have been selling at half the prices.

Only a patented trademark could help arrest all such sale.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.

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