Organized Vs Unorganized Bag Industry

ORGANIZED VS UNORGANIZED

Scope for organized players:

While organized players have market share of only 35.4%, major portion of market share of Indian bags industry is still captured by unorganized and small players.  As more than 60% market share is still captured by unorganized players, there is huge scope for organized players to enter in that zone and expand market share.

Causes of high unorganized market share:

1. Cost Factor:

Cost being one of major influencing factor for Indian market is the primary reason for high market share of unorganized players, as most of products by unorganized manufacturers costs much lesser as compared to branded products.

2. Ease of availability:

Unbranded and unorganized industry products are much easily available and have much high penetration in traditional and small markets as well as in rural areas, making it more feasible for consumer. While for branded products, one needs to go to different showrooms and shopping complexes which are usually not in close vicinity to residence of consumers, unbranded products are much easily available in nearby shops for consumer and hence influencing purchasing decision of consumer.

3. Variety and range of products:

Most of unorganized and unbranded products are available in much versatile and vast range as compared to branded products, one of major reason for same being lack of standardization in unbranded products, making it easy for manufacturer to provide large variety or product, and hence it is easier for consumer to find product for his or her own suitability and requirements.

Possible ways of increasing market share for organized industries:

As explained above, the factors influencing consumer’s choice between unbranded and branded products, if addressed can improve market share of organized industries.